A Letter to the European Commission on Apple's Lack of DMA Compliance

Ahead of the European Union's DMA implementation deadline next week, Spotify and many EU companies sent the following letter to the European Commission today raising concerns about Apple's lack of compliance.

Mrs. Margrethe Vestager

Executive Vice-President A Europe Fit for the Digital Age

European Commission

Mr. Thierry Breton

Commissioner for Internal Market European Commission

Dear Executive Vice-President, Dear Commissioner,

We are 34 companies and associations operating across a wide range of digital sectors, including aviation, publishing/press, gaming, commercial radios, audio streaming, applications software, communications, marketing, payment, fintech, crypto and marketplaces. Together, we represent tens of thousands of businesses of all sizes and we serve hundreds of millions of customers across Europe.

We are very concerned that Apple's proposed scheme for compliance with the Digital Markets Act (DMA), as communicated on 25 January 2024, will not meet the law's requirements therefore inhibiting our ability to deliver the benefits of the DMA to consumers as soon as possible.

Apple's new terms not only disregard both the spirit and letter of the law, but if left unchanged, make a mockery of the DMA and the considerable efforts by the European Commission and EU institutions to make digital markets competitive.

There are a myriad of elements in Apple's announcement that do not comply with the DMA. We take this opportunity to highlight some of the most obvious and egregious:

Apple is offering app developers an unworkable choice between staying on its current terms which are manifestly not compliant with the DMA or opting into new terms, implying that only app developers opting into the new terms will benefit from the DMA. This is a false choice and merely adds unnecessary complexity and confusion. Neither option is DMA compliant and both options would simply consolidate Apple's stronghold over digital markets.

The new fee structure in the proposed new terms seems designed to maintain and even amplify Apple's exploitation of its dominance over app developers. With a hefty transaction fee and a Core Technology Fee (CTF), few app developers will agree to these unjust terms. These fees will deter app developers from providing seamless in-app experiences for consumers, and will hamper fair competition with potential alternative payment providers.

Apple claims the changes include new controls and disclosures, and expanded protections to reduce privacy and security risks the DMA creates. This is masquerading unfounded privacy and security concerns to the detriment of user choice. Apple's approach - such as the introduction of scare screens will merely mislead and degrade the user experience, depriving them of real choice and the benefits of the DMA.

To succeed, the DMA must create opportunities for real competition, including alternative app stores and sideloading. New app stores are critical to driving competition and choice both for app developers and consumers. Sideloading will give app developers a real choice between the Apple App Store or their own distribution channel and technology. Apple's new terms do not allow for sideloading and make the installation and use of new app stores difficult, risky and financially unattractive for developers. Rather than creating healthy competition and new choices, Apple's new terms will erect new barriers and reinforce Apple's stronghold over the iPhone ecosystem.

The European Commission's response to Apple's proposal will serve as a litmus test of the DMA and whether it can deliver for Europe's citizens and economy.

In the absence of materially different proposals from Apple, we urge the European Commission to take swift, timely and decisive action against Apple, to protect developers and benefit consumers and do so as soon as the DMA obligations apply. This is the only way to guarantee the DMA remains both credible and delivers competitive digital markets.

Yours sincerely,

The Signatories

EU Companies

Adevinta

Beonex

Blockchain.com

Cafeyn

Deezer

Epic Games

iconomy

Mustang

Paddle

Parula

Proton

Schibsted

37signals

SkyDemon

Spotify

Threema

Uptodown

Vipps MobilePay

EU Associations

Alliance Digitale

Association Europ enne des Radios (AER)

Classifieds Marketplaces Europe (CME)

Digital Content Next (DCN)

Digital Music Europe (DME)

European DIGITAL SME Alliance

European Games Developer Federation (EGDF)

European Fintech Association (EFA)

European Magazine Media Association (EMMA)

European Newspaper Publishers' Association (ENPA)

European Publishers Council (EPC)

France Digitale

Internet Economy Foundation (IEF)

News Media Europe (NME)

Sveriges Tidskrifter

Tidningsutgivarna

LINK:	https://newsroom.spotify.com/2024-03-01/a-letter-to-the-european-commi...
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