Apple's Proposed Changes Reject the Goals of the DMA | Hacker News Reader

Apple's Proposed Changes Reject the Goals of the DMA

newsroom.spotify.com

60 pointsmfiguiere68 comments

I'm fine with Apple charging $.X per install from their app store. That should be in their right as a platform.

What's not cool, and what I was excited for DMA to fix, is that Apple says that by transacting with a customer _by any means_ on their platform, you owe them a part of that transaction. This is anathema to a free market. Again, it's fine if they charge you for using their payment platform, or even alternate payments made through some Apple payment UI. What's not fine is forcing anyone who wants to sell you a good or service to have to compete with the smartphone market as a whole to access you as a customer unimpeded. It is especially egregious that Apple prevented you from as much as mentioning that alternative payment methods exist off-platform.

So the biggest issue in my eyes isn't that Apple is charging per install, it's that they're charging to so much as mention that you are able to transact elsewhere, both in the per install cost and in still taking a commission. That is tying and that should be illegal. It is like if a leading browser blocked websites from companies that refused to share their profits, regardless of if that transaction even happened through the browser.

> Apple says that by transacting with a customer _by any means_ on their platform, you owe them a part of that transaction.

That is indeed what the US Federal court ruled in Apple v. Epic, and all possible appeals have let that ruling stand.

> as discussed in the findings of facts, IAP is the method by which Apple collects its licensing fee from developers for the use of Apple’s intellectual property. Even in the absence of IAP, Apple could still charge a commission on developers. It would simply be more difficult for Apple to collect that commission.

Indeed, while the Court finds no basis for the specific rate chosen by Apple (i.e., the 30% rate) based on the record, the Court still concludes that Apple is entitled to some compensation for use of its intellectual property.

https://stratechery.com/2021/the-apple-v-epic-decision/

Fortunately for EU regulators, US judicial precedent is not binding there while their Digital Markets Act is. We'll see if they take this lying down.

Given treaties between the EU and US, I doubt the EU will be able to strip companies of their intellectual property rights.

We'll see.

That's not how intellectual property works.

Getting paid when others use your intellectual property is exactly how intellectual property works.

"Intellectual property" is a right granted by states in order to further specific goals of the state.

"Treaties" are binding agreements between nations that place limits on what they may or may not do.

Fun fact: The EU itself is based on treaties between it's member states.

I would think that case is at least meaningfully in my favour. The anti-steering ruling supports my point that while Apple can charge whatever commission it wants on its payment platform, this should not entitle it to ban or tax competing means of trade discovered through the platform.

The ruling is meaningfully weaker than what I'd expect from DMA, but this is natural, the legal case was argued on existing law, DMA is new.

> The anti-steering ruling supports my point that while Apple can charge whatever commission it wants on its payment platform, this should not entitle it to ban or tax competing means of trade discovered through the platform.

The judge literally ruled that no matter who you use as a payment processor, Apple could still charge a commission for using it's intellectual property.

The same summary of the Apple v. Epic decision I linked to above has a good section on what the anti-steering section of the ruling means and people seem to misunderstand what happened there as well.

> "developers cannot communicate lower prices on other platforms either within iOS or to users obtained from the iOS platform"... "These provisions can be severed without any impact on the integrity of the ecosystem and is tethered to [California] legislative policy."

Notice the references to “other platforms”; those are the web, Android, or, in cases like Fortnite, other consoles. Judge Gonzalez Rogers’ argument is not that Apple has to allow different payment options within an app — as noted in the previous section, that is Apple’s right to control, and even mandate — but rather that Apple can’t stop a developer from telling users that they can go outside the app to another platform to acquire digital content.

https://stratechery.com/2021/the-apple-v-epic-decision/

Apple's move to open up alternate payment processors was not a result of the Apple v. Epic decision. That has more to do with preexisting regulatory rulings in places like the Netherlands and (of course) the DMA.

This ruling means at minimum that a company can say ‘or sign up for less at on our website’. Cf. Spotify, who were allowed to serve customers that signed in from an account with an off-app subscription but were not allowed to tell the customer that this alternative subscription existed.

Companies like Spotify and Netflix (that have a free app used to access subscription content) removed the option to pay through their app years ago.

You can only pay (and create an account) by going to their website, so they have always effectively paid Apple nothing but the yearly $99 developer account fee under the old rules.

However, now they can now tell you where to go to set up a new account on their website next to the login account and password fields of their app.

>I'm fine with Apple charging $.X per install from their app store. That should be in their right as a platform.

100% totally disagree. If you are engaging in a sales transactions, both parties should be given the opportunity to approve the sale.

The developer had the opportunity to approve when it put the app up for its list price.

IMO it is easier to see why this is OK if you imagine Apple weren't tying a waiver for this fee to being unable to inform the user about alternate payment platforms. That tie is obviously anti-competitive but is therefore distracting.

Once you put your code out there you can’t control who installs it.

If someone gets my app package and puts it up on another App Store I can’t control, I would be getting charged for those installations and have little control over taking it down depending on the government hosting the servers hosting my stolen software.

as long as computers have existed you have always been able to install an application from your preferred source, it is unconscionable and anticompetitive to impose a fee only if the application is installed from a third party source.

is like having a cookie wall where pressing accept all is a single click, instead to do reject all you have to uncheck 50 checkboxes one at a time.

apple is doing the same thing by saying it's okay I use app store vs. I want freedom, because for the first choice it's easy, for the second choice they put a big tax in front of you

> is like having a cookie wall where pressing accept all is a single click, instead to do reject all you have to uncheck 50 checkboxes one at a time.

Which is an extremely clear violation of GDPR

> as long as computers have existed you have always been able to install an application from your preferred source

The company that creates a platform gets to decide if their platform is open or closed.

For instance, Microsoft created Windows as an open platform while they created XBox as a closed platform.

Apple created Macintosh as an open platform and created iOS as a closed platform.

Microsoft attempted to close Windows after the fact with Windows RT and Surface RT but consumers rejected that change. The free market decides what consumers find acceptable.

iOS is a platform that favors ease of use and safety over openness.

https://hardcoresoftware.learningbyshipping.com/p/215-buildi...

Consumers have a choice. Quite a lot of them choose Android.

I don't understand how companies get so big they'll put everything on the line to get it beat down by regulators. A little bit of good faith actions would get them a long way, but instead they choose obliteration.

Well there is that story https://a16z.com/why-i-did-not-go-to-jail/,. where they're like "everyone does it, I did it at my last company, it's fine". Maybe Apple similarly has lawyers, CEOs, etc. who tell them "we can handle any fallout, play hard"? Also, as advised against in that story, legal is part of finance https://www.organimi.com/organizational-structures/apple/

Cool story. I still don't quite get what law was broken and how? When is the stock option price supposed to be measured?

Probably on some fixed date every month, rather than the the day with the lowest price every month.

They get so big because they're allowed to, it's not really surprising in our politico-economic situation

It's more profitable for them to skirt the law or try to change it. Apple has more money than many governments. They're not really scared. To them regulations (and getting around them) are just a cost of doing business.

I hope the EU layeth the smackdown, because the US isn't gonna do anything.

it’s so interesting to me how the DMA applies to Alphabet, Amazon, Apple, Bytedance, Meta, and Microsoft, but the last week i’ve only seen interesting and hot posts on HN about one gatekeeper in particular.

all of the notions that apple must do x or y and if not, they violate the DMA and the EU must take damages— or that somehow the DMA is flawed and needs to be rewritten, are kind of wild. the DMA applies to everyone equally, so either something is allowed or it is not, and we dont know yet what the EU will say.

this is only the beginning, but the desperation of companies like Spotify and Epic openly trashing any semblance of a business relationship with the company that has 22% marketshare in Europe is pretty wild to me.

You havent been paying attention if you think Spotify and Epic's tone is surprising or that there's a business relationship to lose.

It's because other gatekeepers have been fairly obedient regarding DMA or less impacted. At least no other gatekeepers tried to downplay the purpose of DMA itself to the level of Apple's.

Could have to do with how Apple announced its compliance plans yesterday and that's what everybody is talking about.

"0.50 cent Euro" makes my brain hurt.

They're officially called euro cents.

But then it's either 50 Euro cents, or 0.50 Euro, no?

It's Verizon math.

http://verizonmath.blogspot.com/2006/12/verizon-doesnt-know-...

I would read John Gruber's post before taking anything Spotify says at face value.

Spotify lobbied hard and got their language adopted as part of the DMA - which as Gruber noted - is really much more a "anti-American business" bill. Now that apple has a approach that they believe meets the letter of the law, Spotify is complaining about the intent of the law.

The other worth mentioning: you can't regulate monopolies into compliance. They will fight over the last penny through sneaky workarounds. The only solution is breakup.

Yeah, that makes sense. When was the last company that got broken up? Mabell?

I don't think so. It's only Apple who is blatantly trying to circumvent it. All other gatekeepers already have implemented necessary changes in a pretty conservative, obvious way.

Worth noting that the CCP takes a different approach to compliance enforcement.

We cannot assume that over the next century that US companies will dominate globally.

We have to find a way to get US companies to enrich our Capitalist Democracy and stop gatekeeping otherwise we are going to lose our position.

I’m Australian and am fully aware how much Western Democracies need the US not to fuck up!

> Earlier this week, thanks to the clear language in the DMA, we shared how we plan to offer customers in the EU more choice

I followed the link to see their plan of offering customers in the EU more choice [0] and all i saw was dark patterns and cheap marketing, all in order to sell a bit more. Here’s a better idea: why not open up spotify to competing players?

[0] https://newsroom.spotify.com/2024-01-24/the-dma-means-a-bett...

In other news, water is wet. Of course Apple rejects the entire premise of the DMA. Whether you agree with them or disagree with them, you shouldn't expect Apple to be happy about being forced, or to do anything more than the letter of the law requires. If they were cheerful about it, they'd have already done it, globally, before being forced to.

Hopefully the end result is a large concerted effort to regulate Apple as a monopoly.

At this point I would be fine with EU and US legislators going overboard on them.

Spotify has no room to speak. Pay your artist, just as greedy.

Spotify doesn't have a monopoly on music streaming.

Apple doesn't have a monopoly on smartphones.

If a developer wants to release an app for iOS, what company do they have to go through and are there any alternatives?

Sure apple is prepping to allow 3rd party app stores but they'll likely go about it in a very Apple fashion and have some sort of catch.

I heard Cory Doctorrow speak on the Pivot podcast about that!

Labels were investors in Spotify…..

So to boost profits for IPO they had incentives to reduce payouts to artists…

Or something like that. It all sounded very corrupt!

Spotify gives 70% to rightsholders, yes?

Rightsholders yes, not artists. But that's not an issue Spotify is out to tackle

For a bit of perspective, look at how much the various streaming services pay to artists per stream:

Tidal 1.3 cents

Apple Music 1 cent

Youtube .8 cents

Amazon .4 cents

Spotify .33 cents

https://cloudcovermusic.com/blog/how-much-artists-make-strea...

True, but percentage terms would also be interesting. If they all pay around 60-70% of their revenue to rights-holders, which seems like the case, the question of which of these services pays best or is most ethical or whatever becomes more nuanced.

Artists seem to agree that Spotify's rates are particularly bad.

> Spotify faced the music on Monday (March 15) as creators around the globe gathered to protest the streaming giant’s royalties model.

On Monday, the U.S.-based Union of Musicians and Allied Workers took a more hands-on approach when it led a worldwide demonstration on the doorsteps of Spotify offices.

https://www.billboard.com/pro/international-creators-gather-...

Well sure, but they could be wrong.

Wouldn't the artists have first hand information on how much money they get paid from each service? The artist's union could get access to that information from their members, so would have a lot more data than most.

Notice that they didn't hold global protests at Tidal's offices.

What if it's a situation where all the music streaming services pay 70% and Spotify has the most streams and therefore the highest total dollar amount, but the lowest per-stream payment. It would be highly arguable whether Spotify is being greedy in that case. This might be what's happening!

I don't think the difference between the total amount paid by each music streaming service and the amount paid per stream by the various music services is too complex a topic for a musician's union to understand.

The statements released to artists with their royalty amount includes the number of streams played of each of their works on the service.

I am aware of that, but the metric I have been talking about this the entire time is neither of those.

What matters to artists is how much the artist is paid per stream.

Spotify pays artists the least per stream.

I am disagreeing with you about whether that is an important metric.

It may not be important to you, however you do not speak for the artists.

> Among its demands, the Union is calling for a 1 cent per stream royalty rate

https://www.billboard.com/pro/international-creators-gather-...

To artists it definitely is an important metric, and Spotify screws artists over on that metric worse than any other streaming service.

I am talking about a different metric.

Per-stream count lacks relevance on the count of the model of paying X% of revenues to the rights holders.

Instead of asking for stricter regulations, Spotify would do well to ask themselves why most (all?) the gatekeepers are in the US and not the EU.

What do you think the answer is?

Spotify has its own App Store, with an even worse experience for developers in my experience.

Rather than a published set of rules and fees for commercial apps, instead Spotify requires you contact them, and fees and rules are done behind closed doors, if you even get that far.

Since Spotify is throwing stones here, what are Spotify’s commercial rates for Spotify integrated apps in their App Store?

Can you provide link to Spotify's app store? I've used spotify since it launched and was never aware of this feature.

They seemed to have recently removed it. The link below shows what it recently looked like.

The main issue was if you want to make a commercial app, there are no publicly available commercial terms, and it is easy for Spotify to not offer commercial terms to apps/companies that may in some way increase the chance of competition with Spotify. For example, if you wanted to make an app that would allow you to export your playlists, Spotify may offer you terrible commercial terms or none at all.

This is more restrictive than Apple.

https://www.iorad.com/player/2097656/Spotify---How-to-view-S...

That's not an app store. That's just a gallery of Spotify partners...

Due to the way music licensing works, Spotify would never have had the same type of app store as Apple or Google.

It was a listing of apps on the Spotify platform.

The main point is, Spotify has a platform, like Apple, but is throwing stones from a glass house when it comes to trying to build on the platform.

Most of the integrations do not have anything to do with using the copyrighted music, e.g. a playlist export app.

It's not an app store. It's not like throwing stones from a glass house, because it's not an app store.

Most of the integrations do not have anything to do with using the copyrighted music, e.g. a playlist export app

Most Spotify integrations literally involve playing music through Spotify, so it's curious that you pick one of the very rare integrations that do not.

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