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Message: <blockquote data-quote="Bugsy Malone" data-source="post: 10380" data-attributes="member: 201">20th March 2019Hi everyone!This week’s write up includes:<ul> <li data-xf-list-type="ul">Spotify filed a complaint against Apple for unfair fees ([USER=118]@Sara Moon [/USER] )</li> <li data-xf-list-type="ul">Boeing 737 Max aircraft issues ([USER=260]@Abstruser[/USER] </li> <li data-xf-list-type="ul">A Brexit update and its impact on the debt restructuring business ([USER=980]@Angel[/USER])</li> </ul>1.     Spotify filed a complaint against Apple for unfair fees ([USER=118]@Sara Moon [/USER])The story:Last Wednesday (13th March), the Spotify CEO Daniel EK published a blog post announcing that Spotify had filed a complaint with European antitrust officials arguing that Apple imposed unfair fees on it which, “purposely limit choice and stifle innovation at the expense of the user experience”. Apple currently requires Spotify and other content providers to pay a 30% fee on each purchase made through Apple’s in-app payment system. When Spotify agreed in 2014 that it will pay the fee, it had to raise its premium subscription price from €9.99 to €12.99 while Apple released its own ‘Apple Music’ service for €9.99 in 2015. Spotify then decided to opt out of paying the fee in 2016, and as a result, it had to pull its premium subscription service from the App Store. It is currently supporting only the free version of its app in the App store. Spotify asked the European Commission to interfere to prevent Apple’s anticompetitive behaviour.Impact on businesses and law firms:It’s not just Spotify who has complaints about Apple’s unfair rules. Netflix has also, last December, opted out of Apple’s payment system and decided to no longer sell paid subscriptions in its Apple mobile apps. Instead, like Spotify, it sells subscriptions on its own website where it doesn’t have to split revenue with Apple. There is also a pending class-action lawsuit against Apple (Apple Inc. v Pepper), which is to be heard by the US Supreme Court. Interestingly, the claim was brought by iPhone users not app developers. The issue in the case is ‘whether consumers may sue anyone who delivers goods to them for antitrust damages, even when they seek damages based on prices set by third parties who would be the immediate victims of the alleged offense’ (see Supreme Court of the United States Blog). In other words, the case will decide on the issue of whether consumers of app offered through the App store could sue Apple for higher price they suffered due to Apple’s anti-competitive practice in the App Store. Apple argues that it cannot be responsible for the app price rise because 30% fees are imposed on app developers, not on consumers.Not only this, similar anti-competitive behaviour we see from Apple can also be seen from other tech behemoths. For example, last year, the European authorities fined Google €4.34 billion for its breach of EU antitrust rules by imposing ‘illegal restrictions on Android device manufacturers and mobile network operators to cement its dominant position in general internet search’. For example, Google required manufacturers to pre-install the Google Search app and Chrome app as a condition for licensing Google’s app store. The European Commission has held that Google’s abuse of power has led to the dominance of its search engine and prevented rivals from competing with it, thus denying consumers the benefits of effective competition.Due to the growing use of anti-competitive business strategies from the largest technology companies like Amazon.com Inc., Alphabet Inc. (who owns Google), Facebook Inc and Apple, the Massachusetts senator Elizabeth Warren has called for legislation that would designate these companies as “platform utilities” and unwind technology mergers that undermine competition and hurt small businesses. She proposed that some mergers by these huge tech companies which has led to damage on healthy competition to be unwound, such as Amazon’s purchase of Whole Foods, Facebook’s acquisition of Instagram and Google’s deals for Waze. Also, under her proposal, these “platform utilities” with more than $25 billion in global revenue will be barred from owning participants on their own platform. For example, Amazon Marketplace and AmazonBasics would have to be separated.So what does this all mean to businesses and law firms? It seems like there is growing pressure on big tech companies like those mentioned above to avoid any abuse of power and ensure that they do not hinder rival companies from competing on their own merits. For Apple, the previous case of Google might mean that it may soon be subject to thorough investigation by the European regulators on its anti-competitive policies and end up having to pay a huge fine. For law firms, how the US Supreme Court would decide the case on Apple would be something to keep an eye on, because if the court decides on the consumer’s favour, it would mean that the tech companies would really have to review any of their anti-competitive policies that affect consumers to avoid floodgate of lawsuits. Also, if Ms Warren’s proposal is accepted, the law firms would have to investigate whether companies that would be classified as the so-called “platform utilities” (essentially, those providing a platform) have any mergers that needs to be unwound and help them over the unwinding procedure.</blockquote>

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