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Spotify and Deezer call on EU to restrict tech giant “gatekeepers”

By | Published on Thursday 14 December 2017


The bosses of Spotify and Deezer yesterday urged European law-makers to ensure that the streaming companies’ tech giant rivals can’t abuse their position as gatekeepers to digital consumers. Which probably confirms why various European digital music companies recently formed their own lobbying organisation in Brussels (although Digital Music Europe insists it has a wider remit).

It’s Apple, Amazon and Google who the standalone streaming music firms have issues with. All three tech giants make and operate devices, transaction platforms and content services, and it’s felt that they often exploit the first two in order to provide a boost for the latter. The latter being the services that compete head on with Spotify and Deezer, of course.

According to the Financial Times, Spotify chief Daniel Ek and Deezer CEO Hans-Holger Albrecht yesterday signed a letter to European Commission President Jean-Claude Juncker, urging the European Union to ensure “a level playing field” that is not hindered by American tech giants “regularly abusing their advantaged position”.

The letter – which was also signed by reps of the gaming sector – has been sent now because the EC is actively considering new rules for how big tech companies work with smaller firms whose digital tools and services are sold and/or distributed via the former’s platforms. Both Spotify and Deezer also put their names to a similar letter back in May.

The likes of Spotify and Deezer have various issues with the big three tech giants – and Apple in particular – in relation to fees the big three charge when purchases are made, how data is shared with app makers, and how they are able to integrate with innovations in the big three’s products, such as the increasingly important voice-activated assistants.

In particular, they don’t like the so called Apple tax, which means that if someone signs up to Spotify or Deezer within an iOS app, Apple takes 30% of the money. As that equates to Spotify and Deezer’s best case scenario profit margin, they have to pass the 30% mark-up onto the consumer. This makes it look like Spotify and Deezer are more expensive than Apple Music, when in fact they all have the same price point outside the iOS ecosystem.

Without going into any of these individual gripes in any detail, the new letter does call for “clear and enforceable obligations that are a deterrent and prevent unfair businesses practices by platforms”. It added that: “These obligations should include but go beyond mere transparency requirements, which alone will not ensure platforms act as gateways rather than become gatekeepers to the digital economy”.

While Apple, Amazon and Google will be united in their distain for any new European regulations that restrict how they exploit dominance in one aspect of the digital market to achieve dominance in another, they all concurrently moan about each when they behave in this way. As we discuss in this week’s edition of the Setlist podcast.