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European tech lobbies for action against Apple and Google

Spotify and a host of European internet businesses have called on Brussels to crack down on what they see as troubling practices by the likes of Apple and Google.

Big internet platforms “can and do abuse their privileged position”, according to a letter signed by the chief executives of Spotify, music streaming rival Deezer and German start-up investor Rocket Internet among others.

Although the letter to the European Commission does not cite the Silicon Valley giants by name, it complains that some mobile operating systems, app stores and search engines have evolved from “gateways” into “gatekeepers” — effectively hindering rivals from competing with their own services.

Apple and Google together control well over 90 per cent of mobile operating systems, meaning that companies which offer products on smartphones have to abide by terms and conditions set by the Silicon Valley groups, or risk being unable to reach customers.

The letter comes in the midst of a debate inside the commission around overhauling digital policy, with new proposals due later this year aimed at addressing allegedly unfair contractual clauses enforced by big platforms.

Options being considered by the EU’s executive arm range from sector-specific codes of conduct, to an independent dispute settlement body that would settle rows between big platforms and their often smaller business customers.

In the letter, the chief executives write that this mismatch requires “specific rules guiding the interactions between platforms and their business users”. Normally, a company abusing its dominant market position would be covered by competition law.

But such cases take too long and cost too much for smaller internet companies, hence the need for extra regulation, they argue.

Common complaints from the companies include not being able to access customer data when they sign up through an app store, as well as big companies promoting their own services over third parties’.

The letter comes after a row between Spotify and Apple last year, when the streaming company accused the iPhone maker of blocking updates to its iOS app, citing “business model rules”. It claimed this was done maliciously in order to promote its own music product, Apple Music.

The Swedish music app’s lawyers wrote in a letter to Apple that the practice “raises serious concerns under both US and EU competition law” and “[diminishes] the competitiveness of Spotify on iOS and as a rival to Apple Music”.

Within the European Commission, there is a debate over how to approach the topic, with some calling for a cautious, narrow approach, while others are demanding that Brussels do more to rein in the likes of Google and Apple.

Officials are also wary about being perceived as anti-American. The EU’s executive arm has argued with companies such as Apple, Google and Amazon over everything from competition policy to tax.

Google and Apple declined to comment.

Via FT