The European Commission, the EU’s top antitrust body, is probing Apple over its dealings with record labels and digital music companies in Europe to find out if the Cupertino-based technology giant is trying to illegally limit other free, ad-supported music streaming services such as Spotify, the Financial Times (FT) reported, citing people familiar with the matter.
The commission has contacted several labels and digital music companies, seeking information about agreements between them and Apple, which is expected to launch its own music streaming service sometime this summer. Although gathering information is the first step in a probe, it does not necessarily lead to a formal antitrust investigation. However, if the commission finds any misconduct, Apple might have to alter its business practices or face hefty fines, FT reported.
The European regulators are said to be concerned that Apple could use its market position and relationship to influence labels to dump free, ad-supported services, which rely on licenses with music companies for their catalogues.
The latest case is similar to Apple’s U.S. antitrust case over e-book pricing last year, when the company was fined $450 million for allegedly conspiring with five publishers to raise prices.
Apple’s upcoming music streaming service is built on the company’s acquisition of Beats Electronics for $3 billion in May last year. Apple’s service, which could cost a monthly subscription fee of $10, is expected to be bundled with the company’s existing iTunes music download app.
Meanwhile, Apple’s forthcoming low-priced music service has also caused concerns among artists, who fear that it will cut further into their streaming income.
“This is the issue that’s constantly getting swept under the rug by streaming services,” Marc Ribot, the co-founder of the Content Creators Coalition, reportedly said.