The European Commission has levied a hefty fine of €1.8 billion on Apple for abusing its dominant market position in distributing music applications to iPhone and iPad users (iOS users) through its App Store.

The Commission found that Apple imposed restrictions on app developers, preventing them from informing iOS users about alternative and cheaper music subscription services available outside the app. These practices are illegal under EU antitrust rules.

Currently, Apple is the sole provider of an App Store where developers can distribute applications to iOS users across the European Economic Area (EEA). Apple controls every aspect of iOS and sets the terms and conditions to be adhered to in the App Store and to reach iOS users in the EEA.

The Commission's investigation revealed that Apple prohibits music streaming app developers from fully informing iOS users about alternative and cheaper subscription services available outside the app and from providing guidance on how to subscribe to such offers.

Today's decision concludes that Apple's anti-steering provisions constitute unfair trading terms, violating Article 102(a) of the Treaty on the Functioning of the European Union (TFEU). These provisions are neither necessary nor proportionate to protect Apple's commercial interests concerning the App Store on Apple's smart mobile devices and adversely affect the interests of iOS users, who cannot make informed and efficient decisions regarding where and how to purchase music streaming subscriptions for use on their device.

Apple's practices, which lasted nearly a decade, may have led many iOS users to pay significantly higher prices for music streaming subscriptions due to Apple's high commission charged to developers, passed onto consumers in the form of higher subscription prices for the same service in the Apple App Store.

In determining the fine amount, the Commission considered the duration and severity of the violation, as well as Apple's overall turnover and market capitalization. It also took into account that Apple submitted incorrect information during the administrative process. The Commission concluded that the total fine amount of over €1.8 billion is proportionate to Apple's global revenue and necessary to deter the company from repeating similar tactics.