EU’s Fine Against Apple Sends a Troubling Signal to US Technology Companies, Says ITIF

WASHINGTON—In response to the European Commission’s announcement that it is imposing a €1.8 billion fine against Apple for engaging in allegedly “unfair trading conditions” in violation of EU competition law, the Information Technology and Innovation Foundation (ITIF), the leading think tank for science and technology policy, released the following statement from ITIF Director of Antitrust and Innovation Policy Joseph V. Coniglio:

The penalty against Apple is the third-largest the EU has ever imposed and is wholly disproportionate to Apple’s allegedly unlawful conduct. The EU rarely brings claims under the “exploitative” authority it appears to be relying on in this case, which goes beyond the scope of U.S. antitrust law, let alone with such a huge fine.

The App Store has empowered third-party apps and increased choice for consumers. The EU’s theory that Apple exploited power in the EU’s gerrymandered market for the distribution of music streaming apps through its App Store is belied by the fact that Spotify has more than a 50 percent market share in Europe’s dynamic music streaming market.

Spotify’s success on Apple’s platform should stand out as a model for how U.S. and European technology companies can work together to grow Europe’s digital markets and drive shared innovation amidst common challenges like the increasing threat of Chinese technological dominance.

Instead, the EU’s decision suggests European regulators plan to continue using competition law to target U.S. technology companies like Apple for the benefit of European technology companies like Spotify even when there is no cognizable exclusionary conduct or evidence of consumer harm.

Unfortunately, rather than serving as a voice of reason to defend U.S. tech companies from fines like this, U.S. antitrust enforcers continue their own crusade against them, with many predicting that a lawsuit against Apple may be imminent. As China continues its strategy to overtake Western technology firms, it is long past time that U.S. and European antitrust policies prioritize sound enforcement.