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If Spotify is forced to leave Apple's mighty App Store, others will follow suit

Just as publishers and the music industry thought that slick digital devices like Apple’s iPad would help future proof their industries, a potentially fatal blow has been struck, writes Emma Barnett.

Macro screenshot of Spotify - the peer to peer music streaming website  
It is believed Spotify is planning to use the fresh financing to help it crack the north American market
Last week Apple announced the terms of its new App Store subscription service, which has sent certain publishers and music services into a panic.
This panic is not unjustified as under the new terms, which come into play at the end of June 2011, Apple will take a 30 per cent cut from any content publishers’ subscription revenues which have been generated via an app on the Apple platform. Moreover Apple’s new terms forces publishers, which offer a subscription or purchase option outside of their app, to offer the same option, at the same price or less within the app – if they wish to stay on the platform.
The US Justice Department and the Federal Trade Commission (FTC) are now looking at Apple's new subscription terms to see if the tech giant is breaking the law by insisting publishers use its subscription system to collect payments from iPhone and iPad users.
If Apple stays true to its word, a major victim in all of this could be one of Europe’s leading technology lights: Spotify, the hugely popular music streaming service.
According to music boss, Ben Drury, the chief executive of 7digital, an online music retailer, if Spotify was forced to give away 30 per cent of its subscription revenues, it could potentially derail the whole company.
Abdullah Shahzad

Abdullah Shahzad

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