Big Tree, Small Axe Duel: The Fight Between Spotify And Apple And How The David Humbled Goliath
The Oasis Reporters
December 29, 2024
By Oscar Hoole
In 2006: Daniel Ek started Spotify in Sweden at a time when the music industry was dying:
Piracy killed 50% of revenues and CD sales had collapsed just as iTunes were dominating legal downloads.
Everyone said streaming would fail.
Yet, by 2015, Spotify was growing fast with 75M active users and it was present in 58 countries with a networth of $8.4B.
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Then Apple decided to enter music streaming.
Their weapon? Apple Music.
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Their advantage? Control of the App Store.
In 2015, Apple tried to CRUSH Spotify.
It threatened to remove them from App Store.
• Demanded 30% of all revenue
• Blocked their app updates
But Spotify’s response was genius.
Here’s how a Swedish startup outsmarted the world’s biggest company.
Apple’s strategy was brutal: 1. Charged 30% fee on all subscriptions
2. Banned links to external payment options
3. Blocked app updates mentioning prices
4. Pre-installed Apple Music on 1B+ devices.
They were simply choking Spotify slowly.
The numbers were devastating:
• Spotify: $12.99 on iOS (to cover Apple’s 30%)
• Spotify: $9.99 everywhere else
• Apple Music: $9.99 everywhere
Apple could undercut Spotify using Spotify’s own money.
Pure genius. Pure evil.
But then Ek made a shocking move:
Instead of surrendering, he went nuclear.
Filed an antitrust complaint with the EU.
Apple’s response? “Spotify wants all the benefits of a free app without being free.”
Spotify then launched
Exposed Apple’s practices to the world:
• Rejected app updates 12 times
• Blocked Spotify from HomePod
• Prevented Siri integration
• Restricted user communications
The tech world was stunned by their boldness.
The war escalated:
• EU opened formal investigation
• US Congress questioned Apple
• Other developers joined the fight
• South Korea changed their laws
David was winning against Goliath.
2021: The first victory.
Apple forced to allow external payment links.
Their 30% tax started crumbling.
But here’s the crazy part:
During this entire war, Spotify kept growing
Ek’s strategy was brilliant:
1. Made the fight public
2. United other developers
3. Focused on user experience
4. Kept innovating (podcasts, audiobooks)
5. Never backed down.
They turned Apple’s pressure into free marketing.
Today:
• Spotify: 489M users
• Apple Music: 88M users
The ‘little Swedish startup’ is 5.5x bigger than Apple Music.
They didn’t just survive – they dominated.
The lesson is clear: When a giant tries to crush you, don’t hide. Take the Fight to the public arena. Build alliances. Turn their size into a weakness. David beats Goliath by changing the rules of the game.
Founders: Your biggest competitor’s strength can become their weakness. Spotify turned Apple’s dominance into a story about unfairness – and won. Sometimes the best defense is a bold offense.
@theoscarhoole is on Twitter .
