NY, Connecticut investigate Apple for Music service violations

Panic in the disco as lawyers pick the playlist

Although Apple has barely thrown back the covers on its Apple Music streaming service, it is already facing anti-trust investigations from two US states.

According to the New York Times, attorneys general in New York and Connecticut are investigating whether Apple has pressured record labels – or colluded with them – to eliminate "freemium" services from rivals like Spotify and Rdio.

Those operators dangle the free service in the hope of converting users to paid, ad-free services. The new Apple service does not have a free tier. Instead it offers three months free service before subscription fees must be paid.

The NYT says ahead of its June 30 streaming launch, Cupertino set to work pressuring labels to quit supporting the freemium services.

Artists have a hostile relationship to the freemium services, claiming they don’t receive enough income. Most notably, pop star Taylor Swift withdrew her music from Spotify in protest against the freemium model.

A spokesman for one of the attorneys general told The Times that the investigation is designed to ensure consumers continue to enjoy the benefits that have arisen from the rise of music streaming.

Several major record companies recently announced their revenues from digital streaming exceeded those from physical media for the first time.

One record company has already responded to the investigators’ queries. Universal Music Group indicated it had no agreements with Apple or with other record companies that would inhibit the availability of freemium services.

It’s not the first time Apple has been investigated for content-based anti-trust violations. In 2013 a US federal judge found the company had violated anti-trust law by colluding with publishers to raise e-book prices above the $9.99 charged by market leader Amazon.com.

The two attorneys general involved in looking into Apple Music were also part of the e-book investigation. ®

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