What to know

  • Spotify has seen a boost in subscriptions after adding external payment options on iOS devices.
  • The company can now bypass Apple's 30% App Store commission fee due to regulatory changes.
  • Spotify implemented the new payment system in March 2025 and is already reporting positive results.

Spotify has reported a significant increase in subscriptions after implementing external payment options for iOS users. The music streaming giant shared this information during its quarterly earnings call on Wednesday.

The new payment system, launched in March 2025, allows iOS users to subscribe to Spotify Premium directly through Spotify's website rather than through Apple's App Store. This change lets Spotify avoid Apple's 30% commission fee on in-app purchases.

"We've seen a meaningful uptick in conversion rates since implementing external payment options," said Spotify CEO Daniel Ek during the call. "Users appreciate having payment choices, and we're able to offer more competitive pricing without the App Store fee burden."

The change came after regulatory pressure forced Apple to allow developers to direct users to alternative payment methods. The Digital Markets Act in Europe and similar regulations in other regions have pushed Apple to loosen its grip on App Store payments.

Spotify now displays a button in its iOS app that takes users to its website to complete subscription purchases. The company also sends notifications to existing subscribers informing them of potentially cheaper options outside the App Store ecosystem.

Financial analysts estimate that Spotify could save hundreds of millions annually by redirecting subscribers away from Apple's payment system. The company hasn't disclosed specific numbers but indicated the impact is already "material" to its bottom line.

"This is a win for both Spotify and our users," said Spotify's Chief Financial Officer. "We can invest more in content and features while potentially offering more competitive pricing."

Apple has not publicly commented on Spotify's announcement. The tech giant has historically defended its commission structure as necessary to maintain the App Store's quality and security.

Other major app developers are watching Spotify's results closely. Several companies including Netflix and Epic Games have previously criticized Apple's payment policies and may follow Spotify's approach if it continues to prove successful.

Industry experts suggest this could mark a significant shift in the mobile app economy, potentially reducing Apple's service revenue while giving developers more control over their business models.

Via: techcrunch.com