Report: Apple Targets Spotify, Attracts DOJ's Attention

The tech industry's competitive streak could land one of its biggest players in hot water. According to The Verge, the U.S. Justice Department is keeping a close watch on Apple's negotiating tactics regarding its upcoming music-streaming service.

Citing anonymous sources, the blog said Apple wants music labels to put an end to Spotify's free, ad-supported music tier (something Universal Music Group is also allegedly pursuing). At this point, Spotify has more than 60 million users, but only 15 million subscribe to paid tiers.

In March, Re/code reported that music labels aren't thrilled with free music-streaming tiers, and that Apple has told them it will be subscription-only after a free trial period.

So, if Apple is successful in its bid to abolish Spotify's free tier, the two companies' services would be more in line with each other, and possibly allow Cupertino to attract some iOS-based Spotify users.

Spotify is also not Apple's only target, meanwhile. Cupertino reportedly offered to pay YouTube's licensing fee to Universal Music Group if the label cut off access to YouTube. "All the way up to Tim Cook, these guys are cutthroat," an unidentified music industry source told The Verge.

That, the blog said, has attracted regulators' attention. "DOJ officials have already interviewed high-ranking music industry executives about Apple's business habits," The Verge said.

Rumors of a Beats-based app for iOS devices cropped up in February, suggesting that Cupertino will launch a paid streaming platform that "deeply integrates" the Beats brand, as well as a number of popular artists.

Last month, reports tipped a free trial period for users, who will then have to pay a possible $8-per-month fee to access more music; iTunes Radio will remain free.

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Spotify and Apple did not immediately respond to PCMag's request for comment; the Justice Department declined to comment. More details about Apple's music-streaming service are expected at next month's WWDC event.

Jay Z's Tidal music service arrived at the end of March and does not provide a free, ad-supported option.

Editor's Note: This story was updated May 5 with a response from the U.S. Justice Department.