Apple iTunes Prices to be Standardised Across Europe after EC Announcement

Apple relents and is set to keep prices the same for music downloads from iTunes across Europe.

It seems Apple is set to standardise its music download prices across Europe according to a statement released today.

Apple said it would lower UK iTunes prices matching already standardised pricing on iTunes across Europe. The statement follows a prolonged EC antitrust and competitions investigation into UK customers paying more for their iTunes downloads than other consumers in the rest of Europe; they were forced to buy music from the (pricier) UK store.

The issue, which first rose over two years ago after the British consumer association Which? complained iTunes stores in France and Germany charged 0.99 euros (about 74-pence at today’s exchange rate), while UK consumers paid 79-pence (that’s over one Euro), instead of letting all European consumers including those from the UK buy from iTunes at a standard price.

The EC announced it was to hold an enquiry in April last year and the issues raised by the enquiry focused on the key assertion that iTunes prevented users in one country from downloading from another of its websites in another European Union country.

In a "statement of objections" sent by the Commission to Apple, the Commission alleged agreements with record labels (thought to be behind alleged pricing discrepancies) contained territorial sales restrictions, which “violated" EU competition rules.

Apple faced fines of as much as 10% of its worldwide annual revenue if the ruling went against it, but Apple, at the launch of the EC enquiry, remained defiant releasing a statement denying any wrongdoing.

However, Apple has now reversed that stance; UK customers will be able to pay the same for their iTunes downloads as those living in other EU countries. This could mean what you’ll pay for your iTunes music downloads (per track) could fall from the current 79-pence to around 66-pence by summer 2008.

In its statement today, Apple noted it must currently pay more to some record labels to distribute their music in the UK than it pays them to distribute the same music elsewhere in Europe.

It said: "Apple will reconsider its continuing relationship in the UK with any record label that does not lower its wholesale prices in the UK to the pan-European level within six months."

In a further comment from the Commission, it said its antitrust proceedings clarified it is not agreements between Apple and the record companies that determine how the iTunes store is organized in Europe. And so, “the Commission does not intend to take further action in this case".