Apple's Control vs. Spotify's Dominance Discussed on CNBC

Two of the music industry's biggest players were trading barbs about Apple's use of the App Store to control Spotify's pricing.
By Michael Sheetz ,

NEW YORK (TheStreet) -- The music streaming battle is getting louder as Apple's (AAPL) - Get Report General Counsel Bruce Sewell responded this morning to Spotify's claim that Apple's App Store was preventing Spotify from equalizing its competition with Apple Music.

Lance Ulanoff, Chief Correspondent and Editor-at-Large at Mashable, believes this is a predictable problem given Apple's ownership of a multitude of services and that this situation is "a one-off thing."

"Every time Apple builds something that somebody else has created, that's going to be a concern," Ulanoff said on CNBC's "Power Lunch" this afternoon. "Apple will not only control the app you're using but the platform that you get it on and the sort of commerce system or subscription system that you're dealing with."

Sewell's statement declared that Spotify's attempt to "avail itself of the benefits of Apple's hard work" without paying would provide "a tremendous advantage over other developers."

As of March 2016, Spotify had 30 million paid users to Apple Music's 15 million. Ulanoff believes this is not a case of Apple misusing its control of "both the content and the platform" because "Apple also makes money when Spotify is on the surface."

"You have to remember that without Apple's platform, a number of these services probably wouldn't reach the millions of people that they're already reaching now. So it's actually been a great platform," Ulanoff added.

Shares of Apple closed up 0.33% to $95.92 on Friday afternoon.

Separately, TheStreet Ratings team rates Apple as a "buy" with a ratings score of B.

This is driven by a number of strengths, which TheStreet Ratings believes should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks TheStreet Ratings covers. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, notable return on equity and expanding profit margins. TheStreet Ratings feels its strengths outweigh the fact that the company shows weak operating cash flow.

TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.

You can view the full analysis from the report here: AAPL

Loading ...