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Apple's Music Streaming Deals Under E.U. Regulatory Spotlight

European Commission asks competing services about licensing terms.

Vjeran Pavic for Re/code

European Union antitrust regulators are investigating Apple’s deals with record labels and online music streaming services to see if it is blocking rivals’ access to its planned music streaming platform, two people with knowledge of the matter said.

The move by the European Commission comes as the iPhone maker expands into the fast-growing music streaming business to offset a decline in iTunes sales.

Streaming music has also attracted the attention of online retailer Amazon, while singer Jay Z last month launched the Tidal service, amid stiff competition from Spotify, Pandora, Google and others.

The E.U. competition authority sent out questionnaires last week and has given the companies until April 17 to reply, the sources said on Thursday.

“The questionnaire asks about the terms and conditions of the licensing of content to music streaming platforms and record labels,” one of the people said.

The commission, which could open a case if it finds evidence of wrongdoing and could impose fines of as much as 10 percent of a company’s global revenue, plans an investigation into e-commerce next month to remove anticompetitive barriers to online trade and services.

The E.U. executive declined to comment. Apple did not reply to an email for comment. French online music service Deezer declined to comment on whether it received the questionnaire.

The Financial Time earlier reported that the commission was scrutinizing whether Apple’s deals with record labels unfairly limit free, ad-supported rivals.

Apple bought Beats Music, founded by recording mogul Jimmy Iovine and rapper Dr. Dre, for $3 billion last year, as the market moved away from digital downloads to subscription and streaming services.

(Additional reporting by Ankush Sharma in Bangalore; Editing by David Holmes)

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