Apple and Epic Games are returning to court after last year’s verdict which ruled in favor of the former on 9 out of 10 points. Epic had alleged anti-competitive behavior on part of Apple, accusing the tech giant of monopolistic practices. The video game publisher was obviously unhappy with the ruling, as they wanted Apple to allow third-party payments, which would have helped it increase revenue. But it wasn’t a complete victory for Apple either, as the company was ordered to remove the anti-governance rules that prohibited developers from telling users about alternatives to Apple’s in-app purchase system.
Both companies are now trying to have the ruling in their favor overturned. A lot has happened since the case started back in August 2020, and if you’re having trouble keeping track of it all, it’s because there really is a lot to keep track of. So in this article we look back at everything that has been resolved so far and what lies ahead in the Epic Games vs Apple case.
What has happened so far
The drama began after Epic introduced an alternative way for iPhone and Android users to buy “V-Bucks” – an in-game currency for the super-popular battle royale game Fortnite. This alternative way allowed players to take advantage of special discounts on certain items in the game, which could not otherwise be used. With this addition, Epic bypassed Apple’s 30% cut on purchases made through the App Store. Immediately after, Apple removed Fortnite from the App Store and suspended Epic’s developer account, citing a violation of its in-app payments policy. Google made a similar move.
Epic CEO Tim Sweeney believed the 30% fee was exorbitant and that users should have the option to purchase through other media. He sued Apple and Google, and launched a #FreeFortnite campaign that went so far as to promote a boycott of Apple products. Apple countersued Epic.
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From the very beginning, it seemed that Epic did not do well in the case, and the judge ruled in Apple’s favor in keeping Fortnite out of the App Store. However, the same ruling ordered Apple to unblock Epic’s developer accounts, so all was not lost for the game developer. Prior to the ruling, a number of companies including Microsoft had supported Epic’s requests to reverse the ban on their developer accounts. This is because Epic develops and supports the Unreal Engine – a 3D graphics game engine that is the backbone of a huge catalog of games. Epic losing access to the engine would have made it obsolete on Apple devices since the company would not have been able to maintain it. This in turn would have hurt many developers who relied on the engine.
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The trial continued for over a year until September 10, 2021, when Judge Yvonne Gonzalez Rogers ruled in favor of Apple on nine out of ten counts brought against the company. The one count that did not favor Apple blocked Apple from preventing developers from adding links in their apps to third-party payment methods. Judge Rogers also ruled that it was not really a monopoly as Epic had claimed. Rather, it was largely a duopoly along with Google.
Epic was subsequently ordered to pay Apple $3.6 million, which is 30% of the revenue withheld from Apple in the game company’s attempt to circumvent the App Store. An Apple representative stated that “the court has confirmed what we have known all along: the App Store does not violate antitrust laws.” Meanwhile, Tim Sweeney, CEO of Epic Games, stated that the ruling “is not a victory for developers or for consumers.” He also declared that Epic will not bring Fortnite back to the App Store until the company is allowed to offer the payment option in the app.
It’s been over a year since that ruling, and Fortnite continues to be unavailable directly on all Apple platforms, except through Nvidia’s GeForce Now and Xbox’s Cloud Gaming services.
The renewed case
So why is the case being dragged back to court now? Everything is obviously about money. Fortnite is a free-to-play game that relies primarily on in-app purchases for revenue. A significant portion of that – around 30% – is taken by Apple, and Epic doesn’t want to pay the “Apple tax”. Apple also refuses to back down since the App Store in its current implementation is super profitable for the company, with some estimating that these commissions pay Apple $15 to $20 billion annually.
Now Apple is trying to overturn the order that allows developers to tell users how to make in-app purchases from outside its own payment system, while Epic is trying to overturn findings that Apple did not violate antitrust laws.
The case is being heard before the US Ninth Circuit Court of Appeals in San Francisco. Representatives from the US Department of Justice and the State of California also appear to outline relevant laws.
The last session saw Epic admit that it had not brought sufficient evidence on some points. Toward the end of the hearing, Judge Milan Smith told Epic’s attorney Tom Goldstein, “the only thing that really bothers me is this weight of evidence. Looking at the record, (Apple’s lawyers) appear to have made a good case.”