The iOS App Store: A Monopoly or Safeguarding Software?
Apple vs. Epic Games
Fortnite has become an online gaming sensation which has more than 350 million players. Last month, Apple removed Fortnite from its iOS App Store for violating its policies after Epic Games used a different way for users to bypass Apple’s in-app payment system. On August 13th, Epic sued Apple alleging that the policies take a significant portion of app sales that developers need to pay Apple. They argue that the way in which developers can make money on the App Store are anticompetitive considering the business model.
This is not the first time this discussion has come up. For years there have been complaints from app developers all over the world claiming that Apple’s gateway to the App Store stifles innovation and as a result, punishes consumers with unreasonably high prices. Epic CEO Tim Sweeney believes that Apple is running a monopoly and that a 30% revenue share is far too costly. In a letter to Epic, Apple lawyer Douglass Vetter stated that Epic wants “all the benefits Apple and the App Store provide without having to pay a penny. Apple cannot bow to that unreasonable demand.”
Sweeney informed Apple that Epic would make a direct payment system breaking the terms and policies of the Apple App Store. That same day, Epic even released a parody video of Macintosh “1984" Super Bowl ad with Apple as the villain. Sweeney has been very clear to mention that he will continue to address this “for so long as it take to bring about change, if necessary for many years.”
There have been worldwide antitrust scrutiny with not only Apple but Amazon, Google and Facebook. Companies like Spotify, Basecamp and others have criticized Apple and joined forces together in the Coalition for App Fairness. This is an independent nonprofit organization that advocates for “freedom of choice and fair competition across the app ecosystem.”
Apple has continued to defend its policies within the app ecosystem. One of their arguments is that it keeps users safe from software threats.
“The App Store is the world’s most trusted marketplace for apps precisely because of the standards and safeguards put in place — and the mechanisms Apple has developed to enforce them,” — Apple
This morning on Monday September 28th, Apple and Epic games met in an online courtroom hearing because of the COVID-19 pandemic. The decisions made in this case will affect both iOS and Android ecosystems. If there is any risk that Apple could lose this case, it could change how all app stores across the tech industry will operate and Apple may be forced to settle. Apple and Epic not only have to make their cases to the judge but also to their consumers who are stuck in the middle. For those who own an iPhone as well as enjoy playing Fortnite will be very interested in the conclusion of this lawsuit as it might affect their buying decisions in the future.
