The Epic Games v. Apple lawsuit concluded with a number of mixed conclusions for both companies but with lasting implications for app developers. Epic Games, the company behind Fortnite, made significant news in August 2020 when it decided to allow consumers to purchase in-game currency through its website instead of the Apple App Store interface. When Apple removed Fortnite in retaliation, Epic Games sued, arguing that Apple was violating antitrust laws. In May 2021, a California judge held several hearings over questions of “what is a game” and whether Apple’s rules were a breach of antitrust. Now, the judge overseeing the trial, Yvonne Gonzalez Rogers, has submitted her ruling.
Rogers initially made news by filing a permanent injunction against Apple. The injunction blocks the Big Tech giant from requiring app developers to use only the App Store payment system. The ruling would allow developers to add interface elements to iOS applications that link to external purchasing mechanisms.
While Rogers’s blocking of Apple’s anti-steering policies is a big shift in the App Store market, the judge did not affirm Epic’s notion that Apple’s practices were monopolistic. Rogers dismissed nine out of Epic’s 10 claims against the company, then ordered Epic to pay damages to Apple equal to the amount lost through their breach of contract involving Apple’s 30% commissions on products sold in the iOS version of Fortnite.
Upon hearing the results of the case, Apple declared the ruling a “resounding victory” despite the forced change to their App Store policies. Epic Games, in contrast, intends to appeal the decision, although it is unclear what it is appealing.
In the meantime, app developers are interested to see how to use these developments to their benefit. Spotify Head of Global Affairs and Chief Legal Officer Horacio Gutierrez stated that “we are pleased with Judge Yvonne Gonzalez Rogers’ finding that Apple engaged in anti-competitive conduct and has permanently prohibited their anti-steering provisions.” Gutierrez added that these changes, among several others around the world, “show that there is strong need and momentum for legislation to address these and many other unfair practices, which are designed to hurt competition and consumers. This task has never been more urgent.”
Spotify has been a consistent critic of Apple’s App Store practices. In 2019, the music streaming service filed a complaint with the European Commission arguing that the App Store rules “purposely limit choice and stifle innovation at the expense of the user experience.” Spotify also implicated that Apple favored promoting its own products since its decision to act as “both a player and referee” allows it to “deliberately disadvantage other app developers.”
Lawmakers were also pleased. “Today’s decision in the Epic Games v. Apple case is an important step,” tweeted House Antitrust Subcommittee Chairman and Rep. David Cicilline, “but it is further evidence that Congress must enact clear rules of the road to prevent platform monopolists from abusing their power and picking winners and losers online. Congress must act!”
When it comes to smaller developers, Apple’s change in policy opens a lot of doors, particularly when it comes to games. “As the barrier to entry has been reduced with access to powerful game engines such as Unreal and Unity or global distribution channels such as Steam, the video game industry has exponentially grown,” argued James Deighan, co-founder of the game company Mega Cat Studios. “One of the last remaining strongholds is the 30% platform fees that most first-party storefronts are holding to. If there would be a shift for this commission, it would be profound for us.”
When Deighan heard about the ruling and injunction for anti-steering, he was ecstatic. The game developer told the Washington Examiner that he hopes that the policy change will encourage technological innovation and increase the number of microtransactions.
