Apple Accuses Epic Games of 'Willful, Brazen, and Unlawful Conduct' in Countersuit Asking for Breach of Contract Damages

[tegranjeet]

"All competition is anti-competitive." - I think you need a dictionary, mate.

It’s true in this arena at this scale. Companies can buy other companies to stifle competition.

i wouldn’t say all competition is anti competitive. Especially athletic events. Although, even at the top level, we get doping and drugs, which, if you think about it, actually were fine before there were rules against using drugs and blood doping to get an edge. Everyone could do it if they chose. Some (most?) however, see the drugs as a moral conundrum since they require little to no time or effort with seemingly little commitment. Of course we pay for the doping later in life or even very soon, but who cares when we can have that edge now. We all want that edge, and most will stop at nothing to get it. That’s true competition. Beating the competitor via any means possible. Kill or be eaten. This is maybe the most apparent in business. Yet we are “civilized“ folk and will duel it out in court instead of the battlefield.

Competition only becomes anti-competitive when we start bending the existing rules or adding more and more. It’s a fine line to walk to be sure. We need some rules, but too many is, well, too many, and we end up not wanting to play anymore. That’s why this is so controversial, it could be setting the stage for law changes.

 

[4jasontv]

It has nothing to do with numbers? That’s really the only argument one could make - that iOS is so big Apple has to keep it closed to keep it safe. Not saying I agree but I don’t know what other argument one could make for having one open and the other closed.

The argument can be made that it's their store and they can at any time change the rules. If they think slot machine apps are bad they can remove them all. So sad to bad if you spent your life savings developing one. It's no different than Walmart no longer selling cigarettes, or modeling agency no longer wanting to represent a certain person.

The argument is: Apple is OK with some unregulated development on the mac but isn't ok with it on iOS. They don't have to justify the decisions.

 

[Abazigal]

"And "rent" isn't illegal." - Oh, but it is illegal if it is monopolistic. Same as if a company spews toxic waste into the river in order to increase it's profits. Breach the laws that our government makes (i.e. "we the people" make, as the government are our elected law makers), which are required to be followed if you want to operate a business in our country. See, "we" own the country, not the companies. The companies only get to operate if we let them. And we only let them if they follow the laws we make. And we make those laws to protect us from all the nasty business practices that a lot of businesses will take advantage of if we let them.

Apple isn’t a monopoly and it hasn’t broken any rules either.

 

[sideshowuniqueuser]

As a consumer I like having more choice (the choice of a walled garden and its benefits) not less (where every device has multiple storefronts). It's anti-consumer.

But with multiple store fronts you still have that choice, no one is advocating that Apple's store front has to be removed, only that other store fronts will be allowed. You will still have the choice to stick with Apple's walled garden if you want, and others will have the choice to not to if they want. That's real choice. Not the completely choice-less "choice" you are advocating. BTW, the multiple store front model is exactly what we have with macOS. There is an Apple store that you can "safely" get software downloads from. And there is also choice to get software downloads from anyone and anywhere. As individuals, we make the choice of whether to take those non-Apple store downloads or not. Apple doesn't talk about that being a problem on macOS, simply because if they tried that on with macOS, then most of the macOS customers would abandon Apple for Windows or Linux. I regularly download software both from the Apple store and from all kinds of places. I also can download things that Apple would consider not wholesome enough for it's "family" values, even though I am an adult.

 

[4jasontv]

But with multiple store fronts you still have that choice, no one is advocating that Apple's store front has to be removed, only that other store fronts will be allowed.

Can we also regulate that you have to sell it for the same price on every store, and that if one store doesn't want to have the app no store can offer it?

Seems fair, right? We can't allow the developer to have a monopoly over how their app is priced and distributed.

 

[4jasontv]

Apple isn’t a monopoly and it hasn’t broken any rules either.

And even if it is a monopoly that doesn't mean it has broken any rules either.

 

[Realityck]

Just put all the lawyers involved in this case in a closed area and wait until we find out who is the last one on their feet.

 

[sideshowuniqueuser]

Can we also regulate that you have to sell it for the same price on every store, and that if one store doesn't want to have the app no store can offer it?

Seems fair, right? We can't allow the developer to have a monopoly over how their app is priced and distributed.

Failed analogy.

 

[4jasontv]

Failed analogy.

How is that an analogy? If Apple has no say on how it's software is used than none of the apps have one.

 

[Abazigal]

My thoughts: Apple was always primarily a device company under Jobs. Would it have been wrong for Tim Cook to move into services as well? No, but only as long as they continued to innovate in the device space as well. Tim Cook seems to have gone only for the former. Its let Apple increase its revenue, and along with stock buybacks, its share price. Great for investors, which is why Tim Cook still has a job, but otherwise bad for anyone that enjoys Apple devices and wonders about lost potential.

Apple is a design company.

They take an emerging product category with a frustrating user experience and deliver a polished product made possible by its control over the hardware, software and (if necessary) services.

In this context, I don’t feel Apple has changed. Everything Apple has done is to add value to the Apple ecosystem, which is why I buy Apple devices in the first place.

For example, my Apple Watch is integrated with Apple Music. TV+ ties the various streaming services together, while Apple Arcade helps surface apps that I can use on my iOS devices.

I feel the move into services was inevitable. Going all the way back to when Apple removed google maps for its own maps app. It makes sense to have your own services and decrease your reliance on third party offerings who, like what Epic has demonstrated, can be friends with you one moment and then turn on you the next.

The safest hands are still your own.

 

[Quu]

I have to say if Apple loses this and other companies can make competing stores on the iPhone it will really be a double edged sword for us as consumers.

On the one hand we would get software with features Apple won't allow on their own store and competition on price. On the other hand we will have to at some point install third party stores that may have a poorer user experience compared to the built in App Store or stores that allow apps which don't respect our privacy.

And on top of that there is the question of security. An open store not run by Apple may not be vetted as well as Apples and that could allow for viruses. The strict sandboxing that Apple currently forces upon us will certainly have to be altered significantly to allow third party stores to function fully with the ability to install, update and uninstall apps etc

In addition to these things you can be sure lawsuits will start to allow for the iOS frameworks Apple keeps for themselves to be opened up to all developers. Heck if they're forced to allow third party stores there's nothing to stop that store publishing apps that use Apples private frameworks, something Apple strictly prohibits currently on their own store.

So ya know there's upsides and downsides. Personally I think I'd lean towards maintaining Apples control over the App Store. I feel they've gradually opened up enough that I'm satisfied. Being able to set your own Browser as the default in the new iOS 14, having background apps in general (from a few years ago). Having apps that can handle VoIP and so forth. I feel like they've been moving in the right direction, albeit slowly.

What EPIC is asking to do I feel will degrade the user experience, at-least for me. I do not want to install lots of different application stores where my privacy and security may not be respected to the same degree as it is with Apple. I like being able to use Apple Pay in my apps to shelter my payment information, I like being able to login with Apple and have the app developer only receive a randomised iCloud email address etc - I'm certain EPIC would never offer similar features in their own store as there's no incentive for them to do so, they just want to sell Apps while Apple is trying to make an entire ecosystem with which to compete with Android so it's really different goals.

Anyway just my mumbling thoughts about the whole thing.

 

[Makosuke]

The thing that bothers me about this whole thing is that Epic is being so disingenuous, based on their tactics versus how they behave toward console developer programs with similar pricing structures.

If they had not violated the contract but instead launched a PR push or lawsuit or shadow org or something saying, "We think 30% is too high a price for the value a developer of our size gets from the App Store and the quality of developer support provided by Apple," then fine. That's a totally legit argument, and might well be true, particularly when it comes to developer support.

They could have pointed to the level of developer support that a similar cut on a console gets them and compared that to what Apple provides to illustrate that Apple was using its size and position to provide poor value to the developer. I doubt this is legally allowed, but maybe they could even have pointed to the discount that Microsoft or Sony give them due to their size as evidence that Apple is out of line with the industry.

Or, they could have gone as far as saying "We think 30% is too high a price for the level of developer support provided by Apple, and this is even more true for smaller developers than a company of our size, so we are taking a stand for the ecosystem." It's spin, but it might well be true for smaller developers if they never get featured or promoted by Apple, so it's based on fact even if it's self-serving in the end.

But instead they're framing it as if they're fighting against some sort of abnormal pricing structure--when it's similar to consoles--and that they're some kind of scrappy underdog--when they're a $20 billion company with their own game storefront and are 40% owned by a half-trillion-dollar Chinese company and most of the rest by a billionaire.

Not to mention playing the victim when they got exactly the treatment any multi-billion-dollar company would expect when violating a contract with another multi-billion-dollar company. They didn't argue that the contract was unfair, they broke it then launched a PR campaign and then sued when Apple responded in exactly the way the contract stated they would.

Apple's statements are of course skewed to position them in a positive light, and they're of course periodically the most valuable company on the planet, but unlike what Epic has said, they're at least technically telling the truth. It's spin, but it's spin based on things that are basically true.

As a consumer, Epic basically wants iOS to be Android but with lower developer overhead on the official app store. The developer overhead is debatable--a lower cut would at least on average reduce costs to me, and only at the cost of profit to Apple shareholders up to a point--but I use iOS for a reason and don't particularly want to see it turn into Android.

 

[macfacts]

Apple goes on to explain the current Epic vs. Apple situation, and how Epic blindsided Apple with a "hotfix" to add the direct payment option and then the ensuing lega

If epic can slip this hotfix/update (with a direct payment method) past apple's app approvers, then it's just as easy to slip malware thru.

 

[Tech198]

It must be a pretty good chunk of revenue from Epic to pressure Apple this hard..

Compared to other platforms, and the % is a lawsuit really worth it, when you have most of your customers on others anyway?

Or is Epic just wanting to show "it can be done"?

 

[ravenstar]

OK but if the argument is Apple is providing access to people who spend money...well they don’t get a cut of transactions involving physical goods or goods purchased via a browser. And they’ve created rules whereby certain digital goods can be purchased outside the App Store. Before smartphones existed would anyone have seriously argued that Microsoft and/or it’s OEM partners deserved a cut of all e-commerce? Should ISPs or mobile carriers get a cut? Without them smartphones wouldn’t be worth much.

Not sure where you're going with this. The Microsoft/OEM situation isn't analogous. None of them created an end-to-end hardware-os-ecommerce system. But anyway, it isn't the least bit unusual for a company to license technology to other companies and charge based on volume or percentage of cost of the final product. We've been reading about it right here for years. It isn't unusual for stores to take a percentage of the selling price of a product for itself. It's not unusual for a store to prohibit a seller from advertising a competitor within the store. The only thing that is relatively unique here is that a company has created a closed product that they opened up to other developers under certain rules and that product has proved immensely popular with paying customers. On what basis should Apple be forced to relinquish control of this product that they have created? It's not an essential product, there are many viable (if not as nice in some users' opinions) alternatives, and Apple isn't attempting to block competition from other devices or developers. Some people don't like how Apple is running its product, but that's not a legal basis for depriving them of their creation.

 

[4jasontv]

If epic can slip this hotfix/update past apple's app approvers, then it's just as easy to slip malware thru.

One could argue that Epic did slip malware thru. After all, if there was an issue with a payment customers would have blamed Apple not knowing Epic was pocketing everything.

 

[AdonisSMU]

I've said it before & will say it again, it comes down to Marketing !

If AAPL has ever promoted an App, then AAPL is entitled to their just cut !

However, if AAPL has NEVER promoted an App, then, IMO, AAPL should NOT get any more than a 10% cut of Revenue !

Epic has benefited significantly from AAPL's marketing, & as such, I side with AAPL on this one !

And, I agree with AAPL that it is ALL-about money, nothing else !!

App Discovery is the other, more important problem, with the existing App Store ... hopefully, it too will soon have its Day in the Sun !

Umm but Apple has had Epic Games at its conferences and Epic has gotten special access to apis before theyve been released in beta. If anyone should be paying the app store 30% cut its Epic.

 

[ravenstar]

Did Epic have a choice but to use the tools, etc., that Apple FORCES developers to use? It's not like Epic chose to use Apple SDK's, etc., over other options. Everything Apple says Epic "enjoyed", Epic was basically forced to use.

Don't be silly, of course they did. By EPIC's own admission they're available on many other platforms. No one forced them to develop for iOS, they wanted to do it to make money.

 

[AdonisSMU]

Lol it's funny how Apple conveniently left out the fact that they used Infinity Blade for their own shameless self promotion of the iPhone's prowess over Samsung Galaxy way back in 2010:

To quote Jobs, "Wow, it's all on a phone!"

Like there is no one else in the Gaming Industry or a related industry to demonstrate performance with.... 🤦🏾‍♂️

 

[4jasontv]

It’s true in this arena at this scale. Companies can buy other companies to stifle competition.

i wouldn’t say all competition is anti competitive. Especially athletic events.

*EHEM* YANKEES *EHEM*

 

[4jasontv]

Like there is no one else in the Gaming Industry or a related industry to demonstrate performance with.... 🤦🏾‍♂️

...

BUT CAN IT RUN INFINITY BLADE!?!?! /s

 

[AdonisSMU]

No matter what side you’re on, the outcome of this fight will impact everyone. It’s really interesting to watch it play out.

Personally, I’m team Epic. I don’t think device makers like Apple, Sony, or Microsoft should also be allowed exclusive access to be the only storefront. It’s anti competitive.

Good news its not. The courts have already ruled you can do whatever you want with your device. However its not Apples problem if the jailbreak goes wrong. Thats it.

This issue goes beyond that though. It means basically all hardware like your microwave could be required to support all kinds of software. Thats a slippery slope.

Epic is trying to force Apple to introduce backdoors and security holes into Apples iOS Operating System so governments around the world can track and control people.

 

[macfacts]

Can we also regulate that you have to sell it for the same price on every store, and that if one store doesn't want to have the app no store can offer it?

Seems fair, right? We can't allow the developer to have a monopoly over how their app is priced and distributed.

You want the same rules apple tried to create for the ebook market? Remember there was a lawsuit about this and apple lost

 

[grjj]

I've said this in every story so far but it doesn't seem to be sinking in to people's heads:

A monopoly is not illegal. The US Government, in fact, endorses and protects many monopolies with copyright and trademark laws.
There are certain scenarios in which a predatory monopoly is formed where a company uses a controlling power in one market to control another market. None of that is in play here. Apple is not a majority share in any market that compete in. There are other mobile phone brands and platforms out there in the world which Apple does not in any way prevent from doing their business.

So, please, before you go arguing that Apple is a monopoly, understand that every brand is and there is absolutely nothing wrong with being or having one.

 

[4jasontv]

You want the same rules apple tried to create for the ebook market? Remember there was a lawsuit about this and apple lost

OMG YES! Movies too!