Apple Removes Fortnite From App Store [Update: Epic Files Lawsuit Against Apple]

[cheese01]

Obviously, Apple doesn't want to decrease their cut or allow for app sellers to bypass it, and Epic wants to pay as little as possible to Apple. They're both public companies which exist to make money - of course this is what they want to do.

I wonder what the breakdown of the App Store's running costs would look like. Server hosting? Internet bandwidth? Paying for human app reviewers? API development costs?

Ideally, I think Apple could provide an alternative fee structure for app sellers: 0% cut from an app's sales and iAP, but a fixed fee charged to the seller per download, or fee per amount of download bandwidth used (or some combination of the two). This would really solve the headaches for app sellers providing a subscription to a service with its own high running costs (e.g. Spotify), while covering the App Store's running costs in a fair way.
This also removes any real argument for allowing alternative app markets, which allows Apple to maintain their tight control on their OS and software (something which, in my opinion, is unique to Apple and makes their offerings stand out positively from the competition).

Of course this would almost certainly reduce Apple's services revenue, but at least they wouldn't be making any losses where they previously didn't. Government Regulation time?

 

[springsup]

If Apple didn't review it, that means app developers can add arbitrary code to existing approved apps somehow?

What's the purpose of the app review process then? If they could add a new payment option without a new version update, could some rogue developer add malware?

yep, games have been doing this for a long time and I freaking hate it.

one of the great things about the AppStore is that it manages updates, so when I go to launch any app, it’s already the latest version. No waiting necessary, and the downloads get intelligently scheduled to occur when I’m on WiFi and not in lower-power mode, etc.

games which do their own updates have none of this. Launch a game and you’re forced to wait (sometimes quite a long time) for updates to download, decompress and apply. Your phone heats up, the battery drains, and you can’t do anything else while the game is updating. And yeah, they can slip in features which bypass review.

It’s like game developers are stuck in the 1990s, and insist on building all their own infrastructure and acting like their own mini operating systems. They have an unending sense of entitlement to do what they want, and it ends up worse than if they just used the platform’s built-in tools. I’d be happy if Apple banned in-app updating.

 

[Ethosik]

Bad analogy. By blocking you from
the Apple platform they cut off your revenue. When you host your web site with another provider, the same people can still access your web site, so there is no revenue loss to you.

Is Epic complaining about loss of customers? No, they broke the rules, the app got removed and they are complaining about it. We are not discussing customers here. Therefore, the analogy fits. If I break rules ANYWHERE, the same result happens.

 

[mrcloaked]

Others can do good.

 

[ipponrg]

yep, games have been doing this for a long time and I freaking hate it.

one of the great things about the AppStore is that it manages updates, so when I go to launch any app, it’s already the latest version. No waiting necessary, and the downloads get intelligently scheduled to occur when I’m on WiFi and not in lower-power mode, etc.

games which do their own updates have none of this. Launch a game and you’re forced to wait (sometimes quite a long time) for updates to download, decompress and apply. Your phone heats up, the battery drains, and you can’t do anything else while the game is updating. And yeah, they can slip in features which bypass review.

It’s like game developers are stuck in the 1990s, and insist on building all their own infrastructure and acting like their own mini operating systems. They have an unending sense of entitlement to do what they want, and it ends up worse than if they just used the platform’s built-in tools. I’d be happy if Apple banned in-app updating.

There is an app update weekly for every app I have. On one hand it’s nice that they go through a review. On the other hand, the App Store kinda sucks as a download manager. It fails every so often for no reason, so you have to force kill the App Store and restart. Unlike true patches, you still have to download the entire app. It would be nice if it was a real patch system.

 

[Yammabot]

It’s apple’s playground if you don’t want to follow the rules go play somewhere else. It’s that simple. You want to be on the biggest, best platform that’s trusted by its users you pay the price.

 

[Rogifan]

I like this line of thinking, but am not sure that developers would be happy paying any amount to Apple that is basically greater than 0%. You lower it to 25% or 20% or even 15%, people may rejoice for a while, then once that becomes the "norm", they get complacent and greedy over time and start clamouring for 10% or 5%. Before long, we would be having this same conversation all over again.

I guess this also raises the question of just what this mystery "break even" point even is, or if the App Store even needs to break even. For example, services like Maps, Siri and iMessage clearly don't generate any money on their own, but they help differentiate Apple's product offerings from the rest of the competition, and it's assumed that they pay for themselves by helping to sell more Apple products.

We know that the App Store is definitely profitable right now, but we don't know by how much. What if say one day, Apple reports show that it takes a 20% cut on average from every developer in order to break even (or maybe generate a small modest profit). Would knowing this make developers fork over that 20% more willingly, or will it just flip into a "Apple is so rich, they can well afford to run the App Store at a loss using iPhone profits and just let me keep my 100%?" instead?"

And if Apple were forced to allow alternative payment methods (meaning that more users can circumvent iTunes and decrease their earnings), the only other way Apple can make up for this shortfall would be to increase the annual developer fee. From $100 to $200 or maybe even $500? Companies like Epic or Netflix have no problems shelling out this minuscule sum, but it's your small-time developers would be hardest hit.

Steve Jobs has said a lot of things, but we will never know just how sincere he was about them, or if he could even envision just how big Apple (and the App Store by extension) would become one day. I imagine that if he were still alive today, he need only give one fiery impassioned speech and everyone here on Macrumours would be falling over themselves to support Apple and denounce Epic. If you ask me, that's really the only thing Apple lacks today - a charismatic leader to rally around.

These are all good questions. If I had my way Apple taking a cut of IAP would go away entirely and Apple would find another way to charge developers for what it costs to run the App Store. Maybe that’s increasing the annual developer fee or maybe it’s a completely new charge. Maybe every app has to cost something, even if it’s 99 cents and Apple takes a percentage of that sale. Of course I’m saying this as someone who doesn’t think the App Store should be a money making operation and doesn’t buy this argument that Apple deserves to rent seek because they provide access to a billion customers. If you look at the most popular apps on the store it’s hard to argue they’re popular because of Apple. But you could easily argue iOS and iPhone would be less popular without them. As far as your last paragraph you’re right about what Apple is missing without Steve. And I think he would have clarity of thought on what the App Store should be that Schiller, Cook and Cue don’t have.

 

[Unregistered 4U]

Fortnite isn‘t open to 3rd party stuff being sold. It‘s all in-house by Epic.

WELL! I REALLY don’t like that!! They 100% CONTROL THE FORTNITE MARKET! I don’t see how anyone can see that as anything but an unfair Monopoly.

 

[brownpaw]

There is an app update weekly for every app I have. On one hand it’s nice that they go through a review. On the other hand, the App Store kinda sucks as a download manager. It fails every so often for no reason, so you have to force kill the App Store and restart. Unlike true patches, you still have to download the entire app. It would be nice if it was a real patch system.

I thought it is true patching and it only delivers the delta?

 

[jonnyb098]

Good luck with this Apple. You're being hit left, right and center with lawsuits. This one was provoked.

Lots of lawsuits tend to happen when you are the most valuable company on planet earth. Apple has the deepest pockets of any company including the most liquid cash on hand.

 

[mrcloaked]

It's one game.

 

[coldwaves]

Apple _can_ kill an app on your phone. You would expect that to happen if Apple found out that the app is malware and removing it is in the best interest of the end user. Clearly not the case here.

The situation here is "your app had inactive features, and we would never have let it on the AppStore if we had known about these features. You now activated them." So Apple _might_ remove Fortnite from users' phones, if Fortnite doesn't stop doing what they're doing. And Apple's lawyers might be looking at whether they should refund in-app purchases to users in this case (and per contract that money would have to be paid 100% by Fortnite).

Thanks for pointing this out. Are there any resource on more technical details of this? I would love to read and learn more about how apple kill apps and what the polices are regulating that.

 

[Madmic23]

Good. Fortnite doesn't provide third parties a way to sell within its game. Why should Apple allow them free real-estate for customers that Apple worked to build?

Apple's store. Apple's rules.

Just out of curiosity, how would you feel if Walmart only allowed you to pay with a Walmart Credit Card? I know it's easy to say that you would just shop at a different store, but what if it was the only store in your town? Or they were the only store that carried the products you wanted?

 

[BlankStar]

I don't see the problem here. When I open a store and can't come to an agreement over my cut with a supplier then I won't sell his stuff and that's the end of it. Here Epic wants to sell stuff via Apple's platform but don't the cut Apple wants for the use of the platform. They're greedy and accuse Apple of being greedy. Quite ironic.

And the fact Apple has so many users, is because loads of people are happy with a curated, protected app store, otherwise they'd have an android-device, like many of my friends.

 

[Madmic23]

Obviously, Apple doesn't want to decrease their cut or allow for app sellers to bypass it, and Epic wants to pay as little as possible to Apple. They're both public companies which exist to make money - of course this is what they want to do.

I wonder what the breakdown of the App Store's running costs would look like. Server hosting? Internet bandwidth? Paying for human app reviewers? API development costs?

Ideally, I think Apple could provide an alternative fee structure for app sellers: 0% cut from an app's sales and iAP, but a fixed fee charged to the seller per download, or fee per amount of download bandwidth used (or some combination of the two). This would really solve the headaches for app sellers providing a subscription to a service with its own high running costs (e.g. Spotify), while covering the App Store's running costs in a fair way.
This also removes any real argument for allowing alternative app markets, which allows Apple to maintain their tight control on their OS and software (something which, in my opinion, is unique to Apple and makes their offerings stand out positively from the competition).

Of course this would almost certainly reduce Apple's services revenue, but at least they wouldn't be making any losses where they previously didn't. Government Regulation time?

This is one of the most reasonable alternatives that I've seen suggested, and I think it makes a lot of sense. Good idea!

 

[darkcompass]

A Question.

If I made an App, let's say a game, and made it free on the App Store.
So, ok for far.

Then I allowed people to buy expansions, skins, all sorts of in-app things via my website.
But I did not mention this at all in the app.

But spent a ton of money all over the Internet, social media and the news to tell people how to come to my site and buy all the stuff (no 30% cut)
Then is Apple still going to allow the free app to remain?

Remember I'm not putting any in-app purchases actually in the game, nor any payment options in my App.
Or any mention of payments in the app.

Im sure there's apps like that already.

 

[jsmith78]

There is also a "security" aspect to this. Right now all payments for apps on my iphone are handled through one interface, Apple's, and I know I can trust that apple won't steal my credit card information. However if apps are allowed to run their own payment processing, this could get out-of-hand, really quick.

Their credit processing could look and operate properly, but actually steal info on the back end, (especially when so many apps are sourced from foreign nations)

Even worse, their payment processing could mimic Apple's to trick unsuspecting users into thinking they are using a trusted payment processing, but are in-fact being scammed.

and being that most payment processing services would be web based, and would be a "link" out to the web, they could operate properly for initial App Store approval, but then later changed to be malicious.

 

[TiggrToo]

Just out of curiosity, how would you feel if Walmart only allowed you to pay with a Walmart Credit Card? I know it's easy to say that you would just shop at a different store, but what if it was the only store in your town? Or they were the only store that carried the products you wanted?

Argument doesn’t hold. You can use any payment card with Apple.

 

[mrcloaked]

I prefer the software.

 

[DanTheMan827]

The fact that Epic was concerned about its margins by adjusting pricing for IAP items and did this on purpose to provoke a fight totally invalidates their argument.

This is a fun one because both companies make a ton of money, so who will the MR readers call greedy?

I’ll budge a little. If Apple really is forced to allow alternative billing, force them to route it through Apple Pay. They won’t get their 30% which some devs find hopelessly unaffordable (that’s BS, they don’t want to pay, funny how money works when it’s owed to someone else).

I trust developers less than Apple given the shady stuff like copying clipboard data under the radar. Route their transactions through Apple Pay so they can’t try to pull a fast one. I can already see it...”App on Apple’s App Store suffers data breach exposing CC info, etc.” They’ll pin that on Apple too.

There’s a good reason why payments are handled in one place. Apple has fraud protection like no other.

I doubt this is only about the IAP system, I have a feeling they want to add fuel to the anti-trust investigation in hopes that Apple loses and are forced to allow apps from outside of the App Store which would then allow EPIC to bring their game store to iOS since Unreal Engine already runs on iOS and iOS relatively recently added controller support.

 

[Karllake]

If the vendor has a website, you can buy from them directly. Suppose you bought a laptop produced by Amazon, and the laptop forces you to do online shopping only on Amazon, how's that like?

if that shopping brought me benefits that as a consumer I have the option to buy the amazon laptop or not buy it, buying it and then b****ing about the rule doesn’t make sense, if Apple has market dominance then it might be different, but they don’t.

 

[jsmith78]

I do think there is a simple fix for this.

A setting in iOS that allows for side loading apps. this setting could be something like "Allow Unsecured Apps", with a warning : "This puts your iPhone at risk, Apps downloaded through the App Store are secured by apple and verified safe, if you turn on this setting, you can install unverified apps that may be dangerous, steal your personal data, or damage your data on your iPhone. Are you sure you want to continue?"

 

[mrcloaked]

They have the highest.

 

[jsmith78]

Argument doesn’t hold. You can use any payment card with Apple.

It would be more like "what if walmart only allowed you to buy things that walmart had an agreement with the vendor to sell? Products that the vendor and walmart agreed on terms of the sale and what cut walmart would get?" Oh wait, that is ALREADY TRUE of every store.

 

[DanTheMan827]

Here it goes. I wonder if any manufacturer can now sue Walmart or Safeway for demanding too low a wholesale price? And why isn't this the same again? Developers want free infrastructure, free access to customers, pretty much free everything. When they don't get it they sue.

That's not a good analogy because any manufacturer could choose to build their own store and sell their product there exclusively.

On the iPhone, it's impossible for a developer to sell any App outside of Apple's store.

Your argument would be like Walmart saying "you can't build a store because we have one"