Apple Says 'We Won't Make an Exception' for Epic Games in App Store Dispute

[mejayd]

Imagine going to Target and asking them to display your product because you know a lot of people shop there, BUT you want Target to allow people to pay you directly and bypass selling it in the store so you don't have to pay them a % of the sale.... That's what Epic is doing right now.

 

[TiggrToo]

So then Apple would be controlling the majority of the US smartphone market... how is this not a monopoly then?

People make the argument to switch to Android repeatedly, but if the developers aren't making apps for it because the majority of customers use Apple devices why would users switch?

Majority != Monopoly

 

[atomwork]

Apple should decrease their app revenue cut from 30% to 15% to show how much they care about their developers.

Why? Talent agencies for models, actors, writers, and artists make 30% too. Of course, they can make a custom decision since they don't have billions of clients. Its the rule in the industry. Game companies make billions a year anyway. Its crying foul on a high level.

 

[AZREOSpecialist]

Need to correct Apple's quote: "We won't make an exception for Epic because we don't think it's right to put their business interests ahead of... ours."

This is one fight Apple is going to lose, I'm afraid.

 

[Ethosik]

The App Store is mature now, and additional costs are only incremental so that the store can scale. Remember when Steve said they weren't going to make money on the store, they were running it for cost? I don't think that's true today.

I would love for Apple to adopt a graduated fee structure like Microsoft, but I don't think it's right for government to force them to do it.

By the way, this is what happens when you let a bean-counter like Timmy run the company. He's cheap. He doesn't include cables in the box. Now he doesn't want to include headphones in the box on the next iPhone. Apple is so out of ideas that they created their own credit card, which talentless hacks like banks can do.

Tim's miserly management of Apple has damaged the customer's experience even if it has richly rewarded Apple shareholders.

Just because I have 35 servers, doesn't mean the costs are now $0. There is power, internet, upkeep, employees to monitor, upgrades to storage, property costs, and more.

Not to mention the 30% also pays for the people that are reviewing apps, handling support and financial issues. $99/year is not good enough to cover all of these costs.

 

[lpolarityl]

They can sell through their website. Like Netflix does.

There's one problem though. When I signed up to Netflix, that was a conscious decision that my wife and I made together (it's not _that_ expensive, but it's more money than I would want to throw away). But in-app purchases for games are just stupid and they are only made because people don't think straight; it's an impulse buy. A lot of it is exploiting impressionable young kids. If you had to go through a website, lots of the sales wouldn't be made. Many, many parents would thank Apple if all purchases had to be made through Epic's website.

This exactly. Microtransactions in general should not be allowed in my opinion. It should be illegal. In complete games

It's a like-for-like comparison; it's only a bad analogy because theirs was bad to begin. It was to prove a point.

The comparison to PC prices is valid, because it's the example Epic used for purchasing V-bucks.

And commission among platforms and consoles are largely the same:

Apple (iOS): 30%
Google (Android): 30%
Steam: 30%
Nintendo (Switch): 30%
Sony (PS4): 30%
MS (Xbox): 5% / 15%

I'm going to need a link to the source for those numbers.

 

[zucubo]

So i was wondering if i can sue my car manufacturer because i would like to ,fill’ my tank with gasoline instead of diesel.
🙄

 

[Ramchi]

Thank you. Seriously. It seems that people are the CFOs at Apple and know exactly how much it costs to run the App Store. Should we cut it down to 5% but make the Apple Developer Platform $1,000+ a year instead of $99? As you said, free apps still need the infrastructure and support. Does $99 a year cover all of that? Who knows. I certainly don't. And I don't think anyone here does either. It costs an awful lot to not only host something that gets downloaded millions of times, but to do it at a CDN level costs even more (I pay my CacheFLY bill and I don't have that many downloads and it gets expensive).

People do not understand infrastructure. I was a Director of Infrastructure at a company for some time. I know how much it costs from the servers, storage, network, server rack space (or with Apple, probably property costs since they probably have their own building) and so on.

I can’t believe what you say being director of infrastructure. Hosting App with a size of 10 MB to 2 GB plus per month per App not going to cost huge for anyone. We billions of iOS users get free iCloud storage for 5GB and 15 GB in Google Drive 6 TB (6 One Drive accounts across 6 devices) for less than $100 per annum. There is more network traffic than storage involved in the App Store which is shared mostly by the end user. App Store maintains App Catalogue through an approval system which is 100% automated and it probably scans virus, malicious code blocks. It definitely eases the users in downloading and upgrading apps but that’s not to say huge work etc...there are advantages in having integrated App Store with payment for App Purchase, distribution and control.
Only itchy point is IAP which I personally feel left to the developers. Until the App Store it is Apple territory in approval, payment etc...but inside the App it is the developers area they must have their freedom to charge their users.

 

[TantalizedMind]

I understand where both sides are coming from, but Epic is going to lose this. They don't have leg to stand on in the court of law. They knowingly violated the terms of their contract to prove a point?

It’s kind of like telling a cop he shouldn’t give you a speeding ticket because he was speeding to catch up with you. Or maybe it’s not. Either way Epic will lose in court.

 

[burgerrecords]

1. Apple’sbandwidth/ data center arguments are silly

2. Apple’s Development tool/os investment is silly

3. Whether people like fortnite is silly

4. Whether either company is virtuous or makes too much money is silly.

What is relevant is whether courts and lawyers determine that you should be able to do what you want with something you’ve bought (for which there is precedent) or they determine that the restrictions are legal and reasonable (for which there is also precedent)

 

[PlayUltimate]

A developer can't just decide to charge whatever they want, they have to charge what people are willing to pay. If people are only willing to pay $5 for certain category of app, then the developer can't just charge $7.14.

Agreed. But for some reason, the competitive nature of apps and the cost of doing business is Apple's fault. If I decide to start a traditional business, there is a very high cost of doing business between rent, utilities, employees, permits, inventory, etc. Just because it is "expensive" does not mean that I don't need to pay it. And the cost is more in Los Angeles than it is in Broken Bow, Nebraska. If I don't like the cost of doing business in LA I can move to BB. Unfortunately the business opportunity might be better in LA; same as the business opportunity is better on the iOS App Store.
It just seems disingenuous that developers fail to understand that there is a cost for doing business. For some reason they think that distribution should be nominally free.

 

[MonkeyHammer]

I'm happy Epic is taking a stand for developers against this strict 30% fee program. It's much higher than any physical goods and has set a ridiculous monopoly on the iPhone app market. There is no way to offer an alternative distribution method for iOS software like on Mac, Windows, Android and every other operating system. It's a monopoly and Apple charges a 30% tax to sell anything. I hope Epic wins and lots of top developers join the fight.

 

[Ramchi]

I don't get it.

Company A builds shopping mall. You want to be in the mall selling stuff. You pay rent. What is wrong with that?

- "They treat someone differently". So what? When some really large company wants to open in the shopping mall, I assume they get a discount.

- "The rent is too high". Who are you to say? It has been the same from the start, so it can't be a surprise. You are not forced to sell anything in this shopping mall.

- "The rent should be X". And the price of Pepsi should be Y? Price regulations are not a good idea.

- "They only want to make money". Yes, that's usually the aim for any business.

- "I have no choice but to be selling in this mall/there are few other malls." Is that the fault of the company that built the mall? Will there be more malls built if the company is forced to lower the rent?

- "They don't care about the small merchants". Imagine if the rent was a fixed amount of USD, same for everyone. It would immediately kill all small merchants.

Mall charges for the space the shops occupy not taking cut in the sales revenue unless the mall offers free space for the shops.

 

[Reindeer_Legal]

So i was wondering if i can sue my car manufacturer because i would like to ,fill’ my tank with gasoline instead of diesel.
🙄

Perhaps your car manufacturer should restrict your car to only using gasoline from their Gasoline Store, where they charge 30% from gasoline companies.

 

[mabhatter]

Get an Android phone if you want to side load apps and want more freedom and don’t want Apple controlling what you put on it. There is a reason they’re different.

One article pointed out that Epic tried side loading instructions for Android... but like 40% of the time the customers couldn’t make it work. That means those customers just gave up and didn’t play Epic’s game. THAT is what Apple’s App Store sells... the one place that’s built into your iPhone to get apps that’s not super complicated and also vetted to be safe to run (most of the time, it’s not perfect).
So lose 40% of paying customers because they cannot install the game, or pay Apple 30%... even WITH Apple’s 30% that’s 10% more money in Epic’s pocket.

 

[Ethosik]

I can’t believe what you say being director of infrastructure. Hosting App with a size of 10 MB to 2 GB plus per month per App not going to cost huge for anyone. We billions of iOS users get free iCloud storage for 5GB and 15 GB in Google Drive 6 TB (6 One Drive accounts across 6 devices) for less than $100 per annum. There is more network traffic than storage involved in the App Store which is shared mostly by the end user. App Store maintains App Catalogue through an approval system which is 100% automated and it probably scans virus, malicious code blocks. It definitely eases the users in downloading and upgrading apps but that’s not to say huge work etc...there are advantages in having integrated App Store with payment for App Purchase, distribution and control.
Only itchy point is IAP which I personally feel left to the developers. Until the App Store it is Apple territory in approval, payment etc...but inside the App it is the developers area they must have their freedom to charge their users.

Cloud storage is not typically CDN grade storage. I have a CDN network set up, someone in California can download from a local California server instead of a server in New York which will be slower. Similarly someone in France will download from a French server instead of a US server.

One developer max is 2GB. Hundreds or thousands of developers would be in the terabytes. Add on top of that CDN infrastructure, you have hundreds of copies all throughout the country/world. It doesn't just take up space on one server.

 

[PlayUltimate]

Bad analogy. If I don't like the price of wine at the restaurant, I can buy it much cheaper at the grocery store, a liquor store or online from a multitude of wine sellers websites. Where can I get Fortnite? ONE PLACE.

But the wine analogy isn't even equal to this, because the winemaker doesn't sell direct to restaurants, they sell to a distributor who also takes a cut. The only one that gets screwed at the restaurant is the customer and I, for one, skip buying wine at restaurants that are clearly doubling the price of wine for just the service of popping the cork.

Fortnite is available everywhere; just not on the iPhone.
Using your analogy, if you want to drink wine at the restaurant, you pay restaurant prices at that restaurant. One can't, in most cases, bring my own wine to the restaurant just because I don't like the prices. If I want to pay less for wine, I'll need to go somewhere else to buy it and drink it.
Similarly if Fortnite does not like Apple's prices, I can sell somewhere else. I can still go play Fortnite on my PC, PlayStation, Xbox, et al. Fortnite just wants to be able to sell on Apple's platform and not pay to use it.

 

[consumerDan]

Monopoly argument only stands if Apple is the only avenue for players. It isn't. Google Play has banned Fortnite as well, so the argument crumbles at the beginning and will certainly fall apart in court. Secondly, Fortnite is on a lot of different platforms which also eliminates the monopoly argument. Don't like the platform that charges the same rate as ALL other platforms? Encourage your users to go to another platform.

If I don't like the terms of an agreement I can petition to have them changed or I can file a lawsuit and try to force a change, but if I violate the terms before I petition or file, I have invalidated my stance. I am in violation of the terms so I no longer have any standing. Epic games is foolish, but I guess they are drawing from the bully driven cancel culture or "protesting" against Apple?

Personally, I have banned my kids from making any purchases in Fortnite and from playing it from the day they did this. I also discovered that Tencent owns a 40% stake in Epic games and I don't think this is good for the US in any manner. The PRCs tentacles are too long and need to be cut off. Ban investment from Chinese companies as we all know they are controlled by the PRC. Much of the opposition is likely coming from PRC! Chinese trolls. Chinese interference. Not welcome.

 

[unQuestionable]

Great!

 

[forgotmyhandle]

The railroad analogy:
Apple built, builds and maintains the railroads on which Epic is running its locomotive, and that millions (billions?) of passengers (iPhone and iPad owners) ride. Locomotives that run on this railroad must fit the gauge of the railroad tracks and abide by its rules, or they don't run on the railroad. Locomotives that don't belong to the railroad company have to pay a fee to use the railroads. If Epic wants different gauge tracks on which to run its engines, if it wants to not pay a fee for riding the rails that someone else builds and maintains, if it wants to connect directly to the passenger, they should build their own railroad.

Railroads are not for everyone. That's why we have cars. Cars enable the freedom to go to more places than the railroad can take you. What would be the car analogy here? Android? PCs?

 

[Reindeer_Legal]

Cloud storage is not typically CDN grade storage. I have a CDN network set up, someone in California can download from a local California server instead of a server in New York which will be slower. Similarly someone in France will download from a French server instead of a US server.

One developer max is 2GB. Hundreds or thousands of developers would be in the terabytes. Add on top of that CDN infrastructure, you have hundreds of copies all throughout the country/world. It doesn't just take up space on one server.

Meanwhile cloudflare is free.

 

[Ethosik]

Bad analogy. If I don't like the price of wine at the restaurant, I can buy it much cheaper at the grocery store, a liquor store or online from a multitude of wine sellers websites. Where can I get Fortnite? ONE PLACE.

But the wine analogy isn't even equal to this, because the winemaker doesn't sell direct to restaurants, they sell to a distributor who also takes a cut. The only one that gets screwed at the restaurant is the customer and I, for one, skip buying wine at restaurants that are clearly doubling the price of wine for just the service of popping the cork.

Where can you get Fortnite? Android, macOS, Windows, Xbox, PS4, Switch and more.

 

[dguisinger]

Personally, I have banned my kids from making any purchases in Fortnite and from playing it from the day they did this. I also discovered that Tencent owns a 40% stake in Epic games and I don't think this is good for the US in any manner. The PRCs tentacles are too long and need to be cut off. Ban investment from Chinese companies as we all know they are controlled by the PRC. Much of the opposition is likely coming from PRC! Chinese trolls. Chinese interference. Not welcome.

Did you ban them from using Discord? Spotify? Riot Games? Everything from Epic? Activision? Those are all Tencent
What about Tiktok?

What about hardware produced in China? Apple? Android? Your TV, monitors, consoles, .... did you tell them they have to go to school naked because their clothes were made in China?

 

[Seend1983]

Since we've all agreed that Epic Games has absolutely no chance in winning this because they have absolutely no legal grounds, let's talk about what Apple should do. Apple has the right to push a payment arrangement that it sees fit, it is a BUSINESS after all, however, I believe it would be more beneficial if Apple change their fee system. Namely, it shouldn't be a flat out 30% charge, but more of a progressive charge like the tax system. In our tax system we don't expect everyone to pay 30% tax. There's different tiers for different income levels - higher income pays more, lower income pays less. Should be like that for the App Store - multibillion dollar companies like Epic should be "taxed" at the highest tier, while the smaller developers would expect to pay much less. At a certain size, like a beginner dev with their first app, it would be free or close to it. As developers begin making more money and climbs the revenue ladder, Apple could increase the cut up until a maximum limit. Apps making tens of millions of dollars a month could rightfully expect to the pay the highest amount, since they're benefiting from the App Store the most. I'm sure some will still whine and complain though, but that just takes us back to where we are today with Epic Games vs Apple.

 

[Reindeer_Legal]

The railroad analogy:
Apple built, builds and maintains the railroads on which Epic is running its locomotive, and that millions (billions?) of passengers (iPhone and iPad owners) ride. Locomotives that run on this railroad must fit the gauge of the railroad tracks and abide by its rules, or they don't run on the railroad. Locomotives that don't belong to the railroad company have to pay a fee to use the railroads. If Epic wants different gauge tracks on which to run its engines, if it wants to not pay a fee for riding the rails that someone else builds and maintains, if it wants to connect directly to the passenger, they should build their own railroad.

Railroads are not for everyone. That's why we have cars. Cars enable the freedom to go to more places than the railroad can take you. What would be the car analogy here? Android? PCs?

You already paid for iOS when you bought the phone. It's a one time purchase. Apple has to maintain iOS because that's their responsibility to consumers (this is the same for all other software purchases).