Apple Terminates Epic Games' Developer Account

[Righty McRighterson]

LOL And when did government interference ever deliver something like it. If they do then it will be to the detriment of all involved.

Consumer protection regulations that protect market diversity are *good* which you benefit from on a daily basis.

 

[Righty McRighterson]

What monopolies?

This is triply so for Google as there are multiple app stores available on the platform.

So, ignoring Apple for a moment, what App Store monopoly you believe exists on the Google platform?

Fair point re Android.

Just Apple that needs to allow installation of independent app stores.

 

[one more]

I think that all of this is actually very simple - you can not break an existing agreement, neither morally, nor legally. If you do, there are consequences. Nobody should be surprised here, as everybody was aware of the rules beforehand - both Apple & Epic Games. This is the whole point of entering into agreement in the first place.

Now, we hear that Epic Games were trying to negotiate better terms with Apple which Apple refused. Epic Games could be reasonably upset, but could nevertheless continue on the existing terms, still benefiting from Apple platform. Instead, they chose to go rogue. And what did they achieve? This story gained some minor traction in the tech world, but I have not seen it getting much further. Both sides now spend money in legal fees and Epic Games players are locked out of Apple. It is a lose-lose outcome so far and all of EG’s making.

I am not defending Apple here and heard of other complaints (Spotify and, lately, Facebook and Microsoft). I believe that they could all try to make their points individually or collectively, but breaking the agreement is not a way forward.

 

[cyb3rdud3]

Consumer protection regulations that protect market diversity are *good* which you benefit from on a daily basis.

Not necessarily at all. When bringing benefit to one group it will always be at the cost of another group.

Take EU mobile telephony roaming charges for example. It was always possible to have a contract that supported that when you wanted it. But now it’s forced on everyone as standard, even those who didn’t use it or perhaps only have a need for one or two weeks in the years. So instead of those paying for what they actually need, everyone is paying for it now.

 

[TiggrToo]

Fair point re Android.

Just Apple that needs to allow installation of independent app stores.

So I then argue, how is Apple running a monopoly?

If Acme Industries creates a brand new Smartphone platform tomorrow, based on neither Apple nor Google, and, as a result has a dedicated App Store; would that be classed by you as a monopoly?

If no, then what’s the break even point? When does an exclusive become a monopoly?

 

[gnasher729]

And how, precisely, do they sell directly to consumers on iOS?

Sell through their website.The problem is by the time their typical customer goes to their website, they figured out that it is absolutely stupid to pay good money for virtual tat. They wake up and decide they can save 100% of the cost of in app purchases by not buying them.

 

[AndiG]

That issue was already resolved. The main issue with Hey!'s app was that it wasn't functional on installation. Once Hey! instituted a free initial trial period that made it usable after the download, it was allowed on the App Store.

After press was involved - you should read the story again and follow the arguments of @DHH closely. Nearly every developer run into problems with the various logical gaps and inconsistencies in the App Store’s policies and their enforcement. There are too many written and unwritten rules one may get in conflict with.

f.lux was rejected because of „to weird“ and now is a feature of iOS. Parental control apps have been removed, and the list of Apple acting in an anti competitive kind of way is endless. Developers all over the world are mad at Apple because of their weird policies and anti competitive behavior.

 

[Righty McRighterson]

Not necessarily at all. When bringing benefit to one group it will always be at the cost of another group.

Take EU mobile telephony roaming charges for example. It was always possible to have a contract that supported that when you wanted it. But now it’s forced on everyone as standard, even those who didn’t use it or perhaps only have a need for one or two weeks in the years. So instead of those paying for what they actually need, everyone is paying for it now.

I don’t need to make the case for competition promoting efficiency as it‘s an economic fundamental, so your first statement is clearly intended to mislead.

re roaming charges, do you have by evidence that this has pushed up prices in the EU? I’d be happy to take a look. My roaming charges have dropped dramatically since the the introduction of standardisation. I frequently holiday with US friends who never stop complaining about being shafted when abroad by their telecos.

 

[MacGizmo]

Yup, on average they take more than 30%.

I work with multiple companies that sell products through Walmart. I know exactly how much they take, and it's nowhere near 30%. Walmart takes a percentage based on the category your product falls under, with a maximum of 20%. Most products fall under the 12-15% category, with some even in the 6% category. Only one type of product falls under the 20% category, and that's because it's a high-markup type of product.

Every other platform-exclusive app store (Google Play, Microsoft, Nintendo, and Sony) all take the same 30%.

Yes, but the difference is that you aren't forced to buy from those console app stores. You have other options to run the game on those consoles, do you not? Epic's argument is that with Apple, you have no choice.

They could deliver their game as a web experience (using WebAssembly, they can do quite a bit) and sell directly. If they want to be in Apple’s App Store, they need to pay what Apple want to charge them.

Oh c'mon, that's ridiculous. Just because it CAN be done, doesn't mean it's a good option for anyone. Nobody wants a "web experience" for a game like this.

I completely agree with you that Epic needs to pay Apple's fee. All this nonsense of "it's not about the money, it's about the monopoly power of Apple" is ridiculous. To use the Walmart analogy: even if you pay Walmart their fee, you don't get to just build your own store-within-a-store to sell your products. Your product goes on the shelf (digital or otherwise) where Walmart wants to put it, and many times even at the price Walmart wants it sold at (they still have that kind of power). The argument Epic is making fails on many levels, in my opinion.

That is not how we define monopolies. The courts are quite clear on this:

I wasn't referring to Apple's monopoly on iOS app sale and installation procedures in the legal sense. I think you know that. There is nowhere else to go. Apple, in general, has no monopoly on smartphone or app sales. But, Apple does in fact have a 100%, iron-clad lock monopoly on the purchase and installation of iOS apps on iPhone/iPad.

...I think it may cost them much more than they were expecting...

I agree. They're rolling the dice here. The best outcome for Epic is the court rules that they're forced to continue operating the same way as things are now. But that means they will have lost a good portion of their best customers in the meantime. Out of sight, out of mind. I honestly think they would be better off going the route of public shaming Apple and getting more developers to do it with them.

 

[AndiG]

So I then argue, how is Apple running a monopoly?

Guess you know that for sure but you are just refusing to accept this:

Congressman, let me push on you a little bit. When we talk to folks in and around Apple, their response is, “Look, we invented the iPhone. We invented the App Store. We invented the market. We just put out a study saying half a trillion dollars worth of commerce moved through the store. We don’t touch 85 percent of that money. These rules have been in place since 2010. If you don’t like it, leave.” Does that persuade you?

That’s always the answer of monopolists: “if you don’t like it, leave.”

The whole idea is you’re not allowed to engage in behavior which is anti-competitive, which allows you to use an enormous market share to shake down people — to demand ransoms, essentially — and that results in higher prices for consumers.

The whole reason that we have competition as a virtue — in that we have policies to promote competition — is because it promotes innovation. It makes space for the next great idea, the next great company. And it also drives down prices, gives consumers more choices.

https://www.theverge.com/2020/6/18/...e-hey-email-fees-policies-antitrust-wwdc-2020


Best explanation, nothing to add ...

 

[gnasher729]

Apple's current policy of.
You bring me $100 a month or $100,000 a month and I still get 30% regardless feels wrong & unfair.
I suspect most of us here would be willing to take less % if the amount of money we are getting rose up dramatically.

Apple started that with the iTunes (music) store. They started by negotiating one contract with/against the four largest record companies. Apple's lawyers/negotiators on one side, lawyers/negotiators from four record companies on the other side (I think one big record company didn't want to join, and joined a few years later).

Then they took this deal, negotiated by the best lawyers the record industry had, and said to every other record company, independent of their size: "This is the deal. You can take it or leave it. It was negotiated for you by the best lawyers in the record industry, and if it is good enough for them, it should be good enough for you. We won't negotiate. ". One deal, the same deal, for everyone. Not a bad deal for the little guys and a better deal for the big guys. Now one of the biggest guys doesn't like the deal. Tough.

I have the same deal as Epic has (except that I didn't deliberately violate the rules and I'm not running Apple down), and I'm happy with the deal. You think me getting the same deal as Epic feels wrong and unfair? Doesn't feel wrong and unfair to me.

 

[TiggrToo]

After press was involved - you should read the story again and follow the arguments of @DHH closely. Nearly every developer run into problems with the various logical gaps and inconsistencies in the App Store’s policies and their enforcement. There are too many written and unwritten rules one may get in conflict with.

f.lux was rejected because of „to weird“ and now is a feature of iOS. Parental control apps have been removed, and the list of Apple acting in an anti competitive kind of way is endless. Developers all over the world are mad at Apple because of their weird policies and anti competitive behavior.

You should also read on how Apple have recently changed their processes and have made it significantly easier to challenge the reviews.

Guardian VPN developers successfully challenge App Store rules after Apple threatened rejection - 9to5Mac

One of the changes Apple announced for developers at WWDC this year was the ability to challenge App Store Review...

9to5mac.com

 

[gnipgnop]

So I then argue, how is Apple running a monopoly?

If Acme Industries creates a brand new Smartphone platform tomorrow, based on neither Apple nor Google, and, as a result has a dedicated App Store; would that be classed by you as a monopoly?

If no, then what’s the break even point? When does an exclusive become a monopoly?

Nintendo already won a lawsuit decades ago that was centered around whether or not being the sole gatekeeper for software on their own hardware constituted a monopoly, so Epic has some problems there. I think that's one of the reasons their main antitrust complaint boils down to an illegal tie-in. They're trying to say that the App Store is the product they want and that IAP is the product they don't want and is being illegally tied-in. I find it hard to see how the courts will view a store as being the equivalent of a product though.

 

[TiggrToo]

Guess you know that for sure but you are just refusing to accept this:

Congressman, let me push on you a little bit. When we talk to folks in and around Apple, their response is, “Look, we invented the iPhone. We invented the App Store. We invented the market. We just put out a study saying half a trillion dollars worth of commerce moved through the store. We don’t touch 85 percent of that money. These rules have been in place since 2010. If you don’t like it, leave.” Does that persuade you?

That’s always the answer of monopolists: “if you don’t like it, leave.”

The whole idea is you’re not allowed to engage in behavior which is anti-competitive, which allows you to use an enormous market share to shake down people — to demand ransoms, essentially — and that results in higher prices for consumers.

The whole reason that we have competition as a virtue — in that we have policies to promote competition — is because it promotes innovation. It makes space for the next great idea, the next great company. And it also drives down prices, gives consumers more choices.

https://www.theverge.com/2020/6/18/...e-hey-email-fees-policies-antitrust-wwdc-2020


Best explanation, nothing to add ...

That did not answer my question.

I’ll ask it again: If Acme Industries Inc create a brand new platform with an exclusive App Store, is that a monopoly?

It’s a yes or no answer. Quoting someone else on Apple is evading the question I asked.

 

[derekamoss]

What's the cut for developers/publishers for a physical copy of a new game release? Around 45%. What's the cut for developers/publishers for a digital copy of a new game release? 70%. What does the consumer pay for a physical copy of a new release? Same price as the digital copy...typically $59.99 for the standard version of the console game.

See the problem there? The consumer isn't getting a price break from the choice of format OR from the level of cut for the publisher/developer. Epic knows this. Epic also knows that prices for mobile games are usually much cheaper than on consoles.

The price break isn't the issue at all, it's the fact that EVERYONE else but Apple allows you to buy from multiple sources and aren't stopped by apple policies to say you can buy this here here or here and definitely are aloud to say this much percentage is going to store provider without app being cited for irrelevant content.

 

[gnipgnop]

I work with multiple companies that sell products through Walmart. I know exactly how much they take, and it's nowhere near 30%. Walmart takes a percentage based on the category your product falls under, with a maximum of 20%. Most products fall under the 12-15% category, with some even in the 6% category. Only one type of product falls under the 20% category, and that's because it's a high-markup type of product.

That only applies to the online third party marketplace. In their retail stores, a typical deal would be to buy the product from the seller for 25% above the cost to manufacture.

 

[derekamoss]

xCloud is not a reader app due to the fact that it's streaming apps, not simple files like music or video. The App Store requires apps to be submitted for review, which also means they need to be programmed to run on iOS/iPadOS. None of the xCloud games are ports to iOS/iPadOS.

Once again, nothing at all even close. Why are games considered apps? Movies/tv shows AND games are technically the exact thing, entertaining content telling a story, and you can't say that the difference is you interact with games more so it's not just a reader app because netflix has movies where you interact with making choices that change the movie.

 

[TiggrToo]

I work with multiple companies that sell products through Walmart. I know exactly how much they take, and it's nowhere near 30%. Walmart takes a percentage based on the category your product falls under, with a maximum of 20%. Most products fall under the 12-15% category, with some even in the 6% category. Only one type of product falls under the 20% category, and that's because it's a high-markup type of product.

Who are we to believe, you or this person on Quora who states it averages out at 24%?
https://www.quora.com/On-average-how-much-does-Walmart-mark-up-its-products?share=1

In addition, everyone is basing this markup on the cost of the item, ignoring information the fact that Walmart are really good at forcing suppliers to reduce their price to Walmart.

No one should take invoice cost as a isolated value because even that is made up of even more breakdowns.

 

[gnipgnop]

The price break isn't the issue at all, it's the fact that EVERYONE else but Apple allows you to buy from multiple sources and aren't stopped by apple policies to say you can buy this here here or here and definitely are aloud to say this much percentage is going to store provider without app being cited for irrelevant content.

It's definitely an issue in regards to Epic's public statements. Publicly, they've put a lot of effort into claiming that the 30% cut prevents lower prices. That isn't really what they're arguing in court though, as they seem to be focused on claiming that IAP represents an illegal tie-in.

 

[gnipgnop]

Why are games considered apps? Movies/tv shows AND games are technically the exact thing, entertaining content telling a story, and you can't say that the difference is you interact with games more so it's not just a reader app because netflix has movies where you interact with making choices that change the movie. It's not at all the same.

Games are considered apps due to the specifics of the programming involved. When you install a game on macOS, it automatically goes into the Applications folder and has a .app extension. Music and video are files. So the way to think about it is that a Reader app provides access to files, not applications.

 

[derekamoss]

It's definitely an issue in regards to Epic's public statements. Publicly, they've put a lot of effort into claiming that the 30% cut prevents lower prices. That isn't really what they're arguing in court though, as they seem to be focused on claiming that IAP represents an illegal tie-in.

It still does not matter. Everywhere one else is allowed to go somewhere else to buy subs and IAP's except apple. It's not like anyone is saying we have to have multiple stores in apple eco system just that hey go to our website to subscribe which unlike apple store, everyone else can

 

[D4vidrim]

It is inevitable that Apple will lose this war. It's a shame that Apple will waste millions only to lose in court over something we already know. Facebook just proved that Apple is engaged in censorship by denying a Facebook app update that simply said "30% of fee goes to Apple". Stating the truth and showing customers transparency is now against app store rules. Where does this end?

This is going to be a watershed ruling when it occurs and I suggest that everyone dump their AAPL shares on the wind-up. A jury trial will not go in Apple's favor.

Is it in Apple's favour? Is it really the truth?
Or maybe, just MAYBE, Facebook is not paying any money (=ZERO $) to Apple for the Facebook app? Because it is free... while Facebook earns billions of dollars?
And maybe, that 30% might be there exactly to cover what Apple spends for the Facebook app and for every patch Apple sends to every iPhone out there every week that Facebook updates its app?
It is not perfect, but if you remove the 30% fee, Apple has to raise money in other ways: would it be better? That's what you should demonstrate. And you haven't so far.

 

[derekamoss]

Games are considered apps due to the specifics of the programming involved. When you install a game on macOS, it automatically goes into the Applications folder and has a .app extension. Music and video are files. So the way to think about it is that a Reader app provides access to files, not applications.

Xcloud isn't installing anything on the computer or phone though. Both xcloud and netflix have an app you download and install to view the content but after that nothing else is installed. There is no individual files downloading onto the phone, both are streaming content.... In fact netflix actually should be taken down because you can actually download movies for offline viewing which you can't do at all on xcloud.

 

[D4vidrim]

There's just one thing I don't understand.
Epic broke the terms. Apple removed the app. Apple then told Epic they have limited time to remove the direct payment feature, otherwise Apple terminates their account.

Now, what if Epic doesn't want the app back in the store? Apple basically tried to FORCE Epic into submitting new and fixed Fortnite back to the store. The way I see it, Apple terminated Epic's account (removing all other non-Fortnite apps of Epic), because they refused to submit a fixed version of an app that was no longer there, regardless of whether Epic even wanted Fortnite back on iOS or not.

Actually you see it the wrong way. Refusing to submit a fix is not a reason and Apple did not force Epic into doing anything. It's much simpler: Epic did something against the agreement they signed, that is why the account was terminated. Nothing more.

 

[deevey]

Fair point re Android.

Just Apple that needs to allow installation of independent app stores.

Android is just an OS - an open source one at that, you can make an android phone tomorrow with some help from a Chinese OEM, skin it however you wish and set up your own Appstore.

An iOS device is a combination of Closed Source hardware and Closed Source software developed for a single company with many safeguards in place - that's how many of us like it.