Apple Terminates Epic Games' Developer Account

[Duane Martin]

My post was removed for being “frivolous,” look at all these frivolous posts that are still up. I’m hurt

Seriously, having read through this thread (and all the others on MacRumors on the subject) what could you possibly have written that was more frivolous than what remains? It boggles the mind.

There are a great many emotional reactions on this subject, both for and against Apple's practices, and there is a great deal of misinformation being posted. I am a fan of facts and offer Virtual Legality's take on the issue from a legal perspective for everyone's consideration. Warning it is an hour long and suitably complex given the issue. If you get bored watching it you might want to reconsider posting your uninformed opinions. Please. I am begging at this point.

As a developer do I wish Apple charged less than 30%? Absolutely. I wish Tesla's cost less and my favourite restaurant was cheaper as well, they hold a "monopoly" on some amazing dishes (see, I can use the word monopoly incorrectly as anyone else on this forum). Do I want to see iOS opened to every "App Store" that wants to exist? Absolutely not, that would fracture the market and remove what I believe to be one of the biggest selling points of iOS, a level of security. Anyone who argues that it would be the same as the Mac OS market has, in my opinion, a flawed understanding of the market. That said, my opinions on these two issues (cost and nature of iOS) are completely irrelevant in the legal argument going on. The difference between me and so many posters on MacRumors is I recognize that fact.

 

[roar08]

Apple’s legal team have been very busy. 2 trillion dollar company! Bet you, they have the best lawyer‘s in this planet.

I KNEW lawyers lived underground!

 

[garylapointe]

"That was a surprise!" thought Epic and no one else.

Epic fail!

 

[b0fh]

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

web app game. Can be done.

 

[Riffz60]

The big issue here and the primary complaint is....the App Store is a monopoly.
Time will tell if a court agrees, but the Fortnight app was only fodder for the cannon.

It isn’t a monopoly. Which is easily understood by the fact you can buy Fortnite on PS4, Android, Xbox, Nintendo, PC, Mac etc.

People are acting like an iOS device is something it’s not. An iPhone is a product made by Apple that can run whatever it wants. It’s up to the end user if they wanted to buy it.

People aren’t entitled to run whatever they want on an iPhone just like you can’t run whatever you want on a Playstaion.

If the user doesn’t like what Apple is offering they have plenty of choice for other ways to play this game.

Hardware creators of game and media devices have always tried to control what software can be played on their systems. I’m honestly struggling to understand how many people can’tgrasp this

 

[thadoggfather]

People will blindly side with Apple, and I must include the disclaimer that I do enjoy their products like so many of us here, but I own their products they DO NOT own my mind: I think this is shamefully authoritarian.

Shows Tim is one big gigantic power tripping, bean counting FRAUD when push comes to shove.

It was completely absurd to make the statement that what Epic is doing is 'putting the entire App Store at risk' more or less -- for what? A fair shake? More agreeable terms? Putting up a fight without rolling over, even if they lost?

Total hyperbolic gaslighting nonsense. I hope others become brave enough to challenge the crappy terms (that they do ultimately agree to, no one forces them -- that much can't be argued otherwise) but there is strength in numbers.

This just sets the scary precedent that no one dare better question Apple at any point. Epic was made out to be an example, a rather epic one.

I also don't give a crap about Infinity Blade or Fortnite personally but that's totally besides the point. In fact that may be part of the point - their offerings don't blind me to my overall convictions and opinions.

 

[Bigsk8r]

But Apple doesn’t charge everyone on the App Store. Why should Apple make money from Epic but not Netflix other than it’s Apple’ s store and they get to make the rules (which isn’t really a good argument).

I think you may have missed a detail. Netflix has always been a subscription based video service, like HBO, CBS All Access, Prime, etc... as such, they do NOT have in-app purchases. You either subscribe to the service, or you don't.

If Fortnite had been a portal to just play - play and NOT buy additional stuff in the game - there would not be a problem. Apple is hosting the app store for apps, but wants 30% of In-App purchases.

That's the difference, and it is huge.

 

[GizmoDVD]

They also cut the price of console over time, its not like they ever make massive profits on the hardware.

Switch is now 3.5 years old and still $299.99.

MS/SONY/Nintendo also makes bank of pressing discs/carts, certifications etc. Lots of ways for additional revenue while still getting the same 30% cut.

 

[Wildkraut]

Well Apple is not long term thinking here.
Even if Epic loses this battle, today’s kids are tomorrow’s adults/customers.
This will leave a bad rotten Apple taste in their mouth, all these kids will avoid Apple in the future, Apple will end with a f’up business, anyway.

 

[Pascal Desjardins]

Think of it this way, you have a walled community, they only allow restaurants that pay the community developers 30% of their total bill, they prevent the restaurants from telling customers that they can come and pick up their food, and they force restaurants to still charge the same price to deliver to that community as every other house.

Now imagine that community also doesn't allow certain restaurants because they want to review all of the menu items from that restaurant while not doing the same for other restaurants...

Now, say you really want something from this brand new sushi restaurant that everyone else is enjoying but you can't because your community sells its own sushi and they don't even let you go get takeout yourself.

Oh, and this walled community controls over 52% of the housing in the country.

Even if it was the best community in the country, a lot of people would still be mad... some people just want to go pick up their own food

On top of that, your restaurant doesn't have to pay the rent, electricity, gas, cleaning of the garbage, snow plowing, lawn mowing, security etc. oh! and the community developer provides you free advertising and brings you 1 billion potential customers for $99 a year... and you still complain that you have to pay a commission on your sales. In this case, let's build shopping centers that you can squat for free!

 

[BC2009]

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

How do they sell directly to Walmart customers? They can't.

They would have to build their own platform, create a user base, build trust with that user base and grow it. And then they can sell whatever they want on that platform.

But lets look at Fortnite as a platform. After all, there is a secondary market within Fortnite to buy in-game virtual currency and spend it on in-game virtual stuff. Just like the App Store is a secondary market for Apple.

The difference is that Apple lets others play in their secondary market for a fee, while Fortnite does not let third-parties sell alternate third-party virtual currencies to buy third-party in game virtual stuff using third-party payment systems. They would have to invest in doing that.....

Building a platform costs money. Maintaining the platform costs money. Opening that platform to developers with a well-supported SDK costs money. Fielding customer support calls for your platform (e.g.: parents that are upset about in-game purchases from the kids or people frustrated when a game crashes and deletes their data) costs money.

Epic is welcome to do all the things to build a platform and if they truly believe in openness, they can invest in letting third parties capitalize on their Fortnite platform and they even have the option to do it charitably by charging nothing or next to nothing for the privilege. But they won't because they are looking for a free ride.

Since the dawn of the gaming console, developers have paid to play in order to sell their games on game console platforms. Not only is the retailer taking a huge cut, but the game console maker takes a huge cut. Apple's 70% to developers revolutionized that -- it was the most developers EVER got paid from their revenue (at least twice as much) and Apple's developer program had the LEAST barriers to entry -- allowing individual devs to sign up and sell their apps without having lawyers to read, negotiate and sign developer contracts with the likes of Nintendo, Sony, Microsoft, or (once upon a time) Sega.

I say "good riddance" to Fortnite from the iOS App Store and Google Play Store. Make way for less greedy developers.

 

[ruka.snow]

The issue I have with the 30% cut on the in-app purchases is Apple is acting purely as a card processor in this transaction.
They do not host or serve up the content. It's a simple transaction.
I'm waiting for that to be brought up in a complaint.
Apple is acting as a store front with the App Store, however in-app purchases are made after the initial product has been acquired. Those purchases are not made IN the App Store, they are made within the app. Apple is just processing the transaction at this point.

Card processing fees for a simple transaction are 1.5-3.5% range. Any card processor who attempts to charge more than that is going to be explaining themselves to federal regulators.
Merchants can tack on up to 4% in addition to the card fee to cover their transaction expenses. Any higher and they will have to deal with both state and federal regulators as 11 states have strict caps on this.

Apple hosts the app and all the updates and handle the tax. The charge on IAP is how free apps pay their way, otherwise, you have something costing Apple thousands per app per month(at least pre AppStore I was looking at $2000/month at least on hosting and CDN costs). The transaction fees and taxes are just a small portion of what that 30% covers. There seems to be this naive narrative forming that the 30% is a transaction fee akin to Stripe.

 

[dguisinger]

One thing that gives me a laugh

Max over at the Max Tech youtube channel had been beating the drum, day after day, about how Apple was finally taking gaming seriously with Apple Silicon ......its been absolutely crickets on the subject XCloud, then EPIC took their action and after Apple threatened to yank the developer account .... suddenly no more pro-games videos, not a word.

 

[BC2009]

On top of that, your restaurant doesn't have to pay the rent, electricity, gas, cleaning of the garbage, snow plowing, lawn mowing, security etc. oh! and the community developer provides you free advertising and brings you 1 billion potential customers for $99 a year... and you still complain that you have to pay a commission on your sales. In this case, let's build shopping centers that you can squat for free!

spot on!!!!!

 

[dguisinger]

Apple hosts the app and all the updates and handle the tax. The charge on IAP is how free apps pay their way, otherwise, you have something costing Apple thousands per app per month(at least pre AppStore I was looking at $2000/month at least on hosting and CDN costs). The transaction fees and taxes are just a small portion of what that 30% covers. There seems to be this naive narrative forming that the 30% is a transaction fee akin to Stripe.

"Hosts the App"
Wrong. They host the binary.
Online games and many other apps (most these days) are SaaS..... the app is the small portion you download, most of the functionality is hosted by the ISV, not Apple. Apple has very little skin in the game when it comes to costs, yet rake them over the coals.

 

[rjohnstone]

I think you may have missed a detail. Netflix has always been a subscription based video service, like HBO, CBS All Access, Prime, etc... as such, they do NOT have in-app purchases. You either subscribe to the service, or you don't.

If Fortnite had been a portal to just play - play and NOT buy additional stuff in the game - there would not be a problem. Apple is hosting the app store for apps, but wants 30% of In-App purchases.

That's the difference, and it is huge.

Amazon Prime Video has in-app purchases.
This was blocked for the longest time because of Apple's 30% rule.
You could watch the movies, but you had to rent them from your computer.
Amazon and Apple have made a side agreement to allow in-app movie rentals.
So Apple can be flexible when they want to be.

 

[itsmilo]

Epic violated an already agreed TOS contract with Apple.
Lawyers are expert in this field. Easy win for Apple.

you could write that you own the first born Child by downloading an app in the TOS and it wouldn’t mean anything. A TOS is not above the law and once the court has made a ruling the TOS could be just thrown out of the window

 

[BC2009]

Well Apple is not long term thinking here.
Even if Epic loses this battle, today’s kids are tomorrow’s adults/customers.
This will leave a bad rotten Apple taste in their mouth, all these kids will avoid Apple in the future, Apple will end with a f’up business, anyway.

And then they can switch to Android where they can play Fortnite.... oh wait... that doesn't work.

Umm.... maybe they can carry a PC in their pocket instead.... no, that doesn't work.

Maybe Epic will spend the money to invest in a new mobile OS and start making phones and on this new mobile OS, Epic will let anybody sell anything for free because they aren't greedy at all..... no wait.... they are throwing a fit because they cannot get more than 70% of mobile sales even though they make the same or less from game console sales.

I guess I am not seeing the scenario you are talking about where these 12-year-olds who Epic deprived of Fortnite take it out on Apple when they grow up.

 

[rjohnstone]

Apple hosts the app and all the updates and handle the tax. The charge on IAP is how free apps pay their way, otherwise, you have something costing Apple thousands per app per month(at least pre AppStore I was looking at $2000/month at least on hosting and CDN costs). The transaction fees and taxes are just a small portion of what that 30% covers. There seems to be this naive narrative forming that the 30% is a transaction fee akin to Stripe.

Apple does not host the game content. They host the loader. Developers PAY for Apple to host this via their Developer account fees.
In-app purchases require ZERO Apple infrastructure. None. Apple forces devs to use them for processing transaction.

 

[kesennnnn]

Done and dusted 🦵 🗑 👏

 

[richardsonrs]

Epic could fix this by simply having a subscription for vbucks. problem solved.

 

[WannaGoMac]

Nice to see all the positive comments.

 

[rjohnstone]

And then they can switch to Android where they can play Fortnite.... oh wait... that doesn't work.

Sure it does... APKs can be sideloaded.

 

[Grohowiak]

Lawyers on both sides going to get hammered this weekend chanting and already counting $$ that will flow their way lol.

 

[buckyballs]

The playstation store is a monopoly. I can't sideload things to my PS4. I don't want to give Playstation 30%.

There's a key difference between a Playstation and an iPhone. A Playstation is sold as specialist gaming hardware, whereas a phone has become essential to everyday modern life. Those are taken into consideration when antitrust proceedings take place. It's the reason Microsoft lost 20 years ago as the web became more critical