Epic Games Unlikely to Win Injunction in Ongoing Fortnite Battle With Apple, Jury Trial Possible

[Martinpa]

To be fair, when Epic defended it actions, YGR noted that it provided "good evidence" that the App Store (primary market) is separate and distinct from IAP (aftermarket), running counter to Apple's longstanding claims that the two are integrated (both aftermarket, hardware being primary market) - a fact that Epic could not have otherwise proved. This has important implications for its anti-trust claims. While Epic may lose on its contractual IAP obligations, it may very well win proving the App Store is a monopoly (i.e. no other stores allowed in the primary market).

All that said, YGR was puzzled why an injunction was needed stating "this doesn't mean Fortnite can't go back into compliance now. You made your point, let a jury decide."

I’m not a judge, but when you can effectively have the shell of an app on the App Store, given away for free, with all functionalities unlocked via IAP, I can’t see how you can say that the actual app and the IAP aren’t both the same market

 

[31 Flavas]

Epic has built their own store. Apple is blocking Epic from releasing the store for iOS. That's what this entire case is.

Let's take this to it's logical extent. Would Epic be willing to offer it's own store space, free of charge, to anyone that wants to not pay Epic the 12% cut they ask for? For that matter, I want direct access to all 350 million players of Fortnite. I want to sell my own emotes, outfits, and other cosmetics directly to them. But, Epic has a monopoly on that. Monopolies are bad, mkay? Why can't I make my own in-game store to sell directly to them? #FreeFortniteEmotes

Let's, for sake of argument, say that you are Jeff Bezos and you own Amazon.com. I want access to the millions and billions of people that visit Amazon.com every day, because that's a huge market. Likewise, I'd like to have my own store on the Amazon.com website. No, I'm not going to pay you for space inside of your store or website. You make billions and trillions already - so don't come boo-hoo'ing to me about how you'll lose sales to me. This is more fair for consumers who want choice, don't want to be subject to any terms or conditions, and for me and others. You're monopolizing your website. Why are you blocking me from just using your platform? And if I want to selling in your portion of Amazon.com because I don't think people will otherwise trust or visit my store on your website. Don't be anti-competitive and charge me a 30% commission.

Duh, yea. These are all ridiculous assertions. I wonder why Amazon would block me from using their stores or website? But, because Apple ... it's ok?

 

[Martinpa]

Why am not surprise of the comment section. Do you all like to pat on each others back because of potential good news for Apple? Yeah, they make good products, but don't think for a second believe Apple cares about you. The price they charge for their product you means they care only for your money. Snap out of it, Apple is not your god.

Why do people think that siding with Apple on one issue means I think they care about me? I don’t think they do, I don’t expect them to.

 

[Trần Thiện Khiêm]

What if Epic charged $9.99 for the game in the App Store? Playing by the rules, Apple gets their 30% for all the development tools, App Store "marketing", distribution, etc. Now, Apple's job is done. They're happy. Later, a player wants to buy something in the game, that is run on Epic servers and has nothing to do with Apple. Why should Apple get 30% of that just to process the payment? At that point, Epic has nothing to do with Apple and should be able to process their own in-app purchases without Apple raping them.

Then Epic Simply sells the game for free and avoids paying Apple

 

[bousozoku]

Epic said that it wants to create its own store to distribute apps on iOS, but Apple's anticompetitive behavior prohibits it. In response, Apple's lawyers said the request was an indictment of Apple's "entire business model" focused on the "safety, security, and privacy of its users."

It's odd. On Android, Epic Games was able to make Fortnite available for sideloading. Eventually, they chose to make it available through Google Play Games, rather than to set up their own store on Android. Amazon, of course, did this, and ended up with their own version of Android because Google didn't want the competition. Why didn't Epic Games make a huge issue out of the Google Play Store? Could it be that Apple has more money?

 

[Analog Kid]

Let's take this to it's logical extent. Would Epic be willing to offer it's own store space, free of charge, to anyone that wants to not pay Epic the 12% cut they ask for? For that matter, I want direct access to all 350 million players of Fortnite. I want to sell my own emotes, outfits, and other cosmetics directly to them. But, Epic has a monopoly on that. Monopolies are bad, mkay? Why can't I make my own in-game store to sell directly to them? #FreeFortniteEmotes

Let's, for sake of argument, say that you are Jeff Bezos and you own Amazon.com. I want access to the millions and billions of people that visit Amazon.com every day, because that's a huge market. Likewise, I'd like to have my own store on the Amazon.com website. No, I'm not going to pay you for space inside of your store or website. You make billions and trillions already - so don't come boo-hoo'ing to me about how you'll lose sales to me. This is more fair for consumers who want choice, don't want to be subject to any terms or conditions, and for me and others. You're monopolizing your website. Why are you blocking me from just using your platform? And if I want to selling in your portion of Amazon.com because I don't think people will otherwise trust or visit my store on your website. Don't be anti-competitive and charge me a 30% commission.

Duh, yea. These are all ridiculous assertions. I wonder why Amazon would block me from using their stores or website? But, because Apple ... it's ok?

If I recall, Epic wasn't selling emotes and outfits, they were selling v-bucks. I should be able to produce and sell my own v-bucks for players to redeem for Fortnite goodies, and it would be unfair for Epic to think I owe them a percentage of those sales. Epic has a v-buck monopoly.

I have no problem with Amazon charging me a flat percentage for access to their store. My intent is to sell freemium boxes. They are free-to-use cardboard boxes shipped free to Prime members. If you would like, you can go to my webstore to purchase a TV that I will put in that box when I send it to you. Because it's an In Box Purchase, it's a separate business and Amazon has no right to any of my TV revenue.

 

[bousozoku]

Long time Fortnite player. Epic will never get another dime from me. They embarrassed themselves with their stupid #FreeFortnite and deserve to lose. Play stupid games (breach of contract) win stupid prizes.

Fortnite won't even be relevant a year from now, and everyone will be off to the next new game.

I'm sure that they thought that kids who play Fortnite would get their parents upset enough to do something about Apple but that's not how things work. I wonder if all of those Nerf guns, blankets, t-shirts, etc. will end up in the dumpster, as well.

Then, what will Epic Games have?

 

[yyy]

Something interesting I found on Wikipedia about the Xbox Games Store (source): "Price consistency and whether some content should be available free of charge has also been a source of criticism related to the Xbox Live Marketplace. A notable incident was Microsoft charging for a Gears of War map pack that developer Epic desired to provide at no cost... Exacerbating the controversy, Game Informer made claims that Microsoft forced companies to charge for content the company itself wanted to distribute free."

 

[Stromos]

Yes that's true. Don't misunderstand, I'm not arguing that Epic should win. I'm simply saying that I don't understand why there are so many people on this forum who actively oppose the idea of having more ownership over what you can do with your Apple devices. I find that very surprising. I'd like if Apple made devices more open so that developers, power users, etc could do what they wanted with them (and sure, void the warranty or AppleCare or whatever).

But where does the blame go? If you install malware on your phone and my number gets leaked because your contacts get pulled or your phone becomes part of a botnet that tries to get into my network do I get to go after you?

Apple isn’t perfect but so many people are like Apple doesn’t care about you.

I am a power user and I like that I don’t have to worry about the crud with my iPhone. I have to be wary of every app I install on my android/windows/Linux that’s not from a trusted source and there are app that you just can’t get elsewhere.

Apple Pay is light years ahead of security requirements from swiping a magstripe and even using chip cards which are pinless and useless security theatre in this country.

Apple forced encryption with payment it forced cards not to rely on static numbers that you give everyone every transaction. When you do an IAP it’s going over that protected environment. When you subscribe to something you have control when to terminate said subscription and company xyz has zero ability to play games. Looking at magazines, gyms, etc. This is why companies hate the Apple model.

Companies don’t like HomeKit because it requires encryption. Let that sink in.

Yes it’s part of Apples Marketing to say that malware prevention and security are selling points but it’s to the end users benefit.

Apple decided long ago they would take a higher ground knowing privacy would be a selling point. It may not be out of the kindness of their hearts (it’s about money) doesn’t make it any less better than the alternatives.

 

[deevey]

If Microsoft said "sorry you can ONLY install applications from the Windows store" on your PC, would everyone be OK with that? Clearly not.

They already do that on Windows-S ... and to upgrade (legally) to windows 10 proper will cost you a pretty penny.

Xbox with its specific software/hardware combo is a fairer comparison anyhow than a Multi-System OS like Windows.

 

[31 Flavas]

This is exactly what Apple could do if it lost this case. Fortnite would still be shut out. Lots of independent developers would now need to sell Apple on the merits of the app. Many more would be out of work. The plethora of free apps would be gone. And this would likely be completely legal.

Wow, it's like you are saying that more harm for consumers then good for them could come out of a win for Epic in this case. Surely, Epic only has everyones best interest at stake here.

 

[jinnj]

It's interesting that Epic believes that consoles are sold at a loss. That's been the industry myth for a long time, a myth that hasn't been supported by the facts. There are companies who do teardowns and look at the BOM, but if you look at the division financials only certain consoles are sold for a loss; Nintendo, for example, seems to be making money off the Switch hardware.

MS made money per unit on the XBOX360 (not including the Red Ring of Death), Sony made money on launch for the PS3.

 

[jinnj]

That's the point. Epic knows Fortnite was lightening in a bottle and are doing this to try and stay relevant as a game launcher (not their engine)

This has nothing to do with their game launcher. They want a game store so they can sell 3rd party apps to iOS users without Apple taking a cut. All of this is in the court filings. They told Apple they want OS Level access to the device without any Apple approval required. This goes back to Steam (Valve) kicking their ass and Tim (Epic) just doing nothing for 14 years.

 

[deevey]

Yes that's true. Don't misunderstand, I'm not arguing that Epic should win. I'm simply saying that I don't understand why there are so many people on this forum who actively oppose the idea of having more ownership over what you can do with your Apple devices. I find that very surprising. I'd like if Apple made devices more open so that developers, power users, etc could do what they wanted with them (and sure, void the warranty or AppleCare or whatever).

In that case you already have jail breaking or someone can come up with an alternative OS that can be installed somehow. But it sure as hell isn't Apples job to make that kind of hackery easy.

Apple don't sell hardware - they sell an ecosystem.

 

[tCdemon]

Epic Lawyers: Waahhhh! Waahhhh!
Judge: Not in my court room!
Apple Lawyers: 🤣

 

[cyb3rdud3]

They should, but they don’t. At least in that case I have the right to take my business elsewhere or make my own burger.

You do have that right. As does EPIC. But you don’t have the right to sell your own made burger with your own business model inside of Macdonald’s And likewise neither has EPIC.

It is very possible that Epic will loos this battle, which is a shame, but in the long run Apple undoubtedly will loos the battle over the argument that they are not a factual monopoly. A 30 % fee is simply too much for what they or any platform offer.

It’s a very easy statement to make that 30% is too much. But what do you base that on? Why is 30% too much? Do you realise 30% is lot less than the 70% many were paying before such an AppStore. I think it’s value for money considering the market I can access of individuals who actually spend money, the services that are provided to me to globally distribute my apps, and the dealing with invoicing and tax globally without me having to create legal entities all around the world. And I haven’t even began to talk about the tooling provided. I used to spend thousands on that previously

Nope from a business perspective I have done my sums and can clearly say I couldn’t do all that for less. It’s a simple cost to do business and worth it.

But somehow you just think it’s too much. I would love to know why you think that.

Question for any lawyers on the thread: is there a legal statute that says not allowing any sort of side loading is a anti-competitive or monopolistic practice? Or is this one of those tech things where the law simply hasn’t caught up?

Wondering what the legal argument would be if Apple were sued for not allowing installations outside the App Store rather than over the 30% fee for purchases made on the store.

I understand the security arguments on the Apple side, but I’m curious as to whether or not that, for instance, not allowing people to visit a link and install an app (like downloading an apk on Android) is evidence of some illegal or questionably legal stance.

Do you realise the app is actually a free download and install and that this has nothing to do with how you install it? Also EPIC already has its own store to buy vbucks. What it wants has nothing to do with side loading.

The products Epic started this fight with are multiple-platform, so they can use their own store to sell consumable items across the platforms. They need to make IAP available though, and can't advertise their store in Apple's, so the real issues are that they want to use the App Store but avoid paying for Apple's services, and also want to use the App Store to advertise their services. It has nothing to do with any cut.

This ^

Ummmm ... yes I can do whatever aftermarket modifications I want on it. Can I change the software in the computer brain of the car? No, because that's a literal physical safety requirement and I'm sure very heavily limited by law.

Will all modifications void the warranty? Certainly not. Will some? Sure. I can decide as the owner what I want to do with it and the manufacturer or insurance company can dictate what they will or won't cover. Again, not the best comparison given how heavily regulated all that stuff is.

Yes you can change the computer in a car, and there is no law against it. People do all sorts of modifications by computer to their cars.

 

[TwoBytes]

Apple should sue Epic for a damaged reputation, buy the whole company out and reinstate the app in the store again with an IAP of Tim Sweeney character dressed as a clown for $999.

childish? Yes

 

[Dhonk]

One thing I haven’t seen mentioned is that Epic and others have tried cheating the system by creating Freemium games with the intent they did. If they charged $5.99 for the game, they wouldn’t complain about the 30% Apple Tax. But by choosing the route they did where they try to milk every penny out of teens with freemium upgrades, it shows their ambitions. Apple created a platform, built it, manages it, maintains it. Epic wants a free lunch, but basic Econ 101 shows they’re wrong

 

[Morgenland]

Judge Yvonne Gonzalez Rogers has clear arguments and expertise, much more so than most of the Macrumors people here who complain about the 30% on many occasions. My respect is for her.

It is amazing to me that the management at Epic is not replaced by smarter people.
In business life clowns are usually still fired. Maybe we just have to wait and see.

 

[Brandhouse]

"It's all 30 percent and you just want to gloss over it," the judge said to Epic's lawyers. Hahha! Stick that and shove it. If you don't like rules then take your bat and ball somewhere else. 🤣

 

[groove-agent]

I think we should dump buckets of rotten apples (the fruit) at Epic’s HQ in protest of their stupidity. Anyone live near their head office?

 

[Ethosik]

Yes that's true. Don't misunderstand, I'm not arguing that Epic should win. I'm simply saying that I don't understand why there are so many people on this forum who actively oppose the idea of having more ownership over what you can do with your Apple devices. I find that very surprising. I'd like if Apple made devices more open so that developers, power users, etc could do what they wanted with them (and sure, void the warranty or AppleCare or whatever).

I do have ownership for what I do with my iPhone. I can throw it in my swimming pool all winter and leave it there. I can jailbreak it.

What people don't realize that MANY people (not on this forum - family members non-technical people) get iPhones over Android BECAUSE of the locked down experience. I know many people that have moved from Android to iPhone because they DID get malware on their Android Phone. They have not had any issues since getting an iPhone.

My iPhone has way more critical data about me than my computer does. I do my banking on my phone, I have all my health data on my phone, credit cards on my phone, messages from family and friends that have personal discussions that would be devastating to be leaked out, all my email is my phone. Only thing on my computer are my Steam games and Visual Studio work. I think it is critical to keep the iPhone as secure as possible.

I SPECIFICALLY purchased iPhone for the locked down experience. If you do want more ownership over the device (other than what I have mentioned) there is Android.

 

[Philip_S]

I still don't understand why it matters if the devices/consoles are sold at a loss or not when it comes to the 30%. 30% is still 30% and it's the platforms right to set what commission it feels is right and developers can choose if they want to agree to that and distribute on that platform or not.

If the device is sold at a loss, the vendor can claim there is a consumer benefit to the high price of software to make up for it.
Without that it looks rather like the established platform owners have come to a gentleman's agreement to not cut margins and to discourage third party stores.

 

[farewelwilliams]

Assuming that’s how it’s actually viewed from an accounting perspective

Not assuming as Steve Jobs literally announced on stage the 30% pays for this kind of stuff.

, if a developer opts not to use CloudKit — as very many do for myriad reasons — they have to pay for it regardless. Why?

I don't use Apple Voice Memos app, but I paid for it my iPhone purchase.
I don't use the Android Auto app, but I paid for it my Pixel 3 purchase.
I don't use Windows Maps, but I paid for it in my PC purchase.
Maybe I should get a discount for all of my devices because there are some things I absolutely don't use that my device purchase pays for, right? No. That's not how it works. Similarly, there are hundreds of frameworks, developer tools, and developer services. Providing a "discount" for switching on or off each of these resources would be idiotic.

 

[Ethosik]

If the device is sold at a loss, the vendor can claim there is a consumer benefit to the high price of software to make up for it.
Without that it looks rather like the established platform owners have come to a gentleman's agreement to not cut margins and to discourage third party stores.

Do people KNOW 100% that the iPhone sales make up for the App Store benefits and infrastructure? What part of the iPhone sales makes up for R&D on the A-series processors, design of the case and interior of the phone, AI/Neural Engine/Image Processing part of the CPU and logic built in the iOS, camera system and how it processes pictures, Secure Enclave, Apple Pay and many more things.

iPhone sales typically make up for iOS itself and the hardware of the phone. Obviously more expensive than that for profits. 30% cut on App Store is used for offering support for customers so developers do not need to, billing overhead with iTunes Billing so developers do not need to, actual payment processing, APIs, tools, app review, payment disputes by customers (those Apple Employees need to be paid somehow), CDN quality distribution of your app to offer very fast downloads anywhere in the world, international payments, discovery in the App Store, and many more things.