Epic Games vs. Apple Judgment Allows App Store Developers to Link to Alternative Payment Methods

[ader42]

You've not read my post's properly. It has nothing to do about Apple merging with others, it's about the principles of monoplies. Many businesses are denied merging because it is feared they will create a 'monopoly' in the marketplace, which would restrict competition and therefore be anti-competitive.

Apple control 100% of the App store and everything associated with the app store. they control it's payment methods, preventing developers from using their own payment methods. they prevent developers from linking to outside payment systems (looks to be changing), they prevent developers from allowing users to know there are cheaper payment opitions and yet this is not considered 'monoplistic' behaviour by the Judge.

So my argument is that when two companies want to merge and the FTC say 'nope, not going to happen' because of factors that are very similarly used in the app store, the two companies can go 'hold on, your denying the merger based on factors that are very similar to the app store but the app store has been classed as not being 'monopolystic', so why is Apple allowed to have 100% control of a service but we (the two companies) are not?'

Even the court recognised and affirmed that the marketplace is not the iOS app-store; and pertaining to this case the relevant marketplace was mobile gaming micro-transactions - in which they have no monopoly.

The more general marketplace is smartphones generally of which Apple hold only 15% = not a monopoly.

I think you’re kinda saying Ford have a monopoly on the Ford brand waa waa.

 

[laptech]

This is nonsense as pointed out before. All your examples are companies within a broad market being prevented from merging.

Computers market? Nope
Phone market? Even with what Apple has bought they are only 15% of the world marketshare.
App marketplaces? Nope
Mobile Gaming platforms? Nope
iOS? Not a product category.

Just because my views and thoughts on the matter differ to that of yours, there is no need to refer to mine as being 'nonsense', they are just different points of view. As for what you wrote is note relevant and as for the app marketplace, i beg to differ because there is only two marketplaces for apps, app store for ios devices and play store for android. Now thats a very very broad marketplace is you as me.

 

[I7guy]

Just because my views and thoughts on the matter differ to that of yours, there is no need to refer to mine as being 'nonsense', they are just different points of view. As for what you wrote is note relevant and as for the app marketplace, i beg to differ because there is only two marketplaces for apps, app store for ios devices and play store for android. Now thats a very very broad marketplace is you as me.

That there are multiple marketplaces as some of the android vendors have their own app store.

 

[cmaier]

That there are multiple marketplaces as some of the android vendors have their own app store.

Not to mention other mobile marketplaces, like Nintendo’s, Huawei’s, etc.

 

[Abazigal]

You've not read my post's properly. It has nothing to do about Apple merging with others, it's about the principles of monoplies. Many businesses are denied merging because it is feared they will create a 'monopoly' in the marketplace, which would restrict competition and therefore be anti-competitive.

Apple control 100% of the App store and everything associated with the app store. they control it's payment methods, preventing developers from using their own payment methods. they prevent developers from linking to outside payment systems (looks to be changing), they prevent developers from allowing users to know there are cheaper payment opitions and yet this is not considered 'monoplistic' behaviour by the Judge.

So my argument is that when two companies want to merge and the FTC say 'nope, not going to happen' because of factors that are very similarly used in the app store, the two companies can go 'hold on, your denying the merger based on factors that are very similar to the app store but the app store has been classed as not being 'monopolystic', so why is Apple allowed to have 100% control of a service but we (the two companies) are not?'

Because of the market that Apple is deemed to be operating in.

Which is not just the iOS App store, but the entire mobile gaming market.

 

[jlc1978]

Because of the market that Apple is deemed to be operating in.

Which is not just the iOS App store, but the entire mobile gaming market.

There you go Abazigal, bringing facts into an internet pissing contest.

 

[Analog Kid]

They already do - sort of. Developers can release an upgrade as a separate app and charge for it. If they want to they can over a discounted price for a set period. Not quite like being able to simply charge an upgrade fee as an IAP. but doable.

I’ve seen companies offer discounts on upgrades— one way is to simply sell the new version as a “bundle” with the previous version with a complete the bundle price below full price for the new app.

 

[laptech]

Because of the market that Apple is deemed to be operating in.

Which is not just the iOS App store, but the entire mobile gaming market.

Just because a Judge has ruled it that way does not mean the court decision is right, hence why there are always appeals and more appeals and then the Supreme court rulings. If every lower court decision was right, there would never ever be appeals or even the need for the Supreme Court. The fact that Judges do not get it right is why appeals exist and the Supreme Court exists. Just because it's Apple and this forum is Apple biased, it does not mean the Judge's decision is correct.

 

[Rogifan]

The IP that drives the app is still Apple's though.

But is it part of Apple’s store? Facebook is using Apple IP as well but they’re not paying Apple 30% because their app is free and the majority of users aren’t making any in-app purchases. Most of the apps on my iPhone were free to download and I haven’t made any in-app purchases with them. The only IAP I’ve made is in a few game apps where I paid to remove ads.

 

[Analog Kid]

iOS (Apples own product, can’t be a monopoly on your own product

The judge ruled that iOS isn’t a market at all. To repeat:

In terms of substance, the Court agrees with Dr. Schmalensee that plaintiff’s identification of a “foremarket” for Apple’s own operating system is “artificial.” The proposed foremarket is entirely litigation driven, misconceived, and bears little relationship to the reality of the marketplace. Quite simply, it is illogical to argue that there is a market for something that is not licensed or sold to anyone. Competition exists for smartphones which are more than just the operating system. Features such as battery life, durability, ease of use, cameras, and performance factor into the market. Consumers should be able to choose between the type of ecosystems and antitrust law should not artificially eliminate them. In essence, Epic Games ignores these marketplace realities because, as it presumably knows, Apple does not have market power in the smartphone market. Rather Apple only has 15 percent of global market share in 2020.

 

[I7guy]

But is it part of Apple’s store? Facebook is using Apple IP as well but they’re not paying Apple 30% because their app is free and the majority of users aren’t making any in-app purchases. Most of the apps on my iPhone were free to download and I haven’t made any in-app purchases with them. The only IAP I’ve made is in a few game apps where I paid to remove ads.

Correct.

If an app charges IAP, they must pay a commission. Apps that don't charge IAP, don't have to pay a commission.

As I understand this, this is a legitimate use case, even though some see it as a dichotomy.

 

[leman]

But is it part of Apple’s store? Facebook is using Apple IP as well but they’re not paying Apple 30% because their app is free and the majority of users aren’t making any in-app purchases. Most of the apps on my iPhone were free to download and I haven’t made any in-app purchases with them. The only IAP I’ve made is in a few game apps where I paid to remove ads.

Great comment! This brings us to the core of the issue: Apple needs a way to monetize the use of their APIs and infrastructure. The mandatory App Store revenue sharing was an elegant (if not always appropriate) solution, but that party is over now. They could absorb these costs through hardware sales, but that might push them to more aggressive sales tactics (like cutting software support for old phones early), which nobody wants. They could charge apps for distribution and API use, but that would kill the small devs. From where I am standing, the best path forward is to rework the App Store fee structure so that going third-party payment route is much less profitable for the big dev and accept a loss of App Store revenue that comes with it. Apple can compensate with growth in Macs and other products.

 

[matram]

Great comment! This brings us to the core of the issue: Apple needs a way to monetize the use of their APIs and infrastructure. The mandatory App Store revenue sharing was an elegant (if not always appropriate) solution, but that party is over now. They could absorb these costs through hardware sales, but that might push them to more aggressive sales tactics (like cutting software support for old phones early), which nobody wants. They could charge apps for distribution and API use, but that would kill the small devs. From where I am standing, the best path forward is to rework the App Store fee structure so that going third-party payment route is much less profitable for the big dev and accept a loss of App Store revenue that comes with it. Apple can compensate with growth in Macs and other products.

Percent of revenue is an established mechanism i believe. The developer would have to declare revenue and pay Apple monthly. Apple could audit the developer.

 

[cmaier]

Just because a Judge has ruled it that way does not mean the court decision is right, hence why there are always appeals and more appeals and then the Supreme court rulings. If every lower court decision was right, there would never ever be appeals or even the need for the Supreme Court. The fact that Judges do not get it right is why appeals exist and the Supreme Court exists. Just because it's Apple and this forum is Apple biased, it does not mean the Judge's decision is correct.

So, specifically, where was the judge wrong? I mean, go to the findings of fact she provided, and cite to the specific findings that are incorrect, or the specific law that she misinterpreted.

 

[matram]

Just because a Judge has ruled it that way does not mean the court decision is right, hence why there are always appeals and more appeals and then the Supreme court rulings. If every lower court decision was right, there would never ever be appeals or even the need for the Supreme Court. The fact that Judges do not get it right is why appeals exist and the Supreme Court exists. Just because it's Apple and this forum is Apple biased, it does not mean the Judge's decision is correct.

If you read the full ruling you will find that the judge has done a thorough job of exploring market definitions with many references to case law. She understands the judgement will be appealed and she put in a lot of work in findings of facts and analysis.

 

[I7guy]

Just because a Judge has ruled it that way does not mean the court decision is right, hence why there are always appeals and more appeals and then the Supreme court rulings. If every lower court decision was right, there would never ever be appeals or even the need for the Supreme Court. The fact that Judges do not get it right is why appeals exist and the Supreme Court exists. Just because it's Apple and this forum is Apple biased, it does not mean the Judge's decision is correct.

Correct. And this verdict could be upheld right through SCOTUS....or not.

 

[cmaier]

If you read the full ruling you will find that the judge has done a thorough job of exploring market definitions with many references to case law. She understands the judgement will be appealed and she put in a lot of work in findings of facts and analysis.

Not to mention that findings of fact are given deference by appeals courts, who mostly concern themselves with whether the lower court interpreted the law correctly.

 

[jdb8167]

So, specifically, where was the judge wrong? I mean, go to the findings of fact she provided, and cite to the specific findings that are incorrect, or the specific law that she misinterpreted.

Your legal expertise is no competition for the other poster's feelings. (This BTW seems to sum up most of the posts I've read in the last few days on this topic.)

 

[Lemon Olive]

If you read the full ruling you will find that the judge has done a thorough job of exploring market definitions with many references to case law. She understands the judgement will be appealed and she put in a lot of work in findings of facts and analysis.

It is very impressive in my opinion. She did a really, really good job on this case, regardless of how anyone feels about the decision.

But having done such a thorough job, it is near impossible to argue with this decision. Epic's case was largely about whining for free access to Apple's success, and Apple's practice of preventing you from linking to other signups was pure greed and anti-competitiveness. Everyone knows this. The judge got it all 1200% correct.

 

[cmaier]

Your legal expertise is no competition for the other poster's feelings. (This BTW seems to sum up most of the posts I've read in the last few days on this topic.)

I claim no expertise in anti-trust law . I just encourage people to be specific

 

[jdb8167]

I claim no expertise in anti-trust law . I just encourage people to be specific

You still have a law degree which is much more than nearly anyone else commenting.

 

[cmaier]

You still have a law degree which is much more than nearly anyone else commenting.

Me? I’m just a humble country CPU designer, all confused by these big city legal concepts…

 

[jlc1978]

Just because a Judge has ruled it that way does not mean the court decision is right, hence why there are always appeals and more appeals and then the Supreme court rulings. If every lower court decision was right, there would never ever be appeals or even the need for the Supreme Court. The fact that Judges do not get it right is why appeals exist and the Supreme Court exists. Just because it's Apple and this forum is Apple biased, it does not mean the Judge's decision is correct.

Which is why judges carefully lay out their reasoning for a decision. They do not want to be overturned on appeal.
Now, it's up to Epic to find an error in her application of the law when appealing. They will no doubt provide a list of them, hoping one will stick.

So, specifically, where was the judge wrong? I mean, go to the findings of fact she provided, and cite to the specific findings that are incorrect, or the specific law that she misinterpreted.

This is the internet - she is wrong because we disagree with her; who cares about things like laws and facts when there are opinions.

Not to mention that findings of fact are given deference by appeals courts, who mostly concern themselves with whether the lower court interpreted the law correctly.

There you go again, bringing facts into an internet argument.

 

[leman]

Percent of revenue is an established mechanism i believe. The developer would have to declare revenue and pay Apple monthly. Apple could audit the developer.

I don’t think that such mechanism has any precedent or will be practically enforceable. Not to mention that it would be a truly draconic measure that will create massively negative PR for Apple.

 

[matram]

I don’t think that such mechanism has any precedent or will be practically enforceable. Not to mention that it would be a truly draconic measure that will create massively negative PR for Apple.

I believe it is the approach used by EPIC for their Unreal engine but I would agree that it would not go down well with smaller developers.

But I can see Apple giving companies the option of either using todays IAP or using their own but then paying a fee based on revenue for their own payment processing. I do not think it will be 30% but I do think Apple want to send a message that their services are not for free if you make money of them.