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

[Analog Kid]

Oh go away, your argument is full of logical fallacies. Over and out.

I hadn't thought of it that way. You've convinced me with your carefully made arguments and overwhelming supporting evidence.

So the stock is up today. From that should we assume that now that everyone has had time to read what the court actually wrote they think Apple won?

No. I think I understand it now, so let me explain: Today's move isn't significant because it was a move upwards, and not a move downwards.

It's complicated. You have to really understand the stock market. Math won't help.

 

[Maximara]

Part 2….reanswering all those lingering questions:

No matter how you view this case having an actual Lawyer explain the case in a manner where you are not lost 10 words in is a credit to people who actually want to understand a case. To paraphrase my late mother - "any blithering idiot can make the simple look complicated but it takes an actual genius to accurately make the complicated seem simple".

 

[Maximara]

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.

Given the judge gave an 180+ page explanation of their thought process it is going to run uphill battle for Epic to make any headway.

 

[laptech]

No matter how you view this case having an actual Lawyer explain the case in a manner where you are not lost 10 words in is a credit to people who actually want to understand a case. To paraphrase my late mother - "any blithering idiot can make the simple look complicated but it takes an actual genius to accurately make the complicated seem simple".

I watched upto 10mins of the video and had to stop because one of the primary issues brought forward by Epic seems to constantly mis-judged. In that video the person references a portion of the 185 Judges document which states that Apple has the right to collect comission on IP that is used by others. Yes they do have that right BUT the issue is that Apple forces every app developer to use Apple's payment system, even when their are other payment systems that can be used. It is restrictive business practice and should not be allowed but it seems no one, not the Judge, the lawyer in the video or the reporter from Verge can understand.

Facebook, Epic, Google and many others that develop app's for the App store have their own payment systems that users could use but Apple forbids this. It disturbs me no one is able to see the fact that any app developer that wants to develop an app for iOS that uses in-app purchases is forced to use Apple's own payment system which charges the app developer 30% of the in-app purchase cost and if the app developer does not like the app store conditions they are free to leave. But here's the thing, there is only ONE iOS app store which means the ONLY way a developer can develop an app for iOS is be bounded by the restrictive terms and conditions of having to use Apples own payment system which they charge for it's use. This is restrictive business practice and it astounds me that the majority of people cannot see this or just refuse to see it.

If a food producer wants to sell their products in supermarkets, there are a number of supermarkets the food producer can go to if they are not happy with the terms and conditions set out by the supermarket.

If a retail company wants to have their product advertised on television, there are a number of television studios the retailer can go to.

If an architect wants to have their design built, they can chose from a number of building companies.

In all the above examples, if the person is not happy with the terms and conditions, they have others of the same type they can go to. in all the above examples, the business practice is not 'restrictive' but with Apple, if you want to develop an app for iOS it's 100% their way or the highway. If a developer is not happy with the terms and conditions Apple set out, where else can they go to host their iOS app? they can't.

People say the app store is not a monopoly, well ask yourself this, if you develop a program for Windows, Mac or Linux, where can you go to get your program hosted? there are 1000's of places where you can get the program hosted. If you develop an app for the android system, where can you get the app hosted? yes, there are numerous places where you can get the app hosted. If you want to develop ios apps, where can you get them hosted? one place and one place only and that one and only place is 100% controlled by one company.

If Sky owned every satellite media company and the only way a company could get their program to appear on satellite TV was to agree to Sky's terms and conditions, basically being Sky's way or the highway, there would be shouts of 'monopoly' because they control the satellite market and they would be right but yet for Apple, they control 100% of ios app distribution market (if it's not in the app store the app will never get seen) suddenly everything is OK

Therefore, let AT&T buy up all the mobile network operators because hey, there are still alternatives such as land lines (just as people keep on saying there is android) so it's all ok right?

 

[Maximara]

I watched upto 10mins of the video and had to stop because one of the primary issues brought forward by Epic seems to constantly mis-judged. In that video the person references a portion of the 185 Judges document which states that Apple has the right to collect comission on IP that is used by others. Yes they do have that right BUT the issue is that Apple forces every app developer to use Apple's payment system, even when their are other payment systems that can be used. It is restrictive business practice and should not be allowed but it seems no one, not the Judge, the lawyer in the video or the reporter from Verge can understand.

For something this complex the first 10 minutes aren't going to tell you squado especially as you did not even get to
Contractual Commissions (Apple and Unreal) (12:27)
An Apple Appeal? (26:30)
Ninth Circuit and Reversal Stats (28:06) or
Conclusion (32:46)

The law doesn't always make sense to a layman. Case in point, back in the late 1990s I had to help enforce The Antiquities Act of 1906. We had to survey areas near Camptonville, CA to make sure there wasn't logging in archeological sites. Problem was the law was written when all loggers had were hand axes and two person saws.

The heavy machinery modern logging equipment causes any buried lithics to eventually rise to the surface. So the logging company would go in log up to 90% of an area, we'd come in and find lithics all over the place meaning they couldn't continue to log there.

We knew it was silly to the point of stupid (joke was we worked for the Forest Circus rather than Forest Service) and so did our bosses Tom and Barry (yes the joke for them was it was time for the Tom and Barry Show) but it was the way the Law was written.

Another governmental agency I worked for, the Bureau of Land Management, had the opposite problem. They had detailed rules on livestock and mining (their nickname was Bureau of Livestock and Mining) but anything outside of that - like water rights, oil or gas drilling - were not regulated for the longest time. Even today the law with regard to those things, compared with the livestock and mining ones, are a total joke in terms of details and regulation.

This is all relevant because the Sherman Anti-trust act is old (1890) and saw an update in 1914...nearly a century ago. For those who want to read the actual legalese it is codified in 15 U.S.C. §§ 1-38

 

[leman]

It is restrictive business practice and should not be allowed but it seems no one, not the Judge, the lawyer in the video or the reporter from Verge can understand.

Please do not equate lack of understanding with simple disagreement. What you say might be obvious to you, but others can have a different viewpoint. See below.

If a food producer wants to sell their products in supermarkets, there are a number of supermarkets the food producer can go to if they are not happy with the terms and conditions set out by the supermarket.

If a retail company wants to have their product advertised on television, there are a number of television studios the retailer can go to.

If an architect wants to have their design built, they can chose from a number of building companies.

In all the above examples, if the person is not happy with the terms and conditions, they have others of the same type they can go to. in all the above examples, the business practice is not 'restrictive' but with Apple, if you want to develop an app for iOS it's 100% their way or the highway. If a developer is not happy with the terms and conditions Apple set out, where else can they go to host their iOS app? they can't.

The problem of your argument is that you assume that iOS is a "market", with the full meaning of the word. However, this is not something that is immediately obvious. iOS could also be a "television studio" or a "supermarket" from your examples. Just like you don't have a fundamental right to sell your product at a popular supermarket chain, I don't see why you should have a fundamental right to distribute your application for any given popular platform.

There are reasons why iOS is popular. And a lot of them have to do with the walled garden model that Apple has decided to adopt. This is not the only model, and it's not obvious that it's the best model, but it is effective for all parties (Apple makes money, customers are happy, developers get access to cutting edge tech and some of the best APIs on the planet). I think Apple should have the right to chose the model they want for the products they make. Mind, I am not advocating that Apple should have absolute power in this regard, it is obvious that some regulation is needed to ensure that everyone has the same opportunity, but I also don't see any fairness in forbidding Apple to choose how they want to do business.

People say the app store is not a monopoly, well ask yourself this, if you develop a program for Windows, Mac or Linux, where can you go to get your program hosted? there are 1000's of places where you can get the program hosted. If you develop an app for the android system, where can you get the app hosted? yes, there are numerous places where you can get the app hosted. If you want to develop ios apps, where can you get them hosted? one place and one place only and that one and only place is 100% controlled by one company.

Those platforms have adopted a different economical model. That's it. You cannot dictate that iOS has to follow the same model just because it's the standard. There are merits in both open and closed ecosystems. Besides, not every ecosystem out there is open. Take consoles for example. Or plugin marketplaces for some of some popular applications.

If Sky owned every satellite media company and the only way a company could get their program to appear on satellite TV was to agree to Sky's terms and conditions, basically being Sky's way or the highway, there would be shouts of 'monopoly' because they control the satellite market and they would be right but yet for Apple, they control 100% of ios app distribution market (if it's not in the app store the app will never get seen) suddenly everything is OK

And that's where the flaw in your argument is. If Sky owned every satellite company, they would have monopoly power satellite TV. If Apple controlled all the smartphones, they would have monopoly over smartphones. But they don't. iOS is only what, 14% of the worldwide smartphone market share? You complaining about Apple having 100% control over iOS is the same like you complaining that Walmart has 100% control over their inventory.

Believe me, I do understand where you are coming from, and your stance is not without merit. It is just not as obvious or self-justified as you think. Just because you like the platform and want your product to be featured on it does not give you the right to it. To give you another example: just because someone is the most though after movie start in the world does not give studios right to have that actor appear in their movies. It is still up to the actor to decide what they want to do and what they do not. You instead are suggesting that just excuse something is successful and popular, it should be in unrestricted access. I see a lot of danger in that ideology.

 

[Abazigal]

In all the above examples, if the person is not happy with the terms and conditions, they have others of the same type they can go to. in all the above examples, the business practice is not 'restrictive' but with Apple, if you want to develop an app for iOS it's 100% their way or the highway. If a developer is not happy with the terms and conditions Apple set out, where else can they go to host their iOS app? they can't.

People say the app store is not a monopoly, well ask yourself this, if you develop a program for Windows, Mac or Linux, where can you go to get your program hosted? there are 1000's of places where you can get the program hosted. If you develop an app for the android system, where can you get the app hosted? yes, there are numerous places where you can get the app hosted. If you want to develop ios apps, where can you get them hosted? one place and one place only and that one and only place is 100% controlled by one company.

The problem you cited is the same regardless of whether Apple has sold one iphone or 1 billion iPhones.

Their platform was never open, and developers faced the same restrictions back in 2018 as they do now.

So if you want to say that this wasn’t an issue back when the iphone had way smaller market share, then my question is - what’s the magic number when Apple is considered a monopoly? 30%? 50%? 90%? Who decides?

And Apple isn’t really doing anything to stop a potential third entrant into the mobile market either. The market simply voted with their wallet, and consolidated behind android and iOS, and decided that other platforms like windows phone and blackberry simply weren’t worth their time. And at this point, nobody is foolhardy enough to enter the market because they realise the huge hurdles they need to clear to catch up with the competition.

You probably have a valid point in that it may well be better for the industry as a whole if iOS were made more open like windows, but if Apple refuses to do so, it’s their prerogative and their right to keep iOS closed.

 

[playtech1]

So if you want to say that this wasn’t an issue back when the iphone had way smaller market share, then my question is - what’s the magic number when Apple is considered a monopoly? 30%? 50%? 90%? Who decides?

When it comes to competition law, size really does matter.

As for who decides the % (and perhaps more importantly, how to define the market to which the % relates), well that's the politicians and courts. In the EU a rough rule of thumb for whether a company is dominant is 40% of the market.

Although it's theoretically possible for another mobile entrant to emerge and Apple may not be actively stopping it, that doesn't really change the situation, which is being judged as it is today rather than in a hypothetical future where there are more market players.

 

[laptech]

........


And that's where the flaw in your argument is. If Sky owned every satellite company, they would have monopoly power satellite TV. If Apple controlled all the smartphones, they would have monopoly over smartphones. But they don't. iOS is only what, 14% of the worldwide smartphone market share? You complaining about Apple having 100% control over iOS is the same like you complaining that Walmart has 100% control over their inventory.

.........

And this is the flaw in your argument and those that do the same because everytime i or others comment or refer to the app store as being a 'monopoly', you and others who support the same reasoning immediatly twist it and substitute app store with 'smartphones' and then go on to say that Apple does not have a monopoly on smartphones to try and justify your argument. Stop doing that because it twists the debate into something it's not.

The debate is about the app store, nothing more, nothing less. It has nothing to do with smartphones or the iOS operating system, it's is about the app store. Giving my example you said it would be a monopoly if Sky was to own all the satellite companies and controlled the market. Car manufacturers used to have 100% control of the car spares market, just a fraction of their overall business but they were forced to change. Apple own 100% of iOS app distribution, not smartphone, not iOS but 'iOS app distribution', it is very specific, remember that.

You say Sky is not allowed to own and control 100% of the satellite market so why is Apple allowed to have 100% of the 'iOS app distribution' market?. They get to decide who is and who isn't allowed to be hosted in the app store, they set the prices, they set arbitary rules on payment system, a system that can incurr a charge of 30% and there is no other choice.

Even if people believe the app store is not a 'marketplace', the app store is a business within a business. With that in mind, car spare parts was a business within a business for the car manufacturers but the car manufacturers were told to stop that practice and to all 3rd party companies to buy and sell car spar parts.

So tell me, why is Apple allowed to control 100% of the app store but car manuracturers were not allowed to control 100% of their spare parts. Whats the difference?

 

[laptech]

.........

You probably have a valid point in that it may well be better for the industry as a whole if iOS were made more open like windows, but if Apple refuses to do so, it’s their prerogative and their right to keep iOS closed.

What are you talking about?? the issue has nothing to do with the iOS operating system therefore talk about iOS being made more open is ludicrous. The app store is a host for iOS apps, it has nothing to do with iOS operating system. Why do people insist on twisting the debate into something it's not!!!??? it's about the APP STORE, not smartphones, not iOS operating system...the STORE..why can't people understand this????

 

[theotherphil]

What are you talking about?? the issue has nothing to do with the iOS operating system therefore talk about iOS being made more open is ludicrous. The app store is a host for iOS apps, it has nothing to do with iOS operating system. Why do people insist on twisting the debate into something it's not!!!??? it's about the APP STORE, not smartphones, not iOS operating system...the STORE..why can't people understand this????

The judge has already ruled on this. It is not illegal to have a monopoly on your own products. In fact, it is expected. Why can’t people also understand this?

 

[Abazigal]

What are you talking about?? the issue has nothing to do with the iOS operating system therefore talk about iOS being made more open is ludicrous. The app store is a host for iOS apps, it has nothing to do with iOS operating system. Why do people insist on twisting the debate into something it's not!!!??? it's about the APP STORE, not smartphones, not iOS operating system...the STORE..why can't people understand this????

The App Store is part of iOS. How else are you going to bypass the App Store, if not by opening up iOS and allowing users to sideload?

 

[leman]

And this is the flaw in your argument and those that do the same because everytime i or others comment or refer to the app store as being a 'monopoly', you and others who support the same reasoning immediatly twist it and substitute app store with 'smartphones' and then go on to say that Apple does not have a monopoly on smartphones to try and justify your argument. Stop doing that because it twists the debate into something it's not.

The debate is about the app store, nothing more, nothing less. It has nothing to do with smartphones or the iOS operating system, it's is about the app store. Giving my example you said it would be a monopoly if Sky was to own all the satellite companies and controlled the market. Car manufacturers used to have 100% control of the car spares market, just a fraction of their overall business but they were forced to change. Apple own 100% of iOS app distribution, not smartphone, not iOS but 'iOS app distribution', it is very specific, remember that.

You say Sky is not allowed to own and control 100% of the satellite market so why is Apple allowed to have 100% of the 'iOS app distribution' market?. They get to decide who is and who isn't allowed to be hosted in the app store, they set the prices, they set arbitary rules on payment system, a system that can incurr a charge of 30% and there is no other choice.

Even if people believe the app store is not a 'marketplace', the app store is a business within a business. With that in mind, car spare parts was a business within a business for the car manufacturers but the car manufacturers were told to stop that practice and to all 3rd party companies to buy and sell car spar parts.

So tell me, why is Apple allowed to control 100% of the app store but car manuracturers were not allowed to control 100% of their spare parts. Whats the difference?

Because, again, it is not obvious that "iOS app distribution" constitutes a market in the general sense of the term. You are essentially arguing if a company makes a platform and allows a third party to distribute services there, it automatically makes that platform a full market. I don't think this is compatible with any modern legal framework. On the contrary, there are good reasons not to accept your definition, because that would essentially mean that no company is allowed to define their own product.

 

[laptech]

Because, again, it is not obvious that "iOS app distribution" constitutes a market in the general sense of the term. You are essentially arguing if a company makes a platform and allows a third party to distribute services there, it automatically makes that platform a full market. I don't think this is compatible with any modern legal framework. On the contrary, there are good reasons not to accept your definition, because that would essentially mean that no company is allowed to define their own product.

OK, so lets for arguments sake say the app store is just that, a store. Why is it then that car makers were not allowed to continue to have 100% control of their spare parts store?. The car makers had people/companies build their spare parts, which the car makers subsequently sold in their own spare parts store but someone said no, they are not allowed to have 100% of their own store. So why did authorities see fit to tell car makers they cannot have 100% of their own spare parts store but yet Apple is allowed to have 100% control of it's app store?. One being a digital store and one being a real world store is irrelevant as they both have to play by the same trading rules, is just that Apple is being allowed not to play by the same rules...why?

 

[AppliedMicro]

I have linked to the developer agreement, IAP agreement and judgement many times in our discussion and showed how apple can take commission on any purchase within or external to the app, which subsequently enables extra functionality within the app

You have linked to the agreement - as did I.

and showed how apple can take commission on any purchase within or external to the app

No, you have not, with regards to the 30% rate you‘re claiming they can.

1. You have shown - as do the developer agreements do say - that Apple can take commission on any purchase that is done through their (in-app purchase) system and software

2. In addition, but (crucially!) separately, they are requiring any paid app "enhancements" to go through their in-app purchase system.

I am predicting that the 2nd requirement can - and likely will - fall, due to legislation or enforcement of competition law.

Again, what you are also missing is that the Judge has also ruled that Apple isn’t just acting as a payment processor

I didn't say that they'd be "just acting as a payment processor".

Though that would not be entirely wrong, since payment processing is a good comparison - since that's essentially (but not exclusively) what Apple is providing.

In future: Apple processes the payment from the suers stored payment type and takes 30% before giving the developer 70% or if the developer chooses to use their own payment processor, the developer takes 100% and Apple sends an invoice for their 30%.

Whether you believe it or not, these are the facts.

No. Apple will have to change their developer agreement to do so.

It a developer is providing feature enhancements on its own (without Apple IAP), they may be - currently - violating their agreement.
If and once they can legally do so (without IAP and Apple acting as an agent/commissionaire), the current developer agreement doesn't entitle Apple to that same 30% cut. There's just no provision for that in the text. If Apple doesn't have to do anything with the transaction, they won't be allowed to charge. Even though the judge hinted they may be entitled to some compensation for their IP. But they will have to find another way.

Again, can they change their agreement? They can. But charging the same supracompetitive rate of 30% on transactions that aren‘t handled by them will be even harder to justify against investigations or accusations of anticompetitive behaviour.

 

[leman]

OK, so lets for arguments sake say the app store is just that, a store. Why is it then that car makers were not allowed to continue to have 100% control of their spare parts store?. The car makers had people/companies build their spare parts, which the car makers subsequently sold in their own spare parts store but someone said no, they are not allowed to have 100% of their own store. So why did authorities see fit to tell car makers they cannot have 100% of their own spare parts store but yet Apple is allowed to have 100% control of it's app store?. One being a digital store and one being a real world store is irrelevant as they both have to play by the same trading rules, is just that Apple is being allowed not to play by the same rules...why?

I am not familiar with the car market, so I do not know what specifics you are referring to. Things obviously get complicated here, but my guess would be that this is essentially about "power". Car spare parts are an important commodity, since cars regularly need maintenance. This puts the car manufacturer into a position of power, allowing them to dictate unreasonable conditions (you probably won't throw away your car just because the vendor asks too much money for an oil filter — buying a new car is going to be much more expensive still).

Same reasoning obviously applies to Apple, and that's exactly what the judge did in their verdict. They have declared that Apple prohibiting developers from linking to third-party payments was unjust use of their power. I am quite sure similar would be the case if Apple started rejecting browser apps because they compete with Safari. However, given that Apple's curation of the App Store is mostly fair to everyone (there are some issues here and there, but overall, it works), and that their conditions are not unreasonable, there is no reason to claim that Apple is using their power to restrict any developer or customer of accessing or using iOS.

 

[laptech]

I am not familiar with the car market, so I do not know what specifics you are referring to. Things obviously get complicated here, but my guess would be that this is essentially about "power". Car spare parts are an important commodity, since cars regularly need maintenance. This puts the car manufacturer into a position of power, allowing them to dictate unreasonable conditions (you probably won't throw away your car just because the vendor asks too much money for an oil filter — buying a new car is going to be much more expensive still).

Same reasoning obviously applies to Apple, and that's exactly what the judge did in their verdict. They have declared that Apple prohibiting developers from linking to third-party payments was unjust use of their power. I am quite sure similar would be the case if Apple started rejecting browser apps because they compete with Safari. However, given that Apple's curation of the App Store is mostly fair to everyone (there are some issues here and there, but overall, it works), and that their conditions are not unreasonable, there is no reason to claim that Apple is using their power to restrict any developer or customer of accessing or using iOS.

apps for the iphone are an important commodity wouldn't you say? because without apps, the iphone is worhtless. The apps make the iphone a very imporant tool and the fact that Apple controls the app store, it puts them in a very powerful position which allows them to dictate unreasonable conditions, conditions which Epic feels are unreasonable and fighting against.

 

[leman]

apps for the iphone are an important commodity wouldn't you say? because without apps, the iphone is worhtless. The apps make the iphone a very imporant tool and the fact that Apple controls the app store, it puts them in a very powerful position which allows them to dictate unreasonable conditions, conditions which Epic feels are unreasonable and fighting against.

How Epic feels is their business. Whether the conditions dictated by Apple are unreasonable is measured by common expectations in the society and the industry. As it stands, a court of law decided that these conditions are generally reasonable, aside the counter-steering provision, which was explicitly made void.

The simple thing is that the majority developers don't think that Apple is oppressing them, the users don't think that Apple is oppressing them or the developers, and the court of law does not think that Apple is oppressing them. Of course, we should all engage for making the App Store a fairer and more transparent place for everyone. But it does not mean that what you suggest is the only just or right way of doing it. Neither are those who disagree with you blind or stupid.

 

[I7guy]

Ive said many times in our exchange that such number included both companies, Apple and Google, at planetary level. It seams that was not overstated after all.

Now, since this was ruled in California what is that number there?

What is kind of sad is that regulation is coming to the sector while Apple and Google evolve to higher ground in this context and some people will have no clue why and how was that even possible … while looking for ghosts.

Nobody knows what will happen in the future. The court affirmed 9 out of 10 points in the suit and even then, Epic is not free and clear from commission and rents. In the United States there is a ways to go before regulation can take effect, if it ever does. And just because law makers put a law into effect, doesn't mean it won't withstand a challenge in the supreme court.

 

[I7guy]

[...] conditions which Epic feels are unreasonable and fighting against.

The court did not rule for epic except on one count. The court didn't feel these conditions were unreasonable.

 

[Abazigal]

apps for the iphone are an important commodity wouldn't you say? because without apps, the iphone is worhtless. The apps make the iphone a very imporant tool and the fact that Apple controls the app store, it puts them in a very powerful position which allows them to dictate unreasonable conditions, conditions which Epic feels are unreasonable and fighting against.

Like you said, these are terms which Epic "feels" are unreasonable.

They are entitled to their own opinions, but they are not entitled to their own facts.

 

[laptech]

How Epic feels is their business. Whether the conditions dictated by Apple are unreasonable is measured by common expectations in the society and the industry. As it stands, a court of law decided that these conditions are generally reasonable, aside the counter-steering provision, which was explicitly made void.

The simple thing is that the majority developers don't think that Apple is oppressing them, the users don't think that Apple is oppressing them or the developers, and the court of law does not think that Apple is oppressing them. Of course, we should all engage for making the App Store a fairer and more transparent place for everyone. But it does not mean that what you suggest is the only just or right way of doing it. Neither are those who disagree with you blind or stupid.

In my opinion what Apple is doing to Epic and others who are worth millions/billions is a form of legalised racketeering. Apple knows the games produced by Epic are extremely popular hence they look for a way to profit from Epic and they do so by forcing Epic to use Apple's own payment system which incurs a 30% charge everytime an Epic user makes an in-app purchase for one of it's games. Epic pays Apple a yearly fee to use the app store, same with every app developer but Apple seeing how popular mobile games are, Apple decided they wanted a piece of that pie.

Apple provide a hosting platform with a minor set of tools to help developers get their app on the host. Does this warrant Apple getting billions every year from app developers who have spent their own time and money designing and developing a popular app, hell no....

Maybe when all those defending Apple have developed their own app, spent their own money, spent weeks, months designing, writing, testing with no help from Apple and Apple comes along and say 'i am taking 30% of every transaction your app makes', are you telling me your going to be OK with this to the point your are never going to complain because you feel Apple are justified in taking 30% everytime your app is used? hell no your not, your going to do exactly what Epic is doing.

I own and have used many Apple products over the years but on this, Apple is very wrong in my opinion and my opinion will never change.

 

[leman]

In my opinion what Apple is doing to Epic and others who are worth millions/billions is a form of legalised racketeering. Apple knows the games produced by Epic are extremely popular hence they look for a way to profit from Epic and they do so by forcing Epic to use Apple's own payment system which incurs a 30% charge everytime an Epic user makes an in-app purchase for one of it's games. Epic pays Apple a yearly fee to use the app store, same with every app developer but Apple seeing how popular mobile games are, Apple decided they wanted a piece of that pie.

Sorry, but this is nonsense. App Store rules were in place long before Epic entered mobile games market. The idea of the "30% cut" is that developers who make money with their apps contribute to running the store infrastructure so that less fortunate developers can also try their luck. One can of course discuss whether the 30% cut is reasonable in this case, but this has to do with Epic's unique business of selling ridiculously overpriced virtual sticker to children. But I digress.

You mention the yearly fee that Epic pays. That fee is basically to cover certificate management. The $99 do nothing to cover the distribution or hosting costs.

Apple provide a hosting platform with a minor set of tools to help developers get their app on the host. Does this warrant Apple getting billions every year from app developers who have spent their own time and money designing and developing a popular app, hell no....

This is a good question. Frankly, I don't have an answer to that, because these things are highly subjective. In my opinion, Epic's business is highly unethical. I hate micro transaction-based games with all passion, and I hate how Epic uses blackmail and buyouts to propose their own crappy game store.

Anyway, I don't think that it is unjust or unreasonable from Apple to demand a compensation for using their ecosystem. After all, Apple built it up to make money. Why would they give it to you for free? You can ask the same question about Epic by the way, they also demand a cut from any dev who wants to host a game on their store (their cut is smaller, but they also offer less service).

Maybe when all those defending Apple have developed their own app, spent their own money, spent weeks, months designing, writing, testing with no help from Apple and Apple comes along and say 'i am taking 30% of every transaction your app makes', are you telling me your going to be OK with this to the point your are never going to complain because you feel Apple are justified in taking 30% everytime your app is used? hell no your not, your going to do exactly what Epic is doing.

Actually, I am planning to publish software on App Store and I am very worried that changes brought by this jury verdict would make it more difficult for me. I'd rather pay Apple the 15% of my revenue rather than set up my own cloud infrastructure AND deal with payment processors AND deal with pesky accounting. So yes, I think it's fair, because doing these things myself will cost me more. Besides, it's not like all this money is going to Apple. This money is first going to the other developers who are using Apple's infrastructure.

Epic obviously does not think it's fair because they are big enough to do them cheaper. And of course, they want to make money of other developers themselves. This is literally what this fight is about: Epic wants to institute their own game store on the iPhone to make profit of third-party devs. That's why they are unhappy with the verdict.

Again, in my ideal world Apple would make App Store non-profit in the sense that all revenue from the App Store should go towards the infrastructure maintenance, support and development of new APIs, basically stuff that developers benefit from. That would be the ultimate fairness — every player contributes to the maintenance and development of the ecosystem according to their success and Apple makes no money off them. I think this should be achievable with around 10% revenue "tax" for all the apps. Of course, it's not something that shareholders or the board would like to hear. And it obviously won't make Epic happy either.

 

[Abazigal]

Apple provide a hosting platform with a minor set of tools to help developers get their app on the host. Does this warrant Apple getting billions every year from app developers who have spent their own time and money designing and developing a popular app, hell no....

To me, Apple does a lot more than that.

Apple has aggregated the best customers in the world thanks to the iPhone.

Apple has made it extremely seamless for consumers to purchase apps thanks to biometrics and iTunes.

The trust that consumers have in the App Store makes them more amenable to purchasing new apps.

The inability to side load apps reduces the incidence of piracy, meaning more people pay for apps.

All these come together to grow the overall pie, and I feel that Apple is justified to a cut of the profits to reflect its role in helping developers sell more apps than they otherwise would have had they simply self-hosted their app on the internet and expected users to purchase it directly from their website.

A payment processing service like Stripe brings none of that to the table, so of course they charge less, because they do less for the money.

Maybe when all those defending Apple have developed their own app, spent their own money, spent weeks, months designing, writing, testing with no help from Apple and Apple comes along and say 'i am taking 30% of every transaction your app makes', are you telling me your going to be OK with this to the point your are never going to complain because you feel Apple are justified in taking 30% everytime your app is used? hell no your not, your going to do exactly what Epic is doing.

I will say it depends.

A smaller developer who lacks the resources would find value in the benefits I listed above. 30% is not unreasonable, and it gets lowered to 15% upon meeting certain criteria. For them, the App Store remains a boon, and the minor cost savings from using third party payment options may not be worth the hassle and added friction.

The developers who feel outraged by this are likely those like Epic who feel that they are big enough that they don't need the benefits the App Store brings, or at least, feel that said benefits are not worth 30%. Like Epic, Spotify, Facebook. These are also the companies I hold the least sympathy for.

Moving forward, we may end up seeing a bifurcation of opinion from smaller and larger developers. It may no longer be meaningful to refer to all developers as a unified whole because each of them have differing priorities.

 

[Nuno Lopes]

Nobody knows what will happen in the future. The court affirmed 9 out of 10 points in the suit and even then, Epic is not free and clear from commission and rents. In the United States there is a ways to go before regulation can take effect, if it ever does. And just because law makers put a law into effect, doesn't mean it won't withstand a challenge in the supreme court.

Agreed.