However, if this is the case why is there two accounts, one for Epic International and one for Epic Games? I thought the Epic International account was for enterprise and was being misused for Unreal distribution or something.
It feels as though maybe Epic have two app-store accounts one they use for iOS games like Fortnite and one they use for Unreal. This would explain Apple’s assertion that Epic could simply swap from one account to another to switch any “blame”, and why Apple felt it right to terminate the duplicate (Unreal) account.
This scenario seems the real one, but why Epic made such a fuss over it I don’t know, because if Apple had terminated the Epic International account, Epic could have just used the Epic Games account instead which was not under threat.
The only scenario in which it would have made a big difference is if one of the accounts had been an enterprise one, like I originally suggested.
So you answered your own question here, Epic Games publishes Fortnite to the App Store and breached its developer contract when they introduced their own payment system so Apple is within their rights to terminate it.
Epic International develops the Unreal Engine which is sold or licensed to other developers to build games on International doesn't publish anything because Unreal Engine doesn't do much on its own so International has not breached its own developer contract (yet). Apple may or may not have cited the possibility that Epic Games could simply switch to publishing Fortnite via the Epic International account as a reason to terminate that one too but this is likely not true for the following reasons:
Apple just wanted leverage against Epic in this fight and maybe to just point out to everyone (including Epic) how much Apple's platform has benefitted them until now.
Since Epic International only really requires the tools and resources from an Apple Developer account, it seems trivial that they could simply open another one and access those resources from there so no harm would really be done. They could just set their devs as freelancers and buy them one each even.
Likewise, Epic Games could rebrand or create a subsidiary or affiliate etc and open a new account of their own with which to re-publish. Whichever account they use, its not going to last very long if they are still breaching the terms. Its not like they are going to change the name of Fortnite or be able to disguise it as a different game.
Anyway, Apple did put Epic International and the Unreal Engine under threat deliberately to put Epic in their place somewhat.
Yeah the McDonald’s thing is interesting. I feel like they said digital only because in app purchases are really just a deferred payment for many apps. Like instead of paying 50 dollars that you would balk at for a photoshop app you kind of pay it off later through in app purchases.
It comes down to practical economics. If Apple charged their 30% on physical goods, for a start that would be a pretty extortionate commission. Compare that rate to payment processors or even auction houses and its not a very competitive rate so its likely to land them in trouble sooner or later.
More important than that is that when Apple charges 30%, the seller has two choices: Eat the cost or add it on. If you add 30% to your McDonalds or Dominos order, that's going to heavily impact how many people use that app. You can just go on the website instead and if Apple complains you are breaking the rules by circumventing their commission despite your website processing orders for years previously, you're just going to axe the app more than likely. McDonald's cannot afford to add 30% or eat it themselves. What about eBay? Imagine the outrage there if Apple added 30% to every auction price! Not going to work.
There is a justification for this beyond pricing. McDonalds developed the recipe for that burger, meat, seasoning, preservatives sauce, the lot. They spent a fortune developing it, protecting it, getting it consistent across thousands of restaurants all over the world, advertising it, setting up supply chains, then some oil has to cook it and wrap it before they hand it to you. And it cost $3 after all that. The profit margin on it is probably less than 50c. Now Apple wants a buck.
That stupid hat you bought on Fortnite took one dude a couple of hours to whip up one morning. He might get $200 an hour but Epic can sell an infinite number of those hats having paid a one-off cost of under $500. And every one they sell is $3 again. Or if its really flashy maybe its $10. Or if its a franchise tie-in, its $20 and $10 of it goes to Disney or whoever. If Apple gets $1-6, Epic still makes good money for basically nothing. They can afford to eat the cost. This is assuming they actually sell you the hat for a few bucks. They probably charge you a couple of bucks for a chance to win it. With an average cost of winning anywhere up to $100 or more.
The judge ruled that it wasn't in the public interest that Unreal Engine be hindered and the order held that Apple shouldn't be able to interfere with that relationship and that it felt like overreach. As you rightly point out that doesn't prevent Apple trying to cancel their contract later on and obviously Epic could then litigate against them terminating the contract. Unless things get significantly worse, I don't see Apple invoking the nuclear option on Epic however I think it was a rude awakening of what that nuke looked like. More importantly the judge didn't rule that it was illegal for Apple to do such a thing, they said it was not in the public interest for the purposes of the TRO to let Apple alter the status quo at this time.
My understanding was that it had nothing to do with public interest. That gets decided later. The judge ruled that terminating Epic International would cause irreparable damage to the Unreal Engine. Specifically its reputation and customer base, if it were kicked from iOS for any length of time. This would be unfair in the event that Epic went on to win the overall suit, so the judge blocked Apple from doing it. Apple was overreaching to make a point and gain leverage over Epic as the judge says but if Epic use that account to publish Fortnite again and don't remove the payment runaround, Apple will be well within their rights to kick that one too regardless of any damage it does to Unreal Engine.
That said Epic have gone to war now with Sony, Microsoft and Steam in recent memory. They've now gone to war with Apple and Google, what's to say they don't make some other move that limits their other platforms?
Yeah, talk about biting the hands that feed. I can't see Epic coming out of this looking all that good. They just look greedy, petulant and ungrateful. Citing a monopoly is daft when you're suing two of them at once. If theres two, they aren't monopolies are they? If they believe there is price fixing going on surely they could have filed a complaint with the relevant authorities? But then Google would point out there is a way around their commission and Apple can point out they can stick to Android and go around Goode's commission and they have no leg to stand on again. They just seem to want a free lunch.
If apple wanted that, they had it in their power to do that without making the court overrule them on unreal.
Apple’s concern re: the unreal dev account is that they don’t want fortnite developers to switch to using that account, etc.
Its just about gaining leverage. And maybe to intimidate a little. If Fortnite goes offline and then Unreal loses all its customers, Epic's shares will tank. They will be forced to sell Unreal at below its value because they have no choice but to sell it and then they will just be the owners of a game no-one can play any more unless they are prepared to piss about side loading their hand me down Android phones. It would die fast and so would Epic.
If Apple was a more open system, it really wouldn’t be Apple. A lot of how they got where they are is they were able to convince media owners that they could protect content because of their closed system. Remove that advantage and maybe Android would have more marketshare in the US.
I suspect its more to do with wealth and patriotism. Americans have more disposable income so they can buy nicer phones. Also Apple is American and most users have no idea that Android is google and hence also American. They see Samsung, Huawei, LG etc and assume its not American so they buy Apple.
