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“A sad outcome for all developers.”
Image credit: Epic Games
Epic Games boss Tim Sweeney has vowed more legal action against Apple, just days after the US Supreme Court dismissed both parties’ further attempts to appeal a 2021 California court ruling on the Epic vs. Apple antitrust lawsuit.
Epic initially launched court proceedings against Apple back in August 2020, after the company revoked Epic’s Fortnite developer account, preventing the game from being distributed on its devices. Apple made the move after Epic deliberately circumvented contractually mandated App Store payment mechanisms within its Fortnite iOS app, which would have allowed it to avoid Apple’s 30 percent platform fees.
A decision on Epic’s lawsuit came in September 2021, when Judge Gonzalez-Rogers ruled against Epic in nine of its 10 claims, determining the company had failed to prove Apple held a monopoly as defined by antitrust laws. Gonzalez-Rogers did, however, side with Epic in one matter, ruling Apple could not block developers from linking out to alternative payment methods from within their apps – a practice known as “anti-steering” – as that would constitute “anti-competitive conduct” under state law.
Since then, Apple and Epic have been embroiled in appeals, neither party happy with Gonzalez-Rogers’ decision; but after the US Ninth Circuit Court of Appeals ruled to uphold the lower court’s 2021 verdict last April, Epic and Apple both petitioned the US Supreme Court to overthrow the decision – and those requests have now been rejected.
As reported by Reuters, the Supreme Court declined to hear Apple’s appeal against California’s anti-steering decision, while also choosing to dismiss Epic’s challenge against the ruling that Apple’s policies did not violate federal antitrust laws. No reason for the decision was given.
Following, the Supreme Court decision Epic’s Tim Sweeney took to social media to declare, “The court battle to open iOS to competing stores and payments is lost in the United States”, calling it a “sad outcome for all developers”.
Apple, meanwhile, has been forced to begin allowing iOS developers to include “metadata buttons, external links, or other calls to action that direct customers to purchasing mechanisms” in their apps, as per Gonzalez-Rogers’ ruling. However, in doing so, Apple is mandating developers must still pay a 27 percent commission on proceeds made via external links on all goods that can be used in their app, provided sales were initiated within seven days of clicking through – a fee it insists is a “reasonable means to acount for the substantial value Apple provides developers, including in facilitating linked transactions” in its updated guidelines.
Apple has also implemented a full-screen notification, warning app users that it is “not responsible for the privacy or security of purchases made on the web”, that appears when clicking on a link leading to external payment methods.
Needless to say, Tim Sweeney is not happy, calling Apple’s fee an “anticompetitive new 27% tax” that “kills price competition”, and referring to its warning message as a “scare screen” that “disadvantages” developers. He added that “Epic will contest Apple’s bad-faith compliance plan in District Court”, indicating that Epic – which has already invested a huge amount of time and money in its beef with Apple – has no intention of backing down.
Sweeney’s threat of more legal action comes just months after Epic laid off 900 employees, telling staff that, “For a while now, we’ve been spending way more money than we earn” and insisting the job cuts would enable it to “stabilise our finances”. The company – which partnered with Microsoft in 2022 to provide iOS users with access to Fortnite via cloud streaming following its removal from the App Store – has since released Fortnite’s hugely popular throwback season, plus new Rocket Racing, rhythm-action, and Lego survival modes as part of its plans to improve its fortunes.
As for Apple, it still has to contend with considerable legal challenges outside the US. The company remains at loggerheads with EU antitrust regulators, which – as part of an investigation sparked by music-streaming service Spotify – has claimed the iPhone maker’s anti-steering rules break EU laws prohibiting unfair trading practices.
