THE NEUTRAL ZONE
Epic Games has filed lawsuits against tech giants Apple and Google after both companies removed Epic’s popular Fortnite game from their app stores, violating the companies’ direct-payment policies. The lawsuit will determine the legality of Fortnite’s attempt to circumvent the transaction fees with its own in-app purchases. Both Apple and Google currently charge up to 30% per transaction within the game. Epic argues that “Apple is bigger, more powerful, more entrenched and more pernicious than monopolies of yesteryear,” and that Google used its size” to do evil upon competitors, innovators, customers,” falling short of their “Don’t Be Evil” slogan.
Fortnite also released a 1984-themed video mocking Apple’s famous anti-monopoly advertisement in which it recontextualized Apple as the very type of company it sought to upend. Epic created a social media campaign attempting to rally Fortnite players against the tech giants, warning that they could miss updates within the game if the lawsuit drags on. Facebook spoke out against Apple, stating that Apple’s app store policies only allow Facebook to pay small businesses a fraction of its sales via Facebook’s new paid online events feature. Facebook app head Fidji Simo asked Apple to reduce its 30% App Store tax or allow Facebook Pay on its platform to provide more revenue to businesses struggling from Covid-19. “Unfortunately, they dismissed both our requests and SMBs will only be paid 70% of their hard-earned revenue,” Simo said. Google does not take a cut of sales from users on Android devices, so Facebook alerted iOS users of the revenue tax specific to them.
With Fortnite pulling in an estimated $46.7 million just in the past month, Epic stands to face an uphill battle against two of the world’s largest tech companies. Apple is facing antitrust related scrutiny over its anti-competitive practices, which could skew public perception in Epic’s favor.
Meanwhile, indie game developers could benefit from Epic winning the suit, as getting rid of the app-store tax would allow smaller creators to earn a larger share of the revenue they generate. Some say that Epic set up an “antitrust trap” for Apple, meaning Epic knowingly violated the rules of the platform to lure Apple and Google into public court battles that they hope will create enough public backlash to force policy change.
Apple just kicked Fortnite off the App Store – The Verge – 8/13/2020
The decision marks a significant escalation in the feud between Epic and one of the world’s most dominant mobile software marketplaces. It also comes at an especially fraught time for Apple as the iPhone maker navigates antitrust concerns over its operation of the App Store and the rules it imposes on certain developers.
Payments industry should be worried by Fortnite suing Google — not Apple – PaymentsSource – 8/14/2020
Just as the card networks and mobile wallet providers can point to options such as checks or cash to show that merchants and consumers can still make payments if they don’t like their credit cards’ fee structures, Google can point to the alternative app stores to argue that it does not hold a monopoly on Android payments. But if Epic can show that these alternatives don’t sufficiently loosen Google’s grip, merchants can use it as an example to make the same argument against interchange fees and other policies.
‘Fortnite’ maker Epic Games just set an antitrust trap for Apple, and Tim Cook walked right into it – Business Insider – 8/14/2020
Epic was obviously expecting Apple’s decision to eject “Fortnite,” because shortly thereafter, the company sprung the final part of its snare. It filed a lawsuit accusing Apple of trying to illegally block competition in the markets for app distribution and in-app purchases on iPhones and iPads — and cited Apple’s response to its discounted V-buck offer as a primary case in point.
If ‘Fortnite’ Stands Its Ground Against Apple And Google, Epic Could Lose A Ton Of Money – Forbes – 8/14/2020
The game has two weeks until the next season launches, and the game can no longer be updated through the app store. While players can play stuck in old seasons, they will not be able to access new ones, or new cosmetics. That will effectively kill the game on mobile, short of side-loading through the Epic launcher on Google, though who knows how many people will know to do that. It should not be playable on Apple devices at all.