Apple-Epic Judge Hints at Compromise in Feud Over App Store (bloomberg.com) 93
The judge overseeing the high-stakes trial between Epic Games and Apple hinted at a compromise that turns on the iPhone maker allowing developers to inform users through their mobile apps that they can buy virtual goods on the web at a cheaper cost. From a report: U.S. District Judge Yvonne Gonzalez Rogers appeared to be looking for middle ground while hearing from economists called by both companies as expert witnesses in a case that threatens to upend the multibillion-dollar marketplace for apps that run on mobile phones around the world.
The judge questioned Apple's App Store rule that blocks developers from including a link or other information in their apps to steer users away from the store to buy virtual goods elsewhere online at a discounted rate. The anti-steering policy is at the heart of Epic's argument that Apple maintains a near-monopoly and juices profits by barring developers from offering alternative payment options in their apps. "What's so bad about it anyway, for consumers to have choice?" Gonzalez Rogers asked Richard Schmalensee, an economist and Massachusetts Institute of Technology professor, who was testifying Wednesday as an expert witness for Apple in the second week of trial in Oakland, California.
Her question drew pushback from Schmalensee, who noted that the U.S. Supreme Court, in a 2018 ruling, threw out a lawsuit that accused American Express of thwarting competition by prohibiting merchants from steering customers to cards with lower fees. "If the app vendor can say, if you press this button you can buy this for less, that means the App Store can't collect its commission," Schmalensee said. That amounts to "undercutting" Apple's App Store sales, he said. Gonzalez Rogers said she didn't think the situations were "factually the same."
The judge questioned Apple's App Store rule that blocks developers from including a link or other information in their apps to steer users away from the store to buy virtual goods elsewhere online at a discounted rate. The anti-steering policy is at the heart of Epic's argument that Apple maintains a near-monopoly and juices profits by barring developers from offering alternative payment options in their apps. "What's so bad about it anyway, for consumers to have choice?" Gonzalez Rogers asked Richard Schmalensee, an economist and Massachusetts Institute of Technology professor, who was testifying Wednesday as an expert witness for Apple in the second week of trial in Oakland, California.
Her question drew pushback from Schmalensee, who noted that the U.S. Supreme Court, in a 2018 ruling, threw out a lawsuit that accused American Express of thwarting competition by prohibiting merchants from steering customers to cards with lower fees. "If the app vendor can say, if you press this button you can buy this for less, that means the App Store can't collect its commission," Schmalensee said. That amounts to "undercutting" Apple's App Store sales, he said. Gonzalez Rogers said she didn't think the situations were "factually the same."
at the very least let them say that apple takes an (Score:3)
at the very least let them say that apple takes an 30% cut Facebook had that issue.
Re:at the very least let them say that apple takes (Score:4, Informative)
So many people miss what Epic is suing about. The judge isn't going to adjust the 30% because that's not what the lawsuit is about. You can read it yourself here [unrealengine.com].
The claims are:
Count 1: Federal Unlawful Monopoly Maintenance in the iOS App Distribution Market; Count 2: Federal Denial of Essential Facility in the iOS App Distribution Market; Count 3: Federal Unreasonable Restraints of Trade in the iOS App Market; Count 4: Federal Unlawful Monopoly Maintenance in the iOS in-App Payment Processing Market; Count 5: Federal Unreasonable Restraints of Trade in the iOS In-App Payment Processing Market; Count 6: Federal Unlawful Tying the App Store in the iOS App Distribution Market to In-App Purchases in the iOS In-App Payment Processing Market; Count 7: California Unreasonable Restraints of Trade in the iOS App Distribution Market, Count 8: California Unreasonable Restraints of Trade in the iOS In-App Payment Processing Market; Count 9: California Unlawful Tying the App Store in the iOS App Distribution Market to In-App Purchase in the iOS In-App Payment Processing Market; and Count 10: California Unfair Competition.
A compromise deal to get the game with Epic's payment processing may help with counts 2, 3, 5, 7, and 8. It would not resolve the other five.
Re: (Score:3)
So here's the thing: Epic doesn't care. They're in this for the money, and if they get a settlement that gets them the money, they'll happily say "screw what's right, we get paid" and go for it.
For the rest of us, the obvious solution is a "let me install whatever app I want from whatever source I choose" switch. But while Epic is asking the court to fix that issue, it's not really relevant to what they're looking to get out of this. They want the money. If Apple offered to only take a 5% cut instead o
Re:at the very least let them say that apple takes (Score:5, Interesting)
If Apple offered to only take a 5% cut instead of 30%, but just for Epic, they'd take the money and run.
They might. I don't think they would, but they might.
However, assuming this actually goes to a judgement, the judge is not ruling on the 30%. That's not what the claims are, nor the remedy they're asking for.
Many of the news articles are making great points about the presentation reinforcing views regarding the 30%, but when it comes to the actual claims in the lawsuit, the case overall is going very badly for Apple. Perhaps the biggest question for them is about the nature of the market, and their lawyers are clearly avoiding it by calling it anything but what it is called in the lawsuit claims.
As the article pointed out, the judge did indeed suggest some things regarding compromise, but the answers were damning against Apple. In what the reporters thought were regarding compromise, she asked about the possibility of buying virtual goods elsewhere, and was told that's against their policy. That's a direct statement regarding counts 4, 5, 6, 8, and 9 that Schmalensee unintentionally was supporting. He said he did suppose that they could do something different if Apple changed their policies, reinforcing that they had restrained trade by their policies. What he described as undercutting the sales was actually the textbook examples for claims 6 and 9 for unlawful tying, and for count ten's unfair competition laws; if third parties would choose to use alternatives at a lower cost if not for the tie to the distribution methods, that's strong evidence about the nature of the tying. "Options don't exist in these circumstance." That isn't talk about compromise like people think was hinting, that's a direct question about if trade had been restrained and if the markets had been tied.
Apple is still trying desperately to change what the market means. The claims are all "in the iOS App Distribution Market", or "in the iOS Payment Processing Market". Apple's lawyers are extremely careful not to use those words, if you're paying attention to the details. Apple keeps trying to frame it as the games market such as pulling in Valve and XBox, the apps market by invoking the Google Play store, the smart phone market generally, calling the markets anything other than the iOS markets actually listed in the lawsuit. Time will tell if the judge will agree with them. Defining what the extent of the market actually is makes an enormous difference to possible outcomes.
If the judge agrees with the definition of the markets as an iOS constrained marketplace, Apple's executives own testimony and emails have sealed it's own fate dramatically, at least for the tying and restraint of trade points. Their expert witness today further cemented it against those counts by saying they had the option to change it up.
Re: (Score:2)
Considering the plaintiff (Epic) is still presenting, it's too early to say "going badly for Apple" because Apple ha
Re: (Score:2)
"But Your Honor, the murderer has a fan base!"
Re: (Score:2)
Well, that's just it, isn't it; if Apple agreed to stop manipulating the market they control and also participate in, the whole problem of their manipulating the market would be solved! Golly gee, what an insight. LOL
Re: (Score:2)
EPIC don't want money from Apple... EPIC wants a court decision against Apple...
They want to set up a jurisprudence which could then be used against Microsoft and Sony...
Don't forget that Fortnite revenues are 7% from Apple, more than 30% from XBos and more than 40% from PS.
there are other issues like remote games where (Score:4, Insightful)
there are other issues like remote games where each game needs to be reviewed by apple.
But they don't force Netflix to have each tv show / movie be reviewed
Re:there are other issues like remote games where (Score:4, Insightful)
It's not really the same thing. Apps like Netflix and Youtube use codecs to decrypt and translate streams. That would be like arguing VLC has to be reviewed for every video someone plays on it. While I get that most games use a few engines, and one might argue that the games themselves are simply data fed through an engine, there's still a lot of customization even in games that use the same engine, so each one is very much an individual app.
Re:there are other issues like remote games where (Score:4, Informative)
No, it's pretty much exactly the same thing. While it's available now, Apple initially rejected Steam Link because it allowed people to play games that Apple hadn't approved on iDevices by streaming them from a computer. And of course all references to Steam's store had to be removed from the app, because Apple.
Re: (Score:2)
I think it'd be interesting to learn whether Apple applied any additional scrutiny to Netflix when they released the "Black Mirror - Bandersnatch" episode that was a Choose Your Own Adventure interactive experience. Does that count as a "game"? Or is the user input simplistic enough, and the number of outcomes limited enough, that it falls under the same review guidelines as the rest of Netflix's content?
Then there's the whole Visual Novel genre. They're sold as "games" on stores like Steam but I could
Re:there are other issues like remote games where (Score:4, Insightful)
That is already covered by Count 2, Count 3, Count 7, and Count 10.
Far too many people watching the trial wrongly assume this is about the 30% cut. The 10 counts in the lawsuit are entirely about antitrust and unfair competition law.
Re: (Score:2)
For Epic, this is about the 30% cut. That's the entirety of the issue that they actually care about.
The other issues are there to give them leverage, they'll happily abandon them if they can get the money.
And then the rest of us will have to wait for the next lawsuit.
Re: (Score:2)
Part of the relevant market definition in antitrust jurisprudence has to do with whether or not an anticompetitive cost increase will result in people switching to other platforms in said market.
If everyone is taking 30%, it will not.
If some entity is offering 15%, and people still do not switch, that's a major point in defining the relevant market to exclude the entity taking 15%.
Re: (Score:2)
Before you slap me around for exclusion of other relevant points in the relevant market:
No, I'm not claiming that the cut differential is the only, or even the most determining factor. It's just one of the central.
The bigger one in my eyes is the fact that someone can't take their software with them, which was central in the US v. Microsoft relevant market definition.
Re: (Score:2)
But they don't force Netflix to have each tv show / movie be reviewed
Movies are not software.
Re: (Score:2)
well if they any alt tracks or stuff like dvd extras then it may be software.
Re: (Score:2)
It's all a bunch of 0 and 1, how can you tell?
Re: (Score:2)
They are copyrighted works available in the same market, this is not a worthwhile distinction to make. No argument gains by splitting this hair.
News at 11.... (Score:2)
there are other issues like remote games where each game needs to be reviewed by apple.
But they don't force Netflix to have each tv show / movie be reviewed
STATIC CONTENT IS NOT DYNAMIC CONTENT.
So... (Score:4, Insightful)
No emulators
No remote / streamed games, but Steam Link to your PC is okay, still no purchase
No DLC from alternate stores
Not even book purchases without giving in a cut
I think they played their hand a bit too much, and it might be time to open up some compromises.
apple webkit only, content censorship apple to far (Score:2)
apple webkit only, content censorship apple did go to far.
Hell if they had this back in the day games like leisure suit larry would of been banned for being to adult.
mod parent up (Score:1)
I think that scares me the most about this it sets a technical precedent for actually gathering meta-data on everything you do inside third-party apps as well. Similarly to the way Google can undercut big data firms that use their APIs since databases are not copyrightable.
Judges dislike making binding decisions (Score:5, Insightful)
They'll often hint at what they think participants should do, but without making actual decisions that might be appealed or overturned. It's a reason that courts appreciate plea agreements, in criminal and in civil cases. Sadly, this often makes a court complicit in unfair settlements, to the benefit of the lawyers but not the plaintiff in civil cases where they do, indeed, have strong grounds for their suit but the court wishes to not spend more time on the matter.
Re:Judges dislike making binding decisions (Score:4, Insightful)
This statement shows a deep ignorance of what civil court system is fundamentally about.
It's not about figuring out "who's right/fair", or "who needs punishment". It's about "find a compromise that can satisfy all relevant parties to sufficient extent that they can accept it". This is because of how humans function as species, and is rooted in many millenia of tradition of settling arguments within human societies across time, cultures and locations. We do not want a forced settlement, because forced settlement is vastly inefficient. It carries with it a significant enforcement cost, as party that can't accept the outcome will attempt to renege on the accepted agreement as much as it possibly can, far more so than a settlement it found unwanted but acceptable.
Which is why all civil courts seek solutions that parties can accept without being bound by the judge.
Re: (Score:1)
I don’t see how your arguments conflict but IANAL
Re: (Score:2)
"Unfair settlement". This isn't US criminal court, but a civil one. There's a good argument to be made about a mix of excessive punishment written in various US and state laws combined with culture for DA misconduct in US that makes for a highly flawed criminal justice system in that country.
Same does not apply to civil court, especially in a case of two giant companies that can afford best lawyers money can buy feuding over the very concept of "fairness" in relation to competition. The reason the judge is
Re: (Score:2)
> There is nothing unfair about this.
There is often a great deal unfair about this. Please look into patent law, where suites of often ill-founded patents are used as threats against smaller companies with only a few relevant patents and without the resources to outlast a larger companies legal team. And look into the abuse of copyright law against people who do what is clearly "fair use" quoting or excerpts of larger works, but who nonetheless face abuse by copyright tolls. Or SLAPP, where the threat of
Re: (Score:2)
Chinese troll would indeed know a thing or two about propaganda control and court systems that function exactly as state intends them to.
Sadly for chinese troll, I do in fact have quite a bit of a clue about both said Chinese systems as well as US ones.
Re: (Score:2)
>The US system doesn't function how the state wants?
Correct, because the function isn't a part of The Party, and it doesn't serve The Party. I.e. it's not a system specifically aimed at the people in the nation to maintain the hegemony of The Party.
I know that as someone who's job is to ensure that The Party wins no matter how many must be genocided to do so, it is confusing to you how a court system that is fully enslaved to The Party is not a great thing. For the rest of us, the concept of separation o
Re: (Score:2)
It's genuinely funny to see someone be this ignorant of how relevant system works. But then, you're not going to get someone who scored high on gaokao to do this sort of a menial job that requires near total obedience to narrative and just repeating lines from a cheat sheet. Those people go to at least try to be creative to help The Party, rather than be the low end drones.
Re: (Score:2)
That's an interesting projection on your part. What made you think that?
Re: (Score:2)
>Please look into patent law
You are no longer complaining about the court system, but specific legislation that forms a tiny fraction of civil court cases. This is a complaint addressed at an entirely different branch of government.
Like I said above, this statement, just like your previous one show deep level of ignorance of what it is you're actually complaining about.
Also
>Or SLAPP, where the threat of civil litigation is abused to prevent news reporting against powerful corporations
Is insufficiently
Re: (Score:2)
The problem is endemic, and exists throughout US court systems. I've held up patent and copyright law as particular examples, relevant to Slashdot, where the problem is exceptionally bad and demonstrably so. Even for criminal cases, over 90% of all drug cases are resolved through plea agreements. The idea that the court is a danger to be used as a threat to force litigants or defendants into plea agreements, is an exceptionally dangerous one even if it is far too commonplace among litigants. It lends itself
Re: (Score:2)
Resources grant all living creatures ability of better enforcement of their claims. This isn't limited to humans, pretty much every DNA based life form on the planet follows this principle.
Re: (Score:2)
Yes.
What does democracy have to do with it?
No.
Re: (Score:2)
You don't have a faintest clue what democracy is and why it is the way it is, and instead function on assumption that "democracy" is somehow interfaced with "justice".
Ok.
Re: (Score:2)
I'm completely wrong, but you can't explain how or why, after you demonstrate utter lack of the most basic comprehension of what democracy is, as well as how separation of powers works.
It's funny how you keep showing that to be a typical wumao like yourself pretty much requires being very much a bottom of the barrel when it comes to fairly basic education.
Re: (Score:2)
"I have no explanation for my position on how this system functions, so I'll instead produce an irrelevant factoid on a completely different part of this system and pretend that it's relevant to discussion because [no reason given]".
Ok. Like I said, the job you're doing is for bottom feeders. And you just keep making that clearer and clearer with every post.
Re: (Score:2)
I do enjoy these talks. They remind me of the days of me still playing LoL.
>You're still feeding dumbass.
Re: (Score:2)
You have a brain of a feeder too. I'm half a mind to just answer you with copypasta about Tiananmen Square 1989 to disconnect you as was done a few years ago to Chinese cheaters.
Re: (Score:2)
You think far too much of yourself. Mocking your for being you strictly a side story, most of my posts are not talking to you.
Re: (Score:2)
Like I said above, I have certain fondness for kicking pro-genocide propagandists, even when they're mentally clearly in the bottom 30 percentile or so.
Re: (Score:2)
Except that bottom 30 percentile aren't retarded. Mental retardation levels is usually less than 1% overall, with higher rate in children and much lower in adults.
What I'm kicking is a stupid propagandist thinking himself smart as he makes awful arguments for things like genocide. A bottom feeder. You.
Re: (Score:2)
No, the numbers on amount of people with mental retardation are very real. You can google them.
Oh wait, you probably can't, Great Firewall blocks google and all. Try it on baidu then.
Re: (Score:2)
That is a common misconception among people who's understanding of courts is from US court drama.
Needless to day, everyday court work has very little in common with dramatised TV and hollywood stuff.
Re: (Score:2)
This is because of how humans function as species, and is rooted in many millenia of tradition of settling arguments within human societies across time, cultures and locations.
O'Really? Since the first punch, settling arguments within human societies resumes to having bigger guns.
Re: (Score:2)
And bigger guns need more resources to invent, test, build and maintain. What part of your statement disagrees with the point?
Re: (Score:2)
The part were you assume humans will go for compromise instead of fight. You only try to compromise when you figure you can;t take out the opponent. And even then you won't be happy and build bigger guns.
Re: (Score:2)
That assumption is only built on the fact that to my knowledge, every territorial mammal and most of the representatives of animalia kingdom follow this behavioural pattern, including humans.
What are you basing you ridiculous, anti-reality claim of "humans go for the fight first"?
Reminder: even if you are fairly certain you can win, you still have a good chance of taking significant damage. That's the basic calculus that evolution figured out at least several hundred millions years ago, which is why the esc
Re: (Score:2)
You said it yourself, animals don't compromise. They bully, pardon me, intimidate first, then go for the throat. Same as humans: my gun is bigger than yours so hand over the goods or you will get it.
In a way, you can say that's a compromise, also: the victim agrees to part with his goods and the attacker doesn't kill him.
Re: (Score:2)
Any human that "goes for the gun first" establishes a precedent and tends to live a very short, violent and poor life. For a reason.
You fundamentally misunderstand the concept of escalation, thinking that it starts with violence. Violence is the final stage of escalation, both demonstrative and performative.
Re: (Score:2)
Didn't Japanese teach you how poorly that works when they raped and pillaged your country in the last major war? You slit one soldier's throat, they rape and kill your whole village in revenge.
Re: (Score:2)
Blowing it up is so impersonal, and there are plenty of survivors to tell the tale. Competitions for most beheadings, and babies on bayonets on the other hand, must more in your face. And there are far less survivors to need to kill later.
P.S. It's genuinely funny how poorly you comprehend what I am and what I do in real life. But it's also a solid testament of inherent supremacism of culture of a nation that believes in Heavenly Mandate granted to its leadership, believing itself to be the greatest civiliz
Re: (Score:2)
Funny part is, I know several members of our local Communist party. They're weird and daft in terms of politics, but they're fun to play football with.
Or well, were before China gave its current gift to the world, closing down sports.
Not Really The Same (Score:4, Insightful)
Her question drew pushback from Schmalensee, who noted that the U.S. Supreme Court, in a 2018 ruling, threw out a lawsuit that accused American Express of thwarting competition by prohibiting merchants from steering customers to cards with lower fees.
This isn't really the same though. If the merchants don't like American Express' policies, they can choose to stop accepting American Express since there are many other forms of payment the merchants can take -- cash, check, Visa, Mastercard, Discover, store gift cards, or their own store branded credit card.
With the App Store, you have no choice. Everything is handled by Apple.
What this boils down to is competition. With Apple, there's zero competition.
Re: (Score:3, Insightful)
I can play fortnite and I don't even own an apple device.
Re: (Score:1)
Fortnite, PUBG, and Apex Legends do quite a service to the gaming community. They keep all the horri-bad players there, where everywhere else, just by law of averages, winds up with better gamers on average, be it MMOs, FPS games, or anything multiplayer.
Re: (Score:2)
That’s not the judges argument anyway. It has the precedent for his ruling if it were to be that this policy is anticompetitive and illegal.
Re: (Score:1)
What this boils down to is competition. With Apple, there's zero competition.
The competition is called Android. And in the case of games, Xbox, PS whatever the number is, etc.
All apps will get a free web activated version (Score:2)
You'll be able to buy an app, or download a free version which will ask you to log in somewhere to continue to use it. You'll be able to buy your app features at a discount on the web either directly from the developer or some new upstart WebAppStore - the latter for developers who don't want to maintain their own web front end but want to offer the app at a discount. Those user who prefer the convenience, will pay be able to pay the premium to go though the Apple Store, but that premium may increase to com
Apple's compromise (Score:2)
Re: (Score:3)
However, Apple will NOT do any business with TenCent or Epic, ever again.
They will unless they want to be forced to divest their control of the market they created.
Re: (Score:2)
Doing so would only validate de facto several of the claims made by EPIC and put Apple in lots more legal trouble...
It'd equate to prove they are monopolistic bastards who disregard the federal laws.
Isn't Epic doing the same thing? (Score:1)
Epic Store [epicgames.com]
Core is Epic's Apple Store.
That means, not only they are doing the same as Apple, but it will be possible that in the future a company would sue Epic on the same grounds Epic is suing Apple.