Epic Files Appeal After Loss To Apple in App Store Case (bloomberg.com) 119
Epic Games filed a notice of appeal Sunday following a judge's decision in its antitrust lawsuit against Apple. From a report: U.S. District Judge Yvonne Gonzalez Rogers mostly sided with Apple, rejecting Epic's claims that the iPhone maker is a monopoly. She also didn't rule that Apple needs to restore Fortnite, Epic's hit game at the center of the lawsuit, to the App Store or Epic's Apple developer account. She also rejected the need for third-party App Stores and didn't force Apple to lower its App Store revenue cut of 15% to 30%.
The judge, however, said that Apple has engaged in some anticompetitive conduct and she ordered the Cupertino, California-based technology giant to allow all app and game developers to steer consumers to outside payment methods on the web. All developers for the first time could be able to include a button in their apps to let users pay for transactions online, circumventing Apple's fees. She also ordered Epic to pay at least $4 million in damages to Apple for breach of contract, which included collecting payments outside of Apple's in-app-purchase system.
The judge, however, said that Apple has engaged in some anticompetitive conduct and she ordered the Cupertino, California-based technology giant to allow all app and game developers to steer consumers to outside payment methods on the web. All developers for the first time could be able to include a button in their apps to let users pay for transactions online, circumventing Apple's fees. She also ordered Epic to pay at least $4 million in damages to Apple for breach of contract, which included collecting payments outside of Apple's in-app-purchase system.
I expect that Apple is going to require.... (Score:3)
Apple should, however, rightly continue to allow the iOS purchases to be more expensive than the otherwise equivalent purchases on Android, if the developer so chooses. This may necessitate having separate web portals for iOS and for Android versions of the product, depending on the circumstances.
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Apple could also introduce other fees and licensing fees to offset and revenue loss. I'm sure Epic would not be happy to be charged a per download fee for its apps, for example. As much as some are touting this as a win for small developers they may just see a rise in upfront costs instead of paying as the app sells.
Apple should, however, rightly continue to allow the iOS purchases to be more expensive than the otherwise equivalent purchases on Android, if the developer so chooses. This may necessitate having separate web portals for iOS and for Android versions of the product, depending on the circumstances.
Good point. It could force developers to lower Apple prices or risk angering customers who py more than Android users and who also realize the developer just got a 30% hike in revenue by avoi
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I don't think so, or else I think it would have already happened. It happens plenty of times already
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I don't think so, or else I think it would have already happened. It happens plenty of times already
Yea, but since Apple uses IAP it's not as obvious to most users versus going to a website that has Apple and Android prices. It's one more possible piece of collateral damage for developers, especially smaller ones for whom a revenue hit would hurt.
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I haven't read the judgement but any decent lawyer will have included a clause saying that Apple have no say in how outside payments are allowed to work. The entire judgement is pointless without it - Apple could simply say that outside purchases must be much more expensive or some crap like that.
All in all this is a huge win.
The loss of Fortnite on Apple is good, too. Lots of people want Fortnite on their devices and Apple doesn't have it any more. Kids will be definitely asking for Android next time aroun
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Do you have a copy lying around? Maybe you can enlighten us...
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Why not? Credit card companies do it.
And of course, it a developer doesn't like Apple's terms of service, they can always choose to focus on Android development. This is what many developers do.
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I am sure both Apple and Epic have a lot of decent lawyers. This isn't some small claims court type of actions there, where a landlord is charging rent for a kids lemon-aid stand.
Certainly hasn't sided with Apple (Score:1)
Basically, the judge has granted what Epic wants, just not retroactive is all. They now get to have their external payments!
Re: Certainly hasn't sided with Apple (Score:2)
Apple doesn't have to let Epic back in to the app store
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Apple doesn't have to let anyone in at all.
What it means is a new contract is needed to be negotiated from scratch. But the new contract is required to allow external payments.
Actually, that'll apply for all who want to get such an ability. If you stay with the existing contract you can't expect a new rule. That'll be what the Judge is saying. So, again, non-retroactive.
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Anti competitive practice, but contract is valid? (Score:2)
We rule that standing in a street corner and shaking down all passing by for cash is illegal. But all the pedestrians who dodged the illegal shakedown should pay the money they avoided paying.
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But the developer is held liable for breaching a contract that has just been ruled anti-competitive and illegal. Can't understand the logic.
You don't get to break a contract, and then hope a judge rules it invalid. Instead, you have to get a judge to rule it invalid, and then seek damages.
Which you may not get unless the contract is particularly egregious. It's expected that you know what you're signing when you sign it.
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She gave Epic what they needed but maybe they'll get the monopoly stuff on appeal.
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What is currently not allowed is purchases from within the app, and linking to alternative purchase methods from within the app.
Even the linking would be very problematic to Epic, because most of their in-app purchases are digital tat that nobody needs, and having to go to an external website is just enough to make lots of people wake up and not purchase.
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No, the only difference is that the judge
Actually it's not that (Score:2)
This implication is wrong. It's a pyrrhic victory. Contractually, they would still need to pay Apple's 30% cut, even if they used the outside payment methods. It's just harder for Apple to enforce it.
A Curse upon Epic and Tim! (Score:5, Insightful)
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The ruling seems self contradictory (Score:1)
"... she ordered the Cupertino, California-based technology giant to allow all app and game developers to steer consumers to outside payment methods on the web. All developers for the first time could be able to include a button in their apps to let users pay for transactions online, circumventing Apple's fees.
She also ordered Epic to pay at least $4 million in damages to Apple for breach of contract, which included collecting payments outside of Apple's in-app-purchase system."
Okay, so Apple contractually
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"No longer allowed" is the key thing you're skipping over.
You don't get to break a contract and then hope a judge rules it invalid. The proper course of action is to follow the contract, get the judge to rule part of it is invalid, and then seek damages.
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If a clause in a contract is illegal, then why on Earth should a court enforce it after they've determined that it was illegal in the first place?
Also, if you go your route, then it may be very difficult to get standing in the first place because you have to somehow first prove that you've suffered a harm to even get into court. Think about illegal non-compete clauses in an employment contract for example. How on Earth do you prove that you've suffered harm before you even try violating it?
By violating the
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If a clause in a contract is illegal, then why on Earth should a court enforce it after they've determined that it was illegal in the first place?
They aren't. The ruling is the punishment for unilaterally breaking the contract. Whether or not the provision is legal doesn't change that Epic broke the contract.
Also, if you go your route, then it may be very difficult to get standing in the first place because you have to somehow first prove that you've suffered a harm to even get into court
No, it's incredibly simple: "We think this part of the contract is illegal, and it's costing us $X/month".
Ta-da! Standing and damages.
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No future here (Score:2)
Seems 30% commission is still there (Score:2)
What would be much more disturbing for Epic is that if Apple has to allow alternative purchase systems to allow competitors, then surely Epic would have to enable purchases of their digital tat where they make the money by competitors. Like if I can buy some powerful weapon from Epic for $4.99, then a competitor should
Dividend (Score:2)
What are the odds that this judge will also be revealed to own Apple stock?
Definitely not a monopoly (Score:2)
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Someone in the previous Slashdot discussion on this point out that, legally, protections against anticompetitive behavior are not limited to monopolies.
Re:This is what I call capitalist judge... (Score:5, Insightful)
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The usual retort to this argument is you can always refuse to side-load apps. I don't like the idea because if I say... bank with a bank, or have a piece of hardware (like a car or a home appliance) that needs an App, and the company gets bought, or has a change of heart (or simply now can bypass the App Store restrictions), and only offers their app outside the store, I can not be sure what the App will do.
Sounds like a pretty far-fetched scenario. Android has allowed this from the beginning. Have any popular apps ever decided to stop distributing through the play store and require you to side-load?
The availability and multitude of apps of all kinds are present, so innovation isn't being severely restricted. It is a healthy ecosystem.
Just because Apple's extortion hasn't torpedoed the iOS platform doesn't mean it isn't anti-competitive. The Judge said that Apple doesn't hold a monopoly on mobile gaming, but they *do* within the iOS ecosystem. iPhones are general purpose computers and people can't be expected to choose what phone to buy with thi
Re:This is what I call capitalist judge... (Score:5, Insightful)
They also pointed out that between Apple and Google there exists a duopoly, and that neither has a monopoly as long as their market shares are more-or-less equivalent.
So please, can we let the tired, old, long-debunked, and now legally rejected assertion that Apple has an own-platform monopoly die the final death?
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False. The judge went with the narrowly constructed, "mobile game payments." The the games themselves.
If on appeal it turns out that the market is broader, like including games themselves, then the ruling will have to be broadened substantially and Epic would be nearly guaranteed to win the counter-suit.
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As for the likelihood of being overturned, according to the article I read, appeals generally do not get to reargue the basic facts of the case. Ostensibly this is because the experience of the original judge, having the benefit of being in the court room when the evidence was originally introduced, gets a lot of deference f
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"mobile game payments."
Not the games themselves.
And you know that if you read anything about it, so don't be such an obtuse moron.
appeals generally do not get to reargue the basic facts of the case
What the market turns on numerous questions of law, it is a fact that is floating off by itself and can't be questioned. That is, again, intentionally and blatantly obtuse.
It's like you think you're in debate class, and want to "win" an argument even when the facts don't support what you want to argue.
Re: This is what I call capitalist judge... (Score:2)
Monopoly is just the word used by users/the media to describe thr dominant position Apple has. It doesn't mean they fulfill the (high) legal criteria in the US to be considered a monopoly in the strict sense. Ask an Apple iOS user about their choice of app stores.
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As for the choice of app stores, the judge decided that the relevant market here is mobile game transactions, and so I h
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So please, can we let the tired, old, long-debunked, and now legally rejected assertion that Apple has an own-platform monopoly die the final death?
Absolutely not.
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Having considered and reviewed the evidence, the Court concludes based on its earlier findings of facts that the appropriate submarket to consider is digital game transactions as compared to general non-gaming apps. Indeed, the Court concluded that there were nine indicia indicating a submarket for gaming apps as opposed to non-gaming apps
I left out the 9 reasons because it is rather long, but if you want you can go to the decision directly, or you could read Ben Thompsons very thorough analysis of the decision at Stratechery - https://stratechery.com/2021/t... [stratechery.com] Ben quotes liberally from the decision.
I don't have to argue that they don't have a monopoly. Th
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Sounds like a pretty far-fetched scenario. Android has allowed this from the beginning. Have any popular apps ever decided to stop distributing through the play store and require you to side-load?
You mean other than the obvious one [epicgames.com] that immediately comes to mind? [theverge.com]
And before you point out the obvious—that it was banned from the Play Store—it was only added to the Play Store in April 2020, just four months prior to when it was removed. For the rest of the three years it's been out for Android, it's only been available via side-loading.
The Judge said that Apple doesn't hold a monopoly on mobile gaming, but they *do* within the iOS ecosystem.
The judge never said they have a monopoly on iOS. In fact, the ruling defined the relevant market as being one that extends beyond the iOS ecosystem, so wheth
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However, there's still life to this. I suspect appeals will go all the way to the top.
The trial judge ignored some established (but non-binding) precedent on what constitutes a relevant market for Sherman & Clayton suits.
Microsoft too attempted to say that operating systems were a market that included... all operating systems on all different kinds of hardware, something that would have soundly eliminated the claim t
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You mean other than the obvious one [epicgames.com] that immediately comes to mind? [theverge.com]
And before you point out the obvious—that it was banned from the Play Store—it was only added to the Play Store in April 2020, just four months prior to when it was removed. For the rest of the three years it's been out for Android, it's only been available via side-loading.
Sounds like it doesn't fit the criteria of a mainstream app that people got used to downloading from the Play Store only to have the rug pulled out from under them when the dev started requiring side-loading. At least you can get Fortnite on Android. You can't get it on iOS at all.
The judge never said they have a monopoly on iOS.
Yeah sorry that was my own assertion. Bad sentence formation.
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Sounds like it doesn't fit the criteria of a mainstream app that people got used to downloading from the Play Store only to have the rug pulled out from under them when the dev started requiring side-loading.
The original quote you pulled was talking about an inherent concern with allowing side-loaded at all. While the example provided by that poster involved the app moving from in the store to out of the store, and you carried that theme by adding it as a "criteria" in your post, nothing about that problem actually required such a move.
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So what?
Macdonalds doesn't hold a monopoly on hamburgers, but they *do* hold a monopoly on Big Macs.
Just because it's prohibitively expensive for people who use one platform to switch to another doesn't mean that one of the platforms is being anticompetitive about controlling what, in the end, is it's own fricken product. And it's not like this was a secret from anybody going in, everyone *knew*
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Macdonalds doesn't hold a monopoly on hamburgers, but they *do* hold a monopoly on Big Macs.
People go to McDonald's specifically when they want a Big Mac. This is more like buying an Apple car that won't take you to McDonald's when you want a hamburger. It will only let you drive to the iBurger because it's the "optimal hamburger experience" and they need to "protect people's health" by "controlling the ingredients".
And it's not like this was a secret from anybody going in, everyone *knew* what Apple was doing right from the start. The choice to not buy into it in the first place was *always* there. It shouldn't be Apple's fault that you might only now be experiencing buyer's remorse.
I don't agree that you can expect the average consumer to *know* what lock-in is and make an informed decision about it. A lot of people just get an iPhone because their friends/family
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Or you can, like I said, just not use Apple products in the first place.
It is categorically *NOT* Apple's fault that the average consumer might not have known what they were getting into buying an iPhone and discovering the lock-in when it was not any great secret in the first place.
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It seems like her ruling was a swell compromise. Apple will now have to compete with outside payment methods.
No. If you use external payment methods, YOU STILL OWE 30% to APPLE. And Apple will have right to audit you.
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What's more, they have the right to charge for it, so if you use external payment methods, you will have to pay a higher up-front fee to get the app into the app store in the first place.
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What I would like to see eliminated is the shockingly anti-competitive aspects of it.
I.e., "if your app competes with a functionality that we consider core to the iPhone, you can fuck off"
While this sounds rational at the outset, it leads to things like the SteamLink app hiding the streamed "Store" icon, that lets you interact with the Steam store... on a remote computer, via your mobile device.
Which is not just stupid, it's actually pretty fucking insu
Re: This is what I call capitalist judge... (Score:2)
You are arguing it is a natural monopoly. Do you even understand the implications of what you are saying?
Re: This is what I call capitalist judge... (Score:2)
Re:This is what I call capitalist judge... (Score:5, Interesting)
Nope. The judge didn't say anything about circumventing a monopoly. The judge specifically said Apple did not have a monopoly, at all, anywhere to do with the App store. You don't need to be a monopoly to use your market power anticompetitively.
P.S. pay for past circumventions of profit to Apple anyways...
Indeed, the fact that the judge ordered Apple to change their ToS has nothing to do with the fact that Epic was in breach of the ToS they willingly accepted in the first place.
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While technically you are correct, here's the relevant quote from the Verge article:
The ruling leaves the door open for future antitrust complaints. “The evidence does suggest that Apple is near the precipice of substantial market power, or monopoly power, with its considerable market share,” Rogers writes. “Apple is only saved by the fact that its share is not higher, that competitors from related submarkets are making inroads into the mobile gaming submarket, and, perhaps, because [Epic] did not focus on this topic.”
To me, that's just a matter of perception of "market share". For Apple devices, that market share is 100%.
Re:This is what I call capitalist judge... (Score:4, Insightful)
To me, that's just a matter of perception of "market share". For Apple devices, that market share is 100%.
Yes, and by that measure, Camaros represent 100% of the Camaro market. Chevrolet should be held accountable for that monopoly.
*Anything* is a monopoly if you remove the rest of the product from the assessment.
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To me, that's just a matter of perception of "market share". For Apple devices, that market share is 100%.
And Frank—a super nice guy who hasn't slowed down at all, despite losing a hand in an accident—at my local Frank's Country Store has an undisputed monopoly on all Frank's Country Stores, given that his is the only one. While markets are indeed a matter of perspective, the courts do not share your perspective on how markets are defined, and in this case they found that the market included all mobile games, thus extending well beyond Apple's ecosystem.
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To me, that's just a matter of perception of "market share". For Apple devices, that market share is 100%.
It's not up to you, it's up to the judge. The judge ruled the market share is 55% and competitive because a single device is not a market and combining the low market share of Apple devices with the larger use of App Store vs Play Store he came to that number.
If you want to distill down markets to an arbitrary definition then everyone has a monopoly on their product. The word ceases to have meaning.
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Well being a 28 billion dollar company vs a 2 trillion dollar company. Epic while being 1/100 the size of Apple, they are still a really big company, that a Capitalist judge who would just rule based on their ideology (a bad judge) would still not let a giant like Epic go without any support.
Anti-Competitive actions doesn't make one a Monopoly, also a Monopoly may not be Anti-Competitive. Being that you don't need an iPhone and you can use a Google based phone, or different models of computers, operating
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Well being a 28 billion dollar company vs a 2 trillion dollar company.
TenCent is a 750 billion dollar company.
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This is not a capitalist judge by a corporatist judge. What we have is nothing close to capitalism in this country a increasing corporatist system that is moving closer to the current Chinese form of fascism.
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It's called 'having your cake and eating it too";)
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And if they have an Android based phone, will they have a natural bias against Apple?
Or perhaps a lot of people may not really car that much. A ruling either way, wouldn't cause so much pain and devastation that Apple will end its most profitable line.
I am sure your Anti-Apple bias has you wanting the judge to rule in favor of killing the company... That was never on the table to happen.
Re:Definition of "win" (Score:5, Insightful)
The problem is that their public rhetoric aside, what Epic always wanted was 2 things
- stay in the Apple Store using Apple Payments but with a percentage they get to decide
- get full access to engage with ALL their Apple device users, regardless of payment system used, via email, SMS, etc via data that would be given to them by Apple (rather than having users opt-in)
In short, they want to have their cake and eat it too.
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100% agreed. Epic considered it a loss because they didn't get special treatment, and they didn't get to ignore the rules without consequence. So really everyone but Apple and Epic wins here.
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Re: Definition of "win" (Score:2)
Apple is permabanning Epic
Re:Definition of "win" (Score:5, Interesting)
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The only win is that Epic can use their own payment system for a game not on Apple's platform.
I interpreted this to mean that Epic can use their own payment system for games that are on Apple's platform. Apple never had a say regarding games that were not on Apple's platform.
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Epic Files Appeal After Loss To Apple in App Store Case
The judge, however, said that Apple has engaged in some anticompetitive conduct and she ordered the Cupertino, California-based technology giant to allow all app and game developers to steer consumers to outside payment methods on the web.
From the big picture viewpoint, that is a "win" not a loss. This is exactly what Epic + consumers wanted. If all Epic wanted was a higher cut of the profits, then yes they lost, but now they can use their own outside payment system so it is moot.
Or am I misunderstanding: Is Apple going to get a cut even if the payment is done through an outside system?
OK fair enough, Apple engaged in anti-competitive behaviour, but what about Epic itself? Isn't Epic effectively operates a shop of its own and they are engaging in anti competitive and monopolistic behaviour by raping their users into using one payment provider where Epic control the size of the 'cut' that they the customer is forced to pay Epic? Shouldn't Epic customers have a choice of multiple payment providers to get the best deal on in-app purchases.
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Shouldn't Epic customers have a choice of multiple payment providers to get the best deal on in-app purchases.
Yes.
I know nothing about the Epic store. How does it work? By comparison, how are in-game purchases handle on Steam? Are Steam developers also limited?
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What's what Valve and Epic do, and always have been doing as far as I can remember, making this common business practice on their platforms.
You can use their payment system, but they also allow any 3rd party payment system that's on an external website.
A prime example that I like to cite here is Path of Exile from Grinding Gear Games (which I used to play it).
It's been a standalone first, with its own web store. T
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What's what Valve and Epic do, and always have been doing as far as I can remember, making this common business practice on their platforms. You can use their payment system, but they also allow any 3rd party payment system that's on an external website. A prime example that I like to cite here is Path of Exile from Grinding Gear Games (which I used to play it). It's been a standalone first, with its own web store. Then it's been put onto Steam as well, where you can use Steam's payment system or GGG's website, for which you'll find a button in the game. It works the say way on the Epic store. And this is how it works for many other games as well. https://store.steampowered.com... [steampowered.com] https://www.epicgames.com/stor... [epicgames.com] https://www.pathofexile.com/sh... [pathofexile.com] Hell, even Microsoft's Store handles it the same way (no link provided).
This entire lawsuit is an incredible steaming pile of crap. It's not just the payment system you use when you pay for a game is it? It's the games themselves as well. If you can buy imaginary crap in the games, upgrades, skins, ... whatever, each of Epic's games is in effect a store but AFAIK Epic is the only vendor of in game products allowed. That makes Epic an even bigger and more evil monopoly than Apple, especially if players are not allowed to choose between different payment service providers every
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You're saying that a game, a piece of software with a very specific and limited use case, is the same as a store front that is dedicated for exchanging goods and services for money.
That can only be true if you look at the issue from a level of abstraction where any distinction becomes pointless. A very disingenuous way to frame the issue at hand.
Likely your hate for Epic, and they deserve quite a bit of hate, makes you argue like a fucking idiot. Don't let Epic do that to
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They could, it all depends on the contracts they have developers sign with them in the future.
Off the top of my head: In those contracts they could specify that if there are purchases outside, they developers will have to pay some kind of flat fee per month. Or they could specify that they want a cut of those as well. In that case they'll have to come up with a system where the developer must provid
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From the big picture viewpoint, that is a "win" not a loss.
Kinda? The way I interpret the ruling, consumers won, but everyone in the trial lost.
Epic lost on nine of the ten counts they argued, but won in their argument that Apple was acting anticompetitively according to California law. Because of what those nine losses represent, Epic doesn't actually receive any benefit at all that I can see: Epic and Fortnite remain banned from the App Store, Apple is no longer obligated to keep Epic's Unreal Engine developer account alive (the injunction forcing them to reinsta
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interpret the ruling, consumers won, but everyone in the trial lost.
100% agreed.
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The decision allows Apple to keep Fortnight out of the iOS App Store, so All that revenue they lost when they got booted is still being lost.
The judge also concluded that Apple can boot Epic's other developer accounts, including the one responsible for the Unreal Engine, over their ToS violation. Games already using the engine will not be affected immediately, but they cannot be updated, and so
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It also merits consideration that it appears that content purchased outside of the app store may also be subject to the 30% payment, and Apple might charge developers who use external payment more money to pay for their costs to audit companies that do this to ensure they are getting their cut.
Also, of course, Apple will almost certainly require from developers going forward that if an app provides
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As for forcing IAP on everyone, a pretty damning figure was revea
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I don't think Netflix should have to use IAP for the iPhone
Guess what, Netflix doesn't use IAP. I went to the Netflix website, and they get money from me as long as I don't cancel, and I can watch on my TV through the Netflix app on the TV, or on my TV through the Netflix app on my FreeView box, or on my TV through the Netflix app on my iPhone and my wife's iPad, or directly on the iPad or iPhone. (Since I'm tight with money, only one method at a time).
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This is exactly what Epic + consumers wanted.
How does Epic benefit from being able to use an external payment system for an app that is now completely banned on the App store?
Let's compare:
Before: Fortnite profits on Apple $40million. Epic fee to Apple $12million. Net profit to Epic $28million
After: Fornite profits on Apple $0. Epic fee to Apple $0. Net profit to Epic $0
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No this is definitely a loss to Epic and the greater development community.
The net result is that Apple must now allow developers to use outside payment systems. That sounds like a gain not a loss.
Even if Epic wins a few dollars
Epic did not win any dollars.
Apple has maintained the monopolistic control over the App Store, which is what needs competition.
I don't think that was part of the law suit. Isn't it just about payments.
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The net result is that Apple must now allow developers to use outside payment systems. That sounds like a gain not a loss.
No no no no no. Apple _always_ allowed outside payment systems. What they have to allow is a link in your app connecting you to the outside payment system.
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Thanks for the clarification.