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The Courts Apple

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.

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Epic Files Appeal After Loss To Apple in App Store Case

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  • ... developers that steer people towards an alternative payment mechanism *MUST* also provide in-app support, and that that they will not be allowed to charge any more for in-app purchases than they do on external payments.

    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.

    • ... developers that steer people towards an alternative payment mechanism *MUST* also provide in-app support, and that that they will not be allowed to charge any more for in-app purchases than they do on external payments.

      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

      • by mark-t ( 151149 )

        It could force developers to lower Apple prices or risk angering customers who py more than Android users

        I don't think so, or else I think it would have already happened. It happens plenty of times already

        • It could force developers to lower Apple prices or risk angering customers who py more than Android users

          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.

          • by mark-t ( 151149 )
            I would expect that a web portal on iOS would go specifically to a version that lists iOS prices, not one that lists both.
    • 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

      • I stopped reading at "I haven't read the judgement".
      • by mark-t ( 151149 )

        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

        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.

      • 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.

  • Basically, the judge has granted what Epic wants, just not retroactive is all. They now get to have their external payments!

    • Apple doesn't have to let Epic back in to the app store

      • by evanh ( 627108 )

        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.

        • by mark-t ( 151149 )
          If you stay with the existing contract, then you can't use external payment systems at all, so it's inapplicable.
    • That is a strange way to say Epic lost on most of their arguments except one. Fortnite is still banned. Apple is not changing their 30% cut. Apple has to allow other payment systems. So Epic can now collect whatever percentage of all the payments made from new iOS installs of Fornite. Which is exactly 0 for now.
  • So the judge ruled requiring in-app purchases and prohibiting payment outside the in-app purchases is anti-competitive and prohibited it. But the developer is held liable for breaching a contract that has just been ruled anti-competitive and illegal. Can't understand the logic.

    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.

    • 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.

      • Also Epic did not follow the measure they won on; had Epic included links to Epic payment systems, the judge may have let Fornite back in. Instead Fornite app processed payments which third payment systems are still disallowed.
    • Epic did not violate just the one point that they won. That is the difference. Epic violated multiple points of their agreement with Apple. The ruling says Apple has to allow links in apps. Epic changed Fornite so that the app processed payments using Epic's systems and not just a link. More importantly they lied about it to Apple and was somewhat dishonest about it to the judge.
      • The biggest breach of contract was that Apple reviewed the app, and Epic changed the app behaviour from what Apple reviewed to something different. That's an absolute no-no which gets your app removed from the App Store as soon as it is detected. And I'm quite sure Epic's developer license has been revoked.
        • When the judge asked about this situation, Epic was less than forthcoming about it. To me it was very indicative of someone caught doing something wrong: "Honey, I did not know your best friend was in bed with me . . . We were just sleeping, I swear. . ."
    • She gave Epic what they needed but maybe they'll get the monopoly stuff on appeal.

    • Apple never required in-app purchases, and never prohibited payments outside. That's how Netflix and Prime are sold, on the company's websites.

      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.
    • by tlhIngan ( 30335 )

      So the judge ruled requiring in-app purchases and prohibiting payment outside the in-app purchases is anti-competitive and prohibited it. But the developer is held liable for breaching a contract that has just been ruled anti-competitive and illegal. Can't understand the logic.

      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.

      No, the only difference is that the judge

  • 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.

    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.

  • by space_spaghetti ( 8158346 ) on Monday September 13, 2021 @12:55PM (#61792429)
    Epic and Tim Sweeny have put me, and others, in the most horrible position of siding with Apple. That alone should indicate that some real greasy shit has taken place. Pardon my language. Tim and Epic went into the Apple TOS knowing they would pit Apple users against Apple in a bid to simply get more money from users. This was a plot. A shortsighted greedy plot. A real business would have developed and marketed their game so good that Apple users would be wanting it so bad that Epic could sit down with Apple for a unique price sharing cut, but instead they agreed to the TOS and then called the courts, yuck, disgusting.
    • by mark-t ( 151149 )
      If Epic had been smart, they just would have silently charged more for the iOS version's in-app payments than they did in Android. Users who were actually comparing prices might have objected, but so what? They could have easily known when they were buying their device that iOS users pay more in general for their stuff than Android users anyways. It's not like it's any great secret.
      • I agree! That extra price up front would have been 'honest' and given enough time and users it could have helped create an honest pushback movement to Apple's pricing system and got people to side with Epic and other devs in a more ethical situation. Sigh.
  • "... 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

    • "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.

      • 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

        • 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.

    • No, third party payments systems are still not allowed. Apple has to allow links though. For example currently Netflix iOS app just allows you to watch videos. If you forgot to pay them this month, you have to go to their website directly to pay as you cannot pay through the app. This ruling still disallows paying through the app. What the ruling allows is that if you are in the app, you can now click a link which takes you to the Netflix website.
  • This world is an impossible ball of legal shit
  • It's not quite clear, but Epic was ordered to pay 30% of all purchases using its "alternative" purchase system to Apple, plus interest, so it could have to do the same thing going forward.

    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
  • What are the odds that this judge will also be revealed to own Apple stock?

  • This whole story is ludicrous. I agree with the judge, there's no reason to believe that Apple is a monopoly. There's a massive number of perfectly viable, and with justifiable market positions, that they can't even be considered a 'natural' monopoly - the mere existence of Microsoft and Google and other providers in literally every category in which Apple does business precludes that. I think it's bullshit that they are forcing people to use their stores, but private companies gonna private company. Ther

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