Apple vs Epic: Apple No Monopoly, But Needs to Allow Other Payment Methods

The long running Apple vs Epic case has come to a conclusion of sorts. A judge made a ruling that seems split.

In some regards, it doesn’t seem like this story has been going on since last year, but that’s what has happened at this point. A little over a year ago, Epic filed a lawsuit against Apple. The legal battle revolved around the game Fortnite.

Essentially, Epic offered in-app purchases for their game. They gave players two methods of payment: either with Apple Pay or directly. Apple Pay had a 30% markup to cover the fees charged by Apple. Apple referred to their terms of service and said that this violates them. Essentially, the terms expressly forbid apps from circumventing their Apple Pay method. As a result, they kicked Fortnite from the app store. Epic, for their part, cried foul and accused Apple of acting like a monopoly. As a result, they filed a suit claiming as such.

Shortly after the lawsuit was filed, Apple turned around and banned Epic from the app store. It’s a move that does come off as an act of revenge for the lawsuit. The banning of the developer account meant that every game made by Epic is no longer available for purchase in their app store. Of course, what caught a lot of people’s attention was the status of the Unreal Engine.

Unreal Engine allows developers to make games. Some use the version in the Apple app store. While there is certainly a scuffle between Apple and Epic, the question was whether or not the game engine would remain. Banning the engine could cause a lot of collateral damage that really has nothing to do with this case. A judge ultimately said that the engine should remain because of the potential collateral damage. In fact, Microsoft did at one point step in and asked that the engine remain in the store. That request was ultimately fulfilled.

In court filings by October, Epic admitted that they knew that circumventing Apple Pay was against the terms of service. They did so to avoid the fees. By this point in time, no one really looks like a particularly good party in all of this. It was ultimately decided that the case would proceed by judge alone.

In May of this year, the case proceeded with Apple defending its moderation practices. They argued that Epic wants them to be more like Android, but they want to moderate their own content in their own way.

Now, after all that legal and technological mess, we’ve got a conclusion of sorts. It seems that the case ended with both sides coming out with something. According to NPR, the judge ruled that Apple is not a monopoly, but Apple can’t force developers to use their payment method:

If anything, though, Apple and Google did land small wins, but neither got what it wanted.

U.S. District Judge Yvonne Gonzalez Rogers said Apple is breaking the law by forcing people to pay for apps and in-app items through the App Store, where it usually takes a 30% slice of the payment as commission. Gonzalez Rogers told Apple to ease up and let in other payment options, within 90 days. That will please Apple, but it is far from what Epic sought.

For Apple, Gonzalez Rogers upheld the App Store’s overall structure as legal, a major victory for the tech giant. She also said Apple does not have an illegal monopoly over how developers can process payments for mobile games, which Apple applauded.

“It’s a split decision,” said Mark Lemley, a Stanford Law School professor who studies antitrust issues and technology. “It will improve competition on the edges, but it’s not the fundamental change that Epic and advocates of the antitrust case would have hoped for.”

So, a messy ruling for a messy case. Probably not really a surprise here. As the report notes, there is always the possibility of an appeal. After all, this really is the lower court and the case can legally escalate from there. At this point, there is no word that either side has opted for an appeal, but there is still that possibility.

At the very least, this closes this particular chapter of this case. Whether another chapter gets tacked on remains to be seen.

Drew Wilson on Twitter: @icecube85 and Facebook.



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