Apple and Google are facing a growing rebellion over the 30 percent commission charges on their respective App Stores, after Epic Games filed a lawsuit against both companies.
Epic’s move came after Apple and Google had removed one of the most popular games in the world (Fornite), from their respective App Stores.
They had removed Fornite after Epic Games issued an update that allowed players to purchase in-game currency directly from Epic, bypassing Apple and Google’s payment systems and the 30 percent commission they charge.
In return, Apple’s App Store and Google’s Pay Store, were slapped with federal antitrust lawsuits challenging their rules, after Fornite was removed from both stores.
Both tech giants cited the direct payment feature rolled out on the Fortnite app earlier in the day as the violation, Reuters reported.
Epic is said to be seeking no money from Apple or Google, but rather injunctions that would end many of the companies’ practices related to their app stores.
“Apple has become what it once railed against: the behemoth seeking to control markets, block competition, and stifle innovation. Apple is bigger, more powerful, more entrenched, and more pernicious than the monopolists of yesteryear,” Epic said in its lawsuit, filed in the Northern District of California.
Epic also attacked Apple on social media, launching a campaign with the hashtag #FreeFortnite
Apple is coming under increasing pressure for the 15 to 30 percent commission it takes for most app subscriptions and payments made inside apps.
Apple reportedly makes $46.3 billion-per-year as part of its services segment, and analysts believe games are the biggest contributor to spending inside the App Store.
In a statement to Reuters, Apple said Fortnite was removed because Epic had launched the payment feature with the “express intent of violating the App Store guidelines” after having had apps in the store for a decade.
“The fact that their (Epic) business interests now lead them to push for a special arrangement does not change the fact that these guidelines create a level playing field for all developers and make the store safe for all users,” Apple said.
Google also removed “Fortnite” from its Play Store, but the company’s spokesman Dan Jackson declined to comment on the lawsuit when contacted by Reuters.
“However, we welcome the opportunity to continue our discussions with Epic and bring Fortnite back to Google Play,” he said in a statement.
Jackson said Epic had violated a rule requiring developers to use Google’s in-app billing system for products within video games.
The removal of Fornite from the two App Stores means new iOS players will not be able to download the game, and existing Fornite players on iOS devices cannot receive updates.
That said, the game should continue to work on devices where it is already installed.
Android users however can still download Fortnite from Epic’s website and other non-Google stores and install it on their devices.
Apple is facing a growing rebellion over the charges of its App Store.
In July secure messaging app Telegram filed an official complaint with European antitrust officials against Apple and its App Store.
Apple meanwhile had recently commissioned a report that defended its fees, stating that the 30 percent commission was about average.
It should be remembered that Apple in June was hit with a double whammy, when European Commission, after a year of debating, officially opened two formal antitrust investigations over its App Store and Apple Pay.
And Epic is getting a lot of support from music streaming service Spotify.
In March 2019 Spotify had filed an official complaint and accused Apple of unfairly using the dominance of its App Store to give the Apple Music service a competitive advantage.
Spotify had also previously complained to the EU that the app store represents a monopoly power.
And with the latest development, Spotify applauded Epic’s move.
“Apple’s unfair practices have disadvantaged competitors and deprived consumers for far too long,” Spotify was quoted by Reuters as saying.
Apple at the time strongly defended itself against Spotify’s complaints, and slammed the firm for using its App Store to dramatically grow its business, and then allegedly seeking to keep all the benefits of the App Store ecosystem (including hefty revenues), without making any contributions to that marketplace.
But it is not just Spotify and Epic suing Apple over its App Store.
In June 2019 two app developers filed lawsuits against Apple, alleging the App Store gives the iPad maker a monopoly on the sale and distribution of iOS apps.
It should be noted that Apple’s CEO Tim Cook has also been questioned about the App Store fees and the domination of big tech firms and whether it has hurt competition, in an antitrust hearing in Washington DC in late July.
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