Epic vs. Apple: Order Granting in Part and Denying in Part Motion for TRO [pdf](courtlistener.com)
courtlistener.com
Epic vs. Apple: Order Granting in Part and Denying in Part Motion for TRO [pdf]
https://www.courtlistener.com/recap/gov.uscourts.cand.364265/gov.uscourts.cand.364265.48.0.pdf
117 comments
Not sure if somebody did that bet. So I just put it here. I think the best outcome could be when Apple be forced to allow bigger number of devices under TestFlight - which is the way to install apps not from AppStore. Apple would probably charge extra for that like $1 per device. No virtual goods outside of apple payment system, same 30%.
The best outcome would be for Apple to allow alternate stores into iOS, like Cydia.
Related case: https://www.courtlistener.com/docket/15721902/cameron-v-appl... -- please use the RECAP browser extension if you access any of these filings ( https://free.law/recap/ )
TL;DR: Apple is prevented from revoking Epic’s developer credentials, as they have threatened to do, at least until this plays out in court. Fortnite is still off the App Store for the duration. A schedule is outline for next steps in the legal case.
Ooph. I'm betting that Epic was expecting to get to stay on the app store during the trial. That's an expensive difference. I would guess that Epic will retract its change and ask to be relisted on the app store (and if that doesn't happen, seek rapid redress in the court, since this TRO decision explicitly lists Epic's ability to be reinstated as a rationale for why there is no risk of irrevocable harm).
I'd take that bet. I think Epic (Tim Sweeney, really) was prepared to lose that revenue to win the war.
This ruling is what I expected and seems quite reasonable. Epic doesn't get temporary special privileges to break App Store rules (even though they are alleged to be illegal), but also Apple can't retaliate against them in other areas.
If Epic does reverse the payment changes in an attempt to return Fortnite to the App Store until the lawsuit is resolved, I doubt Apple will let them back in unless forced by the court (despite Tim Cook's "Sir, we do not retaliate or bully people").
This ruling is what I expected and seems quite reasonable. Epic doesn't get temporary special privileges to break App Store rules (even though they are alleged to be illegal), but also Apple can't retaliate against them in other areas.
If Epic does reverse the payment changes in an attempt to return Fortnite to the App Store until the lawsuit is resolved, I doubt Apple will let them back in unless forced by the court (despite Tim Cook's "Sir, we do not retaliate or bully people").
People seem to act like this is the first App Store dispute.
There have been many over the last decade and Apple's behaviour has been consistent i.e. they will simply allow Epic to come back onto the store and pretend like nothing ever happened. Exactly like we saw recently with the Hey app.
Apple doesn't want to punish developers but they will play hard ball if they don't abide by the rules.
There have been many over the last decade and Apple's behaviour has been consistent i.e. they will simply allow Epic to come back onto the store and pretend like nothing ever happened. Exactly like we saw recently with the Hey app.
Apple doesn't want to punish developers but they will play hard ball if they don't abide by the rules.
This appears to be the first dispute where Apple aggressively retaliated in unrelated areas of business.
> This appears to be the first dispute where Apple aggressively retaliated in unrelated areas of business.
But it's also the first publish dispute where someone purposely put in code to activate alternative payment options and broke the rules. Apple is setting an example of epic. Don't break the rules.
But it's also the first publish dispute where someone purposely put in code to activate alternative payment options and broke the rules. Apple is setting an example of epic. Don't break the rules.
Yes it is, Netflix didn't hide code and then later enable it to support another payment option inside their app. They tried to redirect users to a website when signing up for premium.
What Epic did was hide code and later enable the feature.
What Epic did was hide code and later enable the feature.
Netflix hid code and later enabled it to redirect users to a non-Apple payment method. Epic hid code and later enabled it to redirect users to a non-Apple payment method. They did the exact same thing.
Have you got citation? I cannot find anything on google about Netflix hiding and enabling code. The only thing your link states is once the subscription ends the user is redirected to the browser to pay, so, not the same time.
I don’t think Epic is making that much money from Fortnite on iOS to actually care, I think they are using Apple because a) its an easy target and if they win the ruling can be expanded to other platforms too where they currently make the most money on and b) while they aren’t a major source of revenue now Epic probably has bigger plans for mobile centric games down the line.
Basically now it’s the best time for them to do it, Apple is a huge target and they can gain industry support, Fortnite is big enough that even the average judge, jurist and jury member is likely aware of it and right now they stand to lose very little financially from not being on iOS while the potential future gains are insane.
Basically now it’s the best time for them to do it, Apple is a huge target and they can gain industry support, Fortnite is big enough that even the average judge, jurist and jury member is likely aware of it and right now they stand to lose very little financially from not being on iOS while the potential future gains are insane.
> I don’t think Epic is making that much money from Fortnite on iOS to actually care
IIRC they said 11% during the hearing, I don't remember if that was 11% of Fortnite revenue or total revenue, and I don't remember if that might have included android as well.
IIRC they said 11% during the hearing, I don't remember if that was 11% of Fortnite revenue or total revenue, and I don't remember if that might have included android as well.
This makes more sense and closer to the figure i kinda pulled out of thin air just based on the size of the playerbase, the 500M> figure was way too much considering that Fortnite only generates about 1.8b a year and it's revenue is going down.
Android is likely a much much smaller to the point of being a rounding error for Epic right now, there aren't many devices that can play the game right and in the markets that they actually get revenue from they aren't that popular.
I don't think Epic has any other games on the App Store tbh, and they probably didn't include licensing revenue.
Android is likely a much much smaller to the point of being a rounding error for Epic right now, there aren't many devices that can play the game right and in the markets that they actually get revenue from they aren't that popular.
I don't think Epic has any other games on the App Store tbh, and they probably didn't include licensing revenue.
It's possible that revenue has fallen off, but it appears that Fortnite Mobile revenue has been at least $500 million per year. If this trial goes on for two years, that's potentially a billion dollars in lost revenue. https://sensortower.com/blog/fortnite-mobile-revenue-1-billi...
Epic makes over $5B/year — and more than $680 million of that is from the Epic Game Store [1], which has always been banned from iOS due to Apple's policies against alternative stores. Fortnite Mobile makes them good money, but it's not their cash cow — and if they can trade a temporary ban on Fortnite for their store running on iOS, it seems like they'll take it.
1: https://www.forbes.com/sites/mattperez/2020/01/14/epic-games...
1: https://www.forbes.com/sites/mattperez/2020/01/14/epic-games...
Those estimates are utterly out of touch with reality to the point of being a straight fabrication.
Fortnite brought Epic £1.8b in revenue for 2019, there is no way that 25% of that came from iOS based on actual player data and experience, if their iOS revenue is 10% of the total I will be in shock.
Fortnite brought Epic £1.8b in revenue for 2019, there is no way that 25% of that came from iOS based on actual player data and experience, if their iOS revenue is 10% of the total I will be in shock.
The US is disproportionately iOS compared to the entire world, and especially US teens (I've seen estimates of something like 90%). iOS, the US, and US teens are all disproportionately important to digital sales. Although the US is 10% of TikTok's user base, it provides 50% of TikTok's revenue, nd from Charli D'Amelio on down the most-followed TikTok accounts are almost entirely American. That's why everyone expects TikTok's US (and possibly global) operations to be soon sold; the US is the tail that wags the dog.
US is the majority of revenue sure, but there is no way that so much comes from iOS the cross platform play numbers don’t back this up you can’t just extrapolate from hypothetical app download figures.
The US is about 80% of Fortnite’s but the majority of the players are on consoles not mobile. The 80% figure will change drastically when China grants epic permission to monetize the game as the vast majority of their players are in China.
The US is about 80% of Fortnite’s but the majority of the players are on consoles not mobile. The 80% figure will change drastically when China grants epic permission to monetize the game as the vast majority of their players are in China.
I also imagine Epic made these kinds of calculations before trying to take on Apple.
Assuming they introduce the epic store and cut fees from 30% to 0% fees. It would take 6 years to pay the lost revenue back. It's entirely possible that the next hot thing will come out in 6 years and replace Fortnite.
Key quotes:
"the Court observes that Epic Games strategically chose to breach its agreements with Apple which changed the status quo"
"However the showing is not sufficient to conclude that these considerations outweigh the general public interest in requiring private parties to adhere to their contractual agreements or in resolving business disputes through normal, albeit expedited, proceedings."
"Epic Games and Apple are at liberty to litigate against each other, but their dispute should not create havoc to bystanders."
"the Court observes that Epic Games strategically chose to breach its agreements with Apple which changed the status quo"
"However the showing is not sufficient to conclude that these considerations outweigh the general public interest in requiring private parties to adhere to their contractual agreements or in resolving business disputes through normal, albeit expedited, proceedings."
"Epic Games and Apple are at liberty to litigate against each other, but their dispute should not create havoc to bystanders."
It seems some of the decision hinged around this fact from the article: "self-inflicted wounds are not irreparable injury".
I wonder if there could have been a better sequence of events (e.g. sue first rather than sneaking it in)?
I wonder if there could have been a better sequence of events (e.g. sue first rather than sneaking it in)?
I don't think that would have changed anything. The court still wouldn't have granted Epic special permission to break App Store rules before the lawsuit is resolved. Epic isn't in a worse position for trying it. Unless Apple refuses to let them back in after reversing the payment changes, in retaliation for filing a lawsuit. In which case I think the court should intervene.
I'm pretty sure this is the outcome Epic was expecting.My impression is that they don't want their stunts to affect the developers using Unreal Engine, but they're OK with Fortnite being off the App Store if they can win a concession for things like a smaller cut or even getting their EGS onto iOS.
Some choice sections:
"...On Thursday, August 13, 2020, Epic Games made the calculated decision to breach its allegedly illegal agreements with Apple by activating allegedly hidden code in Fortnite allowing Epic Games to collect IAPs directly. In response, Apple removed Fortnite from the App Store, where it remains unavailable to the date of this Order. Later that same day, Epic Games filed this action and began a pre-planned, and blistering, marketing campaign against Apple... "
"...The Court finds that with respect to Epic Games’ motion as to its games, including Fortnite, Epic Games has not yet demonstrated irreparable harm. The current predicament appears of its own making... Epic Games admits that the technology exists to “fix” the problem easily by deactivating the “hotfix.” That Epic Games would prefer not to litigate in that context does not mean that “irreparable harm” exists..."
"...Epic Games moves this Court to allow it to access Apple’s platform for free while it makes money on each purchase made on the same platform. While the Court anticipates experts will opine that Apple’s 30 percent take is anti-competitive, the Court doubts that an expert would suggest a zero percent alternative. Not even Epic Games gives away its products for free..."
Ouch.
Separately, the aspect of Apple pulling keys for the developer (e.g. Unreal Engine) platform access was granted a preliminary injunction. Which seems reasonable.
I guess Epic has a couple days to decide whether to give in or not: "Fortnite’s next season starts on Thursday, August 27, 2020, and will require an update of the game to play."
"...On Thursday, August 13, 2020, Epic Games made the calculated decision to breach its allegedly illegal agreements with Apple by activating allegedly hidden code in Fortnite allowing Epic Games to collect IAPs directly. In response, Apple removed Fortnite from the App Store, where it remains unavailable to the date of this Order. Later that same day, Epic Games filed this action and began a pre-planned, and blistering, marketing campaign against Apple... "
"...The Court finds that with respect to Epic Games’ motion as to its games, including Fortnite, Epic Games has not yet demonstrated irreparable harm. The current predicament appears of its own making... Epic Games admits that the technology exists to “fix” the problem easily by deactivating the “hotfix.” That Epic Games would prefer not to litigate in that context does not mean that “irreparable harm” exists..."
"...Epic Games moves this Court to allow it to access Apple’s platform for free while it makes money on each purchase made on the same platform. While the Court anticipates experts will opine that Apple’s 30 percent take is anti-competitive, the Court doubts that an expert would suggest a zero percent alternative. Not even Epic Games gives away its products for free..."
Ouch.
Separately, the aspect of Apple pulling keys for the developer (e.g. Unreal Engine) platform access was granted a preliminary injunction. Which seems reasonable.
I guess Epic has a couple days to decide whether to give in or not: "Fortnite’s next season starts on Thursday, August 27, 2020, and will require an update of the game to play."
How about this one:
"with respect to the Unreal Engine and the developer tools, [...] the contracts related to those applications were not breached. Apple does not persuade that it will be harmed [...] Apple has chosen to act severely, and by doing so, has impacted non-parties, and a third-party developer ecosystem. In this regard, the equities do weigh against Apple.
Apple's behavior here was not reasonable and definitely deserved this restraining order.
"with respect to the Unreal Engine and the developer tools, [...] the contracts related to those applications were not breached. Apple does not persuade that it will be harmed [...] Apple has chosen to act severely, and by doing so, has impacted non-parties, and a third-party developer ecosystem. In this regard, the equities do weigh against Apple.
Apple's behavior here was not reasonable and definitely deserved this restraining order.
Epic could have used the same developer account for both Unreal Engine and Fornite development knowing full well that Apple would have to either allow both or ban both.
They had ads and lawsuits ready when they pulled the trigger on this chain of events so it wouldn't surprise me if they made sure that the Unreal Engine issue was included.
They had ads and lawsuits ready when they pulled the trigger on this chain of events so it wouldn't surprise me if they made sure that the Unreal Engine issue was included.
They didn't use the same developer account, if I'm reading the order correctly the developer accounts used for Unreal Engine and Fortnite did not even belong to the same legal entity.
* Epic Games, Inc. develops Fortnite and has an Apple developer account that it is released under.
* Epic Games International, S.a.r.l. develops Unreal Engine and holds its own Apple developer account.
* Epic Games, Inc. develops Fortnite and has an Apple developer account that it is released under.
* Epic Games International, S.a.r.l. develops Unreal Engine and holds its own Apple developer account.
Apple can ban just Fortnite (and any other infringing app) a la carte, without banning the entire account, so they wouldn't need to ban or allow both in the first place.
I don't think Epic use the same account on purpose -- I mean, why pay x2 the fees?
well, the fee's are only like $99/year. a rounding error, really.
"...Epic Games moves this Court to allow it to access Apple’s platform for free while it makes money on each purchase made on the same platform. While the Court anticipates experts will opine that Apple’s 30 percent take is anti-competitive, the Court doubts that an expert would suggest a zero percent alternative. Not even Epic Games gives away its products for free..."
Apple is arguing as if accessing their platform for free was a crime. This makes sense, since they have costs associated with reviews, code signing and distribution. But that is of their own making. Walled gardens should be outlawed.
Apple is arguing as if accessing their platform for free was a crime. This makes sense, since they have costs associated with reviews, code signing and distribution. But that is of their own making. Walled gardens should be outlawed.
It being a walled garden is the only way I’m willing to trust it for accessing all my account recovery emails, my 2FA SMSes, my bank details, and the sensor package that can listen to everything I do while GPS tracking me and monitoring my heart rate and gaze if I happen to be holding it where I can see the screen.
Of course, that doesn’t mean I like being stuck with an American cultural hegemony that says sexual content is forbidden, or that needs an encryption export licence from the USA government for apps written by non-Americans for non-Americans, and which still demands annual reporting to the US government for using https.
I’m happy with any walls that meet basic security standards, but I do want a wall, even if it would be nice to choose which wall.
Of course, that doesn’t mean I like being stuck with an American cultural hegemony that says sexual content is forbidden, or that needs an encryption export licence from the USA government for apps written by non-Americans for non-Americans, and which still demands annual reporting to the US government for using https.
I’m happy with any walls that meet basic security standards, but I do want a wall, even if it would be nice to choose which wall.
The walled garden is not what protects your email, 2FA SMSes or bank details. The OS sandboxing and permissions system do that. The two are often conflated, but the two concerns are orthogonal really.
Heck, you could easily imagine a system where software distributed outside the app store can only access a subset of perms if security is such a concern, and that'd still be less anti-competitive
Heck, you could easily imagine a system where software distributed outside the app store can only access a subset of perms if security is such a concern, and that'd still be less anti-competitive
Due to the way iOS works (dynamic dispatch) private APIs can only be prevented through an App Store review process.
And many of those APIs can be used to extract enough information to fingerprint the device, determine your location or steal your data e.g. accessing the list of WiFi networks or browser history.
So no. The two concerns are very much related.
And many of those APIs can be used to extract enough information to fingerprint the device, determine your location or steal your data e.g. accessing the list of WiFi networks or browser history.
So no. The two concerns are very much related.
> Due to the way iOS works (dynamic dispatch) private APIs can only be prevented through an App Store review process.
That's complete nonsense.
Dynamic dispatch has nothing to do with the ability or not of a program to access API. Dynamic dispatch is the selection at runtime of the correct version of a polymorphic function. Obviously, you can sandbox programs written in languages using dynamic dispatch.
That's complete nonsense.
Dynamic dispatch has nothing to do with the ability or not of a program to access API. Dynamic dispatch is the selection at runtime of the correct version of a polymorphic function. Obviously, you can sandbox programs written in languages using dynamic dispatch.
Be curious how you plan to prevent access to Apple's private APIs in Objective-C, which uses dynamic dispatching, without breaking existing code.
I am sure Apple would love to know how you've managed to solve this.
I am sure Apple would love to know how you've managed to solve this.
You could easily argue that Apple has built an OS that is deeply broken and insecure if they aren't able to technically enforce permissions of apps to do certain things. Virtually any other OS has that capability.
They can't be prevented reliably even through the App Store process - that's simply impossible.
The point of a private API not security, it's to distinguish between the public interface that is meant to be stable and implementation details that might change.
They might do some rudimentary checks to catch obvious usage of private APIs, but it's not part of the security model and still apps show up on the App Store that use private APIs, all the time.
The point of a private API not security, it's to distinguish between the public interface that is meant to be stable and implementation details that might change.
They might do some rudimentary checks to catch obvious usage of private APIs, but it's not part of the security model and still apps show up on the App Store that use private APIs, all the time.
they are related because apple plugged one process into the other.
but there is nothing intrinsic to their operation that requires it, and apple could un-plug it.
this is like apple arguing that IE is central to the fabric of windows, and can't be removed during the european antitrust suit.
it's dishonest, but apple will likely make the same claim.
but there is nothing intrinsic to their operation that requires it, and apple could un-plug it.
this is like apple arguing that IE is central to the fabric of windows, and can't be removed during the european antitrust suit.
it's dishonest, but apple will likely make the same claim.
Heck, you could easily imagine a system where software distributed outside the app store can only access a subset of perms if security is such a concern, and that'd still be less anti-competitive
I think this system is called the world wide web.
Apple would have a much stronger case if mobile safari were a first class PWA platform, instead of being almost useless for PWA's. Then the choice would be: make a PWA and live in the browser sandbox, or go through approval and be on the app store.
I think this system is called the world wide web.
Apple would have a much stronger case if mobile safari were a first class PWA platform, instead of being almost useless for PWA's. Then the choice would be: make a PWA and live in the browser sandbox, or go through approval and be on the app store.
I really don't think so. there are many classes of applications that just do not work on the web platform.
A podcast player or music and video streaming app, or a game like fortnite, are not going to work as web sites.
A podcast player or music and video streaming app, or a game like fortnite, are not going to work as web sites.
> but the two concerns are orthogonal really.
Your stance seems nonsensical to me, given the fact that Epic was clearly able to sneak something that violates the rules past Apple's review process.
It's clearly not possible for Apple to actually check all functionality of every app, particularly as it's so easy to hide it or to put it in an embedded web view.
In this case, Epic managed to put an alternative payment method in - but they are a trusted brand, so there's no real security issue overall.
But could some other developer do the same thing and harvest payment details? Of course.
It's clearly not possible for Apple to actually check all functionality of every app, particularly as it's so easy to hide it or to put it in an embedded web view.
In this case, Epic managed to put an alternative payment method in - but they are a trusted brand, so there's no real security issue overall.
But could some other developer do the same thing and harvest payment details? Of course.
> It being a walled garden is the only way I’m willing to trust it for accessing all my account recovery emails, my 2FA SMSes, my bank details, and the sensor package that can listen to everything I do while GPS tracking me and monitoring my heart rate and gaze if I happen to be holding it where I can see the screen.
Sorry I'm not following. What does any of this have to do with the app store?
Sorry I'm not following. What does any of this have to do with the app store?
The problem here is that the majority of discussion around this conflates the iPhone with the App Store. The App Store is a platform, it's fine if Apple wants to charge for curation, distribution, etc.
The iPhone is a hardware device, not a platform, and it's not fine if Apple wants to be the sole guardian of it. Even the court response here conflated the two. Epic doesn't want to be on the App Store for free (that wouldn't be fair), but it does want to be allowed to install its software on iPhones for free (that is fair).
The iPhone is a hardware device, not a platform, and it's not fine if Apple wants to be the sole guardian of it. Even the court response here conflated the two. Epic doesn't want to be on the App Store for free (that wouldn't be fair), but it does want to be allowed to install its software on iPhones for free (that is fair).
> Not even Epic Games gives away its products for free...
Do... do they not?
The point being made in that paragraph seems valid regardless, but that's a strange comparison to end with - is Fortnite not free-to-play on Apple devices? It certainly is on all other platforms I've seen it on.
Do... do they not?
The point being made in that paragraph seems valid regardless, but that's a strange comparison to end with - is Fortnite not free-to-play on Apple devices? It certainly is on all other platforms I've seen it on.
Fortnite is the highest grossing free-to-play game, and the Epic store also takes a cut of games sold on their store.
It's not 30% but the actual amount doesn't matter in the context of that particular part of the order.
It's not 30% but the actual amount doesn't matter in the context of that particular part of the order.
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This seems fair. Although Epic should separate its Unreal business from Fortnite to avoid these in the future.
It's already separately under Epic Games International, S.a.r.l (“Epic International”).
It was under a different agreement from the regular "Epic Games" that Apple decided to both terminate
It was under a different agreement from the regular "Epic Games" that Apple decided to both terminate
You have to remember Epic has planned this all pretty carefully from the start.
They benefit from being able to play the "if you ban us, you also ban all of the little mom & pop game developers" sympathy card.
They benefit from being able to play the "if you ban us, you also ban all of the little mom & pop game developers" sympathy card.
That sounds like Epic abusing its “monopoly”[0] on game engines.
[0] in the same sense that Apple is a monopoly on smartphones, hence the air-quotes.
[0] in the same sense that Apple is a monopoly on smartphones, hence the air-quotes.
This seems like the predictable outcome. Epic knew Fortnite would get banned when they started this; Apple is innocent until proven guilty, so no court will force Apple to reinstate Fortnite unless Epic wins its antitrust suit. But similarly, Apple's subsequent, second threat to ban Epic from doing other lines of business via macOS tools (e.g. Unreal Engine development) seemed excessive compared to other app bans, and seemed clearly an attempt to use their power to shake down Unreal customers as retaliation for the dispute.
I'm not surprised that Epic started this: they want their game store on iOS, and the only way that happens is via an antitrust lawsuit — and you can't bring an antitrust lawsuit unless you show evidence of harm (aka, lost Fortnite sales). Epic wanted Fortnite to be banned so that they could sue Apple.
I'm curious why Apple escalated, though. It seemed to me like they were playing into Epic's hand: they're currently under multiple antitrust investigations by the US and the EU, and using their market power on iOS to corral developers on macOS seems like a pretty obvious violation, and a novel one: when they banned XCloud from iOS, for example, they didn't also ban MS Office from running on Macs. Why would they try to do it now? When I first saw it I wondered if Apple knew something we didn't (since Epic would pretty obviously attempt to contest this in court), and that Apple was playing its own 4D chess game against Epic, secure in the knowledge that the court wouldn't grant the injunction on the macOS tools. But... Now it just looks like a fit of pique? Apple had already banned Fortnite when it issued the second threat to ban Unreal; the second threat ended with them getting nothing (the court prevented them from following through) and left looking like monopolists during the antitrust investigations. I don't get it.
I'm not surprised that Epic started this: they want their game store on iOS, and the only way that happens is via an antitrust lawsuit — and you can't bring an antitrust lawsuit unless you show evidence of harm (aka, lost Fortnite sales). Epic wanted Fortnite to be banned so that they could sue Apple.
I'm curious why Apple escalated, though. It seemed to me like they were playing into Epic's hand: they're currently under multiple antitrust investigations by the US and the EU, and using their market power on iOS to corral developers on macOS seems like a pretty obvious violation, and a novel one: when they banned XCloud from iOS, for example, they didn't also ban MS Office from running on Macs. Why would they try to do it now? When I first saw it I wondered if Apple knew something we didn't (since Epic would pretty obviously attempt to contest this in court), and that Apple was playing its own 4D chess game against Epic, secure in the knowledge that the court wouldn't grant the injunction on the macOS tools. But... Now it just looks like a fit of pique? Apple had already banned Fortnite when it issued the second threat to ban Unreal; the second threat ended with them getting nothing (the court prevented them from following through) and left looking like monopolists during the antitrust investigations. I don't get it.
I think they just went through applying the agreement, which says that the account will be terminated in the specific case of willingful infringement/circumvention. If they had not tried to apply it, it would have been hard to prove to the judge that they always apply the agreement to the letter, which is an important part of this lawsuit (they need to prove that the rules are clear and equally enforced — something that they know it’s not always happened).
Since Epic has 2 different accounts, Apple could have terminated only one of them, leaving Unreal Engine intact. But Schiller’s declaration says that in these cases they have always terminated all accounts that are owned by the same company / conglomerate (I can easily see this is useful in some cases). So again I feel they were in a corner: they had to follow what they have always done, so that other companies couldn’t prove a ad-hoc enforcement of rules (termination rules, in this case).
Since Epic has 2 different accounts, Apple could have terminated only one of them, leaving Unreal Engine intact. But Schiller’s declaration says that in these cases they have always terminated all accounts that are owned by the same company / conglomerate (I can easily see this is useful in some cases). So again I feel they were in a corner: they had to follow what they have always done, so that other companies couldn’t prove a ad-hoc enforcement of rules (termination rules, in this case).
>you can't bring an antitrust lawsuit unless you show evidence of harm (aka, lost Fortnite sales)
I thought the point of antitrust is that it brings harm to the consumers and not just some lesser company?
I thought the point of antitrust is that it brings harm to the consumers and not just some lesser company?
You would think so, but actually a company can't sue another for antitrust violations unless they show evidence that they were injured — and the injury has to pass a two-prong test [1] to be covered.
That being said, the government can investigate without a lawsuit. But just because the government investigates, that doesn't guarantee the government will prosecute; a lawsuit guarantees prosecution, unless it's so baseless it gets thrown out by the court (which Epic's hasn't been).
Hence why Epic took a step that would obviously result in a ban: they needed the correct type of evidence of injury in order to sue.
1: https://www.businessjustice.com/the-elements-of-antitrust-in...
That being said, the government can investigate without a lawsuit. But just because the government investigates, that doesn't guarantee the government will prosecute; a lawsuit guarantees prosecution, unless it's so baseless it gets thrown out by the court (which Epic's hasn't been).
Hence why Epic took a step that would obviously result in a ban: they needed the correct type of evidence of injury in order to sue.
1: https://www.businessjustice.com/the-elements-of-antitrust-in...
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They showed that Apple forcing iOS apps to use their Payment Processor is bad for consumers by providing an alternative that is 20% cheaper. Which is what got them banned.
Every payment and subscription going through Apple is one of the best features for me. Especially the subscriptions.
So why can't Epic (or any other company) provide you that option with a 42% premium (to cover Apple's 30% cut) and allow users to buy direct from them? Then if you wish to trust Apple more with your card details, you can pay more for the privelege. Or you can save some money, but potentially increase your risk by going direct.
I've always hated that Apple seem to think they know better than anyone else; you can't do as you wish on their platforms because you might be stupid.
I've always hated that Apple seem to think they know better than anyone else; you can't do as you wish on their platforms because you might be stupid.
I mean, that’s exactly why I have an Apple device.
No, wait, not that I’m stupid. Though I’m sure some people would call me that.
It’s that they make the decisions for me. I’m specifically paying a premium to delegate the responsibility for making those decisions to them.
I spent years running Nexus devices (since before they were Nexus... still have my ADP1 in a drawer) on Cyanogenmod and LineageOS. At some point I got busy and didn’t have time for my phone to be a hobby or even a thing I had to think about and chose to delegate those decisions to Apple rather than Google because they generally seem to lean more toward privacy-conscious decisions and making money on hardware and apps rather than decisions to support violating my privacy and making money on advertising.
I already paid more for what I agree is a privilege by buying an expensive Apple phone. If you don’t like the rules, then don’t sell here. I’m cool with that. Leave my walled garden alone. I’m comfortable in here.
No, wait, not that I’m stupid. Though I’m sure some people would call me that.
It’s that they make the decisions for me. I’m specifically paying a premium to delegate the responsibility for making those decisions to them.
I spent years running Nexus devices (since before they were Nexus... still have my ADP1 in a drawer) on Cyanogenmod and LineageOS. At some point I got busy and didn’t have time for my phone to be a hobby or even a thing I had to think about and chose to delegate those decisions to Apple rather than Google because they generally seem to lean more toward privacy-conscious decisions and making money on hardware and apps rather than decisions to support violating my privacy and making money on advertising.
I already paid more for what I agree is a privilege by buying an expensive Apple phone. If you don’t like the rules, then don’t sell here. I’m cool with that. Leave my walled garden alone. I’m comfortable in here.
But those aren't mutually exclusive. You can stay in the walled garden if you wish, and people who are comfortable with the risk can go outside. Choice; something Apple thinks its users are incapable of making sensibly.
Or, again, many people have made that choice and are fine with the situation. If you don't want the locked down device you can just not buy an Apple device?
And that's your choice, but forcing that onto everyone is anti-competitive.
How is that being forced on everyone? E. g. I do not use Steam, so they can do whatever they want, it would have zero effect on me.
Steam isn't manufacturing computers. This is about Apple the computer manufacturer. It's unfair for them to lock their computers/phones down so people can't install software without Apple's permission.
The App Store is more or less a red herring here (relevant only to the 30% fee being too much).
The App Store is more or less a red herring here (relevant only to the 30% fee being too much).
Is it though? There's no legal precedent that would allow for software vendors to force device manufacturers to allow their software to be run on the manufacturer's hardware. Otherwise we'd see Android on iPhones, legally-mandated Facebook integration on everything, custom car firmware etc.
The action that triggered these events is that Epic chose to sell some items at a higher price via the Apple store to cover the 30% "tax" and make it clearer to consumers that they are paying a premium to the middleman, or at a lower price via in-game currency (which could be purchased elsewhere) directly in the game.
Offering this consumer choice is what lead to Fortnite being banned.
Offering this consumer choice is what lead to Fortnite being banned.
The harm to consumers is the higher price that they have to pay. Epic didn't just keep the 30% all for themselves, they lowered prices.
Of course a competing App Store can offer lower prices, they don't bear any of the costs for developing and managing the iOS ecosystem Apple spent billions over a decade building (that many other companies lost fortunes failing to compete against). They can just popup a virtual store in someone else's successful established platform and access a market of 1B+ credit cards they had no hand in creating where they can dictate their own margins for selling virtual goods - somehow feeling entitled to get a free ride on the massive development & maintenance infrastructure costs that is subsidized by the App Store.
Strange most other markets don't just let everyone to sell their products (physical or virtual) on their markets at no cost [1].
[1] https://www.ign.com/articles/2019/10/07/report-steams-30-cut...
Strange most other markets don't just let everyone to sell their products (physical or virtual) on their markets at no cost [1].
[1] https://www.ign.com/articles/2019/10/07/report-steams-30-cut...
Apple profits handsomely from the iOS ecosystem every time someone buys an iPhone to access it, or buys a Mac because Apple won't allow building iOS apps without one, or pays the annual developer program fee. They don't need to triple or quadruple dip to be the most valuable publicly traded company in the world.
Apple here is no different than the Telcos wanting to avoid only being paid for just being dumb pipes.
If everybody else is making money building on that basic service they want a piece of that pie too.
iOS is a major cost to develop that's given away for free, continually invested in, advanced, developed & updated. Apple is allowed to have more than one business model on the platform they built, which was their primary focus that reshaped the company at a great opportunity cost to their other businesses. Ultimately the Company bet paid off & became successful against a number of incumbents who lost fortunes trying to compete in Mobile OS's. The App Store is now one of their major sources of revenue for having built a successful platform (a category they helped pioneer).
The nominal annual fee is a cost for accessing the dev tools only, it's in no way a royalty-free cost to sell products on one of the most lucrative markets in the world - that's what their standard royalty % (unchanged from the outset) covers.
The nominal annual fee is a cost for accessing the dev tools only, it's in no way a royalty-free cost to sell products on one of the most lucrative markets in the world - that's what their standard royalty % (unchanged from the outset) covers.
> iOS is a major cost to develop that's given away for free
How is it given for free, you pay for it when you buy the phone.
How is it given for free, you pay for it when you buy the phone.
You dont just get the current OS that's on the phone, but also the upcoming ones for the next 5-6 years[0] for free. A phone bought in 2015 still gets updates.
[0] https://i.imgur.com/eS3ifSC.jpg
[0] https://i.imgur.com/eS3ifSC.jpg
And if my iPhone gets updates in 2025, it doesn't change the fact that I paid 1200 euro for it. How much is the raw manufacturing cost of the 11 Pro (256 GB)?
Also, if the App Store revenue is for iOS development, does that mean that people who buy an iPhone and never pay for an app or an IAP are a net loss to Apple?
Also, if the App Store revenue is for iOS development, does that mean that people who buy an iPhone and never pay for an app or an IAP are a net loss to Apple?
By that rationale, windows 10 is free too.
All those "free" upgrades are part of the phone when you buy it.
You cannot buy just the hardware without the OS at cheaper cost because its a combined hardware/OS cost.
You cannot buy just the hardware without the OS at cheaper cost because its a combined hardware/OS cost.
You're paying for the phone, there is no cost nor can you pay for iOS. The current and all future versions is & always has been free.
It's nonsensical to take a product that can't be purchased in pieces and separate the pieces to call one half free. iOS has always been included but it will never be free.
You're paying for iOS, the phone is free.
Yeah that's right it costs $1249 for each download of iOS (Beta's are 1/2 price), but Apple gives you as many iPhone Max Pro's as you want, mailed along with your free sim! Which doesn't matter if you lose or break out of warranty you can always get a new replacement Free! Family plans are the best, you can install your 1 iOS purchase on 5 free iPhone's - giving free iPhone's away was truly an ingenious revolutionary business model.
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Can I just buy the hardware at a cheaper price without the OS, if not then its not free, its part of the total cost.
That's nonsensical, if you could buy the hardware cheaper or iOS separate then you would be paying for iOS, you can't, Apple doesn't sell iOS, it gives it away. The cost for new iOS versions is irrelevant to the cost of hardware it's running on, it's free for all their devices for as long as they meet the hardware requirements for running new versions.
You could buy an iPhone and put a jail break OS on it, you're still paying the full amount for the device.
You could buy an iPhone and put a jail break OS on it, you're still paying the full amount for the device.
> it's free for all their devices
Have you never heard the phrase "There ain't no such thing as a free lunch"?
The reason Apple does not sell the hardware at a cheaper cost should tell you that the OS is not free. The cost is included. Its a package deal.
> it's free for all their devices for as long as they meet the hardware requirements for running new versions.
If the OS is free then why not let it run on very old models, it will run very slow but that should not matter since the OS is free, right?
Have you never heard the phrase "There ain't no such thing as a free lunch"?
The reason Apple does not sell the hardware at a cheaper cost should tell you that the OS is not free. The cost is included. Its a package deal.
> it's free for all their devices for as long as they meet the hardware requirements for running new versions.
If the OS is free then why not let it run on very old models, it will run very slow but that should not matter since the OS is free, right?
> Have you never heard the phrase "There ain't no such thing as a free lunch"?
Yes, it's a meaningless cliche which is often untrue (I've had many free lunches myself). But "free/gratis" does have a definition to mean "without cost or payment", e.g. how much it costs to acquire/download every version of iOS going back a decade.
Have you ever heard of alternative business models? Try Googling Android, Tizen OS, Web OS, Firefox OS for alternative mobile OS's, it's nearly impossible to for a mobile OS to become mainstream if you had to pay for it.
> If the OS is free then why not let it run on very old models, it will run very slow but that should not matter since the OS is free, right?
Because Apple has to support the devices it says it supports & they don't run acceptably. This isn't new, a lot of commercial software wont support software that doesn't meet a minimum hardware requirement.
Yes, it's a meaningless cliche which is often untrue (I've had many free lunches myself). But "free/gratis" does have a definition to mean "without cost or payment", e.g. how much it costs to acquire/download every version of iOS going back a decade.
Have you ever heard of alternative business models? Try Googling Android, Tizen OS, Web OS, Firefox OS for alternative mobile OS's, it's nearly impossible to for a mobile OS to become mainstream if you had to pay for it.
> If the OS is free then why not let it run on very old models, it will run very slow but that should not matter since the OS is free, right?
Because Apple has to support the devices it says it supports & they don't run acceptably. This isn't new, a lot of commercial software wont support software that doesn't meet a minimum hardware requirement.
>You could buy an iPhone and put a jail break OS on it, you're still paying the full amount for the device.
If I buy a new TV and throw the remote in the trash, the remote was not part of the cost of the TV?
Also, "jail break OS"? Isn't that just iOS?
If I buy a new TV and throw the remote in the trash, the remote was not part of the cost of the TV?
Also, "jail break OS"? Isn't that just iOS?
> If I buy a new TV and throw the remote in the trash, the remote was not part of the cost of the TV?
A hardware remote is, which has an actual per unit cost (a software remote wouldn't be). The cost of Software distribution is effectively $0, a valid comparison would be if you bought your new TV with Android (which costs $0 for the manufacturer to include) you could replace the TV OS with Tizen OS which is also free, neither OS costs anything to the manufacturer or consumer and you don't get it cheaper for purchasing the same TV without an OS.
> Also, "jail break OS"? Isn't that just iOS?
There used to be a healthy alt OS ecosystem for iPhone before newer iPhone's have become increasingly lockdown where it doesn't appear you can do that anymore, the best you can do is JailBreak iOS and install a custom package manager and install custom software not permitted on the App Store.
A hardware remote is, which has an actual per unit cost (a software remote wouldn't be). The cost of Software distribution is effectively $0, a valid comparison would be if you bought your new TV with Android (which costs $0 for the manufacturer to include) you could replace the TV OS with Tizen OS which is also free, neither OS costs anything to the manufacturer or consumer and you don't get it cheaper for purchasing the same TV without an OS.
> Also, "jail break OS"? Isn't that just iOS?
There used to be a healthy alt OS ecosystem for iPhone before newer iPhone's have become increasingly lockdown where it doesn't appear you can do that anymore, the best you can do is JailBreak iOS and install a custom package manager and install custom software not permitted on the App Store.
> iOS is a major cost to develop that's given away for free
Are you sure it's free? The only way to buy ios, is to buy a device running it. It would seem reasonable that part of the premium you pay for eg an iPad is equivalent to an oem license for ios?
Are you sure it's free? The only way to buy ios, is to buy a device running it. It would seem reasonable that part of the premium you pay for eg an iPad is equivalent to an oem license for ios?
Of course they lowered the prices.
It was a PR exercise to show the world the wondrous benefits of a potential Epic Games Store on iPhone/Android.
And of course once they had such a store they pinky promise to never increase the prices in the future.
It was a PR exercise to show the world the wondrous benefits of a potential Epic Games Store on iPhone/Android.
And of course once they had such a store they pinky promise to never increase the prices in the future.
I think the point is that competition will prevent them from doing that. And it worked: in response to Epic's lower rates, Steam also cut their rates. If Epic raises the rate to 30% they'll be more expensive than Steam, and won't be able to compete.
I just checked and Fornite is not available on Steam.
So all that will happen is that certain games will exist only in one store and not be subject to competition.
Or they will secretly sell your data to third parties which Apple won't do.
So all that will happen is that certain games will exist only in one store and not be subject to competition.
Or they will secretly sell your data to third parties which Apple won't do.
Fortnite is not required to be on Steam for there to be competition in the game store marketplace. As a game developer on PC, if you don't like Valve, you can switch to Epic, regardless of whether Fortnite is there or not — and Valve has no policies prohibiting you from doing so if you want to (unlike iOS, where Apple prohibits alternate game stores). You might sell fewer games because it's less popular, but that's not due to any anticompetitive action on Valve's part — and it may not matter that you sell fewer games, because Epic may pay you enough for exclusivity that you make up the difference anyway. The "injury" that Epic is trying to prove with Apple is that game developers are injured by lost sales due to Apple's policies, or lost revenue due to Apple's cut, and that this is due to Apple's anticompetitive policies that (literally do) prohibit competing stores from existing and offering developers an alternative. Game developers are not injured — at least, not in the terms usually used in antitrust cases — by Fortnite only existing on the Epic store and not on Steam.
You might argue that consumers are somehow injured by Fortnite existing on the Epic store but not on Steam. But I think that's pretty hard to prove, at least under existing antitrust law: Fortnite is free, and its microtransactions are not particularly more expensive than competitors, and if you don't want to play Fortnite because you don't like the Epic store for some reason, there are dozens of competing battle royale shooters on every platform Fortnite runs on (and, now, even platforms Fortnite doesn't run on). Where is the lack of competition? Or the injury?
Epic's case centers on injury not to consumers, but to developers. That case is easier to make, and it's the case they care about because they operate a game store that doesn't exist on iOS due to Apple's policies — and a game engine business that operates on a 5% revenue share model, which naturally would increase its profits if Apple stopped taking a 30% tithe from developer revenues in the first place. They're perfectly willing to sacrifice Fortnite Mobile, a comparatively small amount of revenue, temporarily if it gets their other business streams more income in the future.
You might argue that consumers are somehow injured by Fortnite existing on the Epic store but not on Steam. But I think that's pretty hard to prove, at least under existing antitrust law: Fortnite is free, and its microtransactions are not particularly more expensive than competitors, and if you don't want to play Fortnite because you don't like the Epic store for some reason, there are dozens of competing battle royale shooters on every platform Fortnite runs on (and, now, even platforms Fortnite doesn't run on). Where is the lack of competition? Or the injury?
Epic's case centers on injury not to consumers, but to developers. That case is easier to make, and it's the case they care about because they operate a game store that doesn't exist on iOS due to Apple's policies — and a game engine business that operates on a 5% revenue share model, which naturally would increase its profits if Apple stopped taking a 30% tithe from developer revenues in the first place. They're perfectly willing to sacrifice Fortnite Mobile, a comparatively small amount of revenue, temporarily if it gets their other business streams more income in the future.
I think they were referring to the percentage taken when processing sales for other developers on the Epic Games Store and Steam.
They lowered prices as part of a calculated stunt. If Apple is suddenly turning over 20% of the purchase price to devs, why would the devs lower the price when they're getting an extra 20% at the same price point?
This is the correct take. Generally speaking, the prices set by Epic before this stunt likely approximated the highest price which didn't reduce aggregate spending.
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Banning the unreal dev account makes sense when you take it as setting/following precedent of removing access to the legal entity responsible for the breach of contract?
It also follows that Apple could claim that Epic used this unreal dev tooling to break the contract and thus the tooling is "illegal" and subsequently must bear the consequences as well.
I don't think there's anything overtly malicious to the unreal part save for usual corporate lawyering of go big and then back off rather than not reaching far enough and losing.
It also follows that Apple could claim that Epic used this unreal dev tooling to break the contract and thus the tooling is "illegal" and subsequently must bear the consequences as well.
I don't think there's anything overtly malicious to the unreal part save for usual corporate lawyering of go big and then back off rather than not reaching far enough and losing.
The Unreal account was a separate dev account held by a different legal entity: "Epic Games, Inc." (Fortnite) vs "Epic Games International, S.a.r.l." (Unreal). (Props to @scq who noticed this elsewhere in the discussion.)
It's somewhat unusual for corporate lawyering to go big like this against a well-funded opponent. Apple didn't actually have the legal standing to do it — as evidenced by the court issuing the emergency injunction so quickly — and now there's precedent on the books that this kind of threat won't be enforceable against others. Usually, sadly, corporate lawyering tactics are to go nuclear against someone who can't afford to fight you, and tread more carefully when someone can — lest the court take away your nuclear weapons when the big player lawyers back.
It's somewhat unusual for corporate lawyering to go big like this against a well-funded opponent. Apple didn't actually have the legal standing to do it — as evidenced by the court issuing the emergency injunction so quickly — and now there's precedent on the books that this kind of threat won't be enforceable against others. Usually, sadly, corporate lawyering tactics are to go nuclear against someone who can't afford to fight you, and tread more carefully when someone can — lest the court take away your nuclear weapons when the big player lawyers back.
I agree that seemed to be the predictable outcome. But then I cannot understand what was Apple trying to do. What is their strategy here, why be so agressive toward Epic's Unreal Engine? It feels as if they wanted to be proven wrong, but I don't understand why they would do this. If someone has some insights to share, I would be interested.
I don't believe they were specifically targeting Unreal Engine, it just got caught in the cross fire and Apple didn't really care.
Apple wanted to terminate all the dev accounts belonging to Epic which "just to happens" to include Unreal.
Apple wanted to terminate all the dev accounts belonging to Epic which "just to happens" to include Unreal.
From a comment by onion2k in the other HN thread:
> This is a quote from the letter that Apple sent to Epic;
>> If your membership is terminated, you may no longer submit apps to the App Store, and your apps still available for distribution will be removed. You will also lose access to the following programs, technologies, and capabilities:"
>> [...]
>> - Engineering efforts to improve hardware and software performance of Unreal Engine on Mac and iOS hardware; optimize Unreal Engine on the Mac for creative workflows, virtual sets and their CI/Build Systems; and adoption and support of ARKit features and future VR features into Unreal Engine by their XR team
> That is a statement that Apple made saying they will stop all help they give to Epic getting UE running on all Apple hardware. With the other stuff in the letter it makes it very clear that the problem is not just one for Epic Games, but all of Epic.
> You can read it yourself - https://cdn2.unrealengine.com/epic-v-apple-8-17-20-768927327.... (Apple's letter starts on page 51 of the PDF)
Source: https://news.ycombinator.com/item?id=24269719
So they seem to be very specific and specifically call out work on the Unreal Engine.
> This is a quote from the letter that Apple sent to Epic;
>> If your membership is terminated, you may no longer submit apps to the App Store, and your apps still available for distribution will be removed. You will also lose access to the following programs, technologies, and capabilities:"
>> [...]
>> - Engineering efforts to improve hardware and software performance of Unreal Engine on Mac and iOS hardware; optimize Unreal Engine on the Mac for creative workflows, virtual sets and their CI/Build Systems; and adoption and support of ARKit features and future VR features into Unreal Engine by their XR team
> That is a statement that Apple made saying they will stop all help they give to Epic getting UE running on all Apple hardware. With the other stuff in the letter it makes it very clear that the problem is not just one for Epic Games, but all of Epic.
> You can read it yourself - https://cdn2.unrealengine.com/epic-v-apple-8-17-20-768927327.... (Apple's letter starts on page 51 of the PDF)
Source: https://news.ycombinator.com/item?id=24269719
So they seem to be very specific and specifically call out work on the Unreal Engine.
Yes, I've read that.
What they're calling out is that Apple engineers will no longer prioritise improving the performance of Unreal on macOS and iOS. This is kinda outside the developer agreeement.
What they're calling out is that Apple engineers will no longer prioritise improving the performance of Unreal on macOS and iOS. This is kinda outside the developer agreeement.
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What is the text in the agreement that blocks developers from building against it though?
If a third party developer uses an open source library instead of Unreal, must that library belong to an entity that signed an agreement with Apple or the whole app is banned by default?
If a third party developer uses an open source library instead of Unreal, must that library belong to an entity that signed an agreement with Apple or the whole app is banned by default?
> ban Epic from doing other lines of business via macOS tools (e.g. Unreal Engine development) seemed excessive compared to other app bans
No, if you try to smuggle forbidden features through the approval process by hiding them and only enabling them after the app is published your developer account will be terminated immediately. This is clearly documented and Epic knew this up front.
Getting the chance to revert the changes before the account is terminated is what sets apart Epic from most other developers, like people that changed their apps to full emulators after it got approved like what looked like a single game.
No, if you try to smuggle forbidden features through the approval process by hiding them and only enabling them after the app is published your developer account will be terminated immediately. This is clearly documented and Epic knew this up front.
Getting the chance to revert the changes before the account is terminated is what sets apart Epic from most other developers, like people that changed their apps to full emulators after it got approved like what looked like a single game.
Does anyone find this whole situation very anti-consumer?
Two billion dollar tech companies have started a slap fight, both have claimed its for the benefit of their customers/users but in reality its about their own personal bottom line.
The gaming forums filling up with pre-teen twits willing to cheer lead for their respective megacorp is thoroughly depressing to look at.
Two billion dollar tech companies have started a slap fight, both have claimed its for the benefit of their customers/users but in reality its about their own personal bottom line.
The gaming forums filling up with pre-teen twits willing to cheer lead for their respective megacorp is thoroughly depressing to look at.
https://stratechery.com/2020/rethinking-the-app-store/