Why Epic Games’ Lawsuit Against Apple is More Important Than it Seems
BY: Amelia Kwan
While it may seem like simply another case of mundane corporate bickering, Epic Games’ lawsuit against Apple is so much more.
The Fortnite developer and publisher filed an antitrust suit against the tech giant for “monopolistic” and “anti-competitive” business practices after the iOS version Fortnite was removed from the App Store on August 13th. The battle royale game’s removal was provoked after Epic implemented a direct payment system dubbed “Epic direct payment,” effectively circumventing Apple’s 30% cut of revenue and also violating App Store guidelines.
“Epic brings this suit to end Apple’s unfair and anti-competitive actions that Apple undertakes to unlawfully maintain its monopoly in two distinct, multibillion-dollar [sic] markets” reads a legal complaint filed by Epic in the Northern District of California.
Epic’s other legal claims cite that unfair contractual terms and policies “foreclose the iOS App Distribution Market to competitors” and “prevents developers from distributing competing app stores to iOS users.” In other words, using anti-competitive tactics to maintain its monopoly in the market.
Most of us wouldn’t bat an eye at a smaller company like Epic Games retaliating against a mammoth of a corporation such as Apple, especially when they were the ones who violated guidelines in the first place. A brave effort perhaps, but it’s evident they don’t stand a chance.
However, whether Epic will win or lose the lawsuit isn’t the point. Despite only being a legal scuffle over iOS rules, Epic’s challenge to Apple’s business practices has sparked plenty of discourse regarding the privatization and distribution of video games and other digital media. For example, the music streaming service Spotify, along with many other smaller companies, have sided with Epic Games and applaud their defiance.
Spotify Technology SA is one of Apple’s biggest rivals in music streaming. The company also filed an official antitrust complaint in March for unfair practices, claiming they “disadvantaged competitors and deprived consumers for far too long.”
Spotify also accused Apple of taxing them unfairly as a means of repressing their greatest competitor. Their primary objection was with the 15% tax Apple charges for music subscription services, but not other apps like food delivery and driving services.
Months later, Epic Games’ conflict with Apple has escalated far beyond a lawsuit. Epic originally responded to Apple not only legally but with a campaign that appeals to the public. It released a video called Nineteen Eighty-Fortnite, parodying Apple’s iconic “1984” commercial, which conveyed a similar message by likening IBM to the dictatorship portrayed in George Orwell’s novel 1984.
The video openly mocked Apple’s hypocrisy - as the small guy standing up to a trillion-dollar corporation, Apple became what it sought to destroy. “If we don’t do well, IBM will own it all,” said Jay Chiat, one of the creators of Apple’s 1984 commercial when it was first released. The irony is almost too good to be true.
Not only did Apple remove Fortnite from the App Store for all iOS and macOS, but it also targeted Unreal Engines, a game engine developed by Epic Games. Although this was blocked by the District Court judge, it represents the crucial possibility of a threat to the gaming industry as a whole.
Given that Unreal Engines is free and widely used by third-party and indie developers for countless games, removing it could potentially wipe out indie developers and smaller companies, giving Apple even more control. Microsoft also supported Epic Games behind Unreal Engines, stating that denying access to it on iOS and macOS “will harm game creators and gamers.”
It is unclear what will happen in the future with the game industry’s ecosystem, and how it might be affected by inordinately powerful corporations like Apple Inc. Nevertheless, Apple and Epic’s “epic” showdown stands as a catalyst for change in corporate behaviour, especially in a landscape where the majority of services and media have moved online.
All of this begs the question: Is Apple in their right to charge companies that promote through their platforms as they please? Should there be a set of ethical guidelines to enforce more “fair” business practices and competition? What does this mean for consumers?
On one hand, Apple is legally in the right. It clearly defined its terms, which companies signed and agreed upon. On the other hand, Epic Games, Spotify, and many other companies have the moral high ground by advocating for fair competition and consumer freedom. So what will it be?
Nineteen Eighty-Fortnite Commercial Link:
*All arguments made and viewpoints expressed within Youth In Politics and its nominal entities do not necessarily reflect the views of the writers or the organization as a whole.
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