Epic Games versus Apple: Fortnite developer prefers EU Commission

Apple App Store

App developers have to pay to the major mobile phone operating system providers Apple and Google if they want to be present in the App Store or Google Play Store.

(Photo: AP)

Düsseldorf The game developer Epic Games opened in its stalled app store dispute with Apple a new front in the European Union. The company behind the popular online game “Fortnite” filed a cartel complaint with the EU Commission on Wednesday.

Apple used control of the iOS operating system on its iPhones to gain advantage and at the same time block competitors, argued Epic Games. The iPhone company defended its approach.

The conflict that has been going on in the US since the summer could ultimately affect how apps are sold on smartphones – and how much money platforms such as Apple’s App Store or Google’s Play Store are allowed to withhold from the purchase price.

The complaint in Europe is part of a large-scale plan that the company internally calls Project Liberty. “This is about the future of mobile platforms”, stated company founder Tim Sweeney in a blog post.

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Epic no longer wants to adhere to the requirement that has been in force for more than a decade that virtual items in the game on iPhones and iPads can only be offered via Apple’s in-app purchases system. Apple keeps up to 30 percent of the purchase price. Instead, Epic would like to run its own app store on the iPhone.

After Apple rejected the changes to the terms and conditions, the Epic developers built into the app in the summer of 2020 the contractually prohibited option of being able to buy the items directly from Epic. For this purpose, a hidden function was activated in the application in August, which Epic had smuggled past Apple’s app reviewers.

Apple als Big Brother

On the same day, Apple threw “Fortnite” with reference to the rule violation from the App Store. Epic Games immediately went to court in the United States, accusing Apple of unfair competition. Apple filed a counterclaim for damages.

At the same time, the game developer tried to mobilize the fans: He published a video in which he portrays the iPhone and Mac manufacturer as an evil dictator in the style of the surveillance “Big Brother” with a head that looks like a bitten apple with a worm . A parody of a commercial from 1984, when Apple was still the underdog against IBM.

In order to emphasize the demands, Epic Games also joined forces with other companies such as the music service Deezer to form a “Coalition for App Fairness”. This is pressing for a change in the rules.

Epic has already filed antitrust complaints against Apple in several countries, including the US, Australia and the UK, and now also in the EU. In response to the complaint in Europe, the iPhone manufacturer accused the game provider of using consumers as a deposit – and that is what they wanted to show the Commission. Apple is about offering users a secure app platform, and they treat all developers equally.

The pressure on Apple is growing: The EU Commission is already responding to a competition complaint from the music streaming market leader Spotify against the company from California and examines the competitive situation with the payment service Apple Pay.

$ 1.2 billion with Apple users

For Epic Games, it’s a risky and expensive conflict. In addition to the process costs and the management effort, there are also lost sales. It is known from court documents, for example, that the game “Fortnite” is likely to have generated around 1.2 billion dollars with Apple users alone since it was launched in 2017.

Epic Games does not comment on the specific financial consequences. CEO Tim Sweeney but recently announced to the TV station CNNthat the game developer will lose at least a year of money due to the dispute with Apple and Google. Since the company is not yet listed on the stock exchange, it has the financial independence to do so.

Apple has already made changes to the rules for the App Store in the past few months. For example, developers with comparatively low sales since the beginning of the year pay 15 percent instead of 30 percent commission under certain circumstances.

With material from Reuters and dpa

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