From Epic’s lawsuit: Why software companies are besieging the “Apple tax”

The “Apple tax” is once again the target of public attention. Apple and Google’s app store platforms face multiple legal, regulatory and public opinion challenges to 30 percent of developers’ rules. The lawsuit against Apple and Google by Epic Games, the maker of the popular game Fortnite, has pushed Apple and Google’s rules to the forefront of public opinion and attracted support from well-known technology companies and the public.

Now, the “siege” over Apple’s App Store rules continues. In addition to high-profile companies, including Microsoft and Facebook, which have personally attacked Apple, U.S. and European Union lawmakers and regulators have launched antitrust investigations into the company.

For now, however, epic Games games may not necessarily win the battle against Apple.

Is 30% of the App Store’s smoking is a “rule”?

In August, Apple and Google launched Fortnite from their respective app stores because the game went online with its own in-app payment channel, bypassing a platform system that takes a 30% commission. In response, Fortnite owner Epic Games Games Inc. filed lawsuits against Apple and Google.

Epic is seeking an interim court injunction to force Apple to reinstate Fortnite from its app store. But for now, the judge is not on Epic’s side.

At a preliminary hearing on September 28, local time, U.S. District Judge Yvonne Gonzalez Rogers of the U.S. District Court for the Northern District of California expressed skepticism about Epic’s allegations and said it was dishonest for Epic to know that he had violated his contract with Apple by updating the game, CNN reported.

Epic Games argued that Apple had a monopoly on the App Store and charged excess fees, but the judge noted that 30 per cent of Apple’s fees were “industry rates” and that companies such as PlayStation, Xbox, Nintendo, Amazon, Wal-Mart, Best Buy and Google all drew 30 per cent.

In response, Epic said the consoles were “different” because the hardware was sold at a loss, but the judge was not persuaded by the reason, saying there “doesn’t seem to be any evidence to support what you said.”

Epic also said it wanted to set up its own app store to distribute apps on iOS, but Apple’s anti-competitive practices prohibit it. In response, Apple’s lawyers said the request was a prosecution of Apple’s “entire business model” that focuses on the “security and privacy” of its users.

Judge Rogers said the case could be a landmark one and an important one at the forefront of antitrust law. The judge did not give a time frame for the ban, but said that according to her schedule, the case may not be heard until July 2021, adding that she hoped the case would be heard before a jury.

According to technology website MacRumors, there are suggestions that 30 per cent of the fees Epic would have paid Apple could be deposited into a managed account at the end of the lawsuit, which could be used as a way for Fortnite to return to the Apple App Store, but it’s unclear whether the two companies agreed to the plan.

“Group” surrounds the apple.

It’s not just Epic Games.

Companies such as Epic Games, music software company Spotify Technology and Match Group, owner of social app Tinder, have formed a coalition to pressure companies such as Apple, a nonprofit group called Alliance for Fair Apps.

The alliance says most app stores extract excessive user-paid commissions from software developers and stifle competition by giving their products and services an unfair advantage. The alliance seeks to drive changes in laws and regulations that change the way companies operate their app stores.

In a statement, the Fair Applications Alliance said: “The control platforms that operate these app stores must not abuse the control they enjoy and must be monitored to ensure that their actions promote market competition and provide consumers with a fair choice.” “

In addition to the founding members of the Fair Apps Alliance, tech giants such as Microsoft and Facebook have also attacked Apple’s App Store rules.

Microsoft is involved in The Epic and Apple lawsuits. In an August 23 court statement, a senior Microsoft engineer said allowing Apple to block Epic Games’ developer accounts would prevent game makers, including Microsoft, from using Epic’s Unreal Engine, a major blow to their game development.

“If Unreal Engine doesn’t support Apple iOS or macOS, Microsoft will have to choose between giving up users on iOS and macOS or choosing a different game engine when developing new games.” Kevin Gammill, microsoft’s general manager of gaming development experiences, said in a statement.

In September, Epic won a temporary restraining order against Apple for disabling developer accounts that support Unreal Engine in retaliation for Microsoft’s own appeal. But the judge also ruled that Apple did not need to put Fortnite back online in its app store.

Facebook, one of the tech giants under antitrust investigation, has also won a small 10 percent battle with Apple.

On September 25th Facebook said it had agreed to allow small businesses that had been forced to switch their physical activities to Facebook’s online pay-per-view activities because of the new crown pneumonia outbreak, exempting them from paying 30 per cent of Apple’s App Store trading revenue. The exemption period for this “Apple tax” is three months, which ends at the end of December 2020 and will be re-imposed from 2021.

Antitrust investigations in the United States and the European Union.

Apple is currently under antitrust investigation by the U.S. Congress and the Justice Department, the Federal Trade Commission and the European Competition Commission. Apple defended itself by saying that its App Store commissions and other app market fees are the same and that it will provide users with cyber security and privacy protection services.

Antitrust scrutiny against Apple has focused on the store’s control over developers. Apple and Google, which control access to apps from almost all smartphones around the world through their iOS and Android operating systems, charge 30 per cent for in-app purchases in their app stores and make their own apps to compete with independent developers.

On July 29th The US Congress held an antitrust hearing against four tech giants: Google, Facebook, Amazon and Apple. Among them, Facebook and Google have suffered the most monopoly attacks, with relatively little firepower against Apple.

At the hearing, Apple CEO Tim Cook defended the company, saying the company treats every developer equally and citing opportunities for developers from the App Store. “If Apple is a gate keeper, all we have to do is open the door a little bit more,” Cook said. “

The European Union has also launched an antitrust investigation into Apple.

On June 16th EU antitrust authorities launched a formal investigation into Apple’s Apple Pay payment service and app store rules and whether competition law had been violated. The survey deepens the EU’s long-standing battle with Apple over taxes and monopolies.

In 2019, Spotify, a Swedish-based music streaming service, filed an antitrust complaint with the European Union, saying Apple imposed restrictions on developers using its app store. In response to the EU allegations, an Apple spokesman said: “The European Commission is pushing for baseless complaints from a small number of companies that just want hitchhiing and don’t want to follow the same rules as everyone else.” “

What is the “Apple Tax”?

The so-called “Apple tax” means that Apple, through its App Store App Store, charges a 15-30% commission on most app subscriptions and in-app purchases on the iOS platform, with the exception of in-app purchases that make Apple profitable.

The “Apple tax” is a big controversy. While the iOS system is more secure, developers are unhappy with Apple’s ban on consumers on iOS buying products from outside the App Store. And, from a developer’s point of view, Apple’s app review process isn’t transparent enough.

On September 28th Google said it would enforce its policy requiring developers who distribute Android software on the Google Play Store app platform to use Google’s in-app payment system. The announcement also brings Google’s Google Play Store policy into line with Apple’s App Store policy.

Developers have until September 30, 2021 to switch all of their Android apps to Google’s billing system, which will take a 30% commission on digital payments.

Although Google’s Android app market policy and Apple App Store are similar, Google has received far less attention and criticism than Apple.

Android allows users to download apps without using its Play Store, meaning app developers can distribute apps on platforms other than the Google App Store, such as Samsung’s Galaxy App Store and Huawei App Market. But most Android users still download apps directly from Google’s Play Store.