According to Apple, Epic Games hired PR firms in 2019 to work on a media strategy called “Project Liberty” aimed at portraying Apple “as the bad guy.” In October 2020, Judge Yvonne Rogers had concerns that Epic knew exactly what they were doing with the controversial Fortnite update, so this doesn’t come as a surprise.
Here is a quote from Apple:
Epic’s monopoly maintenance claim is premised on the notion that the antitrust laws preclude Apple from imposing conditions on the licensed use of its intellectual property, and impose on Apple a duty to deal with Epic on the terms preferred by Epic – to the detriment of other developers and consumers alike. But Apple has no obligation to license its intellectual property, aside from a limited exception not applicable here, businesses are free to choose the parties with whom they will deal, as well as the prices, terms and conditions of that dealing.
CNBC provided a summary of what Apple, and Epic, will argue in court. The case could be heard on May 3, 2021, (but the date could change due to the pandemic).
Apple will argue:
- Its 30% commission is essentially the same as other online software stores like Google Play or stores for video game consoles and Apple’s fee has decreased over time.
- It faces competition both for iPhones as well as other platforms to play games.
- Its App Store policies have led to a boom in the software industry and result in greater safety and security for users.
- The App Store is a core, integrated feature of the iPhone, and that using Apple payments for digital purchases is a key feature.
Epic will argue:
- Apple forces consumers to bear high switching costs to stop using Apple products, locking them in.
- As Apple has accumulated more customers and locked them in, the importance of selling software to Apple customers has grown.
- Apple controls the only way to install software on an iPhone through the App Store.
- Apple uses its App Review process, which manually screens individual apps, for anti-competitive purposes, removing apps for business reasons under the pretext of security.
- Because some developers have chosen to raise iPhone software prices because of Apple’s 30% fee, it causes consumers to pay more, and Fortnite is an example.