Apple / Epic Games trial: hard blow for the apple giant

A US judge on Friday rendered a major decision in the battle between Apple and Epic Games, the publisher of the video game Fortnite, determined to force the tech giant to facilitate competition on its App Store (app stores), at the heart of a hundreds of billions of dollars economy.

But this decision does not give a clear winner between Apple, forced to make concessions but cleared of monopoly accusations, and Epic Games, widely hailed as victorious but dissatisfied to the point of appealing.

The business model of the App Store

Launched in 2008, the store of mobile applications – quickly imitated by competing technologies – gave birth to a whole economy of services accessible on his smartphone.

Third-party publishers submit their applications, and if validated, iPhone or iPad users can download them, only through this platform.

“Apple has helped build an economy that brings in over $ 500 billion a year, and only gets a dab of that amount for all the innovation it has facilitated and the costs of operation.“said the patron Tim Cook au New York Times in early April, calling the App Store an “economic miracle”.

The firm of Cupertino takes a 30% commission on sales of apps in the App Store and on purchases of digital goods and services within those apps.

Some developers benefit from a reduced rate of 15% (newcomers, annual revenues less than $ 1 million, etc.).

Other companies, like Spotify and Netflix, avoid the commission by not offering the option to subscribe to their services from the app, and by letting consumers see for themselves that they need to go to the site. web.

No monopoly according to American justice

Apple will now have to let applications redirect their users to their website – and thus escape the “Apple tax”, as these detractors call it.

Yvonne Rogers, the American judge in charge of litigation with Epic Games, decided Friday that the manufacturer of the iPhone could no longer prevent publishers from communicating directly with their customers to direct them to alternative means of payment.

But she did not agree with the video game studio.

Epic wanted the court to recognize that Apple is in an illegal monopoly situation, but the judge did not find “infringement of competition law“. “Success is not illegal“, she added.

The studio will appeal the verdict. He sued Apple a year ago after trying to bypass the App Store payment system. His Fortnite game was immediately removed from the platform.

Tim Sweeney, le patron d’Epic, promised to “keep fighting” for “fair competition between payment methods within apps“.

What about consumers?

They are losers, according to Epic: “Fortnite will return to the iOS App Store when Epic can offer its payment system in the app in competition with that of Apple, by passing on the savings thus made to consumers,” said tweeted Tim Sweeney.

Because Apple can continue to impose its payment system for purchases made directly in the application.

Users wishing to subscribe to a meditation program, for example, may not mind paying on the website. But what about impulsive transactions in video games, when the rest of the adventure depends on the purchase of an additional life?

It is likely that these transactions remain in the apps, and therefore through the App Store. In the immediate future, therefore, users will notice little change.

Economic impact for Apple

The App Store has nearly a billion users worldwide, which is a juicy market. They spent $ 643 billion on apps in 2020, according to Apple.

But it is difficult to quantify possible losses for the Apple brand.

The group raised $ 64 billion in revenue from the platform last year, according to analysts at business channel CNBC.

These revenues come from a fraction of the apps – 85% of those on the App Store pay no commission (because they’re free, in particular).

Those who pay can appreciate the services provided by Apple, notes analyst Carolina Milanesi, who thinks the group has nothing to worry about in terms of the impact on its revenues.

Especially since consumers may also prefer not to enter their bank details on too many different platforms.

Apple hailed the decision as a “resounding victory” and an “validation of its economic model“.

Reference-feedproxy.google.com

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