by Jason Snell
Tired of paying fees to platform owners, Epic Games goes to court
Epic Games, the makers of the popular game Fortnite, doesn’t appreciate that mobile platform owners—we’re talking Apple and Google—demand that if you use their app stores, you have to pay them 30% of digital sales, which in Epic Games’s case, is basically 30% of everything it makes.
It hated Google’s policies so much that it initially released Fortnite for Android via sideloading only, before begrudgingly giving in a year and a half later and agreeing to Google’s terms to get on Google Play.
I’ll say this for them—they’re consistent. On Thursday Epic turned on a new Fortnite feature and trumpeted it in a press release—it was bringing direct purchase of digital goods to its iOS and Google Play apps, and at substantial discounts to buying through the purchase methods offered by Apple and Google.
Of course, this is a violation of the terms of both app stores, and Epic knew it would get shut down on both platforms. Which it did. But no worries—it had a video mocking Apple for the decision ready to drop, and a lawsuit ready to be filed.
This is not the usual story of a developer accidentally stepping into a confusing App Store policy, or even of a developer gently pushing the limits of the App store rules only to be rebuked. I doubt Epic Games has any expectation that they’ll be able to use this publicity as leverage to get Apple and Google to agree to different payment terms. That ship has sailed. What Epic Games wants to do is go to war with Apple and Google—in both actual courts and, more importantly, in the court of public opinion.
What Epic Games seems to want is for it to be illegal for platform owners to force software developers through a single commerce engine, from which the platform owners skim a percentage of the take. Epic’s behavior on Android suggests that it’s not really advocating for the freedom to sideload its app on iOS—because it knows that it would likely be an even worse user experience than what it found on Android. Epic wants the freedom to install its own sales engine in its app and keep all the money.
Epic also knows that this is all happening at a time where stories of large tech companies using their power to increase their control and profitability are breaking on a regular basis. Legislators and regulators have threatened to investigate and punish big tech companies, including Apple and Google. This is another log on the fire.
How this will end is anyone’s guess. It will be interesting to see how the tech giants play this. I really do believe that, if left to its own devices, Apple would simply shrug and walk away, leaving Epic unable to reach people who want to play Fortnite on an iPhone or iPad. But surely Apple is also considering the potential threat of government intervention in its business. If I were at Apple, I would rate that threat as one of the top two existential threats to Apple. (The other is Apple’s reliance on China both as a place to sell products and as its manufacturing hub, given the deteriorating relationship between it and the U.S.)
This goes beyond arguing over money. Should Apple be allowed to keep Microsoft’s game-streaming service off its platforms? Should the maker of any computing platform be able to set itself up as the arbiter of what software and services can run on it? Right now, companies have a great deal of latitude in this area—which is why the Mac has a free and open software market and the iPad and iPhone don’t.
My inclination is that Apple should compete on the merits of its features, rather than winning because it’s the only option. Apple’s in-app purchase system will be simpler, more convenient, and more familiar to most users of its platforms. Add in Sign In With Apple and Apple Pay and things could become even more frictionless. If Apple is afraid that video-game-streaming services threaten the future of games in the App Store, I can relate—but if that’s truly the future of gaming, Apple won’t prevent it from coming true by banning the future from its store. It’ll just end up being behind the times.
But this is a complicated, multi-faceted issue. Every time I try to simplify it, it gets more unwieldy. In the end, Apple can do what it wants—but it risks losing control of its platform if governments decide that what it’s doing needs to change.