Apple vs Epic
In the biggest legal battle of the year, the Fortnite creator seeks to take down the tech giant.
If you don’t know your Pleasant Park from your Retail Row then the chances are that you haven’t played Fortnite. Nevertheless the game is an absolute phenomenon and boasts celebrity fans including Drake, Finn Wolfhard and Travis Scott. Now Epic Games, the developer behind Fortnite, is going one-v-one against Apple in the U.S. courts but who will emerge with Victory Royale?
To understand this case we need to first point out that although Fortnite is free-to-play, there is a virtual currency in the game called V-Bucks. V-Bucks can be bought using real money and allow a player to access perks such as season passes, outfits for their character or emotes. Problems began in the summer of last year when Epic Games offered a discount on V-Bucks on iOS and Android if players bought them directly rather than through the app store. This move was a deliberate ploy to avoid the 30% revenue cut that is taken by Apple and Google.
The tech companies responded by removing the game from their app store for violation of the terms of service but Epic likely knew this would be the outcome because they then filed suit in California.
At the heart of their bid for injunctive relief is a pretty simple argument: Apple’s control over the app store is anti-competitive. After all every single smartphone now runs on either Apple or Android so if there is to be a mobile version of Fortnite it has to run on those platforms and that means accepting the revenue cut. Any counter-argument that this money is used to help vet the app stores for unsavoury content is not true because the sums that Apple and Google make from a range of popular apps are ridiculously high compared to the running costs of the app stores.
On the surface that sounds persuasive but in a legal sense it is unlikely to succeed. The argument essentially relies on the app store being a public utility but the District Court in California is just not likely to buy that. After all Apple is a private company and the store is a part of that enterprise. Furthermore 30% is a relatively standard charge across a competitive gaming industry that includes PlayStation, Xbox and Nintendo.
Whatever happens, the proceedings are indicative of a reckoning that seems to be on its way for big tech. Apple is already facing another law suit brought by the European Union with regard to its app store. It’s hardly surprising; the companies do occupy a unique position within the market that allows them to act with impunity. The Epic Games case shows that it is ultimately the consumer that loses out on this. In the absence of genuine competitors it may be up to the courts or legislators to step in.
I have tried to think of a way to try and make this week’s episode of the podcast sound sexy but just can’t seem to do it. Care homes and VAT don’t exactly raise the pulse rates but there is an interesting discussion about EU case law that could have ramifications for future litigation in the UK.
Episode link: http://uklawweekly.com/2021-uksc-11/
Make a difference today,
Marcus