In a court clash with potentially huge repercussions for the
world of mobile tech,
Fortnite maker Epic Games takes on Apple starting Monday
aiming to break the grip of the iPhone maker on its online marketplace.
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The case opening in federal court comes with
Apple feeling
pressure from a wide range of app makers over its tight control of the App
Store, which critics say represents monopolistic behavior.
The two firms will be debating whether Apple has the right
to set grounds rules, control payment systems and kick out apps from its
marketplace that fail to comply.
Also at stake will be Apple’s slice of revenue from iPhone
apps, as much as 30 percent.
Apple contends that its commission is the industry norm, and
is fair compensation for giving developers a global storefront and keeping it
secure.
Epic, which is seeking to return to the App Store without
being forced to use Apple’s payment scheme, is not alone in its criticism.
The European Union on Friday formally accused Apple of
unfairly squeezing out music streaming rivals based on a complaint brought by
Sweden-based Spotify and others which claim the California group sets rules
that favor its own Apple Music.
A recently formed Coalition for App Fairness, which includes
both
Spotify and Epic, have called for Apple to open up its marketplace,
claiming its commission is a “tax” on rivals.
Apple booted Fortnite from its online mobile marketplace
last year after Epic released an update that dodged revenue sharing with the
iPhone maker.
Apple does not allow users of its popular devices to
download apps from anywhere but its App Store, and developers have to use
Apple’s payment system which takes its cut of up to 30 percent — a percentage
which goes down after the first year and is waived for those with limited
revenues.
Due to the legal row, Fortnite fans using iPhones or other
Apple devices no longer have access to the latest game updates.
After months of dueling legal filings, a trial before
District Court Judge Yvonne Gonzalez Rogers is to begin with Epic laying out
its case in opening remarks.
Apple is to counter with its position before witness
testimony begins. The companies agreed to leave the verdict up to the judge
instead of a jury.
Some analyst say Apple appears on firm ground in defending
its turf.
Wedbush Securities analyst Daniel Ives said, “The Street
views the bark worse than the bite on this trial and when Apple wins we believe
it will embolden the company’s iron grip on its App Store and fee structure.”
The trial is being held in a courtroom across the bay from
San Francisco, and witnesses are to include the chief executives of Apple and
Epic.
Rogers has tightly restricted access to the courtroom due to
COVID-19 risks, allowing the public to listen to proceedings via a phone line
or Zoom.
The legal battle comes as Apple puts priority on selling
digital content and subscription services to the one billion-plus people around
the world using devices powered by its iOS mobile operating software.
“Who gets the money for Epic’s games is what they are
fighting for,” said analyst Rob Enderle of Enderle Group.
“I think Apple is in the wrong here when it comes to the
good of the industry; you want to fund innovation not distribution.”
Epic earlier this year lodged a complaint against Apple with
EU antitrust authorities, deepening its bitter feud with the iPhone-maker over
its app store.
“We will not stand idly by and allow Apple to use its
platform dominance to control what should be a level digital playing field,”
Epic Games CEO Tim Sweeney said in a statement when the complaint was filed.
The company said the complaint “complements” legal
proceedings it has launched in the United States, Australia and Britain.
Epic has said is seeking decisions by authorities to force
Apple to amend its practices for all developers.
As the battle over App Store control rages, Apple has not
backed down. And it has ignited further complaints by implementing a new
privacy policy which limits the ability of third-party apps to track users — a
feature critics say also favors Apple’s in-house services.
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