The Justice Department and 17 state attorneys general filed a massive lawsuit against Apple on Thursday morning, accusing the company of monopolistic smartphone practices. Meanwhile, Fortnite maker Epic Games has been accusing Apple’s App Store for iOS of violating antitrust agreements for years in an ongoing, arduous legal battle.
Epic is never specifically named in the 88-page lawsuit, but the gaming company’s complaints are reflected in extensive discussions of the App Store’s anti-competitive practices.
“Apple often enforces its rules on the App Store arbitrarily,” the lawsuit states. “And it often uses App Store rules and restrictions to punish and restrict developers who exploit technologies that threaten to disrupt, interfere with, compete with, or erode Apple’s monopoly power.”
Epic’s main complaint about the App Store is that developers have to give 30% of in-app purchases to Apple. And unlike Android devices, iPhones don’t allow sideloading of apps, which means Apple has control over any app in its App Store. For nearly a decade, Epic CEO Tim Sweeney has been a staunch critic of the revenue cut, which he believes is monopolistic and predatory toward smaller companies. In 2020, Epic made it possible for Fortnite players to pay Epic directly, instead of taking a cut from Apple – then, Apple removed Epic from the App Store, and now, four years later, we’re still watching the two companies do it do in various legal proceedings.
While a judge ruled at the time that Apple can’t prevent apps from directing users to alternative payment methods, the iPhone maker was ultimately not deemed a monopoly.
Given past rulings in Apple’s favor, it’s surprising that this lawsuit aligns with some of Epic’s complaints.
“While Apple has reduced the tax it collects from a subset of developers, Apple still extracts 30 percent from many app makers,” the lawsuit states. “Apple also generates significant and growing revenue by charging developers to help users find their apps in the App Store — something that, for years, Apple told developers was part of the reason they were paying the 30 percent tax in the first place ».
Epic isn’t the only major company to take on Apple. In January, as developers prepared for the European Union’s new Digital Marketing Act (DMA) to come into effect, Spotify also jumped into the ring, calling Apple’s compliance plan “blackmail” and a “complete and utter farce.” Then, in March, Apple was fined €1.84 billion for violating antitrust rules in the music streaming market.
On Thursday, the Coalition for App Fairness (CAF) — which includes Epic Games, Spotify, Deezer, Proton and other companies — released a statement in support of the DOJ’s action against Apple.
“With today’s announcement, the Department of Justice is taking a strong stand against Apple’s stranglehold on the mobile app ecosystem, which stifles competition and hurts American consumers and developers,” said Rick VanMeter, CAF’s executive director. “The Justice Department’s complaint describes Apple’s long history of illegal behavior — abusing App Store guidelines and developer agreements to raise prices, extract exorbitant fees, degrade user experiences, and stifle competition. The DOJ joins regulators around the world who have recognized the many harms of Apple’s abusive behavior and are working to address it.”
Epic Games declined TechCrunch’s request for comment. Sweeney, who is usually vocal on these issues, was also coy on the matter.
‘I will stop antitrust commenting on Twitter until the end of my testimony in the Australian Epic v Apple and Google trial in Melbourne’, Sweeney was postednext to a photo he took in Melbourne.
For more on Apple’s antitrust lawsuit, check here:
