Apple’s ‘resounding victory’ yields small gain for third-party payments
In a blow to Fortnite maker Epic Games, the 9th US Circuit Court of Appeals upheld an earlier district court ruling that found Apple did not violate antitrust laws by forcing app developers to use the App Store’s built-in payment system. Monday’s ruling, however, was a small victory for Epic Games, as Apple was found guilty of violating California’s unfair competition law for its use of “anti-steering” language, which prohibited app developers to connect to third-party payment methods.
Epic Games’ popular video game Fortnite launched on the App Store in 2020 when it tricked people into buying in-game items through an external site. This violated Apple’s Developer Program License Agreement. The eviction launched an antitrust lawsuit in which Epic Games claimed that Apple had a monopoly on the App Store. Epic Games has launched a similar action against Google and its Play Store policies.
“Today’s decision reaffirms Apple’s resounding victory in this case, with nine of the 10 claims having been decided in Apple’s favor,” an Apple spokesperson said in a statement. “For the second time in two years, a federal court has ruled that Apple complies with state and federal antitrust laws.”
The Apple App Store is big business. Last year, the App Store brought in more than $85 billion, according to CNBC analysis. App developers are forced to use Apple’s payment system for in-app transactions, allowing Apple to cut all sales by 15% to 30%, depending on the deal an app maker has entered into with the company.
Apple said it disagrees with the court’s ruling on California’s unfair competition law and is “considering further review,” although changes are already underway. With iOS 17, Apple would allow people to download apps, which means people will be able to download apps outside of the App Store. It would be the equivalent of downloading an application online and installing it on a MacBook. This could be to ensure compliance with European regulations which are due to come into force next year.
Throughout the legal battle with Epic, Apple has largely reigned victorious, except for its “anti-steering” language, which prohibited app developers from allowing people to process transactions outside of the app. Store.
When asked for a comment, Epic Games pointed to a tweet from CEO Tim Sweeney acknowledging the appeals court’s decision but commending the court for rejecting Apple’s anti-direction provisions.
“Apple was successful in the 9th Circuit Court. Although the court upheld the decision that Apple’s restrictions had ‘a substantial anti-competitive effect that harms consumers’, they concluded that we had not proven our Sherman Act case,” Sweeney tweeted. “Fortunately, the positive court ruling rejecting Apple’s anti-steering provisions allows iOS developers to send consumers to the web to do business with them directly there. We are working on next steps.”
It’s still unclear when Fortnite will be allowed to return to Apple devices.
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