Fortnite developer Epic Games is suing Apple and Google for antitrust violations following the game’s removal from both stores. Prior to Fortnite’s removal, Epic Games added a payment option that circumvented the platforms’ systems.

Fortnite developer Epic Games is suing Apple and Google for antitrust violations following the game’s removal from both stores. Prior to Fortnite’s removal, Epic Games added a payment option that circumvented the platforms’ systems.

Fortnite developer Epic Games seems to have a way with breaking the rules. In the face of Fortnites success, companies have ended up changing long-standing policies like Sony, which abandoned its fight against cross-platform play in 2018 after Epic Games forced the issue, eventually leading to cross-play in other games, too.
Fortnites size and popularity gave Epic Games the power to bend Sony and Nintendos rules, but will the tactic work with the monoliths of Apple and Google? Well, the North Carolina-based company is trying. On Thursday morning, Epic Games updated Fortnite with a new option for payment processing, providing a discounted price for players who choose to process payments through Epic, not Apple or Google. Epic thus circumvented the Apple storefronts 30% cut on purchases by giving players a 20% discount on V-Bucks, Fortnites in-game currency. In response, both Apple and Google removed Fortnite from the App Store and the Google Play Store, respectively, citing policy violations.
As it turns out, this is what Epic Games was expecting. And it had a plan. Moments after the game was removed from Apples storefront, Epic Games began its #FreeFortnite campaign, complete with a hashtag, in-game propaganda video, anda pair of lawsuits. In those lawsuits, Epic Games argues that Googles and Apples policies are anti-competitive and a violation of antitrust laws. Epic Games CEO Tim Sweeney said on Twitter that his company is not looking for special treatment; it wants Apple and Google to change its rules and create truly open platforms to benefit all developers, not just Epic. Itll be a hell of a fight! Sweeney said.
Today, Apple said Epic is seeking a special deal, but that’s not true. We’re fighting for open platforms and policy changes equally benefiting all developers. And it’ll be a hell of a fight! https://t.co/R5A48InGTg
Tim Sweeney (@TimSweeneyEpic) August 14, 2020
Epic Games has gone up against large tech companies in the past, but its antitrust litigation will be different. Its looking to change the policies of companies that solidified themselves as market leaders in the industry, and neither Apple nor Google will want to let go of that. This litigation has a much larger scope than any of the other challenges that Epic Games has faced, like the Sony faceoff. Likewise, Epic Games is the underdog, if you can call it that. Although its valued at more than $17 billion, thats significantly overshadowed by the trillion-dollar market capitalization of Alphabet (Googles parent company) and Apple.
Epic is going at the heart of the App Store monopoly, as well as Googles comparable monopoly over the sale of Android apps, Sandeep Vaheesan, legal director at anti-monopoly research and advocacy group Open Markets Institute, told Polygon. Its challenging the practices by which [Apple and Google] acquired this dominant position and tried to leverage this dominant position into new markets. This is a major lawsuit.
Vaheesan said Epic Games lawyers presented detailed factual allegations that rely on strong legal theories, which bodes well for the company. Epic isnt asking the court to rewrite antitrust law as it stands instead, its asking a judge to just enforce the law as it exists. Its different, in that way, from the antitrust hearing in Congress last month, where government officials discussed potential changes to market power rules. (Epics lawsuit, however, is still important in that if Epic wins, itll make it clear that Apples and Googles practices are illegal, and then those companies will be forced to change their practices.)
The U.S. House of Representatives Subcommittee on Antitrust, Commercial and Administrative Law held a major hearing on July 29, in which lawmakers grilled tech executives including Alphabet CEO Sundar Pichai, Amazon CEO Jeff Bezos, Apple CEO Tim Cook, and Facebook CEO Mark Zuckerberg. The high-profile hearing put the four CEOs before Congress, asking them to answer questions about the power their companies wield.
Itll be a test of whether the law thats nominally on the books is actually effective
The hearing, like Epics lawsuits against Apple and Google, brought antitrust and monopoly issues to the public forefront. And thats important, regardless of whether things turn in Epics favor in the court of law.
Itll be a test of whether the law thats nominally on the books is actually effective in constraining the power and practices of these big tech companies, Vaheesan said.
The problem isnt simply that Apple and Google are monolithic companies, but that they have large monopolies over certain markets. Valarie Williams, an antitrust lawyer and partner at Alston & Bird, told Polygon that Epic Games basic allegation comes down to whether or not Apple (and, subsequently, Google) has a monopoly through its App Store. For Epic to succeed in its lawsuits, it has to prove the market exists and that the companies have monopolies over them.
She pointed to another restriction, the tying arrangement, that Epic Games said is violating antitrust laws. [Apple] is saying that if youre going to use the App Store, then you have to use our payment processing service; you cant use your own, Williams said. If you dont want to do that, then you cant use the App Store and thats why Fortnite was removed.
Its not a problem to be a monopoly, Williams said. Its not a problem under the law to have market power. Its when you use that to restrain competition. And Epic Games has alleged that thats exactly what the restrictions do, at least in the case of Apple you cant just move to a different app store on iOS, because Apple doesnt permit them to exist.
Epic Games, in its cases, will be building on the public and political momentum generated by last months hearing, Vaheesan added. He said that antitrust issues arent typically front-page news, but thats changing, of course with the congressional hearings and now, Epic Games #FreeFortnite campaign, which seems specifically designed to harness gamer anger. (Which is not to say that harnessing gamer rage is the correct move, but it is a move.)
Fortnites removal from the app stores doesnt necessarily impact gamers too much at least, not gamers on Android. Googles platform is more open than Apples, and the game wasnt even available on the Play Store until April. Instead, people had to download it directly from Epic Games, and they can still do that, including its updates. On iOS, its not that simple. You cant just go straight to Epic Games to download Fortnite and its updates. New users wont be able to download the game at all, and current users wont be able to play the next update should Apple not return it to the store. Presumably, keeping Fortnite off the app stores means Google and Apple are losing something the 30% commission they take from in-app purchases, which is what Epic Games wants to stop, anyway.
At this point, it doesnt necessarily even make sense to talk about whether Epic Games and Fortnite could or will win against Apple and Google in court. The legal process for antitrust cases is devastatingly slow.
Were not likely to get resolution soon, Vaheesan said. He pointed to a class-action lawsuit against Apples App Store practices that has been in the courts for a decade. (The Supreme Courts 2019 ruling in the case, Apple v. Pepper, allowed for lawsuits to continue in lower courts.)
John Bergmayer, legal director for consumer rights organization Public Knowledge, told Polygon that Epic Games approach with regard to public opinion puts the gaming company in a good position regardless of the potential outcome of the court cases.
If Epic Games eventually wins over Apple and Google, thats great. Itll benefit Epic Games, but more importantly, the industry will be forced to change its practices, at least with regard to tying app purchase exclusivity. If the case ends in a settlement, that still means something is going in Epic Games favor, though it may not have as broad an application to the industry as a whole. (Epic, however, said that its not looking to get a special exemption from either Google or Apple.)
But even if Epic loses, it wont be the end of this particular fight. It sucks, its bad to lose, but it at least highlights the need for some sort of action from Congress to change the law, Bergmayer said.
Congress, at least, seems interested in investigating the nature of these companies antitrust violations, per the House judiciary antitrust subcommittee hearing. Apple is also reportedly under a Department of Justice investigation for its App Store policies, similar in nature to the Epic Games lawsuit. However, its hard to say what will come of any of this, or how long it would take to make adjustments to existing antitrust laws. Thats on top of the ongoing Apple v. Pepper case and the European Unions investigations into the company.
Rep. David Cicilline (D-RI), chairman of the antitrust subcommittee, has spoken publicly (and strongly) against these practices particularly Apples.
Apples tax is highway robbery, Cicilline said in a statement emailed to Polygon. These high fees would not exist in a competitive marketplace. Its also outrageous that a company worth nearly $2 trillion with record-breaking profits is holding smaller companies hostage during an economic crisis. All just because it can. This is a real problem. It doesnt just undermine innovation it threatens the jobs and economic livelihood of the people who work at these companies.

Share