The ongoing saga of Epic Games (David) Vs Apple (Goliath) continued today, with Apple striking out at the game developer, suing Epic in return. We heard via 9to5Mac and elsewhere today, including in a report first filed by CNBC, that Apple sued Epic over its breach of contract terms for the App Store.
In case you have been sequestered for a federal jury trial the last month or have just somehow been living under a rock with no internet access, Epic Games, developers of the battle royale success Fortnite, decided about a month ago to forego its agreements that all developers accept when they get their app on the Apple App Store, and build in a feature to allow its users to purchase in-game currency directly from Epic, effectively circumventing Apple’s hefty 30% markup, and passing on the savings to the customer. The move swiftly resulted in Apple banning Fortnite from the App Store, and serving a two-week ultimatum on Epic that it would terminate its developer account.
It’s been less than four weeks since the move and countermove by the two tech giants, with Epic first suing Apple, filing a motion for injunctive relief in order to prevent Apple from being able to remove, Fortnite (the judge sided with Apple) and prevent Apple from removing its other products as well as access to the app store developer tools for those other products, in which the judge sided with Epic on that argument since the breach of contract allegation surrounds only Fortnite. Just a week later, Epic asked the court again to find in its favor and allow Fortnite back into the App Store. No decision has been made by the judge in this second request, however, it seems unlikely that the judge will change the original decision.
Apple responded Wednesday, when it sued Epic back. In this counter-suit, Apple is seeking damages for the breach of contract, and made the following argument:
″Epic’s lawsuit is nothing more than a basic disagreement over money,” Apple said in a filing with the District Court for the Northern District of California. “Although Epic portrays itself as a modern corporate Robin Hood, in reality it is a multi-billion dollar enterprise that simply wants to pay nothing for the tremendous value it derives from the App Store.”Courtesy CNBC
Apple’s arguments may not be without merit. According to Statista.com, while Apple’s annual revenues from the App Store alone for 2019 were $54.2 billion USD, according to Forbes’ Matt Perez, Epic Games had a respectable $680 Million in revenue in the first year its Epic Store was online. It’s estimated that Fortnite alone raked in $1.9 billion in revenue for Epic Games in 2019. Considering that revenue stream is from a single title, in comparison to the app stores’ thousands of offerings, Apple’s argument may not be without merit, even if the balance sheets of the two companies are vastly different.
Of course, through Epic’s suing and Apple’s counter-suing, Apple has maintained its extension of the proverbial olive-branch, offering a way to end the standoff, and to allow Fortnite back into the fold, if only Epic would upload a new and updated version of the Fortnite app to the App store, sans Epic’s built-in payment system. In the interim, Epic may have offered its own solution in an email between Epic CEO Tim Sweeney and Apple’s Tim Cook and company, essentially making a “come on bro,” argument to Apple execs. Obviously, Epic hasn’t taken the bait, and Apple hasn’t budged. In the meantime, Apple Fortnite players won’t have access to any software updates, including the latest Season 4 update, while Epic continues to toe the line in its argument that Apple is an over-reaching industry Goliath, who embraces anti-competitive and monopolistic practices.
Where do you think this will end? Will the Epic’s argument of being the David to Apple’s Goliath see the day turn in their favor? Who will Fortnite and Apple fans stand behind? Let us hear what you think!