Epic Games vs. Apple – The Future of Application Marketplaces

While Apple’s and other tech giants marketplace practices have been criticized for years, never have they been under as much scrutiny as now. Only another behemoth of a company could even think to take Apple on so there is none better than Epic Games to take up the fight.

This all started with a spitfire of tweets spanning months from Epic Games CEO Tim Sweeney, expressing his discontent with Apple and their “monopolistic” policies. He even spoke to a couple media outlets including The Washington Post and even appeared on CNBC. Most of his discontent was focused on the 30% fee that Apple takes from every purchase made on their platform, which includes any in-app purchases. Sweeney said this policy, which other platforms like the Google Play Store share, is anti-competitive, exploitative, and unfair.

The culmination of all the Tweets was a bold move from Epic Games with their massively popular game Fortnite. Fortnite is one of the most downloaded and played games in the world and generates billions of dollars for Epic Games. Even though the game is free, they make their money through micro-transactions in the form of “V-Bucks”, an in-game currency used to purchase cosmetic items. Now, considering the App Store’s policy, Apple is taking 30% of every single micro-transaction that happens through Fortnite on iPhones and iPads. So, what did Epic Games do? They added a new payment option in the app that would allow players to use an outside payment account to get around the App Store’s fees. And to top it off, Epic Games gave players a 20% discount if they made purchases using this new method. An absolutely genius move for making the statement they desired.

Obviously this was a direct shot at Apple and their policies, but Apple wouldn’t go down that easy. The same day that Epic Games made this move, Apple removed Fortnite from the App Store. A shocking and groundbreaking move, considering the popularity of Fortnite. But Epic saw this coming, and immediately filed a law suit against Apple. And to really stick it to them, Epic had made an In-game event that showed a parody video of Apple’s famous 1984 Macintosh commercial, which flipped the script on Apple. Epic had a fully fleshed out plan, with tweets, hashtags, in-game events, merchandise, and live streams to make Apple the bad guy and use the popularity of Fortnite to their advantage.

Now, their have been weeks worth of back and forth statements, including Apple rescinding Epic Games developer license which would have affected all games that they developed, but a judge blocked this move. Microsoft couldn’t sit on the sidelines, so they came out in support of Epic’s moves and called out Apple’s practices. there’s a long road ahead for this battle, but either way this can hopefully only benefit the consumer and lead to less monopolistic practices.

Sources: https://www.macrumors.com/guide/epic-games-vs-apple/

5 thoughts on “Epic Games vs. Apple – The Future of Application Marketplaces

  1. Apple is taking a huge chance doing this to Epic and its pretty interesting to watch this whole thing go down. Taking 30% of every in game purchase is absolutely absurd, and I feel more for Epic in this situation. Epic Games rely on these purchases due to Fortnite being free and Apple is completely dominating them so they made the right call. The only way Apple product consumers can play the game is through the app store so I can only imagine the amount of money Epic lost after they took it off of the app store. Apple is definitely winning this battle as of right now but I will be interested in seeing how this plays out because having Microsoft join in can completely turn this over and have Apple suffer. Apple has already lost many people in this battle and truly deserve to lose more than they are right now. Hopefully not only Epic Games but other companies start to try overpowering Apple because they are taking a complete monopoly and control over any app that goes through their devices leaving no room for these companies to expand. Microsoft might make a huge move if they can work with Epic and create a way to overtake Apple!

    source:
    https://www.macrumors.com/guide/epic-games-vs-apple/

    https://www.fool.com/investing/2020/08/25/epic-wins-1-loses-1-in-apple-fight/

  2. Personally for how much I dislike what Epic Games has brought to the gaming industry, I have to agree and applaud them for this move against Apple. The monopolistic practices that Apple has been employing in recent years have been unnerving to some degree. From the people I know and the phones I see in people’s hands, Apple has quite a large presence in the phone industry only being rivaled closely by Samsung. This means that a lot of people are affected by Apple’s choices for their phones and some people, such as myself, will not be switching to Samsung. The fact that the app store for iOS is regulated by Apple alone, means that on their devices they have complete control of what content can make it to the consumers and they collect from the sales. Epic games standing up to Apple and telling them they are wrong is a step in the right direction. The app store should be a space for creators to publish content that will make some profit for the creator. Apple needs to loosen its grip on these aspects or they could stand to lose creators which could mean a loss of consumers buying their products. Epic Games is only the beginning and hopefully, more companies will call Apple out, and allow the app store to not be so heavily regulated.

  3. This is a fact I did not know and will definitely stop me from buying things through Apple’s app store or in-app purchases. This tactic is one that has come up through an oligarchy of two providers and a market that is hard to get involved in by small third-party vendors. this will also just continue to get worse and worse for the third-party vendors as no one will be able to enter once they have fully established themselves. With apple making more barriers to entry such as hurting third party payment systems that are not even involved in their process it is a very unfair business tactic. I will be very interested to see how this fairs in court since they unfairly removed the app from the store. That being said I’m sure Apple has some hidden clause in their contracts that helps them in this situation. Since this is going to maintain a large news header it will potentially help expose these issues to the general public of America and maybe influence people to bring their business elsewhere. Another impact this could have is on the release of the new consoles. Epic and Sony just announced that Fortnite will be available on the PS5 which may give it the ability to function without Apple and the app store.

  4. I find this whole fight very interesting. I had no idea any of this was happening before reading this blog post. I feel what apple is doing with their in-app purchases is a little excessive. They are already worth over a trillion dollars so taking 30% of revenue away from app developers is uncalled for. I hope in the future epic games or another company is able to take away some of the power apple has in the application market.

    This battle with apple over application market places reminds me of the monopoly google has on search engines which we discussed in class. Though there isn’t a full out battle like this going on that I know about, Apple and Google are very similar in their power in their respective specialties. As technology becomes a bigger part of society I hope we see more companies share the market with these two companies and make a more even playing field

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