Epic Games, the maker of the popular video game “Fortnite,” became locked in a dramatic standoff with Apple and Google on Thursday that immediately renewed questions about the two tech giants’ power over the digital marketplace.
The standoff pits Epic Games, a $17 billion gaming company, against the trillion-dollar tech giants over how money flows between the companies — an issue that has also been raised by many other app-makers who argued that Apple and Google use their market power to take a cut of money that they have no right to.
The situation began after Epic intentionally circumvented a much-criticized Apple policy that requires certain apps to give the iPhone giant up to a 30 percent cut of all in-app purchases.
That led to Apple removing Fortnite, which has 350 million registered players, from its app store. Epic Games, appearing to anticipate the move by Apple, responded by suing the company for anticompetitive behavior.
Later, on Thursday night, Google removed Fortnite from the Google Play store for similarly circumventing the fee it requires on in-app purchases.
Epic Games becomes the most high-profile company yet to challenge Apple and Google’s rules around payments — and at a crucial time. All of this comes as Apple and Google are facing antitrust scrutiny in Washington.
Epic Games and its founder, Tim Sweeney, have long criticized Apple and Google, the world’s primary smartphone makers, for requiring certain apps to give them a cut of all in-app purchases. Ahead of last month’s tech antitrust hearings, he accused them of being a duopoly.
But while many companies have complained for years about the fees that Apple and Google charge developers, Epic Games on Thursday became the first company to take action and force their respective hands.
On Thursday, Epic implemented its own in-app payment system for Fortnite, effectively circumventing the 30-percent fees. Apple and Google responded by removing the Fortnite app from their systems entirely.
“Today, Epic Games took the unfortunate step of violating the App Store guidelines that are applied equally to every developer and designed to keep the store safe for our users,” Apple spokesperson Fred Sainz said in a statement. “As a result their Fortnite app has been removed from the store.”
Epic Games responded by suing Apple, stating in its lawsuit it was suing “to end Apple’s unfair and anti-competitive actions that Apple undertakes to unlawfully maintain its monopoly in two, distinct multibillion markets: the iOS App Distribution Market and the iOS In-App Payment Processing Market.”
It remains to be seen whether Epic Games will file a similar lawsuit against Google.
Spotify, the popular music app that has had its own battles with Apple over the App Store, said it supported Epic Games: “We applaud Epic Games’ decision to take a stand against Apple and shed further light on Apple’s abuse of its dominant position,” the company said in a statement. “Apple’s unfair practices have disadvantaged competitors and deprived consumers for far too long.”
Epic also took a shot at Apple’s power by riffing on Apple’s famous “1984” commercial, in which the Macintosh creator sought to portray itself as an innovative force defying conformity and overcoming the status quo. Epic used that same motif Thursday to promote a new short film that would air in Fortnite called “Nineteen Eighty-Fortnite.”
The short included the following message to players: “Epic Games has defied the App Store Monopoly. In retaliation, Apple is blocking Fortnite from a billion devices. Join the fight to stop 2020 from becoming ‘1984.’”
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