Court rules Apple's concealment strategies as apparent deceit in Epic Games triumph, potentially leading to Fortnite's return on iOS platform shortly.
Rewritten Article:
Apple Faces Criminal Prosecution over iOS App Store Payments
The ongoing war between Epic Games CEO Tim Sweeney and Apple has taken an unexpected turn, as a US court has found Apple guilty of violating a 2021 injunction, and may even refer the tech giant to criminal prosecutors.
Initially, Sweeney's Epic Games aimed to implement its own payment processing system in Fortnite for iOS, bypassing Apple's 30% fee. After losing the initial battle in a 2021 trial, the US courts ruled in Epic's favor on one point: Apple was prohibited from hindering iOS app developers from directing users to out-of-app websites that utilized their own payment processors.
Sweeney maintained that Apple had not been fully compliant with the court's wishes, and recent evidence seems to support his claim. In a scathing court order, District Judge Yvonne Gonzalez Rogers wrote, "Apple, despite knowing its obligations thereunder, thwarted the Injunction's goals, and continued its anticompetitive conduct solely to maintain its revenue stream."
Apple, in response, contends that it will abide by the court's ruling and plans to appeal the decision. However, according to the court order, Apple's new 27% commission on out-of-app purchases and "scare" screens that cautioned users against such transactions have not been well received.
This time, Apple may have gone too far. The court found that Apple had not been transparent about how it arrived at the 27% fee and referred the matter to the regional US attorneys office for potential criminal contempt proceedings. Judge Gonzalez Rogers stated that Alex Roman, Apple's VP of finance, had lied under oath during the 2024 evidentiary hearing.
Apple's own internal records showed that the company was aware of the external payment processing costs developers would incur when implementing out-of-app purchases, but the court found that Apple conveniently ignored these costs when setting the new commission.
The court also revealed that Phil Schiller, Apple's executive, understood that the new commission violated the injunction and opposed the fee. However, Tim Cook, Apple's CEO, chose to disregard Schiller's concerns and allow his finance team to convince him otherwise.
Following the judge's latest order, Apple faces no further leeway unless it succeeds in its appeal. In the US, Apple will no longer levy any fees on out-of-app purchases from developers. If Apple's appeal fails, this change would apply to all developers, not just Epic Games.
Now that Epic Games has achieved a crucial victory, it seems Sweeney may be open to peace. In a recent tweet, he announced plans for Fortnite to return to the US iOS App Store in the near future: "We will return Fortnite to the US iOS App Store next week. Epic puts forth a peace proposal: If Apple extends the court's friction-free, Apple-tax-free framework worldwide, we'll return Fortnite to the App Store worldwide and drop current and future litigation on the topic."
While Sweeney hasn't gotten everything he originally wanted, the court's latest decision has undeniably shifted the power dynamics between Apple and app developers, potentially paving the way for a fairer app ecosystem in the future.
Insights:
- The legal battle between Epic Games and Apple started in 2020 after Epic attempted to bypass Apple's 30% fee on in-app purchases.
- In 2021, a US court issued an injunction, ordering Apple to allow developers to direct users to external payment options. Apple implemented this by charging a commission on such transactions and limiting where links could appear.
- Following recent allegations that Apple had violated the spirit of the injunction by hindering competition, Judge Gonzalez Rogers agreed, concerned that Apple had not been entirely truthful about its compliance planning.
- Apple has filed an emergency motion to appeal the ruling, arguing that the court exceeded its authority by setting Apple's prices at zero and controlling how developers present payment options.
- This is a significant step forward for developers in the iOS ecosystem and may lead to a more competitive app market in the future.
- In the tech-driven domain of general-news, Apple's missteps over iOS App Store payments have stirred a storm, with the tech giant potentially facing criminal prosecution.
- The ongoing saga between Apple and Epic Games, which kicked off in 2020, saw Epic attempting to bypass Apple's 30% fee on in-app purchases, leading to a legal battle.
- Victory for Epic Games seems imminent, as a US court recently found Apple guilty of violating a 2021 injunction, with potential consequences reaching beyond a simple business dispute, touching upon the realm of financial affairs and technology.
- The season of change in the app industry is upon us, as Apple, faced with allegations of hindering competition, navigates paths towards compliance, potentially reforming the App Store ecosystem.
- In the world of games and tech, it seems that, just as PS and Xbox users gear up for the latest titles and technological advancements, App developers stand poised to gain a fairer stake with a potential shift in the power dynamics between Apple and app developers.
