Epic Games wins partial victory in court battle against Apple and Google
The Australian federal court found both Apple and Google restricted competition in app payments, as Epic Games wins partial victory in court battle against Apple and Google, but changes may be delayed; class actions by developers also succeeded.
According to reporting by The Guardian, Fortnite creator Epic Games has secured a partial victory in the Australian federal court against Apple and Google over restrictions in app stores and the lack of competition for in-app payment options. However, any changes in Australia could take time to be implemented. Fortnite was removed from the Google and Apple app stores in 2020 after Epic Games introduced its own in-app payment system that bypassed the platforms’ methods and associated fees. The company responded by launching legal action against both tech giants in multiple jurisdictions.
Epic Games wins partial victory in court battle against Apple and Google
In the Australian proceedings, Epic Games alleged that Apple’s control over in-app purchases, which included preventing users from downloading apps outside the App Store and stopping developers from running their own app stores on iOS, amounted to a misuse of market power, substantially reducing competition in app development. Epic also claimed Google harmed app developers and consumers by restricting choices in app distribution and in-app payments on Android devices.
Apple’s iOS and App Store remain closed systems entirely controlled by Apple, requiring all in-app payments to go through its system. Google’s Android operating system has similar Play Store rules, but allows “side-loading” of apps and lets manufacturers like Samsung operate their own app stores. Fortnite is still available on Android through side-loading or the Samsung store.
Both Apple and Google charge transaction fees within their app stores. Google Play charges 15% for the first US$1 million earned annually by developers, increasing to 30% above that. Apple charges 15% if revenue from the previous year was under US$1 million, and 30% if it exceeded that. Epic’s own store charges a 12% fee.
Epic argued for the right to operate its own store as competition to Apple’s, and to offer alternative payment options within the official Games Store. Initially separate, the Australian cases were combined to avoid duplicated evidence.
Justice Jonathan Beach found Apple had breached section 46 of the Competition and Consumer Act by preventing side-loading on iOS and blocking developers from using alternative payment methods for digital purchases. Google was found to have breached the same section for its Play Store billing system and for “Project Hug”, which allegedly incentivised developers to keep apps in the Play Store. Epic’s other claims did not succeed. In a post on X, Epic Games said its store and Fortnite would come to iOS in Australia, adding that there were more than 2,000 pages of findings to review. The post read: “This is a WIN for developers and consumers in Australia!”
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Court rulings signal change, but implementation may be slow
A Google spokesperson welcomed the court’s recognition of the “stark difference between Android’s open platform and Apple’s closed system” but disagreed with the court’s assessment of its billing policies and historical partnerships. “We will review the full decision when we receive it and assess our next steps,” the spokesperson said. Potential changes to app stores and payment systems in Australia remain far off. Beach delivered a 90-minute summary of the rulings on Tuesday, covering both Epic cases and two class actions, with the full judgment to follow after commercial redactions. Each Apple and Google judgment exceeds 900 pages, and the class action judgment is over 100 pages.
The class actions, brought by app developers against Apple and Google, were successful. They argued the companies overcharged developers due to their market dominance. The extent of overcharging and the relief for developers will be determined later. “This judgment is a turning point,” said Kimi Nishimura, principal at Maurice Blackburn Lawyers, representing the app developers. “It sends a clear message that even the most powerful corporations must play by the rules and respect the rights of consumers and developers alike.” The case was heard over four months and concluded just over a year ago. Fortnite has returned to the Apple App Store in the US and is available via the Epic Games Store in Europe, but remains unavailable for download in Australia. Apple did not comment when approached. Source: The Guardian
As the technology landscape shifts with new rulings and regulations, partnering with an experienced development team can help ensure your apps and payment systems remain competitive. Moonbeam Development delivers mobile app design, cross-platform integration, and secure e-commerce solutions tailored to your needs.
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Deeply passionate about the latest technological advancements, Austin brings a forward-thinking approach to integrating cutting-edge tech trends into marketing. This is especially evident in his work with mobile technologies, where he consistently pushes the boundaries of user engagement and market reach. Outside of his professional life, Austin nurtures his creative side by playing several musical instruments and drawing inspiration from his favorite television shows.
