Apple Blocks Epic Games’ Online Marketplace in Europe Amid Ongoing Legal Battle
In a move that further escalates the ongoing legal battle between Apple and Epic Games, the tech giant has blocked the Fortnite video-game maker from launching its own online marketplace on iPhones and iPads in Europe. This latest challenge from Epic comes at a time when Apple is already grappling with concerns about sluggish demand for its iPhones in China, causing its stock to plummet by 12% this year.
The legal dispute between Apple and Epic Games dates back to 2020 when the gaming company accused Apple of violating U.S. antitrust rules by charging exorbitant commissions of up to 30% on in-app payments made through its iOS devices. These charges have raised concerns among regulators and competitors, such as Epic, who view them as a threat to fair competition and Apple’s dominance over its own ecosystem.
European lawmakers have taken action by introducing the Digital Markets Act (DMA), a law that forces Apple to allow third-party marketplaces on its devices. This legislation, which takes effect this week, aims to create a more level playing field for app developers and prevent monopolistic practices. In a separate development, Brussels antitrust regulators recently fined Apple 1.84 billion euros ($2 billion) for impeding competition from music streaming rivals through restrictions on its App Store.
Epic Games had been working to take advantage of the DMA by creating a new developer account in Sweden. The company intended to use this account to launch its own game store on Apple’s devices, thereby bypassing the App Store. However, Apple thwarted these efforts by terminating the developer account, citing Epic’s past breaches of contract in the ongoing legal dispute.
Developer accounts are crucial for software creators as they are required to distribute apps to iPhones and iPads. Apple had previously terminated some of Epic’s developer accounts in 2020 after the gaming company deliberately violated Apple’s in-app payment rules. Epic strategically used this violation and subsequent banishment from the App Store as the foundation for its public relations and legal campaign against Apple.
Apple defended its decision to terminate Epic’s account by asserting that court rulings have granted the company “sole discretion” in such matters due to Epic’s “egregious” breaches of their developer agreements. However, Epic Games argued that Apple’s actions constitute a serious violation of the DMA and demonstrate the tech giant’s unwillingness to foster true competition on iOS devices.
The European Commission, the executive body of the EU, has not yet responded to requests for comment on this latest development. Apple had previously proposed certain changes in January to comply with the DMA’s conditions, including allowing alternative app stores on iPhones and providing an opt-out option for using the in-app payments system. However, the company also introduced a “core technology fee” of 50 euro cents per user account per year for developers who choose to participate in the new regime.
As the legal battle between Apple and Epic Games rages on, the outcome of this dispute will have significant implications for the future of app marketplaces and competition within the tech industry. With regulators and competitors pushing for more openness and fair practices, Apple’s control over its ecosystem may face increasing scrutiny and challenges in the coming months.
