A U.S. court today ordered Apple to remove some of the restrictions on its App Store in a dispute between an iPhone maker and Epic Games developer. The decision threatens one of Apple’s biggest revenues and could save application developers billions of dollars, the AP agency said. However, Judge Yvonne Gonzalez Rogers also stated that she did not find that Apple had a monopoly in the mobile gaming transaction sub-market.
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Epic Games is best known as the creator of the popular video game Fortnite, which is played by approximately 400 million people worldwide. Last year, the company equipped its game with a payment gateway, thus circumventing the fee that Apple had to pay for distribution. Apple then immediately removed the game from its App Store platform, and Epic Games then sued Apple.
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According to a court report, Apple cannot prohibit developers from having buttons or links in their applications that direct customers to other payment methods outside of Apple’s own in-app purchase system, which charges developers a commission of up to 30 percent. Also, according to the judge, Apple cannot prohibit developers from communicating with customers through the contact information that developers obtained when registering customers within the application.
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The decision repeals an essential part of the App Store rules, which prohibit developers from informing users of other places they can turn to to pay developers directly, instead of using Apple’s payment mechanisms.
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However, the judge did not comply with some of Epic Games’ wishes, such as forcing Apple to open iPhones to third-party app stores. It also ruled that Epic Games had failed to prove that Apple had an illegal monopoly, but only that the company had committed conduct that distorted competition under California law, Reuters reported.
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Gonzales Rogers also confirmed Apple’s right to block other stores from offering iPhone applications. In addition, it dealt a blow to Epic when it ruled that it had breached Apple’s contract by adding to its application a non-Apple payment system that gave rise to the dispute. It ordered Epic to pay Apple compensation of almost USD 3.7 million (CZK 79.4 million).
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“As the court has acknowledged, success is not illegal. Apple faces stiff competition in all segments in which we do business, and we believe that customers and developers are looking for us because our products and services are the best in the world, “said Apple in a statement. However, he did not say whether he would appeal against the decision.
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Apple’s shares have fallen in response to the court’s announcement and have fallen by more than three percent. This reduced the company’s market value by $ 87 billion.
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An Epic spokesman told Reuters that the company planned to appeal. CEO Tim Sweeney criticized the decision on Twitter, saying it “is not a win for developers or consumers.” He added that Fortnite will return to Apple’s app store as soon as it can offer competitive in-app payments. “We will continue to fight,” he added.
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According to analysts, the exact financial impact of the decision on Apple’s results is difficult to estimate. Game developers are the largest money generator for the App Store, which is the basis of the company’s services segment. Because the changes aren’t as extensive as Epic demanded, analysts say the impact of the decision will depend to a large extent on how the company decides to implement the changes.
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