Apple says Epic Games dispute is a 'marketing campaign' to boost 'Fortnite'

Posted:
in General Discussion edited September 2020
Apple has filed its legal declaration against Epic Games ahead of a court hearing and claims that the dispute was started following a decline in the popularity of "Fortnite."

Credit: Epic Games
Credit: Epic Games


Ahead of a hearing now scheduled in the US District Court for the Northern District of California on September 28, Apple has filed its legal documents outlining its response to the dispute with Epic Games. At the same time, Apple's Head of Games Business Development for the App Store, Mike Schmid has filed a supporting declaration saying that Epic Games has regularly threatened to withdraw its games from iOS.

"For reasons having nothing to do with Epic's claims against Apple, Fortnite's popularity is on the wane," says Apple's filing. "By July 2020, interest in Fortnite had decreased by nearly 70% as compared to 4 October 2019. This lawsuit (and the front-page headlines it has generated) appears to be part of a marketing campaign designed to reinvigorate interest in Fortnite."

After detailing how Apple has supported Epic Games in the App Store, the company's filing concludes with a rebuttal about how the games firm says its reputation has been damaged by Apple.

"Finally, a word about Epic's claimed reputational harm. Epic has engaged in a full-scale, pre-planned media blitz surrounding its decision to breach its agreement with Apple, creating ad campaigns around the effort that continue to this day," says Apple.

"If Epic were truly concerned that it would suffer reputational injury from this dispute, it would not be engaging in these elaborate efforts to publicize it," it continues. "From all appearances (including the #freefortnite campaign), Epic thinks its conduct here will engender goodwill, boost its reputation, and drive users to Fortnite, not the opposite. That is not harm."

Apple altered the App Store to help Epic Games

In App Store games head Mike Schmid's separate supporting declaration, he says that Epic Games has previously threatened similar moves. "On a variety of occasions, Epic personnel have told me that if Apple did not comply with its demands, Epic would simply terminate its relationship with Apple and remove its games off of the iOS platform," he says.

While saying that Epic "has repeatedly leveraged the global phenomenon that was Fortnite to coerce platforms to change their rules," Schmid also says that Apple has made changes to the App Store to accommodate the game developer.

"In particular, Epic requested an exemption from Apple's then-in-place guideline against gifting within apps," he says. "As a general rule, Apple had prohibited live in-game gifting because such activity, if left unregulated, can be a major vector for fraud if not carefully monitored."

"Because of this, I worked closely with my team at the App Store-- in conjunction with Apple's executives and App Review team-- to create a new guideline that would allow for gifting when certain safety requirements are met," he continues. "After much consideration and listening to Epic's request, the leadership team decided that gifting could be allowed with certain protections."

Apple Versus Epic - Mike Sc... by Mike Wuerthele

Comments

  • Reply 1 of 18
    elijahgelijahg Posts: 2,669member
    Not really sure how the predictable result of the app being removed from the App Store is really going to boost Fortnite if I'm honest.
    williamlondon
  • Reply 2 of 18
    I hope Apple have hard evidence (not hearsay) to back up the claim about Epic throwing its toys out of the pram before. That won't go down well with a jury.
    watto_cobra
  • Reply 3 of 18
    elijahg said:
    Not really sure how the predictable result of the app being removed from the App Store is really going to boost Fortnite if I'm honest.
    My son hasn’t played Fortnight on his phone since he got an X-Box last year. But he hasn’t played even on the X-Box much since June or July. HOWEVER I saw him playing last weekend. 
    Did the buzz from Fortnight being in the news lead him to pick it up again?  I don’t know, but I can see that it’s possible! 

    (Or maybe one of his gaming friends noticed it in the news—they tend to move in packs, all playing the same games together.  Just takes one of the gang to pull them all back in...)
    pichaelmwhitewilliamlondonwatto_cobra
  • Reply 4 of 18
    elijahg said:
    Not really sure how the predictable result of the app being removed from the App Store is really going to boost Fortnite if I'm honest.
    That's Apple's primary point: Epic didn't just intentionally violate the App Store rules and get kicked off, they also had an advertising campaign ready to roll out when it happened. They orchestrated the entire thing, so how can they turn around and claim damage to their reputation? 
    mwhitechialkruppwilliamlondonfotoformataderutterBeatspscooter63thtCluntBaby92
  • Reply 5 of 18
    This does not surprise me, they had so much tee up with press releases, the stupid 1984 remake ad, and how quickly they had legal filing ready to go. If this was some idea of gorilla marketing campaign, someone miss calculated in this situation. The fallout could be worse than getting Epic getting points in the gaming community.
    williamlondonwatto_cobra
  • Reply 6 of 18
    At first they were booted from Apple, google and Samsung.  But all we are hearing about is Apple vs epic.  What’s the status with the other two app stores?  
    talexyaderutterwatto_cobra
  • Reply 7 of 18
    auxioauxio Posts: 2,531member
    elijahg said:
    Not really sure how the predictable result of the app being removed from the App Store is really going to boost Fortnite if I'm honest.
    Not really sure how repeatedly showing adverts on TV, radio, billboards, webpages, etc convinces people to buy products, but yet it seems to work.  Get it in front of eyeballs and on the tips of tongues (via whatever means), and people will want to see what the hype is about.  This was a calculated marketing campaign through and through.
    edited September 2020 aderutterbageljoeywatto_cobra
  • Reply 8 of 18
    elijahg said:
    Not really sure how the predictable result of the app being removed from the App Store is really going to boost Fortnite if I'm honest.
    I suspect majority of Fortnite's revenue were from in-app purchases, not from new users, so the publicity likely reminded existing users to go back to the game and play and buy more.  It is no different for McDonalds to spend on TV commercials.

    It was likely a calculated move:  Spend $100 million on TV commercials that people don't see, or $100 million on a lawsuit to tell people "Apple is evil"and hoped it would go viral regardless which side its users "support".
    lorca2770aderutterBeatspscooter63watto_cobra
  • Reply 9 of 18
    A counterpoint: if Fortnite participation is down 70% then it means that they can no longer idly ignore the 30% transaction fees. 
  • Reply 10 of 18

    Why I’ve never thought about this before:

    People say: “Never change the wining team”. 
    But Epic started to change the “team” by means of liar  claims against Appel. 
    Why you should do this, if everything is OK with your business? 
    So we should have guess at the very begin, that there was something wrong with Epic self and that Epic was already in trouble. 
    And obviously to cover this,  Epic has begun with  throwing  mud against Apple.
    And all the time they were talking that it was not about money, but about freedom and fairness for the Epic’s users.

    For me, Epic is even more dirty than I could imagine.
    watto_cobra
  • Reply 11 of 18
    cloudguy said:
    A counterpoint: if Fortnite participation is down 70% then it means that they can no longer idly ignore the 30% transaction fees. 
    I recognize that you may not agree with the strategy and are just playing the devil’s advocate. This may actually be Epic’s thinking.  However, my response would be that this is a terrible way for a business to look at their model and choose as the plan for their way forward.  It would be so much wiser to innovate new content on your current games or to introduce new viral games.  Creating content that people will want to use is a much more profitable venture than trying to get a bigger chunk of a shrinking pie.

    I used to play the Infinity Blade series and liked it, but they kept the story line so small and repeating.  The graphics were amazing at the time, but it just got old because there were only a couple hours of actual content that got reused over and over.
    edited September 2020 tmaywatto_cobra
  • Reply 12 of 18
    davidwdavidw Posts: 1,742member
    cloudguy said:
    A counterpoint: if Fortnite participation is down 70% then it means that they can no longer idly ignore the 30% transaction fees. 
    Your comment loses all credibility when you refer to the 30%commission as just .......  a "transaction fee". 

    71% of Fortnite players play on game consoles. In 2018 Fortnite was by far the most popular game video game on all 3 major game consoles. By mid 2019, it had drop to number 2. In 2020 so far, it has dropped to number 6 and lower. Along with the drops, an estimated over 40% drop in revenue from Fortnite, since 2017/18. Why haven't Epic gone after MS, Sony and Nintendo for the 30% "transaction fee" they have to pay, to be on those platforms? How can Epic idly ignore the 30% "transaction fee" they have to pay, for 71% of their players? 

    And if you had any critical thinking ability at all, you figure out that it would be counterproductive for Epic, economically wise, to give up all their 70% share of revenue from Fortnite players on iOS iDevices, to go after Apple 30% share. If that was a winning strategy, wouldn't going after MS, Sony and Nintendo 30% share be even more productive? Why is it that Epic can idly ignore the 30% "transaction fee" they have to pay, to be on game console platforms?
    tmayGG1pscooter63watto_cobra
  • Reply 13 of 18
    Coincidentally I heard from the 15 year old in my house yesterday that “nobody” plays Fortnite anymore. The teen/tween market is fickle. 
    watto_cobra
  • Reply 14 of 18
    I hope Apple have hard evidence (not hearsay) to back up the claim about Epic throwing its toys out of the pram before. That won't go down well with a jury.
    This is not a jury eligible case. The determination as to whether the App Store even falls under antitrust regulations is a matter of law to determine. Juries only determine matters of fact (when the facts are disputed). There are no facts to litigate here. If Apple and the App Store are determined not to fall under antitrust because the App Store isn't a "market" or Apple is found not to be abusing its position even if the App Store is a market, then it's just a contract dispute. If that plays out, Epic doesn't do well on that front as the contract terms are pretty clear.
    FileMakerFellerwatto_cobratht
  • Reply 15 of 18
    I hope Apple have hard evidence (not hearsay) to back up the claim about Epic throwing its toys out of the pram before. That won't go down well with a jury.

    As a lawyer I can assure you that Apple's lawyers would not be quoting hearsay in any court-filed responses.

    watto_cobra
  • Reply 16 of 18
    Epic's real push is to get their Epic games store on all platforms. able to install unvetted games - regardless of security and malware potential. They want to turn all platforms into the Windows wild-wild west.

    It's entirely a commercial push really - they just want the ability to peddle their unchecked software on every platform - with nobody taking a cut but them.

    Curiously though, they appear to be willing to let Xbox, Playstation, and Nintendo games stores keep their 30%.
    watto_cobra
  • Reply 17 of 18
    carnegiecarnegie Posts: 1,016member
    focher said:
    I hope Apple have hard evidence (not hearsay) to back up the claim about Epic throwing its toys out of the pram before. That won't go down well with a jury.
    This is not a jury eligible case. The determination as to whether the App Store even falls under antitrust regulations is a matter of law to determine. Juries only determine matters of fact (when the facts are disputed). There are no facts to litigate here. If Apple and the App Store are determined not to fall under antitrust because the App Store isn't a "market" or Apple is found not to be abusing its position even if the App Store is a market, then it's just a contract dispute. If that plays out, Epic doesn't do well on that front as the contract terms are pretty clear.
    Epic's preliminary injunction request, which is what this latest filing from Apple relates to, will be determined by a judge.

    But the case more generally can be heard by a jury and Apple has asked to have it heard by a jury. As with so many legal issues, antitrust cases present both questions of law (for a judge to decide) and questions of fact (for juries, if requested, to decide).

    Relevant market definition, e.g, involves both questions of law and questions of fact. A judge may make certain some legal decisions and advise a jury how the law applies when it comes to deciding whether something - e.g., iOS app distribution - constitutes a relevant antitrust market. But ultimately that's a question of fact to be determined, if necessary, by a jury.
    watto_cobra
  • Reply 18 of 18
    carnegiecarnegie Posts: 1,016member
    Epic has made another filing in response to Apple's motion opposing a preliminary injunction.

    https://www.courtlistener.com/recap/gov.uscourts.cand.364265/gov.uscourts.cand.364265.90.0.pdf


    Mr. Sweeney filed another declaration in which he suggests that a lot of what Apple asserted in its opposition was inaccurate.

    https://www.courtlistener.com/recap/gov.uscourts.cand.364265/gov.uscourts.cand.364265.86.0.pdf
    edited September 2020
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