Epic pays Apple $6M for profits made after instituting 'Fortnite' third-party payments

Posted:
in General Discussion edited September 13
Epic CEO Tim Sweeney on Monday announced that his company made a payment of $6 million to Apple for violating App Store rules, as per a ruling handed down in the Epic v. Apple court trial last week.

Epic Games


U.S. District Court Judge Yvonne Gonzalez Rogers in a ruling on Friday ordered Epic to pay damages related to revenue collected from "Fortnite" sales on the App Store following the company's decision to implement a third-party in-app payment system against Apple's policies.

In an attempt to sidestep App Store commissions, Epic last year surreptitiously integrated and activated a direct payment alternative in its popular game "Fortnite." While Apple removed the title from the App Store shortly after the scheme was made public, some users downloaded and installed the offending app version and conducted in-app purchases through Epic's system.

During trial proceedings, it was revealed that Epic raked in $12,167,719 in revenue through Epic Direct Payment on iOS between August and October 2020. Judge Rogers ruled Epic must pay Apple damages that equate to 30% of that sum, plus 30% of revenue collected from Nov. 1, 2020, through Sept. 10, 2021, the date of judgment. The total comes out to $6 million, if Sweeney's tweet is correct.

There is a chance that Epic could claw back the funds if it wins an appeal of last week's ruling.

Apple in a statement on Friday called the verdict a "resounding victory" as it prevailed on nine out of ten counts. Judge Roger's single finding in Epic's favor, however, will force Apple to include alternative payment methods for in-app purchases, a major change to App Store regulations that could severely impact to Apple's bottom line.

Read on AppleInsider

Comments

  • Reply 1 of 17
    Apple's executives are probably too busy with tomorrow's product event to be dealing with the possibility of appealing the ruling.
  • Reply 2 of 17
    Apple's executives are probably too busy with tomorrow's product event to be dealing with the possibility of appealing the ruling.

    I'd hope that a huge corporation such as Apple could handle more than one thing at a time. Doesn't say much for Apple multitasking if they can't. :p
    muthuk_vanalingamwatto_cobra
  • Reply 3 of 17
    Apple's executives are probably too busy with tomorrow's product event to be dealing with the possibility of appealing the ruling.
    They have an entire legal department under Senior Vice President and General Counsel Katherine Adams, who is most certainly an executive and has no reason to be busy with a product event.
    williamlondondavenbaconstangmuthuk_vanalingamforgot usernamepscooter63watto_cobra
  • Reply 4 of 17
    Apple's executives are probably too busy with tomorrow's product event to be dealing with the possibility of appealing the ruling.
    Nah. They are always two years ahead. 
    williamlondonwatto_cobra
  • Reply 5 of 17
    Glad Epic finally has to pay something 

    now they need to pay iOS customers for the annoyance of them having any part in breaking up a streamlined and trustworthy payment process. 

    No one wants to go back to the Wild West days of opera and hackers pushing you every which way just to get something - and then you can’t even trust it. 

    Hopefully the market plays out where people can choose the better system snd vote that way. Will take the incentive out of convoluted tactics. Epic obviously still holds to the used car theory that “a sucker is born every minute,” but hopefully the world has wiser up a lot in modern times. 
    stevenozspock1234pscooter63watto_cobra
  • Reply 6 of 17
    so Epic made over $12 milliion and was only forced to pay back 30% 

    WTF

    and they get their alternative in-app win. 

    still a win for Apple 9 out of 10.
    williamlondonwatto_cobra
  • Reply 7 of 17
    I think the article is a little misleading in that Apple does not have to provide alternative payment methods only that it cannot disallow external links placed by developers in the app that provide information about alternative payment methods or bring the user to an external payment processor. Most developers especially smaller ones won’t do that.  
    thtwilliamlondonspock1234forgot usernamewatto_cobra
  • Reply 8 of 17
    so Epic made over $12 milliion and was only forced to pay back 30% 

    WTF

    and they get their alternative in-app win. 

    still a win for Apple 9 out of 10.
    Given that's the amount that Apple had lost out on due to their shenanigans, how is that not appropriate? 
    williamlondonmike1muthuk_vanalingamforgot usernamewatto_cobra
  • Reply 9 of 17
    mcdavemcdave Posts: 1,756member
    Apple's executives are probably too busy with tomorrow's product event to be dealing with the possibility of appealing the ruling.
    What, all huddled around a machine to push “play” at the right time?
    Japheytokyojimufastasleepwatto_cobra
  • Reply 10 of 17
    mcdavemcdave Posts: 1,756member
    Only $6m but sweeter than Steve Austin.
    Detnatorwatto_cobra
  • Reply 11 of 17
    mike1mike1 Posts: 2,748member
    so Epic made over $12 milliion and was only forced to pay back 30% 

    WTF

    and they get their alternative in-app win. 

    still a win for Apple 9 out of 10.
    Huh?! It’s the amount of the commission they would have earned. 
    muthuk_vanalingamfastasleepwatto_cobra
  • Reply 12 of 17
    mike1 said:
    so Epic made over $12 milliion and was only forced to pay back 30% 

    WTF

    and they get their alternative in-app win. 

    still a win for Apple 9 out of 10.
    Huh?! It’s the amount of the commission they would have earned. 
    ha! you are correct. carry on....
    watto_cobra
  • Reply 13 of 17
    mattinozmattinoz Posts: 1,633member
    Glad Epic finally has to pay something 

    now they need to pay iOS customers for the annoyance of them having any part in breaking up a streamlined and trustworthy payment process. 

    No one wants to go back to the Wild West days of opera and hackers pushing you every which way just to get something - and then you can’t even trust it. 

    Hopefully the market plays out where people can choose the better system snd vote that way. Will take the incentive out of convoluted tactics. Epic obviously still holds to the used car theory that “a sucker is born every minute,” but hopefully the world has wiser up a lot in modern times. 
    Why would it break the excellent system the market has chosen to support?
    Sure there will be 3rd party transactions for apps external to the store they'll have to earn consumer trust to take transactions away from the Apple system. If developer make use of those channels they'll do so at their own peril as they'll backing those systems as trusted. The more they push customers the more harshly the judgement will be when one of those systems breaks trust. 

    The Wild West never went away it got relegated to a tourist attraction. If Epic want a digital theme park that is their punt. 

    Still with the ruling in place Apple should pull their socks up. There are things they can do to improve the store, bring more customers in, bring more developers in even if there is so much direct revenue but it makes the Customer more likely to stick to other Apple offers like iCloud. I think Pro Apps that run to thousands dollars a seat could now be AppStore citizens and improve the life of Apples Customers who use these Apps. 

    I'm sure there are many other examples of things Apple could do to improve the store experience and force others to either follow or look like poor offers. 


    muthuk_vanalingamwatto_cobra
  • Reply 14 of 17
    mcdave said:
    Apple's executives are probably too busy with tomorrow's product event to be dealing with the possibility of appealing the ruling.
    What, all huddled around a machine to push “play” at the right time?
    Haha…took the words right out of my mouth. 
    watto_cobra
  • Reply 15 of 17
    My worry is that Apple will get blamed for all the problematic transactions outside the App Store just like it gets blamed for suicides at Foxconn. You watch, will be seeing the sob story about the family just barely making it and their child runs up a big bill with a third party. When the third party refuses a refund, it will somehow be Apple’s fault. 
    lkruppwatto_cobra
  • Reply 16 of 17
    sdw2001sdw2001 Posts: 17,671member
    Glad Epic finally has to pay something 

    now they need to pay iOS customers for the annoyance of them having any part in breaking up a streamlined and trustworthy payment process. 

    No one wants to go back to the Wild West days of opera and hackers pushing you every which way just to get something - and then you can’t even trust it. 

    Hopefully the market plays out where people can choose the better system snd vote that way. Will take the incentive out of convoluted tactics. Epic obviously still holds to the used car theory that “a sucker is born every minute,” but hopefully the world has wiser up a lot in modern times. 

    Well, fortunately the ruling doesn't mean we are going back to the shareware and freeware days.  It will have a minimal impact, if any.  Apple will just find ways to make it very inconvenient for developers to use a third party system.  And since it seems they will likely get their cut regardless of who does the transaction, I'm not sure what the motivation to use a third-party system is.  
    watto_cobra
  • Reply 17 of 17
    lkrupplkrupp Posts: 9,462member
    j2fusion said:
    My worry is that Apple will get blamed for all the problematic transactions outside the App Store just like it gets blamed for suicides at Foxconn. You watch, will be seeing the sob story about the family just barely making it and their child runs up a big bill with a third party. When the third party refuses a refund, it will somehow be Apple’s fault. 
    You see those types of posts all over the place right now. A user upgrades their macOS and then finds out their mission critical app or favorite game doesn’t work right. When told the need to contact the developer about a resolution the rage begins. It’s Apple’s job, the user states, to make sure their software continues to work through updates. They demand Apple FIX IT NOW! It’s Apple duty and responsibility to keep their 15 year old printer printing, their 32 bit software functioning. “Planned Obsolescence” is the rallying cry. I should not have to pay Microsoft again for a version of Word that works with Apple’s gear when I have the 8 year old version of Word I already paid for which should be working just fine. Evil Apple.

    You are right, somehow, someway, it’s always Apple’s fault, no matter what. You see that right here in the AI forums all the time.
    williamlondonronnwatto_cobra
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