Epic sues Apple after Fortnite removed from App Store

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  • Reply 121 of 129
    boltsfan17boltsfan17 Posts: 2,294member
    crowley said:
    crowley said:
    Does anyone know how the in-app purchases work on Playstation and Xbox, do Sony and Microsoft have a similar system and take a percentage?
    Yes, Sony and MS both take 30% for games. 

    Here's a link to the paid study that Apple had done for the recent House hearings. It has a ton of info about typical charging structures for all sorts of digital commerce, and also has a section about brick/mortar practices.

    https://www.analysisgroup.com/globalassets/insights/publishing/apples_app_store_and_other_digital_marketplaces_a_comparison_of_commission_rates.pdf
    Thanks, but it's not entirely clearly if the 30% mentioned also applies to in-app purchase.  In fact Playstation and Xbox (unless the latter is covered by "Microsoft") are notable omissions from this paragraph:
    The most prominent app stores and software distribution platforms (Google Play Store, Amazon Appstore, Samsung's Galaxy Store, Microsoft Store, App Store) all use policies that require developers to pay commission fees, and use the platform’s in-app payment system to purchase in-app digital products, with certain carve-outs for multi-platform apps. 
    That 30% doesn't apply to everyone. I know Sony makes deals with some of the AAA developers so Sony's cut might actually be a little less. For in-app purchases, every developer has to sign a publishing agreement with Sony to release a game on their platform. Within that agreement, publishers have to go through Sony's official storefront (Playstation Store) to sell virtual currency. As far as Fornite is concerned, both Sony and Microsoft do take a 30% cut from Fornite digital currency sold. 

    https://www.vg247.com/2020/08/13/fortnite-v-bucks-discount-epic-direct/

    Last paragraph from that article:

    "This could land Epic into hot waters with Apple and Google, as it has done with other companies in the past who wanted to bypass the stores’ built-in payment processing. It is, however, interesting that Epic is able to offer the discount on consoles, where the same 30% cut exists."
    edited August 2020 watto_cobra
  • Reply 122 of 129
    SpamSandwichSpamSandwich Posts: 33,407member
    crowley said:
    crowley said:
    Does anyone know how the in-app purchases work on Playstation and Xbox, do Sony and Microsoft have a similar system and take a percentage?
    Yes, Sony and MS both take 30% for games. 

    Here's a link to the paid study that Apple had done for the recent House hearings. It has a ton of info about typical charging structures for all sorts of digital commerce, and also has a section about brick/mortar practices.

    https://www.analysisgroup.com/globalassets/insights/publishing/apples_app_store_and_other_digital_marketplaces_a_comparison_of_commission_rates.pdf
    Thanks, but it's not entirely clearly if the 30% mentioned also applies to in-app purchase.  In fact Playstation and Xbox (unless the latter is covered by "Microsoft") are notable omissions from this paragraph:
    The most prominent app stores and software distribution platforms (Google Play Store, Amazon Appstore, Samsung's Galaxy Store, Microsoft Store, App Store) all use policies that require developers to pay commission fees, and use the platform’s in-app payment system to purchase in-app digital products, with certain carve-outs for multi-platform apps. 
    That 30% doesn't apply to everyone. I know Sony makes deals with some of the AAA developers so Sony's cut might actually be a little less. For in-app purchases, every developer has to sign a publishing agreement with Sony to release a game on their platform. Within that agreement, publishers have to go through Sony's official storefront (Playstation Store) to sell virtual currency. As far as Fornite is concerned, both Sony and Microsoft do take a 30% cut from Fornite digital currency sold. 

    https://www.vg247.com/2020/08/13/fortnite-v-bucks-discount-epic-direct/

    Last paragraph from that article:

    "This could land Epic into hot waters with Apple and Google, as it has done with other companies in the past who wanted to bypass the stores’ built-in payment processing. It is, however, interesting that Epic is able to offer the discount on consoles, where the same 30% cut exists."
    Fortnite has also been booted from Google’s app store. These clowns didn’t realize the trouble they were about to cause themselves. They should probably fire the CEO of their company now.
    watto_cobra
  • Reply 123 of 129
    boltsfan17boltsfan17 Posts: 2,294member
    crowley said:
    crowley said:
    Does anyone know how the in-app purchases work on Playstation and Xbox, do Sony and Microsoft have a similar system and take a percentage?
    Yes, Sony and MS both take 30% for games. 

    Here's a link to the paid study that Apple had done for the recent House hearings. It has a ton of info about typical charging structures for all sorts of digital commerce, and also has a section about brick/mortar practices.

    https://www.analysisgroup.com/globalassets/insights/publishing/apples_app_store_and_other_digital_marketplaces_a_comparison_of_commission_rates.pdf
    Thanks, but it's not entirely clearly if the 30% mentioned also applies to in-app purchase.  In fact Playstation and Xbox (unless the latter is covered by "Microsoft") are notable omissions from this paragraph:
    The most prominent app stores and software distribution platforms (Google Play Store, Amazon Appstore, Samsung's Galaxy Store, Microsoft Store, App Store) all use policies that require developers to pay commission fees, and use the platform’s in-app payment system to purchase in-app digital products, with certain carve-outs for multi-platform apps. 
    That 30% doesn't apply to everyone. I know Sony makes deals with some of the AAA developers so Sony's cut might actually be a little less. For in-app purchases, every developer has to sign a publishing agreement with Sony to release a game on their platform. Within that agreement, publishers have to go through Sony's official storefront (Playstation Store) to sell virtual currency. As far as Fornite is concerned, both Sony and Microsoft do take a 30% cut from Fornite digital currency sold. 

    https://www.vg247.com/2020/08/13/fortnite-v-bucks-discount-epic-direct/

    Last paragraph from that article:

    "This could land Epic into hot waters with Apple and Google, as it has done with other companies in the past who wanted to bypass the stores’ built-in payment processing. It is, however, interesting that Epic is able to offer the discount on consoles, where the same 30% cut exists."
    Fortnite has also been booted from Google’s app store. These clowns didn’t realize the trouble they were about to cause themselves. They should probably fire the CEO of their company now.
    Epic's lawsuit is ridiculous. They are trying to win the court of public opinion to make them look good and Apple the bad guy. The reality is, Epic wants a bigger slice of the pie. Epic trying to get gamers to purchase V bucks directly through their store with a 20% discount means more money for them. For example, for 1,000 V-bucks it's $9.99 on Apple and discounted at $7.99 directly through Epic. Factoring in Apple's 30% cut, Epic makes $1 more when you purchase direct. This is nothing about Apple being anticompetitive, it's all about making more money. It's the same with Spotify. They are bleeding money so of course they want to say Apple is being anticompetitive. The reality is, Spotify is running a failing business model losing a ton of money every quarter. They want a bigger slice of the pie as well. 
    watto_cobra
  • Reply 124 of 129
    canukstormcanukstorm Posts: 2,590member
    I think Gruber nails it with his argument

    "Kyle Orland, writing at Ars Technica:

    Most if not all of the complaints Epic makes against Apple and Google seem to apply to Microsoft, Sony, and Nintendo in the console space as well. All three console makers also take a 30-percent cut of all microtransaction sales on their platforms, for example. […]

    On mobile platforms, Epic is calling the same kind of 30-percent fee “exorbitant” and says it wants to offer a more direct payment solution so it can “pass along the savings to players.” On consoles, though, Epic happily introduced a permanent 20-percent discount on all microtransaction purchases, despite there being no sign that the console makers have changed their fee structure.

    Bingo. This is exactly the point I’ve been trying to make since the Xbox Game Pass controversy last week. Microsoft wants Apple to allow on iOS something they themselves will not allow on Xbox.

    If you think Epic is right in principle about iOS and Android, then they ought to be making the same argument about Xbox, PlayStation, and Switch. A computer is a computer. “Consoles” are a business model and user experience design choice, and the iPhone and iPad are effectively app consoles, where games are just one type of app. It’s a shame (in more ways than this) that Apple TV isn’t a bigger player, because it’s just another variant of iOS.

    But instead of fighting the game consoles, Epic is taking more of a hit: Fortnite players on Xbox, PlayStation, and Switch get the 20 percent reduction in price while Epic still pays the 30 percent cut of each transaction to the platform vendor. It’s a stunt, pure and simple.

    Orland:

    Or maybe Epic just has a better relationship with console makers than mobile phone makers. […] [Sony recently invested $250 million in Epic]s and prominently featured Epic’s Unreal Engine 5 in a recent major PlayStation 5 promotional demo, too. Even Nintendo, which traditionally uses its own technology for game development, has begun using Unreal Engine for its own titles in recent years. In a way, Epic can’t attack these platform holders without also attacking itself.

    I’m sure that has nothing to do with it."

    https://daringfireball.net/linked/2020/08/14/orland-epic-game-consoles

    watto_cobra
  • Reply 125 of 129
    DAalseth said:

    I've never agreed with Apple claiming a portion of all sales from an app even if those sales don't go through the AppStore.
    Yet Apple is demanding a slice of everything bought on Amazon Prime, and Kindle, and all in game purchases, and more, even if those transactions have nothing to do 

    But neither of those things is what Apple or Google have set up in their rules.

    They only take a percentage if:

    1. Its an App Store App.
    2. the financial transaction is for digital goods, and was done in-App.

    Transactions outside the App Store don't. Real world good don't. You can buy books on the Amazon web site, and they appear on your Kindle App on iOS. Apple gets nothing. You can order a pizza, Apple gets nothing.

    Google has a little more flexibility, but has similar rules for Google Play.

    Epic (and a number of others) are taking the position that the App Stores owners are basic middlemen, and do little more than credit card processing. That is at best disingenuous, and at worst delusional. Historically, the personal computer revolution it the 80's and 90's is an abberation, and there are aspects of it that are not normal at all - we'll probably never see a new area of technology emerge like the personal computing again. Tim Sweeney grew up in that, and probably thinks thats how things should be - you can build something commercial, that leverages somebody else's work without cost.

    Would Epic be better off if they got charged only a credit processing fee, or even better, could side step the App Store completely. Totally - they would be. 

    However, what is good for Epic, isn't necessarily what is good for their users. 

    Does Apple's App review guidelines & processes need to be more refinement, and be consistent and transparent ? Could they communicate better ? Does it have ugly knobs on it ? Is there a power imbalance ? Definitely. They could learn a lot from outside Silicon Valley as to what procedural fairness actually is. Most of that isn't to do with what Epic is claiming.

    You can argue if 30% or 25% or 20% or 15% or 10%or 7.5% is the "right" % for Apple to charge. You can argue they need a sliding % scale so more successful titles scale to lower percentages as they pass certain tiers. 

    However, they are also delivering the most frictionless, safest (for consumers), software store ever. Its been hugely advantageous for small/indy developers, and levelling the playing field inherently weakens the position of large players.

    Apple build the development environment used by most developers on the store. They developed and maintain the languages used by most developers on the store. They develop the operating systems used by all of the devices that use the store. They design all the devices. All of that adds up to having some value to access. You can argue what it is, if it should be a flat fee or a % or some combination of both, but its above the transaction percentage on a credit card.

    As a percentage, what Apple charges was lower than any other preceding attempt at a digital or physical software store previously. It hasn't changed much in over a decade. Do you know what it cost to become a developer for Nokia's Symbian OS ? 4 million USD per year. What was the % to be in EB games or a supermarket shelf ? 50+%

    Are their business models that are so low margin, that they don't make sense using Apple's 30% fee ? Yes. There are business models that don't make sense at 1.5% credit card fee rates.

    Thats not inherently anti-competitive. No-one's business model is owed anything. Companies die because they can't adapt to new environments and markets. The people go on to get new jobs elsewhere.

    Some of the commentary by Epic, Spotify and others justifying their positions is just bare faced lying - other parts are valid points. My bet is they will lose the case with costs.

    If society wants to make laws to mandate consumer grade side-loading, they can. But don't for an instant claim it will make end users safer in terms of consumer protections, or privacy or cyber security.

     


    watto_cobraDetnator
  • Reply 126 of 129
    darkpawdarkpaw Posts: 212member
    About time. They are our devices, we should be able to run whatever we want on them including a competing app store. If Apple thinks 30% is fair then it can try competing with app stores where the cut is 10% and see how well it does. What if a $10 app cost only $8 on another app store? How many customers would stick with Apple then?
    Okay, let's go with that suggestion. So, developers can create their own App Store using Apple's SDK? Why do they have free access to the investment in the SDK and the developer tools? I guess all the downloads and bandwidth for downloading those apps through a different store will be paid for by that App Store? And they'll be able to cope with and finance millions of downloads of free apps they don't earn anything from? Apple can handle this as they have multiple sources of income. The App Store - for all we know - makes a loss, but is propped up by the sales of hardware. Do third-party stores have that backing?

    Apple would then have to support the installation of apps from other stores, which means giving away information to third-parties on how their installation tech works. Every time Apple makes a change to their installation code, they'd have to tell all these other stores, or those stores wouldn't work properly. Imagine having ten different App Stores on your iPhone and when you install the next version of iOS, you're back to the original one until those other App Stores figure out how to implement the changes. Great consumer experience.

    Let's ignore the fact that those other App Stores won't necessarily be as cautious or thorough as Apple (you may like this), but they might let apps get through that steal your information, or steal the money out of your bank (I doubt any bank would release their app on a non-Apple App Store, which is another reason for not doing it). And what about apps that mess up iOS. Why does Apple have to provide staff and facilities in their retail stores to cope with the problems these consumers have? "Not my App Store, not my problem"? Again, great consumer experience.

    I'll stick with the current situation with the one App Store that works for everyone.
    watto_cobraDetnator
  • Reply 127 of 129
    uraharaurahara Posts: 659member
    urahara said:
    About time. They are our devices, we should be able to run whatever we want on them including a competing app store. If Apple thinks 30% is fair then it can try competing with app stores where the cut is 10% and see how well it does. What if a $10 app cost only $8 on another app store? How many customers would stick with Apple then?
    Why are you not suggesting to compare 30% with an alternative App Store with no fee at all? Of course lower price will win. But there are costs to run the store; and other related costs like developing Swift, xCode etc. 

    Developers have to pay $99 to be allowed to develop & publish apps. That fee goes towards developing developer tools.
    Of course it goes toward it. Which portion of these costs (developing development tools) does the fee cover?
    watto_cobra
  • Reply 128 of 129
    darkpaw said:
    About time. They are our devices, we should be able to run whatever we want on them including a competing app store. If Apple thinks 30% is fair then it can try competing with app stores where the cut is 10% and see how well it does. What if a $10 app cost only $8 on another app store? How many customers would stick with Apple then?
    Okay, let's go with that suggestion. So, developers can create their own App Store using Apple's SDK? Why do they have free access to the investment in the SDK and the developer tools? I guess all the downloads and bandwidth for downloading those apps through a different store will be paid for by that App Store? And they'll be able to cope with and finance millions of downloads of free apps they don't earn anything from? Apple can handle this as they have multiple sources of income. The App Store - for all we know - makes a loss, but is propped up by the sales of hardware. Do third-party stores have that backing?
    Any data to backup that claim???
  • Reply 129 of 129
    darkpaw said:
    About time. They are our devices, we should be able to run whatever we want on them including a competing app store. If Apple thinks 30% is fair then it can try competing with app stores where the cut is 10% and see how well it does. What if a $10 app cost only $8 on another app store? How many customers would stick with Apple then?
    Okay, let's go with that suggestion. So, developers can create their own App Store using Apple's SDK? Why do they have free access to the investment in the SDK and the developer tools? I guess all the downloads and bandwidth for downloading those apps through a different store will be paid for by that App Store? And they'll be able to cope with and finance millions of downloads of free apps they don't earn anything from? Apple can handle this as they have multiple sources of income. The App Store - for all we know - makes a loss, but is propped up by the sales of hardware. Do third-party stores have that backing?
    Any data to backup that claim???
    There is none because it is not true. Apple services are breaking records. Its why they are worth near $2Trillion today. The appstore probably has the biggest profit margin of any of their services. Apple doesn’t even make and run its own cloud. They‘ve use aws or azure like everyone else. I’d wager there is no difference in the back end services between ios appstore, mac appstore and itunes store. One set of services that has existed for decades which they leverage for different products. Obviously they maintain and upgrade them, but its not like they started from scratch for the appstore when they already had the itunes store. Apple doesn’t do anything at a loss. 
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