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‘Sky won’t fall in’: Epic Games challenges Apple, Google’s app store conduct

Epic Games used its opening submissions to tear apart Apple and Google’s justification for locking app developers out of the market.

user iconNaomi Neilson 19 March 2024 Big Law
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Appearing for the first day of hearings, Epic Games counsel Nicholas De Young KC said Apple and Google will advance “various justifications” for why it has prohibited independent app developers from sharing the market power and using their own payment systems.

Young said these submissions “will not survive scrutiny”.

Over the months-long proceedings, Epic will allege Apple and Google engaged in anti-competitive and unconscionable conduct by imposing restrictions on developers who used their stores.

 
 

This was triggered by Apple and Google’s decision to remove Epic’s game, Fortnite, from its stores in August 2020 because the smaller company attempted to introduce its own payment system.

While there are “various affinities” between the two companies, Young said there are still “fundamental differences” at play.

For example, Apple allegedly engaged in “explicitly restrictive conduct” through “various standard, mandatory contractual terms”.

By forcing developers to use its payment system, Apple takes a 30 per cent commission from any user transactions.

Young said Apple justified this by claiming these restrictions are necessary to protect the “security and privacy” of the app users.

Google’s operating system similarly “built and entrenched its dominance in relation to the relevant market”.

However, its users, who are mostly Android phone owners, are able to download apps from different platforms or from a website.

“The existence of those two alternatives in Google and Android did not cause the sky to fall in, yet Apple contends that such alternatives would have that consequence,” Young told the court.

Young went on to say that even with the ability to download from other platforms, Google’s constraints and technical restrictions have still rendered them “inconsequential”.

Epic’s own software business charges a commission of 12 per cent and does not restrict developers from using other payment systems.

“Epic ensures users would have available an alternative payment system whereby they could pay a much lower price,” Young said.

Running alongside Epic’s action are two class actions against Apple and Google alleging unfair and excessive commission fees.

The hearing continues.