Epic Games Challenges Apple’s App Store Standards

By Brian Sever

You may not have heard of Epic Games, but you’ve heard of their most popular game, Fortnite. The game has over 350 million registered accounts, logging over 3.2 billion gaming hours in April alone. Part of Fortnite’s allure is that it is free to play, allowing wide access across PlayStation, Xbox, and PC. Epic Games expanded into mobile gaming as well, launching a mobile app in 2018. However, last week Apple suspended Epic Games’s content creator status and removed Fortnite from the Appstore.

The reason for the sudden suspension is because Epic Games is challenging Apple’s policies regarding in app purchases. When you make an in-app purchase, your payment goes to Apple, not the developer. Apple then takes a 30% cut before sending the money to the content creators. While Fortnite is free to play, it uses what it calls a “Battle Pass” where you pay Epic and as you play Fortnite you unlock cosmetic items to equip to your character. You can also buy other cosmetic items separate from the Battle Pass as well. Furthermore, Fortnite undergoes seasonal updates, and a new Battle Pass debuts at the beginning of each season. Since launch, Fortnite has had 13 full seasons, with the newest season starting August 27, but mobile gamers have been left behind due to the recent legal battle between Epic and Apple.

On August 13, Epic Games created a new direct payment method, circumventing Apple and violating the terms and conditions of the App Store. Apple subsequently pulled Fortnite off the App Store, and Epic Games filed a lawsuit the same day. Epic alleges that Apple has an illegal monopoly and want to make it possible for themselves and other developers to charge lower prices for their products. By eliminating the overhead cost of Apple Epic could either pass that cost onto the consumer in the form of lower prices, or they could keep that money for themselves. Estimates show that since January 2012, Epic games have been responsible for 1.2 billion dollars in spending on the Apple App Store, however 360 million dollars of that goes directly to Apple due to current procedures.

Only time will tell if Epic Games is able to defeat Apple in this lawsuit, and a victory would surely alter the fabric of the App Store which has gone largely unchallenged since its inception.

 

[i] Nick Statt, Fortnite is Now One of the Biggest Games Ever With 350 Million Players, The Verge (May 6, 2020), https://www.theverge.com/2020/5/6/21249497/fortnite-350-million-registered-players-hours-played-april.

[ii] Nick Statt, Apple Just Kicked Fortnite off the Appstore, The Verge (Aug. 13, 2020), https://www.theverge.com/2020/8/13/21366438/apple-fortnite-ios-app-store-violations-epic-payments.

[iii] Id.

[iv] Gilbert, Apple and Epic Games are Mired in a Bitter Legal Battle, and ‘Fortnite’ is in the Middle of It, Business Insider (Aug. 26, 2020), https://www.businessinsider.com/fortnite-epic-games-apple-lawsuit-explained-2020-8.

[v] Preston Byers & Gerome Heath, The Start and End Dates for All Fortnite Seasons, Dot Esports (Aug. 27, 2020), https://dotesports.com/fortnite/news/start-end-dates-for-all-fortnite-.

[vi] Gilbert, supra note 4.

[vii] Id.

[viii] Id.

[ix] Todd Haselton, Apple Suspends Fortnite Maker Epic Games’ App Store Account, CNBC (Aug. 28, 2020), https://www.cnbc.com/2020/08/28/apple-suspends-fortnite-maker-epic-games-app-store-account.html.