Yvonne Gonzlez Rogers, the Northern California District Judge who handles the case between Epic Games and Apple, has raised a possible solution to the conflict: the possibility that in the applications can be informed of alternative methods paid outside the iOS App Store. However, the economists summoned to testify as witnesses of both corporations have been against of the proposal, as reported from Bloomberg.
At trial, a Microsoft’s request to Apple of 2018 in which he wondered if it was possible that the Office users on iPad subscribe via the web, from Microsoft, which would be opened from the app, rather than from the application, a measure that was rejected even though the Windows guys said they would still pay the commission to the Cupertino guys.
In addition to this, the judge asked Richard Schmalensee, economista and professor at the Massachusetts Institute of Technology (MIT) and witness for Apple, the next: “What’s wrong, anyway, that consumers get to choose?” The answer: decrease the “income stream” from the App Store.
“And the seller of an app may say: if you press this button you can buy this for less, that means that the App Store cannot collect its commission, “continued the economist, who cited as a comparison a 2018 case in which the United States Supreme Court dismissed a lawsuit accusing American Express of impeding competition by prohibiting merchants from directing customers to cards with lower fees.
The judge says that cases cannot be compared because in any store customers see indicators that it is possible to pay with debit and credit cards from other brands. “Visual cues of options do not exist in this circumstance”, explains Gonzlez Rogers. However, Epic also did not like the option, taking another economist, David Evans, as a witness.
Evans was asked whether Offering indications of other payment methods will fix the problem: “That won’t take away the market power that Apple has here, but it will certainly decrease it“However, games and applications could not have alternative payment methods integrated within the app, so “It wouldn’t be a great solution at all”, according to the economist.
App Store fees, a $ 22 billion business
Let us remember that the judgment comes after the legislation of the App Store, where it is specified that the shop shopping (applications, microtransactions and subscriptions) have to be made via Apple’s payment method, which takes a commission of 30%. On August 13, 2020 Epic Games updated Fortnite: Battle Royale on iOS and Android offering an alternative and direct method of payment for the V-Bucks, which made them 20% cheaper. Apple and Google removed the game from their online stores hours later.
The Fortnite Mega Drop lands today! Get up to 20% in savings on V-Bucks using select payment methods. This isnt a short term salethese are our new prices!
More info about availability in your currency and how it works in our blog: https://t.co/E5w29QvO6m— Fortnite (@FortniteGame) August 13, 2020
Clause 3.1.3 of the App Store regulations, as recalled from AppleSfera, prohibits companies from reporting alternative payment methods outside of the digital store. Most subscription services, such as Spotify, Netflix, HBO and others do not report the existence of such a subscription in the app nor can they offer a link to your website for them to subscribe.
The intention of Epic Games is that these limitations are eliminated and allowed alternative payment methods within the app, at the same time that Apple pide that it will be rewarded By the time Tim Sweeney’s firm broke the rules. If Apple were to change the rule for Epic, it would also have to do so for all those subscription services and all other games and apps, which possibly turn the apple brand business upside down. Sensor Tower encrypt in $ 22 billion the value of App Store commissions entered in 2020.