Apple may be claiming victory after a federal judge ruled it doesn’t hold a monopoly in the mobile gaming market Friday, but neither the tech giant nor Epic Games came out winners in the year-long lawsuit.
North Carolina gaming company Epic, creators of the ultra-popular online battle game Fortnite, first sued Apple over its App Store fees last year, launching a massive antitrust case with implications for the future of the gaming industry.
Last week, U.S. District Judge Yvonne Gonzales Rogers ruled Epic failed to prove Apple holds a monopoly on the sale of cell phone games, saying such commerce includes Google’s Android platform. The judge’s decision allows Apple to continue exclusive sales of apps on iOS devices, such as the iPhone, and keep taking 30 percent of the profits, “a fee that Epic and other developers argue is too steep,” writes Will Oremus in a story for The Washington Post.
But Apple’s victory wasn’t complete, Oremus explains.
“Gonzalez Rogers opened a significant crack in Apple’s model by issuing a permanent injunction that would force Apple to allow developers to offer iOS users alternative ways to pay for their apps, services and digital goods — ways that would bypass Apple and its fees,” he writes.
The judge’s ruling also leaves the door wide open for future antitrust cases against Apple, according to Oremus. Gonzales Rogers’ decision was based solely on the evidence Epic brought (or failed to bring).
“In several instances, she chided Epic for failing to bring the necessary evidence to support claims that she seemed otherwise inclined to entertain,” Oremus writes.
Stronger language lies further down in Gonzalez Rogers’ decision, where the judge found Apple lacks justification for its 30 percent App Store fee on game developers and its “extremely high” operating margins “strongly show market power.”
“That’s important, because market power is a key component in antitrust cases of all kinds,” Oremus writes. “Finding that Apple has market power in the App Store is not the same as declaring it an illegal monopolist, but it opens the company to antitrust scrutiny that firms without market power are spared. That paves a path for future antitrust lawsuits against the company, which will learn from the shortcomings of Epic’s case.”
With so much money on the line, appeals and future cases against the big tech sector seem inevitable.
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Follow Staff Writer Jasmine Gallup on Twitter or send an email to jgallup@indyweek.com.
