A New Wrinkle in the Epic/Apple Battle

[Cmaier]

I commented with surprise a week or so ago that Apple allowed Epic back in the App Store (even if it turned out to be a subsidiary).

Well, as it turns out, that didn‘t last long.

Apple kills Epic’s iOS game store plans over App Store criticism

Apple’s lawyers called Epic “verifiably untrustworthy.”

www.theverge.com

Epic says Apple terminated its newly reinstated developer account over tweet - 9to5Mac

In the latest installment of Things No One Should Lose Sleep Over, Epic Games says Apple has taken down its...

9to5mac.com

'Verifiably untrustworthy' Epic games iOS app store plans in EU killed by Apple

The Epic vs. Apple bad blood continues, as Apple has called Epic 'verifiably untrustworthy' and shut down the developer account it made to develop a 3rd-party app store in the European Union.

appleinsider.com

Apple has banned Epic Games' developer account again — Fortnite and Epic Games store on iPhone derailed in 'serious violation of the DMA'

Did it happen again?

www.imore.com

 

[diamond.g]

Does Epic have a separate account for Unreal Engine development on Apple devices?

 

[Cmaier]

Does Epic have a separate account for Unreal Engine development on Apple devices?

Yes, but i can’t remember the status of that one.

 

[Andropov]

Is Apple allowed to do that?

 

[Cmaier]

Is Apple allowed to do that?

Sure, why not?

 

[dada_dave]

Is Apple allowed to do that?

Apple is citing court rulings that say they can. Epic is citing the new DMA saying they can’t. I’m not clear about this one though - while in spirit the DMA is about providing competitive access to stores of so-called gatekeepers, it’s unclear to me what the letter of the law is on this specific issue. This may be known by someone just not me, but regardless all of this is new and hasn’t been challenged in courts so expect everyone to test the limits of the law.

Yes, but i can’t remember the status of that one.

I’m pretty sure it’s up and running. Either one of them killing it would be the nuclear option for both companies. If I remember right, Epic actually split engine development off as a separate dev account before its stunt in order to protect it. I might be misremembering.

 

[Cmaier]

Apple is citing court rulings that say they can. Epic is citing the new DMA saying they can’t. I’m not clear about this one though - while in spirit the DMA is about providing competitive access to stores of so-called gatekeepers, it’s unclear to me what the letter of the law is on this specific issue. This may be known by someone just not me, but regardless all of this is new and hasn’t been challenged in courts so expect everyone to test the limits of the law.



I’m pretty sure it’s up and running. Either one of them killing it would be the nuclear option for both companies. If I remember right, Epic actually split engine development off as a separate dev account before its stunt in order to protect it. I might be misremembering.

Just read the DMA. It’s incredibly vague. That said, I think it comes down to whether Apple is being “fair, reasonable and non-discriminatory.” This has a special meaning under the law with respect to technology licensing, but not sure if it is intended to mean the same thing here. If so, the idea is that apple might be forced to contract with Epic, as long as Epic lives up to fair, reasonable and non-discriminatory terms. The question here is likely whether Apple is being discriminatory. Arguments both ways. Apple’s best argument may be that it makes everyone live up to the same terms, and part of those terms are that Apple can terminate you for violating them, with no requirement to ever let you back in just because you created some subsidiary to get around the ban. Europe being Europe, eventually Europe may make Apple let Epic in.


“For software application stores, online search engines and online social networking services listed in the designation decision, gatekeepers should publish and apply general conditions of access that should be fair, reasonable and non-discriminatory.”

…

”
The gatekeeper shall not be prevented from taking, to the extent that they are strictly necessary and proportionate, measures to ensure that third-party software applications or software application stores do not endanger the integrity of the hardware or operating system provided by the gatekeeper, provided that such measures are duly justified by the gatekeeper.

Furthermore, the gatekeeper shall not be prevented from applying, to the extent that they are strictly necessary and proportionate, measures and settings other than default settings, enabling end users to effectively protect security in relation to third-party software applications or software application stores, provided that such measures and settings other than default settings are duly justified by the gatekeeper.”

…

”
12. The gatekeeper shall apply fair, reasonable, and non-discriminatory general conditions of access for business users to its software application stores, online search engines and online social networking services listed in the designation decision pursuant to Article 3(9).
For that purpose, the gatekeeper shall publish general conditions of access, including an alternative dispute settlement mechanism.
The Commission shall assess whether the published general conditions of access comply with this paragraph.
13. The gatekeeper shall not have general conditions for terminating the provision of a core platform service that are disproportionate. The gatekeeper shall ensure that the conditions of termination can be exercised without undue difficulty.”

 

[dada_dave]

Thanks so much for digging through this and providing the text! Really appreciated.

Just read the DMA. It’s incredibly vague.

I suspected as much. No doubt the EU courts will have fun unpacking exactly what the terms and clauses actually mean in practice for years and decades to come.

That said, I think it comes down to whether Apple is being “fair, reasonable and non-discriminatory.” This has a special meaning under the law with respect to technology licensing, but not sure if it is intended to mean the same thing here. If so, the idea is that apple might be forced to contract with Epic, as long as Epic lives up to fair, reasonable and non-discriminatory terms. The question here is likely whether Apple is being discriminatory. Arguments both ways. Apple’s best argument may be that it makes everyone live up to the same terms, and part of those terms are that Apple can terminate you for violating them, with no requirement to ever let you back in just because you created some subsidiary to get around the ban. Europe being Europe, eventually Europe may make Apple let Epic in.

Very possible, also possible though that even if the European Commission says one thing that the EU courts will disagree … just like our government doesn’t always win in courts against major corporations.

 

[Cmaier]

According to this, Epic only got the new account in the first place because it used th automated system to create it - Apple never actually agreed to let them back in the store.

DMA be damned, Apple cuts off path to Epic Games Store, Fortnite on EU iPhones

Epic says it's retaliation for public criticism; Apple says it can't trust Epic's promises.

arstechnica.com

 

[diamond.g]

I think it is weird. If Apple doesn’t trust Epic, why let them have a dev account for Unreal Engine?

 

[Nycturne]

I think it is weird. If Apple doesn’t trust Epic, why let them have a dev account for Unreal Engine?

It's the difference between Epic providing an SDK that other devs rely on, versus Epic entering into an agreement with Apple for distribution. Anyone submitting games to Apple's App Store is the one representing the game, and ultimately responsible for how it behaves and any policy violations, not Epic.

There's also some politics here as crippling engine development has a ton of knock on effects for developers who haven't violated any of Apple's policies, and that Apple would like to work with. It's also bad PR to resort to something that looks an awful lot like collective punishment.

 

[dada_dave]

It's the difference between Epic providing an SDK that other devs rely on, versus Epic entering into an agreement with Apple for distribution. Anyone submitting games to Apple's App Store is the one representing the game, and ultimately responsible for how it behaves and any policy violations, not Epic.

There's also some politics here as crippling engine development has a ton of knock on effects for developers who haven't violated any of Apple's policies, and that Apple would like to work with. It's also bad PR to resort to something that looks an awful lot like collective punishment.

Yup. And that’s basically the same reason why Epic also wants to keep Unreal Engine separate. The last thing Epic wants is to be viewed as unreliable by devs who use their engine, that devs should be worried that Epic would pull the plug on platform support over a feud.

 

[thenewperson]

I do wonder what would have happened if Judge Gonzales (I think?) didn’t stop Apple from terminating the Unreal account. Would Apple have reinstated just that one? Stubbornly held on to the ban?

 

[dada_dave]

I do wonder what would have happened if Judge Gonzales (I think?) didn’t stop Apple from terminating the Unreal account. Would Apple have reinstated just that one? Stubbornly held on to the ban?

Ha, I forgot about that. Apple actually did try to kill the UE developer account too:

Epic judge permanently restrains Apple from blocking Unreal Engine, but won’t force Fortnite

The decision makes permanent the temporary restraining order ruling from last month.

www.theverge.com

Hmmm I wonder if the bystander rule might apply to a hypothetical Epic Store? I also wonder if that ruling would be different in light of Apple’s win against Epic? After all that was a permanent injunction - but while the case was being litigated? Or permanently permanent? Apple’s statement was that they believe they have the right to block any Epic account or subsidiary after their victory.

Anyway given Apple’s push into gaming, blocking one of the biggest engines in the business sounds like a bad idea.

 

[leman]

I think this is getting really silly. No matter what the personal relationships of these companies are, I don't think it is ok to outright ban a developer from a platform. While I do acknowledge Apple's right to make money from their systems, we start approaching a truly dystopian proportions in these matters, and maybe it is a time for a thorough paradigm change. It would be good if things became simpler for everyone, not more complicated.

 

[dada_dave]

I think this is getting really silly. No matter what the personal relationships of these companies are, I don't think it is ok to outright ban a developer from a platform. While I do acknowledge Apple's right to make money from their systems, we start approaching a truly dystopian proportions in these matters, and maybe it is a time for a thorough paradigm change. It would be good if things became simpler for everyone, not more complicated.

To an extent I agree that petty politics and history is a poor way to run a business. But I also acknowledge that Apple’s argument has merit. They’re treating Epic as a developer who very intentionally violated their developer agreement. The courts agreed that Epic violated their contract. The court further agreed that almost all the terms of said contract were valid.

So this isn’t just about poor personal relationships. Spotify precipitated a 2bn Euro fine for Apple and has been equally vocal about Apple’s practices but they didn’t violate their contract and they aren’t being banned. Removing labels: forcing company A to do business with company E who a court agreed violated their previous legal contract with A is not a step to be taken lightly regardless of new rules. The EU may decide that their new rules require it. They may not.

 

[leman]

To an extent I agree that petty politics and history is a poor way to run a business. But I also acknowledge that Apple’s argument has merit. They’re treating Epic as a developer who very intentionally violated their developer agreement. The courts agreed that Epic violated their contract. The court further agreed that almost all the terms of said contract were valid.

So this isn’t just about poor personal relationships. Spotify precipitated a 2bn Euro fine for Apple and has been equally vocal about Apple’s practices but they didn’t violate their contract and they aren’t being banned. Removing labels: forcing company A to do business with company E who a court agreed violated their previous legal contract with A is not a step to be taken lightly regardless of new rules. The EU may decide that their new rules require it. They may not.

I am not arguing with the legal argument of all this, my concern is the long-lasting implications of this type of socio-economic model. I believe that App Store was a wonderful thing when it was introduced, because it offered equity to the developer. I must wonder though whether this model is still viable in the modern world. The way I see it, the most important concern is preventing abuse from powerful entities. Epic is certainly one, and their action shows no scruples. At the same time, I would also qualify some of the latest decisions of Apple as abusive towards both the end customer and the developer. Their EU marketplace implementation is particular is an absolute nightmare. Apple is not acting like a leader in this space anymore (and they used to), they start to resemble a shady landlord. This is not a sustainable path.

 

[diamond.g]

It's the difference between Epic providing an SDK that other devs rely on, versus Epic entering into an agreement with Apple for distribution. Anyone submitting games to Apple's App Store is the one representing the game, and ultimately responsible for how it behaves and any policy violations, not Epic.

There's also some politics here as crippling engine development has a ton of knock on effects for developers who haven't violated any of Apple's policies, and that Apple would like to work with. It's also bad PR to resort to something that looks an awful lot like collective punishment.

Honestly I'm not sure there are that many iOS, macOS, or iPadOS Unreal Engine titles (games or otherwise) where it would matter much. Most 3rd party engine usage on Apple platforms is Unity, right?

 

[dada_dave]

I am not arguing with the legal argument of all this, my concern is the long-lasting implications of this type of socio-economic model. I believe that App Store was a wonderful thing when it was introduced, because it offered equity to the developer. I must wonder though whether this model is still viable in the modern world. The way I see it, the most important concern is preventing abuse from powerful entities. Epic is certainly one, and their action shows no scruples. At the same time, I would also qualify some of the latest decisions of Apple as abusive towards both the end customer and the developer. Their EU marketplace implementation is particular is an absolute nightmare. Apple is not acting like a leader in this space anymore (and they used to), they start to resemble a shady landlord. This is not a sustainable path.

After the other thread on this subject where I was the one defending the DMA, even I find it odd that I’m defending Apple here. I promise I am not simply a contrarian!

I agree with the main thrust of the DMA (not all of its provisions mind you, I think it misses the mark in several key ways, but that’s a separate topic). I think rules and regulations should be updated in light of digital markets (especially digital only) being quite different from the old brick and mortar markets our old regulatory system was built to handle.

However, I actually think Apple’s approach is almost perfect from a philosophical standpoint but from a practical perspective it needs one minor change that would have a big effect. The DMA allows gatekeepers to protect the integrity of its platforms, as it should! It allows as far as I can tell those gatekeepers to charge for the services needed to make that happen as it should. Apple should and is doing both. Spotify and Epic are wrong to target Apple’s privacy and security checks for criticism as they are. The only question is: is what Apple is charging reasonable? I would argue … almost. Truthfully my optimal approach (or one of them, several payment structures are possible) would be to allow Apple to charge for installs up to a percentage of yearly revenue. Cap it. I would not be shocked if that isn’t the final form of this after all is said and done if it is ever all said and done. This is the approach that Epic takes for access to their UE dev kit so they wouldn’t have much room to complain, not that this would stop them. It is also intrinsically reasonable and basically an industry standard at this point.

I’m not going to argue that Apple’s behavior during this era of giant growth or in its defense of its practices has been perfect, far from it. But I’m likewise not sold that Apple is being particularly unreasonable in these particular instances, either in its DMA compliance, maybe a little here but the terms of this will get ironed out over time, or in continuing to ban Epic’s app distribution accounts. I mean … if you can’t even ban a developer for willfully violating their developer contract then what can you ban them for? I mean this morally not just legally. You shouldn’t blame Apple for what Epic largely did to itself.

Honestly I'm not sure there are that many iOS, macOS, or iPadOS Unreal Engine titles (games or otherwise) where it would matter much. Most 3rd party engine usage on Apple platforms is Unity, right?

Most games are Unity period. However, while UE is a distant second, it is the second most used engine on the market. Further it tends to get used for more bigger AAA, marquee games, which Apple is trying to attract, than Unity does and fewer is not zero. Basically Apple would be removing development for a very popular engine that gets used for games on its market and exactly for the kinds of games that Apple wants to bring into its markets, especially on the Mac, more. Hurting developers that aren’t a party to this dispute isn’t a good idea. An injunction to stop Apple was saving them from themselves and not revisiting that after winning the court battle is likewise a rare wise move on Apple’s part even if they potentially could revoke it.

 

[Herdfan]

The only question is: is what Apple is charging reasonable? I would argue … almost.

I think the current 30% Apple charges is fine in some cases like for an app or in-app purchases for tokens or other "game" purchases.

But 30% is way too much for say books from Kindle or other similar types of purchases.