In a major victory for developers and consumers alike, Judge Yvonne Gonzalez Rogers has issued a permanent injunction in the Epic v. Apple case, forcing Apple to open up its App Store rules and allowing other forms of in-app purchase. This seismic shift in the digital landscape is set to take effect in 90 days, unless a higher court intervenes.
Under the new order, Apple must permit developers to include buttons, external links, or other calls to action that direct customers to alternative payment mechanisms beyond those offered by Apple itself. This means iOS apps will be free to guide users towards payment options outside of the App Store's transaction fees. The implications are significant, offering a fresh avenue for purchases on the iPhone.
The ruling marks a major victory for Epic Games, which was found to have breached its contract with Apple when it implemented an alternative payment system in the Fortnite app. As a result, Epic must pay Apple 30 percent of all revenue collected through the system since its implementation – a sum totaling over $3.5 million.
In her ruling, Judge Gonzalez Rogers rejected both parties' definitions of the marketplace at issue in the case, instead defining it as digital mobile gaming transactions rather than gaming generally or Apple's internal operating systems related to the App Store. Under this market definition, she concluded that Apple is not a monopolist under federal or state antitrust laws, but did find that Apple is engaging in anti-competitive conduct under California's competition laws.
Apple has cast the ruling as a victory for its App Store model, emphasizing that it does not violate antitrust law. However, Epic CEO Tim Sweeney expressed disappointment with the order on Twitter, stating that it does not represent a win for developers or consumers. The company plans to appeal the decision.
The new restrictions echo provisional anti-steering restrictions already placed on Apple outside of the US. For instance, in September 2020, Apple agreed to allow outside signup links for "reader" apps like Netflix and Spotify following a regulatory investigation in Japan. Similarly, a South Korean law has opened the door to alternate payment systems, although its practical impacts are still unclear.
The Epic v. Apple case is part of a broader trend of tech giants facing scrutiny over their control of digital marketplaces. Google, for example, is currently embroiled in a similar lawsuit with Epic Games over its own efforts to maintain the Google Play Store as the central source of software on Android.
As the App Store continues to evolve, developers and consumers alike can expect new opportunities and challenges to emerge. With this ruling, Apple's stranglehold on in-app purchases is finally being loosened, paving the way for a more diverse and innovative digital landscape.