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Christopher Booth
Christopher Booth

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The Epic Apple Tax

Earlier this year something outrageous happened. Epic Games, the creators of the immensely popular game Fortnite, sued Apple. What led to this? Why sue the company that controls the platform that so much of your userbase is derived from? Money of course!

Before the lawsuit began, Epic Games had stepped around one of Apple's rules regarding in-app payments by encouraging users to buy in game currency and items directly from Epic rather than in app. They did this by offering a discount to users who directly purchased from them but notified iOS and Android users they would not receive the same discount since Apple and Google both took percentages from the top. Apple stands firm that all payments in apps must go through their own payment service. This ensures safety of information, adds security to the apple ecosystem, and grants peace of mind to iOS users. Or so Apple claims. In reality, payments can be processed just as safely using outside sources. The problem with that is, Apple wants their cut of the revenue from the app. What's their cut? A cool 30% of all revenue. For any app developer, losing a third of your potential revenue right from the get-go can be a tough pill to swallow, and if you are relying on this potential income, you have to settle for a lot less than you should be receiving. Furthermore, if you want to offer an application to users on iOS, the only way to do so is to pay the annual developer fee, own a Mac to be able to develop for the platform, and then list it on the official App store. There are no real alternatives to this process. With Apple having complete control over their app store, with no other stores available for iOS, they have created a monopoly of their ecosystem and this is at the heart of Epic Game's lawsuit against Apple. Don't think that Epic Games is pursuing this lawsuit for selfless reasons either, though it may have great effects for smaller developers. Remember, thirty percent of a billion dollar franchise like Fortnite equates to hundreds of millions of dollars. In response to the lawsuit, Apple has pulled Fortnite from the App store. It seems until this suit is settled Fortnite will not be available to iOS users.

Epic Games CEO Tim Sweeney largely claims "Apple has locked down and crippled the ecosystem by inventing an absolute monopoly on the distribution of software, on the monetization of software." This is further evidenced by Apple's refusal to allow Microsoft's own game streaming application on the App store. At least Android users can experience the application from the Play store.

This lawsuit is unlikely to be settled anytime soon as it seems Epic Games is in it for the long haul. Hopefully in the future, however, developing an application for iOS wont be so tricky. The next court hearings are scheduled to begin in May 2021. According to statscounter.com iOS currently has just over 60% of the cell phone market share in America.

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