Apple and Google have not commented on Epic Games’ lawsuit. But they both pointed out that their guidelines are aimed at all developers, to “keep the store safe” from security risks.
“Epic blew it up with their big PR campaign yesterday with videos ready to go and everything,” John Bergmayer, legal director of consumer rights group Public Knowledge, told CNN Business Friday. “They were baiting Apple and Google to take their apps down from the store.”
“Epic retaining Christine Varney is significant,” said Sandeep Vaheesan, legal director of the Open Markets Institute. “It shows Epic is serious about this suit.”
The company is asking the court to end Apple and Google’s allegedly anti-competitive conduct. It is not asking for any damages.
Here are the issues at play and what’s at stake.
How app stores work
Every mobile app must go through their app stores, which take a standard 30% cut of revenue for any in-app purchases. Developers claim the fee is too high and stymies growth. Apple doesn’t allow outside apps to be downloaded on its devices, and neither company allows developers in its app stores to circumvent their payment systems.
While Google permits outside apps to be downloaded to Android devices, Epic has complained that going outside the Google-approved process is bogged down with security pop-ups and other software restrictions. Epic originally introduced Fortnite outside of the Google Play Store, but after 18 months it launched the game there in April.
Is Apple or Google a monopoly?
In antitrust cases, perhaps the most crucial element is establishing what the market is, the better to show harm to competition. It is in Epic’s benefit to define the market as narrowly as possible, while Apple and Google will push for a broader interpretation.
In claiming that Apple monopolizes the distribution and purchase of iOS apps, Epic Games is “going to have to convince the judge that those are markets to begin with,” John Bergmayer, legal director of consumer rights group Public Knowledge told CNN Business.
For its part, Epic Games argues that since Apple controls one billion devices, there is no other way to reach these consumers.
Apple also could argue that the 30% fee for in-app purchases pays for running the App Store and reviewing apps to ensure they are not security risks, said Jeffrey Blumenfeld, a partner at Lowenstein Sandler.
“I have a very hard time believing that the result of this lawsuit is that the court says that Apple is not permitted to control distribution of apps through its own App Store,” said Blumenfeld. For the court to rule otherwise, it would have to be “pretty strongly convinced” that consumers would be better off in the long run, he said.
If Epic wins, Apple and Google could be ordered to allow developers to sell in-app purchases without giving the tech giants a cut, said Vaheesan. The court could also rule that Apple and Google are prohibited from bundling payment services with their app stores, allowing developers to be paid directly.
Alternatively, Apple and Google could simply settle with Epic and quietly change their policies.
If Epic loses, Bergmayer, the legal director for Public Knowledge, said “at least that highlights what the limits of antitrust law currently are, so people who want change can look to other avenues.” For instance, they could ask Congress to create new antitrust laws.
The case could take years, numerous lawyers told CNN Business. The 1974 antitrust case against AT&T, for example, took eight years to litigate and concluded with the company’s breakup into multiple businesses. (AT&T is the parent of Warner Media, which owns CNN.)
“I think [Epic winning the lawsuits] would be pretty good for the markets overall,” said Mitch Stoltz, senior staff attorney of the nonprofit digital rights group Electronic Frontier Foundation. “You’d see more experimentation, you’d see more business models. You’d see more innovation.”
CNN’s Brian Fung contributed to this report.