Epic vs. Apple Day 1 Was a Total Mess
It is finally time for the official court case between Apple and Epic Games to begin. No matter the outcome of this case, it will likely have some ramifications for the tech and gaming industry, shifting the direction of where publishers and developers will go moving forward. Epic vs. Apple day 1 has concluded with a messy but intriguing start.
Epic vs. Apple Day 1 Was Ironically a Technical Mess
To kick matters off, the court case was ironically a technical mess at the start of the day. The proceedings were to begin with the opening statement from Epic Games 8:15 am PT sharp to the overseeing US District Judge Yvonne Gonzalez Rogers but that wasn’t the case. This was due to the method in which the court decided to hold this case.
In the pre-trial hearings and for some other cases in the country, Zoom has been the method of choice for holding court during this global pandemic. However, for the actual trial, the federal courts in California opted for a conference call to allow the public to listen in if they would like.
This more public-facing way of handling it is understandable, however, the actual implementation of it was met with some problems. The general public was able to tune in to the conference call, unmute themselves, and cause some chaos when the trial was set to begin.
People could be heard talking over one another, playing music, and the like as the very serious trial was supposed to be happening. It took several minutes to fix the line and this was an awkward start to a trial that is supposed to be about two of the hottest tech companies right now.
Apple is one of the largest corporations in the world and Epic Games is carving out its own piece of the industry with one of the largest video games in the world right now: Fortnite. So, it is pretty hilarious for it to start out this way and this was far from the only issue that we saw in Epic vs. Apple day 1.
Later on in the day (which we’ll get to in a bit), Apple had its chance to provide its opening statements and argument to the Judge Gonzalez Rogers but more technical problems intervened, forcing a 20-minute recess to figure everything out.
Overall, Epic vs. Apple day 1 was a particular mess to start out this very important trial but that isn’t to say that the problems prevented the proceedings from happening. This still happened and we have the breakdown of the important parts that you should know about from what both Epic and Apple have stated thus far.
What Actually Happened: Epic’s Opening Statement
The event began with the opening statement from Epic Games, creators of Fortnite, the Epic Games Store, Unreal Engine, and much more. The video game developer is the one who sued Apple in the first place following the entire fiasco of reducing the price of the V-Bucks virtual currency in Fortnite and that leading to Apple removing Fortnite from the App Store.
As the company that sued Apple first, Epic had the opportunity to start out the court trial with its opening statements and the first set of witnesses. Via The Washington Post, the company set aside around three hours for Epic CEO Tim Sweeney to be the first witness on the stand, which is the second-most for any of its witnesses at this time.
In the opening statement from Epic Games, the company noted that it is suing Apple not for just itself but for changes for all developers out there. The change, specifically, is for the closed environment that Apple has created around the iPhone and the iOS in general.
Epic has argued that the iPhone is essentially a small computer device, made with heavy restrictions that wouldn’t be accepted by the community and everyone at large if it happened on a traditional PC. This is mainly in the fact that users are unable to download any software that Apple has not explicitly approved.
The only main way (without using stuff like Jailbreaks) to download software is through the Apple-owned App Store. Epic Games is seemingly hoping that this trial will force Apple to make the iOS more open like normal PCs are, allowing for more means to create, download, and upload software for iPhone and other Apple devices.
Epic Depicts Apple iOS as a “Walled Garden”
Part of the main argument against Apple is that Epic Games is proposing that the former has intentionally created a “walled garden” for its consumers. Essentially, the operating system is designed to be super restrictive as previously mentioned but also discourage users from switching to another device.
So, Apple allegedly doesn’t just control the system to the point where nothing it doesn’t want gets in but it also ensures that it is very difficult for users to switch to a competitor because of the general infrastructure of the iOS.
Through a slideshow, Epic Games presented this “walled garden” argument, noting how this is done. As part of this, there is an intriguing email from the former Apple executive Ian Rogers and the Apple Vice President of internet software and services, Eddy Cue.
In the email, Rogers noted that the “most difficult to leave the Apple universe app is iMessage.” This app is the famous chat app made by Apple and is exclusively used for iOS devices as you are unable to download it (officially at least) for other devices, like Android phones.
Rogers further mentioned that switching to Android caused issues where families had to use Facebook to message, and WeChat, WhatsApp, and Slack for work. Worse, according to Rogers, he missed out on messages from friends and family who kept using iMessage to message his old address.
Furthermore, Epic tried to break down the walled garden stance of Apple by proving that one of the most valuable facets of this, the safety for consumers, is actually not as secure as you would think. To prove this, an email from Phil Schiller, Apple executive overseeing the App Store was shown.
The email noted Schiller’s reminder to the recipient of how Apple wanted to find “bad apps with low ratings” and become the “‘Nordstrom’ of stores in quality of service.” The reason why Schiller brought this up was because of an unspecified “obvious rip off” of the famous Temple Run mobile game that somehow made it to the number one free app on the App Store at the time, despite having no screenshots, terrible text, and almost all one-star ratings.
To make matters worse, Apple is allegedly, according to Epic, able to “terminate developer at any time for any reason at all”, further arguing that the corporation has a monopoly of power with iOS.
Epic Has Paid More to Sony and Microsoft Than Apple
There were many documents that were shared for this trial and one of them was an Excel spreadsheet going over the list of the money paid to the third-party companies who hosted Fortnite on their platform, like Nintendo, Apple, Sony, and Microsoft.
In the file, the revenue was revealed for the period of January 2017 to October 2020. Most of the money was related to Fortnite but there were other games featured there like the also owned Rocket League and more. In general, Epic Games paid around $237 million USD to Apple for Fortnite commissions.
This is essentially the money that Epic Games owed the tech company for allowing the game on iOS devices during that time. What is interesting about this is that in 2020 alone, Epic paid much more to both Microsoft and Sony than it ever did to Apple during the entire roughly under three years.
Microsoft and Sony received around $245 million and $451 million, respectively, during just last year. This is something that is potentially going to be leveraged by Apple as an argument against what Epic Games is saying, but it is worth noting that the antitrust lawsuit is not necessarily about prices and money, according to Epic Games.
Qualcomm Case Cited in Apple’s Opening Argument
Following the debacle at the start of Apple’s chance to have its opening statement, one of the strongest parts of the argument that the tech giant had was regarding the recent Qualcomm case. This antitrust lawsuit was started by the FTC in 2017 when it alleged that Qualcomm was using its position of having patents to mobile phones as a way to get unnecessary money from companies.
It was then in 2019 when a judge ruled in favor of the FTC stating that this was truly an antitrust issue in which Qualcomm had monopoly of the smartphone power and used it unjustly. However, while this sounds like good news, the situation was reversed in 2020 with a federal appeals court reversing the case’s result.
In the end, the case rang with the decision that anticompetitive behavior is illegal but hypercompetitive behavior is not. The issue in this case is that Epic will have to prove that what Apple is doing is the former rather than the latter, and Apple likely knows this with the immediate callback to the 2020 reversal of the Qualcomm case.
Apple Claims Epic Deceived It
Furthermore, the Apple opening continued in the court trial with the tech company alleging that Epic Games deceived it regarding the crux of this situation, which was the Fortnite V-Bucks fiasco last year. Apple alleges that emails from Sweeney prove that the company was deceptive in its way of going about this.
When Epic changed the price of V-Bucks and allowed players to purchase directly from it in the game, this circumvented Apple’s rules for iOS and it was done without permission. However, the company alleges that Epic was in contact with Microsoft beforehand to give a heads up to that company but not Apple.
This is something that could be possibly detrimental, if proven true, for Epic’s case as it begs the question of why the Fortnite developer would go behind Apple’s back in this way. It could even paint the picture that the Fortnite creators wanted this trial outcome; something that others have suggested in the past.
Apple defended itself in the opening statements that Epic gave, including the security of its platform and the dangers of what would happen if the iOS infrastructure was as open as Google is with Android. And the tech giant also pointed out that players have alternative ways of playing Fortnite, like on Android (though not officially through Google Play Store), Xbox, PlayStation, or Nintendo.
Sweeney States That Fortnite Could Be Part of the “Metaverse”
Here is where the matter gets even more tricky as Sweeney took the stand to be the first of the witnesses in this trial. He addressed the point of having alternative platforms for Fortnite by arguing that the battle royale title is so much more than a video game.
Instead, it is part of what could someday be the “metaverse”, a term for a new realm for people to connect in a huge way that Sweeney and Epic Games is potentially heading towards in the future. To prove this point, Sweeney and Epic counsel Katherine Forrest went over what the game is.
Sweeney noted that players can just hang out there, enjoy concerts, movie trailers, in-game events, and more. There have been so many partnerships with everyone from Disney to musicians to movie directors to now soccer players and more.
It even hosted the “We The People”, politically-driven event at one point to address racism in America. The point of this was to prove that it is more than a game. After his testimony, he was cross-examined by the counsel for Apple Richard Doreen.
Doreen asked several questions to Sweeney, much of which revolved around why Epic Games is doing this now and why against Apple, specifically. Doren kept noting that Apple is doing the same as Sony and Microsoft in requiring a 30% commission and Epic agreed to that a long time ago with titles like Infinity Blade, so why now?
Unfortunately, there was another technical issue in the cross-examination, resulting in the end of Epic vs. Apple day 1 when the line returned. With the end of day 1, here is hoping that the technical issues will be resolved soon so that the trial can go more smoothly and the community can know what is going on. Stay tuned for more details soon about this trial as it will pick up once more tomorrow at the same time (barring more technical problems).