Amid the growing outcry against Big Tech’s anticompetitive practices, Apple’s enormously lucrative App Store could be one of the first fortresses to fall.
In 2019, the App Store generated an estimated $50 billion in gross sales — and Apple kept $15 billion of that. Now the App Store, which is the only way to get iOS apps for Apple mobile devices, is in the crosshairs of app developers, lawmakers and regulators over its virtual monopoly.
At the front of the anti-App Store phalanx: Epic Games, creator of massively popular battle royale game “Fortnite.” Epic sued over the 30% cut Apple takes on all in-app purchases and its policy that bars outside payment methods. After Apple kicked “Fortnite” off the App Store, the game’s iOS players dropped 60% in less than a month, Epic claims.
Apple is “flexing its enormous power in order to impose unreasonable restraints and unlawfully maintain its 100% monopoly over the iOS In-App Payment Processing Market,” Epic said in the lawsuit. The case is set to go to trial in May 2021 — and the outcome could set a broad precedent for how apps including Netflix, Disney Plus and HBO Max reach consumers on Apple devices.
“This is a massive case for the technology industry,” says professor Andy Wu, who teaches technology business strategy at Harvard Business School. “It will have a huge impact on not just Apple but the whole landscape.”
Fueling the fire was a report issued last week by Source…