News: U.S. Federal Judge and Epic Games Challenge Whether Apple is Compliant with an Order to allow Payment Steering -
An evidentiary hearing in the Epic Games v. Apple case will determine whether Apple really has complied to U.S. District Judge Yvonne Gonzalez Rogers' order that allowed developers of apps to "steer" users towards third-party payment methods outside of the native App Store.
The hearing on Apple's subsequent compliance began on Wednesday, May 8. AP is reporting the judge Gonzalez Rogers " questioned whether Apple is putting the barrage of exasperating hurdles to discourage from using other payments within iPhone applications," despite the court order.
Hearing focused on whether Apple Policy Is Still Anti-Steering
The AP piece further notes that Judge Gonzalez Rogers' tone suggested Apple's implementation has primarily focussed on preserving Apple's profits, rather than complying with the purpose of her ruling to permit steering, and improve iPhone users' capability to easily switch to other in-app payment options. The article points out that according to Epic documents, Apple is still blocking the developers from directing consumers towards other payment methods with lower pricing choices.
The AP article continues by stating that in the course of the hearing, the Apple chief executive of the iPhone App Store, Matthew Fischer revealed that Apple had only accepted and accepted applications for 38 apps that show hyperlinks to payment platforms, "a fraction of the approximately 2 million iPhone apps available within the U.S."
PC Mag points out that this low application number 38 of the 65,000 developers who offer in-app purchasesmost likely because of the cost because the 27% Apple fee and the additional cost of fees charged by credit cards would likely result in a more expensive overall price for app developers.
Apple Executive 'Unaware' of the higher overall cost issue
The LAW360 piece on May 10, 2015, describes the proceedings as Epic attorney Yonatan Even and Judge Gonzalez Rogers questioned Apple Finance Vice President Alex Roman. Even emphasized the lower fee of 3% from Apple -- 27 percent on transactions made outside an app for Apple devices as compared to its usual in-app $30 fee as well as Epic further provided proof that the average cost of payments in the U.S. is 3.5%, with a yoga app CEO stating that they pay 3.5 percentage to 6.5 percent fees for payment processing. After Roman said he was not aware of the fact, Even reiterated that the goal was to set an amount that allowed companies to give users a lower price. They asked Roman if he understood this. The judge Gonzalez Rogers is quoted as saying to Roman that "'It appears that you made lots of decisions with no data,' she said. "It seems to me as if you were trying to keep ... your revenue that you had in the past.'" Access the LAW360 article here.
We are pleased to see The Judge's View with Epic
CEO David Nachman states that "We're happy to see that the judge side with Epic in this exchange We're optimistic we can convince the judge to force Apple to let steering be available to game and app developers without fees and unnecessary restrictions. Its aim is to make it easier for worldwide commerce for software as well as digital product firms, and we're joining our clients in celebrating the progress towards free commerce on mobile."
Additional Antitrust Action Against Apple launched by US Justice Department
In addition to in addition to the Epic Games case, the U.S. Justice Department launched an antitrust lawsuit against Apple in the month of March 2024, alleging that Apple is the sole monopoly in the mobile market, and this includes (among other things) with regard to electronic payments.