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[News] Epic Games loses the argument with Apple

When Epic Games decided to sue Apple over what it viewed as unfair commission pricing, many predicted a major upheaval for the app-store model. 

Earlier this year, when Epic — the makers of the popular game Fortnite — introduced their own payment system to get around the 30% cut Apple takes on all in-app purchases, Apple pointed out this breached their terms and conditions, promptly removing Epic’s app from the App Store. 

Within half an hour, another story emerged. Epic Games was suing Apple for being a monopoly power in the “iOS app distribution market.” 

You might remember Epic Games made a 1984-themed video to motivate grassroots support for its #freefortnite campaign. According to Midia, this video seemed to be trying to stir up sentiment against the pricing dominance of Big Tech.

But it seems the winds of the fates were not with Epic’s arguments. The court didn’t view Apple as behaving as a monopoly and found in favor of the tech giant. Epic Games is to repay Apple $6 million for the time it was in breach of contract — or stay off the App Store for good. Apple doesn’t need to reinstate Epic on the platform either; the decision rests with the company.

The only win for Epic was that Apple cannot ban developers from using buttons linking to other payment mechanisms. But Apple can still influence their users, displaying warnings about leaving their site for another payment site. This itself could be enough to keep a skittish user worried about security. So it’s a mixed win for Epic.

Many thought Epic Games was in a good position to question the unchanging commission prices. Gaming is one of Apple’s biggest revenue earners. Last week’s court report says it was worth hearing the arguments. “Generally speaking…” the report states “gaming apps account for approximately 70% of all App Store revenues.”

Epic Games’ founder and CEO Tim Sweeney thinks around 8% commission is more reasonable after such a long time with the platform (since 2008). Last month in an interview with CNBC, Sweeney added that “developers could accept their own payments and avoid the 30% tax by Apple and Google and pass the savings along to all our consumers. Players would get a better deal on items. And you’d have economic competition.”

The upshot is it is still difficult, if not impossible, to design an alternate payment system if you sell your app on big store platforms. And with Apple’s walled garden, if your app isn’t in the App Store, you miss out on all the potential users on iPhone and iPad.

We’re not sure this argument is finally settled. Does App-store dominance impact the freedom of entrepreneurs and developers to sell their wares? Or to pass on cheaper prices to consumers? What do you think?

In other news

  • If carbon turns into diamonds, what does CO2 turn into? A new direct air capture plant has come online in Iceland. Gizmodo describes how the system, run by Swiss company Climeworks, utilizes industrial vacuums to suck carbon dioxide (CO2) from the air. The removed CO2 gets stored underground and after about two years turns to stone. While the plant is the largest in the world, the actual technology isn’t new. And while it’s noteworthy, it’s also very expensive to run and uses a lot of energy to process the carbon dioxide, diminishing the overall impact of the efforts. And ultimately, the amount of CO2 that’s removed from the air is barely a drop in the bucket in terms of overall global emissions. 
  • Intuit gobbles up Mailchimp. Bloomberg announced that tax and invoicing platform Intuit will be acquiring Mailchimp, a popular newsletter service founded in 2001, for $12 billion. As Axios points out, this would be set a new record for the price paid for a privately-held bootstrapped company, and would set the Mailchimp founders for life because the company “opted for profit-sharing instead of stock-based compensation for employees.”
  • Ransomware goes to college. TechCrunch reports that Howard University in Washington, D.C. was hit by a ransomware attack on September 3rd. The university had to cancel classes and deactivate campus Wi-fi while they investigated the attack, which officials don’t believe impacted student accounts. Slate suggests this should serve as a wake-up call to other academic institutions around the country, which have online networks that aren’t locked down to the same degree that corporate networks often are. 
  • Woz wants to take out the trash… in space! Apple Computers co-founder Steve Wozniak tweeted an intriguing video that has the tech space chattering about what he’s up to. Best guesses suggest that Wozniak is starting a new private space company which is likely being formed to help remove space junk — broken satellites and other debris. Space.com and other tech blogs note that details are sparse, but we’re hopeful that this tech leader sets himself apart from his peers and uses his powers — and bank account — for good. 

Tip of the week

It’s a good day to update your devices.

First, this week security researchers at Citizen Lab discovered highly invasive spyware that attacks Apple devices. As reported by The New York Times and Wired, the spyware group NSO has developed sophisticated software that can take over your devices. The spyware allows bad actors to gain access to your computers, mobile devices, and watches without you being aware of the intrusion. 

In an ominous warning, Senior researcher at Citizen Lab John Scott-Railton said, “this spyware can do everything an iPhone user can do on their device and more.”

We can’t overstate the importance of immediately updating all Apple devices. Here are instructions for updating your Mac operating system, your iOS mobile devices, and your Apple Watch. If you have family members who aren’t likely to keep their devices up to date, consider forwarding this article to them so they can take action.
Also, Wired is recommending Windows users update Microsoft Office, due to another vulnerability that could allow hackers to control your computer remotely.  Although Windows 10 updates automatically, you might want to take charge and make it happen now. Go to Start > Settings > Update & Security > Windows Update.

Finally, Google has also pushed out an update to the Chrome browser, again because of a recent vulnerability. So be sure not to let that “Update” button in the corner of your browser get moldy — go ahead and make that update happen now.

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Lisa McKnight avatar

Lisa McKnight

As a digital technology copywriter, I'm passionate about communicating how vital the information industry is and how stuff works. If it's complicated I believe it can also be engaging. With 10 years of copywriting in B2B and B2C marketing, technology is rocking my world. More articles written by Lisa.

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