November 6, 2023
Epic, the gaming company behind the monster hit Fortnite, will legally cross swords with Google in the coming week. A jury must answer the question of whether or not the web giant’s app store is a monopoly.
Epic Games opens a new front in its fight against big tech. Two years after the game studio behind the extremely popular Fortnite largely failed in a lawsuit against Apple, it will enter into a legal battle with Google in the coming months. The issue to be solved is the same: is the tech giant too powerful with its own app store?
The lawsuit is the outgrowth of a long-standing frustration among app makers with both Apple and Google. To get into Apple’s App Store or Google’s Play Store, developers must give up a percentage of the revenue they generate through their app. This is laughingly called the ‘Apple tax’ and the ‘Google tax’. Both tech giants generate billions in revenue, which, according to Apple and Google, is compensation for maintaining their mobile platforms.
One of the biggest contributors to that revenue stream in recent years has been Epic. ‘Fortnite’ is a free downloadable game. The company’s turnover comes entirely from in-app purchases. Players pay euros or dollars to buy V-Bucks. They allow that Fortnite currency to roll into the game in exchange for, for example, a customized appearance (‘skins’) or special movements (’emotes’).
Epic was tired of seeing a significant portion of that in-app economy flow to Silicon Valley. In the summer of 2020, the company decided to bypass the payment systems of the tech giants with its own system. That turned out to be a clever move. When Apple and Google removed Fortnite from their app stores in response, Epic was immediately ready with a double lawsuit.
This has already been done against Apple. The iPhone maker achieved the biggest victory both at first instance and on appeal. The case still has to come before the US Supreme Court before it is finally dismissed.
The trial against Google dragged on longer, but will also start this week in San Francisco and could last until mid-December. In the coming weeks, Google CEO Sundar Pichai and Epic CEO Tim Sweeney, among others, are expected to take the witness stand.
According to Epic, Google is breaking the law by thwarting rival app stores.
Sweeney wants to convince the jury that Google maintains a monopoly. In a nutshell, Epic claims that Google is breaking the law by thwarting rival app stores, which de facto forces developers to promote their goods through Google’s Play Store and include the associated payment systems – and therefore the Google tax.
Google claims that it has a loose policy. The company cites that, for example, smartphone maker Samsung offers its own app store, where Fortnite can also be downloaded. Users can also download the app directly from the internet, Google notes. Epic considers Google’s openness to be pure window dressing and points to deals in which important app developers were paid to commit to the Play Store.
Observers see the fact that Apple largely won in a similar case as a possible sign that Epic will again fail. Although those experts also point out that in the case against Apple, only a judge examined the legal arguments. This time a jury has to make a decision, and that makes the outcome more uncertain.