Judge in Apple-Epic Case Hints at App Store Compromise

The judge overseeing the trial between Epic Games and Apple has reportedly hinted at a compromise that could satisfy at least some of the game developer’s concerns with Apple’s monopoly over in-app purchases made with iPhones and other iOS devices.

Bloomberg reports that the judge overseeing the high-stakes trial between Epic Games and Apple has hinted at a compromise that could address some of Epic’s concerns, primarily the ability for app developers to inform users that Apple’s virtual store isn’t their only shopping option.

U.S. District Judge Yvonne Gonzalez Rogers is reportedly looking for a middle ground while hearing from economists called by both companies as expert witnesses in a case that could shape how Apple’s multibillion-dollar marketplace operates entirely.

Epic and Apple are largely fighting over V-Bucks, the digital currency used to purchase upgrades in Epic’s video game Fortnite. To purchase V-Bucks on iOS, Apple requires that transactions happen via its own payment processing system that takes up to a 30 percent cut from developers. Epic attempted to replace that system with its own, bypassing Apple’s fees and leading to Fortnite’s removal from the iOS store as the trial continues.

The judge this week questioned Apple’s rules that block developers from including a link or other information in their apps that would direct users to make in-app payments via other websites and services, bypassing Apple’s payment processor.

The anti-steering policy is targeted in the lawsuit Epic filed last year alleging that Apple has a near-monopoly and squeezes profits from developers with its App Store rules and fees. Epic is reportedly seeking to abolish these rules and introduce alternative payment systems.

Judge Yvonne Gonzalez Rogers asked Richard Schmalensee, an economist and professor at the Massachusetts Institute of Technology, who was testifying Wednesday as an expert witness for Apple in the second week of trial in Oakland, California: “What’s so bad about it anyway, for consumers to have choice?”

Schmalensee pushed back against the idea, stating that for Apple it could mean a decline in its App Store revenue stream. “If the app vendor can say, if you press this button you can buy this for less, that means the App Store can’t collect its commission,” Schmalensee said. That amounts to “undercutting” Apple’s App Store sales.

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