There are not many people who can say that they beat Apple. Tim Sweeney may have just won a place in this club.
Sweeney is the CEO of Epic Games – better known as a company behind Fortnite – and he won what could be a very significant judicial victory last week, forcing a significant change in the way Apple manages its app store.
Apple will call on this decision (and Sweeney is in a parallel fight with Google on It is rules of the App Store). But if the decision remains in place, it means that the five years and the huge sum of Sweeney money says that it spent and sacrificed by defying Apple and its CEO, Tim Cook, will have paid off.
Explain why Apple App Store rules are so important – for Apple and the developers who complain – can be a brake, even if I continue to try. I wanted to hear Sweeney’s point of view directly because he made fight an essential part of his work for half a decade.
And I also wanted to know when I was able to play Fortnite on my iPhone – something that I have not been able to do since 2020, when Sweeney started fighting with Apple. (I asked Apple a comment, but they did not develop the statement they made last week by expressing their disappointment and plans to call.)
You can hear our entire discussion on my podcast channels. The following is an extract published by our conversation.
Peter Kafka: Why was the decision last week important for you and Epic? And why should a normal person care about it?
Tim Sweeney: This is really one of the problems at the heart of our digital freedoms for the future. We live our lives on our smartphones. We are constantly connected to people. We work on them. We play on them. And our future will be more and more connected there. Thus, freedom for consumers and developers to do business together is of paramount importance. If you have a monopoly guard who dictates what people are allowed to play, see, hear – and take exorbitant costs of each transaction that everyone is online – we will have a much less free world than that in which we have grown up.
I started to program on an Apple II at the age of 13: you turn on the computer, you get a basic programming prompt. Anyone can write code, anyone can save it on a floppy disk, you can share it with a friend, you can sell it. These digital freedoms are essential in the future.
I subscribe to Netflix. I subscribe to Spotify. None of these is done via Apple, because in both cases, none of these companies wanted to pay the Apple fees. But I use Spotify and Netflix on my phone.
Maybe I could say that it’s a bit of hassle for me to have to deal with Netflix on a website rather than directly via its iOS application. But it does not really seem that it is a kind of life and death situation for me or one of the companies involved.
Apple at two levels of rules. They have a level of rules for what they call reader applications, which are essentially applications exploited by companies of several hundred billion dollars – Amazon Video, Netflix, Spotify and several others. Apple allows these applications to do business outside the application. And they previously hampered these developers to talk to users of the best offers (you can get by going directly to these sites).
But even with this restriction, which is now removed, it seemed that life was OK for me, life was OK for Netflix, life was OK for Apple. Everyone got what they wanted.
It was not OK for game developers. Because this exception of the Reader application applies only to video streaming, audio streaming and ebook sites. Apple forced all games, all social media applications and everything else, to do business only via their application. Apple therefore imposed a rule on all game developers, saying that if you sell something for your game anywhere in the world on any platform, you must sell it on iOS, and you must use our payment method, and you must pay us 30% if your income is greater than a million dollars. The game developers therefore had no choice, and all that was just a note of 30%.
What is going on in view of the decision last week?
This now means that all users are free to find out better offers from all developers, and all developers are free not only to accept payments outside the application on the web, but to talk to users of these means of paying and giving consumers better offers. It is a key economic gain here.
From now on, developers will be able to send users to the web to give them a better price, then to earn a little more money for themselves.
But this is only the effect of the first order. The second order effect is that you can expect Apple to continue to offer such a horrible affair, that everyone will move away and direct their customers to iOS payments on the web. So I hope that Apple would intensify and clash, give developers a much better deal than 30% and will actually engage in the competition. But whether Apple chooses to compete or not, the court allowed the developers to make the choice for themselves.
Apple says they will comply with the judge’s decision, but they will also call he. It is therefore possible that the rules are changed again. Do you think that a significant number of developers are ready to take advantage of this window, knowing that it can be closed?
It represents 30% of income, so all the main developers will support alternative payments. Spotify was the first big application that I saw that has already done so. Fortnite will do it later this week. And many, many applications do it.
You said Fortnite will come back to iOS. You were launched from the platform in 2020 for violating Apple’s rules. There is nothing in the decision of the judge who says that Apple must restore Fortnite on iOS. Did you speak to Apple? How do you imagine that Fortnite will return to iOS?
Epic has a valid developer account (Apple) in good standing. Our subsidiary Epic Games, Sweden has opened an account in order to distribute Fortnite in the European Union.
Our relations with Apple on this account were managed by their team of relations with the developers, who were cordial.
Do you feel confident that I can play Fortnite on my iPhone later this week?
I believe it. I would be very surprised – Well, I would not be terribly surprised if we had a bug which took one day or two more to repair – but I would be very surprised if Apple decides to brave the geopolitical storm of blocking a major iOS application.
We told Apple what we do.
How much did you cost you to engage in this five-year legal struggle?
We had legal invoices in terms of EPIC against Apple by more than $ 100 million.
I assumed it was much more. You hired high -end avocados and …
Well, yes. More than $ 100 million, just in legal costs.
But if you look at the lost income, that’s another story. We cannot predict exactly how much we would have won on iOS, but during the two years when we were on the platform, Fortnite had won around $ 300 million on iOS. You could therefore have been able to project hundreds of millions of dollars in lost income following the fight.
And it’s just people who played and couldn’t play. I think of the future players you would have obtained, who were not exposed to the game because they do not have access to it via their phone. Roblox has tons of young players. The majority there are adolescents or less. They all get there via their phone. It was all the people who could have played Fortnite in the past five years.
That’s right. Metcalfe’s law is a real factor here. You are much more likely to play a game or use a social network if your friends are there. Thus, Apple cutting Epic from access to the whole IOS public, which affects not only the players who directly refused access to Fortnite, but that also affects all their friends who could have played more Fortnite or could have played at Fortnite but no, because their friends could not play.
You can therefore easily imagine that there was a billion dollars or more impact on EPIC at that time.
I think freedom cannot be purchased at a price too expensive. The world must change here. And if that does not change, then you will simply make Apple and Google extract all the benefits of all applications forever. And there will be no appropriate digital economy. It will only be monopolization.
I understand logic and emotion behind this argument. On the other hand: you run a for -profit business. You have a lot of investors. They put a lot of money from you. Did they come to you at some point in the past five years and have said: “Tim, I know that freedom cannot be bought at a price too expensive. On the other hand, I have invested a lot of money in you because you are a game business, and your game is prohibited from mobile phones. Could you just settle this and declare victory and move on?”
Apart from an investor who left Epic on the right quickly, everyone held us alongside, because no one has invested in Epic because they want to take advantage of 30% by reversing the action.
They have invested in (we), believe in our vision, believe in our potential and believe that if we manage to build the Metaviatant Fortnite and the growth of an ecosystem game, in an open platform literally serving billions of players, that it will be completely worth it. They all realize that if Apple controls the tap, the income tap at the top of the funnel, they will use this control to extract all the benefits that will never be made from this space.
Do you imagine that this is the rest of your professional life – manage a business, code, then also have legal fights with platforms?
There is a game and a meta-game here, right? The game manufactures impressive software, which is incredibly fun, in a creative and technical way. I love it. But there is a meta-game to ensure that we have the right to do so, and that we can take advantage of the fruits of our work, and that all developers can. A large part of our company is not only an epic profit from our games. It is epic to help other developers to succeed and take advantage of the success of thousands or hundreds of thousands of different developers themselves.
Epic is one of the few companies in the industry that is positioned in a way that really forces us to fight for everyone. And I don’t feel bad about it. I have put a lot of brain power in coding over the years. I put a lot of brain power to find out how to overcome the monopolies that block us.
What good is it to code if you are not allowed to publish your product? You must mix the love of art with your defense of your right to engage in art.
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