Google Says Fortnite's In-app Purchase Swap Was a Breach of Contract, Sues Epic (arstechnica.com) 49
Epic Games keeps piling up lawsuits with app store owners. This time, Google is countersuing Epic for breach of contract. From a report: Epic signed contracts with both Google and Apple, pledging to use the default payment systems for in-app purchases. As part of its push for more open payment systems, though (and to dodge each platform's 30 percent fee), Epic boldly pushed out updates to the Android and iOS apps that switched the payment processing from the platforms' in-app purchases to Epic's in-house system. Google and Apple both allege this action was a breach of their app store contracts with Epic.
Apple sued and got its ruling last month. Epic was ordered to pay $3.65 million in damages, covering Apple's lost revenue from Epic's three months of self-powered payments. Following that ruling, Google wants its missing money, too, and now it's countersuing Epic, hoping for a similar ruling. Google's suit reads, "Epic willfully breached the DDA [Developer Distribution Agreement] by submitting a version of Fortnite for publication on Google Play with a payment method other than Google Play Billing for purchases of in-app content. By doing this, Epic denied Google its service fee under the DDA for any purchases made through the app outside of Google Play Billing." Google continues: "The users that downloaded the non-compliant version of Fortnite before its removal from Google Play are still able to use Epic's hotfixed external payment mechanism to make in-app purchases -- allowing Epic to evade its contractually agreed service fee to Google for those purchases." Google argues that "Epic has alternatively been unjustly enriched at Google's expense" and is seeking restitution of its missing earnings and damages.
Apple sued and got its ruling last month. Epic was ordered to pay $3.65 million in damages, covering Apple's lost revenue from Epic's three months of self-powered payments. Following that ruling, Google wants its missing money, too, and now it's countersuing Epic, hoping for a similar ruling. Google's suit reads, "Epic willfully breached the DDA [Developer Distribution Agreement] by submitting a version of Fortnite for publication on Google Play with a payment method other than Google Play Billing for purchases of in-app content. By doing this, Epic denied Google its service fee under the DDA for any purchases made through the app outside of Google Play Billing." Google continues: "The users that downloaded the non-compliant version of Fortnite before its removal from Google Play are still able to use Epic's hotfixed external payment mechanism to make in-app purchases -- allowing Epic to evade its contractually agreed service fee to Google for those purchases." Google argues that "Epic has alternatively been unjustly enriched at Google's expense" and is seeking restitution of its missing earnings and damages.
Google has a case (Score:1)
Re:Google has a case (Score:5, Informative)
Google, unlike Apple, doesn't prevent you from installing alternative app stores on Android. Epic probably will lose this one.
That doesn't matter. Epic signed a contract with both Apple and Google where it pledged to use their default default payment systems for in-app purchases and then violated that contract. Epic's take on that is: 'But, your honour, in-app purchases yearn to be free. We are heroically liberating them from the tyranny of Google/Apple!!' the judges so far have not been particularly impressed. I'm not a masse fan of some of Google or Apple's business models but the thing is, you can really can sign your rights away if you are dumb enough to sign a shitty contract, Epic is finding that out the hard way.
Re: Google has a case (Score:2)
You can sign your rights away as long as its not for something that is illegal.
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There is no constitutional right to hosting your own payment processor. Okay hyperbole aside there is really no legal requirement to let anyone use an alternate service as part of their service agreement with you. Lock-in contracts are standard. The overruling question is if it is an abuse of market power and the court has so far ruled that in Apple's case they weren't a monopoly given they a) don't dominate the mobile gaming market and b) apply their restrictions to only a small subset of the market (their
Re: Google has a case (Score:4, Insightful)
But there is also for both of them the fact that they decide who pays and who doesn't. There are free apps that make no income for Apple or Google. These free apps are also financed by the money coming from non-free apps. Neither Apple nor Google get money when you buy Fortnite, because it's free. They make their money through in-app purchases. Do you think they deserve to be on the stores for free, when they make lots of money from them through in-app purchases?
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Please don't make the mistake saying that this is about a payment processor. First, what Apple and Google are doing goes far beyond what a payment processor does. They both do a lot of work hosting your app, advertising it, distributing it world wide, handling laws and taxes for over 100 countries for you, and so on. They put gift cards into stores where people buy them and then turn them into purchases. They want to and deserve to get paid for this. But there is also for both of them the fact that they decide who pays and who doesn't. There are free apps that make no income for Apple or Google. These free apps are also financed by the money coming from non-free apps. Neither Apple nor Google get money when you buy Fortnite, because it's free. They make their money through in-app purchases. Do you think they deserve to be on the stores for free, when they make lots of money from them through in-app purchases?
Well put!
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If google wins, Apple will also win on the contract issue. This maybe why Apple has appealed the one decision they sort of lost with Epic..., now that Epic has refiled on the 7 or 8 losing ones.
This appeal by Apple is to delay implementation on the one count as the others are being re-litigated. They are all linked.
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Yeah but the amount of money Google and Apple are going to make off this is relatively small, it might not even cover court costs. The reason to go through with this is to teach app developers a lesson, not to try these kinds of tricks.
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Yes exactly, I was describing it from Google/Apple's point of view.
Re: Google has a case (Score:4, Insightful)
What monopoly? You are free to use a dumb phone. You are free to choose Apple or Google, or something else. On Android you can install an alternate app store.
As much as you want to make this about a monopoly, there is no monopoly here.
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Apple and Google are clearly joint gatekeepers to a resource.
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Apple is a gatekeeper to Google resources?
What stops anyone from making web apps that run on both Apple and Android systems?
What stop anyone from using not Apple and not Google?
We've moved from 'monopoly' to 'gatekeeper', what is your next rationalization?
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Do a search for "monopoly gatekeeper" and simplify your post.
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Do you even know what you are talking about? I did that search, here is what I found:
https://lawstreetmedia.com/new... [lawstreetmedia.com]
That has everything to do with search and nothing to do with app stores. That is about contracts for including Google search that also block competition. Google has the cash to buy a search monopoly across all devices, and have that contract exclude the device from allowing competitive search in the same way. The monopoly gatekeeper thing is all about business contracts and has nothing to
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Yeah but the amount of money Google and Apple are going to make off this is relatively small, it might not even cover court costs.
Apple received over three million dollars. Since Epic hasn't received any revenue since then, they lost a lot more.
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Three million dollars is relatively small, considering what was at stake.
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If google wins, Apple will also win on the contract issue.
I don't know if you noticed that Apple won that one already. The court case ended, Apple one 9 out of 10 points, and will be fighting the tenth one on appeal.
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Epic already lost against Apple as far as this particular issue goes.
Just because Apple are the bigger assholes (in my eyes) doesn't mean that couldn't have formed a legally binding contract with Epic at the time, which then could be breached without legal consequences. The same applies to Google, regardless of whether they allow side loading or not.
The only way for Epic to get out of this breach is to get a ruling that would at least partially, void those contracts. That's not goin
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Google, unlike Apple, doesn't prevent you from installing alternative app stores on Android. Epic probably will lose this one.
EPIC lost on this issue to Apple as well based on the contract.
Clipping the ticket (Score:5, Interesting)
Google's business model (outside of advertising) is to clip every ticket it can on the internet.
This explains why it is getting deeply into UTM (unmanned traffic management) systems for drones. It wants to be the one who *you* pay before you're allowed to take off and fly your toys. This is the entire reason that the company created its Wing division -- to create the illusion that drone-delivery was going to be a thing and thereby convince gullible governments that they must subscribe to Google's UTM service.
He who holds the key to the door dictates the price of entry :-(
So it is also with the app store :-/
they pledged, they used, now they don't (Score:2)
No sympathy for either party (Score:5, Insightful)
Apple, Google, Epic are all too focused on building-up monopoly for extra profit.
They are like sharks in a tank.
One is taking real money for virtual stuffs that will vanish as soon as editor pulls the plug on servers.
The other two are crying fool if they cannot get their 30% share on the first one.
Attorneys, experts will get paid high figures to settle issues between the sharks.
In the end, users are victims cash cow who will continue to be drained for imaginary good they don't really own.
We are living in a feudal society owned by corporations and I really hate it.
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The difference is that the online racket affects both honest sellers, as well as bullshit peddlers like Epic. Epic is pulling a robin hood trick here by representing the interest of honest businesses as well though it would be much easier for them if they didn't. Yes, their motives are tainted, but still, Robin Hood is still way cooler than the Sheriff, and definitely not one and the same.
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Apple, Google, Epic are all too focused on building-up monopoly for extra profit.
They are like sharks in a tank.
One is taking real money for virtual stuffs that will vanish as soon as editor pulls the plug on servers.
The other two are crying fool if they cannot get their 30% share on the first one.
Attorneys, experts will get paid high figures to settle issues between the sharks.
In the end, users are victims cash cow who will continue to be drained for imaginary good they don't really own.
We are living in a feudal society owned by corporations and I really hate it.
Kids spending their allowances on virtual Fortnite crap ... feudal society. Yah... ok, no.
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Apple has stated in the past that their plan for making profit is to control the sale of their products to consumers. The theory is: if they control the experience and they do it well, then they have the opportunity to make future sales
This is why they have stores-in-stores, and don't just want to sell pallets of phones to resellers. -- I see no evidence that this has changed, and (since everyone has to make money to
It's a racket even if you initially agree to it (Score:4, Insightful)
Unless online tenant rights become a thing, landlords will continue to collect their protection money. Kudos to Epic throwing a hiss about it, even if it means getting their knees capped.
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Unless online tenant rights become a thing, landlords will continue to collect their protection money. Kudos to Epic throwing a hiss about it, even if it means getting their knees capped.
Funny, last time I went to a theme park someone else built I had to pay the price of entry. I mean Epic can always create their own games console instead of declaring they have some god given right to dictate terms on someone else's platform.
They don't need to pay 30%. They are more than welcome to not be listed on either App store. But Tim Sweeney is more entitled than a millennial and based on his twitter feed, more whiney than the generation that followed.
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Anyone who's shaken down is free to leave at any time, to different territory, own by other gang. Still doesn't make a racket legal. Just so you know what racket means: Taxing the *only* existing market, typically as a cartel (individual gangs divving up territory). You'll pay tax no matter
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Anyone who's shaken down is free to leave at any time
Do you type that horseshit with a straight face? The terms are dictated to up front and agreed on before being allowed in. A price of admission is not a shakedown, nor is it an illegal racket (something very recently affirmed by the courts).
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> Kudos to Epic
They were free to walk away and not to use the store.
Instead they decided that they will not be paying for using google or apple services to reach customers on those platforms.
Kudos to epic failure for that and for denying me access to games that I wanted to play.
Epic can rot in h3ll... (Score:2)
for what they did to Rocket League once they got control of it. So as much as I am not a fan of Google, I'd love to see Epic maybe have to find some cash and sell of assets :)
Google and Apple should lose (Score:3)
Google and Apple should lose as they have created virtual monopolies using their platforms. Apple doesn't allow third party payment systems and Google has a similar innovation stifling arrangement with users of Android. No one would willingly pay 30% for a service which costs virtually nothing to run. We're not talking a bricks and mortar arrangement or having to spend significant sums on delivery. These margins existing because of the lack of competition enforced by the ones benefiting from the arrangement. Essentially what you are talking about is a market failure.
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Big difference: Google is allowing you to sideload, avoiding all fees. Apple doesn't.
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No one would willingly pay 30% for a service which costs virtually nothing to run.
The Epic Store takes a 30% cut of sales from 3rd party publishers too.
This is why Epic is so hypocritical, saying no one would willingly pay such a fee, while demanding anyone using their store to pay them the same fee.
If Epic didn't charge others 30%, we might have actually believed them that they are against such service fees.
Instead, they are now seen as the company that refuses to stand by their contracts, discouraging other companies from considering making contracts with Epic in the future.
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These are well-established legally binding financial contracts and closed ecosystems. Ever since Nintendo was smart enough to succeed where Atari failed, and create a (technologically) closed ecosystem for their game console, the precedence had been established and tested legally. Nintendo (and every other console maker since) gets a cut of all software sold on their platform by all publishers. Doesn't matter if you stick in a cartridge, download it off the internet, beam it across the universe on entangl
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No one would willingly pay 30% for a service which costs virtually nothing to run.
Except for the hundreds of thousands who do. Why? Because the 30% is a small price to pay for access to customers which someone else gathered all in one place.
You're more than welcome to try and get your own customers on your own platform if you don't want to play by other's rules. But really the only way this can be seen as a "market failure" is through some insane sense of entitlement. "Judge, it's not fair that I can't piggy back of someone else's work. I demand access to their customers!".
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*looks at the Biden Administration pushing for $600 bank account reporting requirement and Yellen going on TV and straight up lying that it's to keep billionaires from cheating on their taxes*
Yes, I can imagine that.