App Store antitrust battle is back in court
SAN FRANCISCO — Apple is heading for a courtroom showdown against the company behind popular video game Fortnite, reigniting a high-stakes antitrust battle over whether the digital fortress protecting the iPhone’s app store illegally enriches the world’s most valuable company while stifling competition.
Oral arguments on Monday before three judges of the Ninth Circuit Court of Appeals are the latest round in a legal battle over an app store that provides a wide range of products to more than a billion iPhones and serves as the backbone of Apple’s $2.4 trillion empire.
The brawl dates back to August 2020 when Epic Games, the maker of Fortnite, filed an antitrust lawsuit in an attempt to erase the walls that have given Apple sole control of the iPhone app store since its inception there. 14 years old.
This rock-solid control over the App Store has allowed Apple to impose commissions that enable it to discount purchases made for digital services sold by other companies by 15-30%. By some estimates, those commissions earn Apple $15 billion to $20 billion a year — revenue that the Cupertino, Calif.-based company says helps defray the cost of technology for the iPhone and a store that now contains nearly 2 million mostly free applications.
U.S. District Judge Barbara Gonzalez Rogers sided almost entirely with Apple in a 185-page decision handed down 13 months ago. This followed a closely watched trial that included testimony from Apple CEO Tim Cook and Epic CEO Tim Sweeney, as well as other senior executives.
Although she said that Apple’s exclusive control over iPhone apps was not a monopoly, Gonzalez Rogers opened a loophole that Apple wants to close. The judge ordered Apple to allow apps to provide links to payment alternatives outside the App Store, a requirement that was deferred until the appeals court ruled.
Monday’s arguments are set to open with Epic attorney Thomas Goldstein trying to persuade the trio of judges – Sidney R. Thomas, Milan D. Smith Jr. and Michael J. McShane – why Gonzalez Rogers should have watched the iPhone app store and system payment as separate marketplaces instead of lumping them together.
A Justice Department lawyer will also have the opportunity to explain why the agency believes Gonzalez Rogers interpreted federal antitrust law too narrowly, jeopardizing future enforcement action against potentially anticompetitive behavior in the US. tech industry.
While the department isn’t technically taking sides, its arguments should help Epic argue that the appeals court should overturn the lower court’s decision.