Information: U.S. Federal Judge and Epic Games Challenge Whether Apple Has Complied With an Order to allow Payment Steering -
The hearing for an evidentiary hearing on the Epic Games v. Apple trial is examining whether Apple has truly complied to U.S. District Judge Yvonne Gonzalez Rogers' order for developers of apps to "steer" users to third-party payment options that are not available in the App Store's native App Store.
The evidentiary hearing regarding Apple's subsequent compliance started on May 8. AP is reporting that Judge Gonzalez Rogers " questioned whether Apple is putting the barrage of exasperating obstacles to discourage using alternative payment methods within iPhone applications," in spite of the court's order.
Hearing Focused on Whether Apple Policy Is Still Anti-Steering
The AP report further states that Judge Gonzalez Rogers' tone suggested Apple's actions have been focussed on preserving Apple's profits, rather than complying with the intent of her order to allow steering and increase iPhone users' capability to easily switch to other in-app payment options. The article points out that according to Epic reports, Apple is still blocking the developers from directing consumers to other payment options with less expensive alternatives.
The AP article continues that during the hearing Apple chief executive of the iPhone App Store, Matthew Fischer, disclosed that Apple had only accepted and approved applications for 38 applications that display the links to different payment systems, "a fraction of the around two million iPhone apps available within the U.S."
PC Mag points out that the low number of applications (38 out of 65,000 app creators who offer in-app purchasesmost likely because of the cost as the 27 percentage Apple fee and the additional cost of credit card fees will likely lead to a higher overall cost to developers.
Apple Executive 'Unaware' of Higher Overall Cost Issue
A LAW360 story on May 10, 2015, recounts that day's proceedings as Epic attorney Yonatan Even as well as Judge Gonzalez Rogers questioned Apple Finance Vice President Alex Roman. Even pointed out the 3% lower fee from Apple that is 27 percent for transactions that take place outside an app using Apple devices, as opposed to the normal in-app 30percent fee and then Epic further provided proof that the cost for payments within the U.S. is 3.5%, with a yoga app CEO who testified that he pays 3.5 percent to 6.5 fee for payments processing. Following that, Roman said he was not aware of the fact, Even reiterated that the goal was to set a fee that would allow the developers to provide users with a better price by asking Roman whether he was aware of that. The judge Gonzalez Rogers is quoted as saying to Roman that "'It sounds like you all made lots of decisions with no data or information,' she stated. It sounds as if you were trying to preserve ... the income that you have had previously.'" Access the LAW360 report here.
I'm glad to see Judge Side With Epic
Chief Executive Officer David Nachman states that "We're delighted to have the judge agree in favor of Epic in this case We're optimistic that this court can force Apple to allow steering for game and application developers without fees and unnecessary limits. Its aim is to make it easier for worldwide commerce for software as well as digital product firms, and we're with our customers to celebrate this progress toward an open and accessible commerce experience for mobile devices."
Additional Antitrust Action against Apple Launched by US Justice Department
Alongside the Epic Games case, the U.S. Justice Department launched an antitrust suit against Apple in March 2024 and claimed Apple is the sole monopoly in the smartphone market, including (among others) on the subject of digital payments.