![]() Tim Sweeney, Video Game Billionaire, Was Asked In Court If He Could Point Out A PlayStation 5 The trial itself, which began on May 3, is seeking to decide both these matters, with the verdict potentially having enormous ramifications not just for the relationship between Apple and Epic, but for the precedent it could set for the way games are sold and managed on other online marketplaces as well.īelow you’ll find a comprehensive roundup of our coverage of the case, which will be added to as it continues (if you’re on mobile, tap on the headline to continue to the linked story). Schmalensee declined to comment, and Evans did not immediately return requests for comment.Epic instigated the lawsuit back in 2020, believing that the 30% revenue cut that Apple was taking from games (like Epic’s wildly popular Fortnite), and the restrictions it placed on other companies implementing in-app purchases in their own titles, were unfair.Īfter attempting to bypass Apple’s in-store payment system with an updated version of Fortnite, Epic’s flagship shooter was removed from the App Store and Apple filed a countersuit, claiming that this circumvention violated the terms of Epic’s contract with Apple. “Each of them knows though that whatever opinions they have said in the past have to be consistent with what they say now," said Steven Salop, professor of economics and law at Georgetown University and a self-described consultant to Epic on its case. ![]() Part of Apple's strategy in putting Schmalensee on the stand was to bring up the differences between Evans' previous work and his current view of the Epic case in a bid to make his testimony look less credible, observers said. "Personally, I don’t see how he gets there and gets it to stick." "I would say (Evans') views on AmEx haven’t changed, but what he would say is the facts here are different and so the same result isn’t appropriate," said Geoff Manne, president and founder of the International Center for Law & Economics research center. Outside observers have been surprised by the split between the two star economists. Schmalensee said Apple's rules that prohibit apps from steering consumers to less costly payment presented an almost identical issue, and that Evans had contradicted many aspects of his previous work. The court sided with American Express, citing Evans and Schmalensee extensively in its decision. Supreme Court case.Īmerican Express had prohibited merchants from steering their customers toward rival cards with lower swipe fees, arguing that its higher fees helped fund cardholder perks that benefited consumers. Schmalensee, by contrast, contends that the relevant market is gaming transactions, where Apple is just one platform among many - Microsoft Corp's (MSFT.O) Xbox and Sony Group Corp's (6758.T) PlayStation - sitting between game developers and gamers and charging commissions to facilitate transactions.Īpple's App Store is a two-sided marketplace, Schmalensee testified, a concept that he and Evans have written about extensively, including in an amicus curiae brief on behalf of American Express in a 2018 U.S. After Apple kicked "Fortnite" off the App Store, Evans testified, only a small fraction of Apple users jumped to other devices like PCs or gaming consoles to play "Fortnite." Since about 2010, Evans testified, Apple's App Store has effectively been its own market, and users rarely venture outside.
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