Fortnite Is Gone

 

Apple (AAPL) and Google (GOOG, GOOGL) have removed Fortnite (the video game made by Epic Games) from their respective app stores for violating their terms of service regarding payments. Basically, Epic Games would prefer that Apple and Google reduce or eliminate their chop of the money Epic charges consumers to play Fortnite.

 

Epic filed a lawsuit against Apple in the U.S District Court for the Northern District of California arguing that Apple removing Fortnite is “yet another example of Apple flexing its enormous power in order to impose unreasonable restraints and unlawfully maintain its 100% monopoly over the iOS In-App Payment Processing Market.”

Sorry. No. That’s not what this is at all. Apple and Google created marketplaces to support their hardware businesses. They own “the mall,” and they rent space to 3rd parties. The price is 30% of your sales. For that “fee,” you are given access to millions of potential customers. There is no version of a mobile Fortnite without the app stores.

These ecosystems demonstrate the profound differences on a quality scale. Apple apps almost always work on every supported Apple device. Android apps… not so much. Google does its best, but the Android OS lives on a very wide range of devices. Other non-app-store apps in either iOS (dev license or jailbreak required) or Android… that’s a total crap shoot. The app store guidelines basically ensure a level of quality control for end users.

When does the transition from “wonderful opportunity to acquire customers” to “100% monopoly” occur? Epic (and everyone else who sells in the Apple and Google app stores) agreed to the terms, and they built their businesses accordingly. No one likes Walmart or Amazon either; try being in business without selling to them.

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  • Epic is just just trying to clear the way for it to increase its own revenue.*
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Shelly Palmer is Fox 5 New York's On-air Tech Expert (WNYW-TV) and the host of Fox Television's monthly show Shelly Palmer Digital Living. He also hosts United Stations Radio Network's, ...

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Stock Profit 7 months ago Member's comment

This will be a fascinating battle between some tech industry giants which will have a massive impact on the way these companies do business. Unfortunately, it will likely be years and years before we see a result. Unless the companies come to some sort of settlement agreement. But there's likely too much revenue on the line for that.

Nicky Paterson 8 months ago Member's comment

This will be very interesting to see how this plays out. These are two giants with millions or even billions in revenue on the line. So which has more clout? Fortnite is clearly addictive with a lot of staying power. But will people switch to playing on a PC? I'm not so sure.

Adam Reynolds 8 months ago Member's comment

Agreed, lots of kids have phones, but not all have access to a PC. One that is powerful enough to play Fortnite. Nor will parents be as willing to let them spend hours on the family PC or their own PC the way they don't mind if they are playing on their own tablet or phone.

Andrew Armstrong 8 months ago Member's comment

One important question that hasn't been answered by Shelly Palmer in this article is this - are the millions of players that had already installed the game, still able to access it? Is it still on their iPads and phones and ready to play? Not sure Google and Apple want millions of addicted players getting angry at them for taking away their drug of choice!

Nicky Paterson 8 months ago Member's comment

Good question but not sure it matters - Fortnite has very frequent updates. If it's no longer available in Apple's/Google's app stores, even if they can play it for now, they won't be able to as early as the next update. Unlikely the lawsuit will be resolved any time before then.

Adam Reynolds 8 months ago Member's comment

Good point Andrew, but even if players are angry at Apple/Google, what are they going to do about it? Had only Apple banned Fortnite, it may have caused millions of people to go out and buy an android device. But with Google following suit, what options are there?

Ayelet Wolf 8 months ago Member's comment

Agreed, what is the combined percentage of operating systems on tablets and mobile devices for Apple and Google? It must be like 98%? If they collude I do think there truly is an case for monopoly/collusion.

Marcy Brown 8 months ago Member's comment

Good insight Shelly, I hadn't thought about it like that.

Dick Kaplan 8 months ago Member's comment

Great thought provoking article, Shelly Palmer. But you are wrong because you overlooked one issue...

Yes, you are correct that #Apple and #Google can charge whatever percentage they want, just like a mall can charge rent. But the issue is that the mall can't forbid you to sell those your wares at your own store elsewhere for less.

Danny Straus 8 months ago Member's comment

Yes, that is an important distinction. I'll give Shelly Palmer another example to further that argument. I used to work at on online store and we also sold items on #eBay and #Amazon to get access to their millions of customers, just as app maker sell their apps on #Apple and Google's app stores. But we charged a little more on Amazon/eBay to cover the higher fees. Customers knew they could always buy them directly at our site for a bit less.

But Amazon and Ebay never said we were forbidden to sell items for less on our own site. That would be completely unfair in my mind. And it seems like there is some collusion between Apple and Google if this is their policy.

#fortnite $AMZN $EBAY $AAPL $GOOG $GOOGL