News: U.S. Federal Judge and Epic Games Contest Whether Apple is Compliant with Order to Allow the use of payment steering -
A hearing on the evidence in the Epic Games v. Apple case will determine whether Apple really has complied with the U.S. District Judge Yvonne Gonzalez Rogers' order for developers of apps to "steer" users towards third-party payment methods that are not available in the native App Store.
The evidentiary hearing regarding Apple's subsequent compliance began on Wednesday, May 8. AP says that judge Gonzalez Rogers " questioned whether Apple is putting an array of unnecessary obstacles in order to prevent from using other payment options in iPhone apps," regardless of the court's directive.
Hearing Focused on Whether Apple Policy Is Still Anti-Steering
The AP report further states that Judge Gonzalez Rogers' tone suggested Apple's implementation has primarily focussed on preserving Apple's profits, rather than complying with the purpose of her ruling to permit steering and increase iPhone users' ability move easily between different payments in the app. The piece explains that, according to Epic documents, Apple is still blocking the developers from directing consumers towards other payment methods with less expensive options.
The AP article continues that in the course of the hearing Apple chief executive of the iPhone App Store, Matthew Fischer explained that Apple has only received approval for applications to use 38 apps to display links to other payment systems, "a fraction of the approximately two million iPhone apps available within the U.S."
PC Mag points out that the low number of applications (38 out of the 65,000 app developers that offer in-app purchases -- is likely due to cost as the 27 percent Apple fee and the additional cost of credit card charges will likely lead to a more expensive overall price for app developers.
Apple Executive 'Unaware' of Higher Overall Cost Issue
An LAW360 article that ran on Friday, May 10 describes the proceedings in which Epic attorney Yonatan Even and the judge Gonzalez Rogers questioned Apple Finance Vice President Alex Roman. Even pointed out the lower cost of 3% from Apple -- 27 percent on transactions made without an app installed on Apple devices as compared the usual $30 fee and Epic further provided proof that the cost for processing payments in the U.S. is 3.5% and a yoga application CEO who testified that he pays 3.5 percent to 6.5 percent fees for payment processing. Then, after Roman said he was not aware of the fact, Even reiterated that the purpose was to establish a fee that would allow companies to give users an affordable price. He also asked Roman if he understood that. Judge Gonzalez Rogers is quoted as stating to Roman that "'It seems like you made lots of decisions with little or no information or information,' she stated. It sounds like the intention was to keep ... your revenue you earned previously.'" Access the LAW360 report here.
We are pleased to see the Judge's Side with Epic
CEO David Nachman states that "We're delighted to have the judge agree in favor of Epic with respect to this dispute We're hoping that the court will order Apple to permit steering for app and game developers with no fees or limits. Its aim is to make it easier for the global marketplace for software and digital product companies, and we're joining our clients in celebrating the progress towards an open and accessible commerce experience for mobile."
Additional Antitrust Affidavit Against Apple Launched by US Justice Department
As well as in addition to the Epic Games case, the U.S. Justice Department launched an antitrust suit against Apple in the month of March 2024 in which it claimed that Apple is the sole monopoly in the smartphone market, including (among many others) in the area of electronic payment.