• September 27, 2021

Exclusive: Apple Risks Losing Billions of Dollars Annually From Ruling

 Exclusive: Apple Risks Losing Billions of Dollars Annually From Ruling

Mark Gurman, reporting on Friday’s ruling in Apple and Epic lawsuit: So how much does Apple stand to lose? That all comes down to how many developers try to bypass its payment system. Loup Venture’s Gene Munster, a longtime Apple watcher, put the range at $1 billion to $4 billion, depending on how many developers take advantage of the new policy. Apple depicted the ruling as a victory, signaling that it’s not too worried about the financial impact. “The court has affirmed what we’ve known all along: The App Store is not in violation of antitrust law” and “success is not illegal,” Apple said in a statement. Kate Adams, the iPhone maker’s general counsel, called the ruling a “resounding victory” that “underscores the merit” of its business.

Apple’s adversary in the trial — Epic Games, the maker of Fortnite — also contended that the judge sided with Apple. This “isn’t a win for developers or for consumers,” Epic Chief Executive Officer Tim Sweeney said on Twitter. […] Apple made about $3.8 billion in U.S. revenue from games in 2020, most of which came from in-app purchases, according to estimates from Sensor Tower. But even if the ruling ends up costing Apple a few billion dollars a year, that’s still a small fraction of its total revenue. In fiscal 2021 alone, the company is estimated to bring in more than $360 billion, meaning the change won’t make or break its overall financial performance. And many developers may choose to stick to Apple’s payment system so they don’t have to build their own web payment platform.
More concerns were shared by the EFF in a thread on Twitter. “Disappointingly, a court found that Apple is not a monopolist in mobile gaming or in-app transactions, so its App Store commissions don’t violate antitrust law. One bright spot: the court found Apple’s gag rules on app developers violate California law…

“The court’s opinion spells out many serious problems with today’s mobile app ecosystem, such as false tensions between user choice and user privacy. Congress can help with real antitrust reform and new legal tools, and shouldn’t let Apple’s privacywashing derail that work.”

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