Music Updates

Apple Ordered to Loosen Practices for In-App Purchases

In today’s ruling, U.S. District Court Judge Yvonne Gonzalez Rogers defines the market as digital mobile gaming transactions and finds that while Apple “enjoys considerable market share of over 55% and extraordinarily high profit margins, these factors alone do not show antitrust conduct.”

“Success is not illegal,” she adds. “The final trial record did not include evidence of other critical factors, such as barriers to entry and conduct decreasing output or decreasing innovation in the relevant market. The Court does not find that it is impossible; only that Epic Games failed in its burden to demonstrate Apple is an illegal monopolist.”

Largely finding Apple’s big commission cut to be ok, the judge gives Apple the win on its counterclaims and rules that Epic must pay 30 percent of all Fortnite revenue it’s collected since August 2020.

But Apple doesn’t walk away from this case unscathed because Rogers does find that Apple is engaging in anticompetitive conduct under California’s competition laws.

“The Court concludes that Apple’s anti-steering provisions hide critical information from consumers and illegally stifle consumer choice,” she writes. “When coupled with Apple’s incipient antitrust violations, these anti-steering provisions are anticompetitive and a nationwide remedy to eliminate those provisions is warranted.”

A permanent injunction will free some of the restrictions that Apple had placed on its developers, particularly in relation to communication on purchasing options.

Apple shares dipped sharply immediately upon the issuance of the ruling and was trading down 3% Friday. Epic, based in Cary, North Carolina, is a private company.

Here’s the full ruling.

This article was originally published by The Hollywood Reporter.

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