Epic Games files lawsuit against Apple after Fortnite is removed from the App Store

The popular video game Fortnite was removed from Apple’s App Store on Thursday, after Epic Games attempted to circumvent Apple’s 30% cut of in-app purchases.

In response, the Cary, N.C.-based video game maker filed a lawsuit against Apple, asking a court to order Apple to reinstate the game and declare the Apple fee illegal.

Google quickly followed Apple’s lead, pulling Fortnite from its Play Store. Fortnite will still be available on Android phones via a direct download from Epic Games, a feature that is not possible on iPhones.

In its legal filing, Epic said the removal of Fornite 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.”

The ban came after Epic released its own in-app payment system on Thursday that would have bypassed the fees taken by Google and Apple’s app stores.

The coordinated move and subsequent legal filing represent a significant uptick in the tensions between the two companies.

Epic’s founder and CEO Tim Sweeney has long railed against these fees as being exorbitant and an unfair business practice. Apple has come under fire recently, both in the U.S. and in Europe, over antitrust concerns related to its mobile marketplace.

In its release, Epic Games told its users that using the in-app payment system rather than Apple or Google’s would result in lower prices for them.

It offered 1,000 V-bucks — about $10 worth of Fortnite’s internal currency — for $7.99 if a player used the direct payment system. Using the normal Apple payment system, the same amount of V-bucks would cost $9.99.

In a statement to the website The Verge, Apple said it removed the game because it violated its App Store guidelines.

“Today, Epic Games took the unfortunate step of violating the App Store guidelines that are applied equally to every developer and designed to keep the store safe for our users,” the company wrote. “As a result their Fortnite app has been removed from the store. Epic enabled a feature in its app which was not reviewed or approved by Apple, and they did so with the express intent of violating the App Store guidelines regarding in-app payments that apply to every developer who sells digital goods or services.”

Apple added that Epic has benefited from the App Store for years, including the tools and distribution it offers to all developers.

“The fact that their business interests now lead them to push for a special arrangement does not change the fact that these guidelines create a level playing field for all developers and make the store safe for all users,” Apple said. “We will make every effort to work with Epic to resolve these violations so they can return Fortnite to the App Store.”

Google also issued a statement:

“The open Android ecosystem lets developers distribute apps through multiple app stores. For game developers who choose to use the Play Store, we have consistent policies that are fair to developers and keep the store safe for users. While Fortnite remains available on Android, we can no longer make it available on Play because it violates our policies. However, we welcome the opportunity to continue our discussions with Epic and bring Fortnite back to Google Play.”

It’s not the first time that Epic has tried to bend app stores to its will.

Epic Apple Complaint by Zachery Eanes on Scribd

Earlier this year, Fortnite finally returned to the Google Play Store after protesting that company’s 30% fee for 18 months.

While Fortnite is free to download, the company makes money from players who pay within the game to customize their characters’ weapons, appearance and signature dance moves.

That meant 30% of the money made within the app was going to Apple and Google. Epic had made Fortnite available to Android-supported phones via a direct download from Epic’s website to get around the Play store fee.

That wasn’t a feature available on iPhones, so Fortnite had always been available on the App Store — until today. While the game is still available on iPhones that have already downloaded it, users won’t be able to download new updates for the game. Eventually that could cause the game to become incompatible with new editions of the iPhone.

The amount of money at play is significant. Fortnite has become one of the most popular video games in the world, with around 350 million players. Fortnite brought in an estimated $1.8 billion last year alone, according to Nielsen’s SuperData.

In the past two years, the game has been downloaded onto iPhones and iPads more than 133 million times, bringing in $1.2 billion, The New York Times reported, citing the analytics firm Sensor Tower. That would put Apple’s cut at around $360 million, according to Sensor Tower.

Sweeney contends that the fees are illegal.

Last December, he said: “We believe this form of tying of a mandatory payment service with a 30% fee is illegal in the case of a distribution platform with over 50% market share.”

Epic also has its own game-download platform where developers can sell games to consumers. The Epic Games Store only collects 12% of sales from those games, and it allows developers to use their own in-game payment system if they wish.

Perhaps bolstering Epic Games as it confronts the tech giants, the company has seen a resurgence in popularity during the coronavirus pandemic, and it recently raised another billion dollars from investors.

The video game maker is now valued at $17.3 billion, by far the most valuable venture-capital-backed company in North Carolina. Sweeney, its founder and CEO, is edging closer to being the richest person in the state.

This story was produced with financial support from a coalition of partners led by Innovate Raleigh as part of an independent journalism fellowship program. The N&O maintains full editorial control of the work. Learn more; go to bit.ly/newsinnovate