This week Epic Games CEO Tim Sweeney has provided the most stinging indictment yet of Apple and Google. He has labeled them as “gangster-style businesses” engaged in this illegal activity. Sweeney’s comments came during an American Economic Association/Y Combinator event Wednesday morning. The second focus was on competition, particularly the need for more competition for app distribution platforms.
Epic Games vs. Apple and Google
Sweeney’s remarks are made as Epic Games and Apple continue to fight in court for the future of the App Store rules. A recent court order forces Apple to at least partially open its platform to additional competition. This decision has huge ramifications for developers and consumers alike. Regardless of the outcome of the ruling, Apple has already moved to change its App Store’s percentage. They’ve cut all the fees and added a “core technology fee” set at 50 cents per install per year for apps with more than one million installs.
“The sad truth is that Apple and Google are no longer good-faith, law-abiding companies,” Sweeney stated, highlighting the disparity between their business practices and the principles of fair competition.
Epic Games, the company behind the popular game Fortnite and the widely used Unreal Engine, is keen on expanding its Epic Games Store. Yet, the store has run into challenges on both iOS and Android. For older back-catalog games, it’s been a great way to lure players over to the Epic Games Store on iOS. The platform’s biggest hurdle may be that 50-60% of users give up before successfully installing the software. In Europe, users who try to install the store are met with a warning that could scare off new customers. Additionally, thanks to Apple’s monopolistic and draconian App Store regulations, the Epic Games Store doesn’t even exist in the U.S.
Issues with App Installations on Android and iOS
Now on Android the story is similar to iOS. Even the Epic Games Store gives users a warning that it’s from an “unknown source.” This alert not only acts to inform them of the fact that it is doing potentially harmful things to their devices. This has quite the opposite effect of producing a high drop-off rate of potential users trying to download the app.
Sweeney specifically condemned the practice of hawking consumer data by the big tech companies. He further sounded the alarm on how our current fee structures penalize smaller developers. He noted that unless an app has very, very high ARPU (average revenue per user), it is a graveyard and disincentivizes the majority of free-to-play games. This negative sentiment speaks to the uphill battle that new and up-and-coming developers face. They are often finding it difficult to achieve in an app ecosystem that is controlled by a few powerful gatekeepers.
Epic Games has initiatives ongoing to sue both Apple and Google. The teens are asking for accountability over what they describe as monopolistic practices within the companies’ app stores. The catalog will be improved on Android and iOS with developer submissions to open later this year. Their goal is to make their store’s selection more reflective of their community.
In terms of federal legislation, the legal landscape is shifting quickly. Yet Sweeney’s remarks convey the urgently growing desire among developers for a more equitable, inclusive, and democratic tech industry. Future precedents Depending on the outcome of Epic Games’ legal battles, future app marketplace policies could be set in stone.
What The Author Thinks
Sweeney’s criticisms are a timely reminder of the broader issues of monopolistic practices in the tech industry. While platforms like Apple’s App Store and Google Play offer developers a gateway to large audiences, they also impose stifling regulations and fees that disadvantage smaller players. A more competitive and transparent approach is needed to ensure that developers can thrive without being subject to exploitative terms.
