Apple intensified its dispute with Epic Games, barring the Fortnite maker from introducing its online marketplace on iPhones and iPads in Europe.
The conflict stems from Epic’s objection to Apple’s 30% commission on in-app purchases, leading to a legal battle since 2020.
Epic’s latest move coincides with Apple’s challenges in China, where iPhone demand is weak. Despite underperforming compared to its U.S. counterparts, Apple’s shares remained stable on Wednesday.
Regulatory and competitive pressures, including Epic’s efforts to establish rival marketplaces on Apple’s devices, pose significant threats to the tech giant’s profits and ecosystem control.
European lawmakers are mandating Apple to permit third-party marketplaces under the Digital Markets Act (DMA), effective this week. Additionally, Brussels antitrust regulators fined Apple 1.84 billion euros ($2 billion) for impeding competition from music streaming rivals through App Store restrictions, marking Apple’s first EU penalty for rule violations.
Despite Epic’s attempts to leverage the DMA, Apple blocked its efforts on Wednesday, citing past contract breaches in their ongoing legal battle.
Apple terminated a new developer account created by Epic in Sweden. Epic established the account in an attempt to reintroduce Fortnite and other games to iPhones in Europe through its game store on Apple’s devices.
Under the new European law, Apple is mandated to permit third-party stores on its devices.
Developer accounts are crucial as software creators cannot distribute apps to iPhones and iPads without them.
In 2020, Apple had previously terminated some of Epic’s developer accounts after Epic deliberately violated Apple’s in-app payment rules. Epic used this violation and subsequent banishment from the App Store as the centerpiece of its public relations and legal campaign against Apple.
Apple stated on Wednesday that court rulings have affirmed its “sole discretion” to terminate any Epic Games developer account due to “egregious” breaches of the company’s developer agreements.
In response to Epic’s past and ongoing behavior, Apple opted to exercise its right to terminate Epic Games’ account. Epic contends that Apple, by terminating its account, is eliminating one of the Apple App Store’s largest potential competitors.
“This is a serious violation of the DMA and shows Apple has no intention of allowing true competition on iOS devices,” Epic Games said.
The European Commission, the executive body of the EU, did not promptly respond to a request for comment. In January, Apple proposed specific modifications before a March 7 deadline to adhere to certain conditions of the Digital Markets Act (DMA), legislation designed to facilitate European users’ transition between competing services.
The company pledged to permit alternative app stores on iPhones and offer an opt-out from using the in-app payments system.
However, Apple also introduced a “core technology fee” of 50 euro cents per user account per year for developers participating in the new regime.
