Epic Games case: Apple to argue it faces competition in video game market
By Stephen Nellis
(Reuters) - Apple Inc said it
plans to argue that it faces abundant competition in the market for video game
transactions to defend itself against antitrust allegations by
"Fortnite" maker Epic Games, the iPhone maker said on Thursday.
Epic sued Apple last year in
federal court in California, alleging the 15% to 30% commissions that Apple charges for the
use of its in-app payment systems and Apple's longstanding practice of
exercising control over which apps can be installed on its devices amount to
anticompetitive behavior. The dispute arose after Epic tried to implement its
own in-app payment system in the popular "Fortnite" game and Apple
subsequently banned the game from its App Store.
The case is to be heard in May in Oakland, California, by U.S.
District Judge Yvonne Gonzalez Rogers, who will have to rule on which notion of
a "market" is the correct one for analyzing Apple's moves for signs
of anticompetitive conduct.
Epic has framed its case around the idea that Apple's iPhones,
with an installed base of more than 1 billion users, represent their own
distinct market for software developers. Epic has argued that Apple has monopoly
power over that market because it decides how users can install software on the
devices and says it abuses that power by forcing developers to deliver their
software through the App Store, where developers are subject to fees on some
transactions.
In a filing that Apple planned to make Thursday, the company
rejected that notion and said the proper market to analyze the case is the
video game transaction market, which includes platforms such as Nintendo Co Ltd
and Microsoft Corp's Xbox gaming consoles, which also limit the software that
can run on their hardware and charge fees to developers.
Apple said it plans to argue that consumers have many choices on
how to carry out video game transactions, including purchasing virtual tokens
from game developers on other platforms such as Windows PCs and using the
tokens on iPhones with no fees to the game developer.
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