What Happened

Judge Yvonne Gonzalez Rogers handed down a decision in a closely-watched trial between Apple and Epic Games on Friday, issuing an injunction that said that Apple will no longer be allowed to prohibit developers from providing links or other communications that direct users away from Apple in-app purchasing.

The decision concludes the first part of the battle between the two companies over App Store policies and whether they stifle competition or not. Rogers did say that Apple was not monopolistic. Apple won on 9 of 10 counts but was found to engage in anticompetitive conduct under California law, and will be forced to change its App Store policies and loosen its grip over in-app purchases. The injunction will come into effect in December.

our take

Apple takes 15% to 30% of the gross sales on those in-app purchases, which is SUPER HIGH. It’s also perfectly within their rights to do it. The issue was that it banned Epic Games Fortnite for circumventing that, which is SUPER WRONG. Bottom line is that Apple should still generate plenty of revenue from its in-app purchases but when a company gets big enough, it will have to negotiate to get those fees down. Just like payment processors negotiate to lower fees for companies with large sales volume. There was surely a number that both companies could’ve agreed upon.

In a win for big app store brands everywhere, Epic Games will still have to pay Apple 30% of all revenue it collected from iOS Fortnite through direct payments until the rule takes effect.