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Apple Reverses Course and Allows Epic Games to Establish Rival iPhone App Store in Europe
Apple has reversed course and granted Epic Games permission to establish an alternative app store for iPhones in Europe. The decision comes after Epic Games violated Apple's rules in the U.S., leading to an antitrust lawsuit. The implementation of the Digital Marketing Act in the European Union paved the way for other companies to compete with Apple's App Store.
In a surprising turn of events, Apple has yielded to regulatory pressure and granted permission to Epic Games, a prominent video game maker, to establish an alternative app store for iPhones in Europe. This decision marks a significant development in the ongoing feud between Apple and Epic Games, centered around the distribution of iPhone apps and the associated transaction fees.
The reversal by Apple comes after Epic Games brazenly violated Apple's rules in the United States last year, leading to an antitrust lawsuit that accused Apple's App Store of monopolistic practices. Although a federal judge largely rejected Epic's claims in a trial earlier this year, the dispute between the two companies has persisted.
Previously, Apple had denied Epic Games' request to create an account that would enable them to operate an alternative app store for iPhone downloads. Apple has maintained exclusive control over this aspect for over 15 years. However, the implementation of the Digital Marketing Act (DMA) in the European Union this week has opened the door for other companies to compete with Apple's App Store. Epic Games wasted no time in seizing this opportunity.
Epic Games CEO, Tim Sweeney, has accused Apple of deliberately obstructing their efforts to establish an app store in Europe as retaliation for challenging Apple's lucrative revenue model. Apple currently collects commissions ranging from 15% to 30% on digital transactions within iPhone apps, generating billions of dollars in annual revenue. This fee structure has faced criticism from Epic Games and other companies, who argue that it amounts to monopolistic price gouging.
European regulators expressed concerns that Apple's rejection of Epic Games' application to set up an app developer account in Europe, based in Sweden, could potentially violate the DMA. This raised the possibility of a substantial fine for Apple. However, Apple did not explicitly mention the regulatory approval in their statement, simply stating that they are now satisfied that Epic Games will comply with their rules.
Tim Sweeney praised the swift action taken by regulators to rein in Apple, hailing it as a victory for European rule of law and the freedom of developers worldwide to voice their concerns. Despite this positive outcome, the animosity between Apple and Epic Games is far from resolved. Apple is currently seeking over $73 million from Epic Games to cover its fees in the U.S. antitrust case related to the App Store. A hearing on this matter is scheduled for later this month.
Apple has reversed course and granted Epic Games permission to establish an alternative app store for iPhones in Europe.
The decision comes after Epic Games violated Apple's rules in the U.S., leading to an antitrust lawsuit.
The implementation of the Digital Marketing Act in the European Union paved the way for other companies to compete with Apple's App Store.
Source: AP NEWS