Summary:
Epic Games secured a partial legal victory against Google and Apple in Australia’s Federal Court, with Justice Jonathan Beach ruling the tech giants violated competition laws by abusing their app store market dominance. The court found their practices substantially lessened competition through restrictive developer contracts and technological barriers. While Epic’s claims of unconscionable conduct were dismissed, the decision marks a significant antitrust challenge to the 30% “app tax” model. This ruling adds momentum to Epic’s parallel lawsuits in U.S. and UK courts, stemming from Fortnite’s 2020 expulsion after implementing direct payments.
What This Means for You:
- Developers gain negotiation leverage: Use this precedent to challenge platform fees when negotiating app store terms
- Prepare for payment alternatives: Investigate third-party payment processors for future implementation
- Monitor precedent cascades: Track similar cases in jurisdictions like U.S. appeals courts for global strategy implications
- Cautious optimism required: Anticipate prolonged appeals and potential regulatory fragmentation across markets
Original Post:
MELBOURNE, Australia — Epic Games, the company behind the popular online game Fortnite, won a partial victory in an Australian court in U.S. billionaire chief executive Tim Sweeney’s claim that Google and Apple engaged in anti-competitive conduct in running their app stores.
Federal Court Justice Jonathan Beach on Tuesday upheld key parts of Epic’s claim that the tech giants breached Australian competition laws by misusing their market power against app developers and using restrictive trade practices.
Google and Apple’s dominance of the app market had the effect of substantially lessening competition and breached Australian law, Beach found.
The litigation began in August 2020 when Apple’s App Store and Google’s Play Store expelled Fortnite because Epic installed a direct payment feature in the extraordinarily popular game.
Epic posted online that the judgment was: “Another HUGE WIN for Epic Games!” Apple disputed parts of the ruling, while Google stated it would review the 914-page judgment with potential appeals pending.
Extra Information:
- ACCC Regulatory Analysis – Explains Australia’s Competition and Consumer Act violations
- Global Antitrust Implications – Details potential ripple effects across digital markets
People Also Ask About:
- Does this ruling apply outside Australia? No, but it creates persuasive precedent for other jurisdictions.
- Will app prices decrease for consumers? Possibly if reduced platform fees translate to developer savings.
- What happens during the appeals process? Google/Apple must post bonds but can maintain current operations.
- How does this affect other antitrust cases? Strengthens claims about platform gatekeeper power in digital markets.
Expert Opinion:
“This ruling represents a seismic shift in app ecosystem governance,” notes antitrust scholar Dr. Katherine Van der Lee. “By validating the ‘walled garden’ as anti-competitive, it threatens the fundamental economics of platform capitalism and could accelerate legislative actions like the EU’s Digital Markets Act globally.”
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