Epic has launched a Fortnite tease that is tweaking Apple’s nose about new rules set to come into force in the EU. The brief clip shows Peely, the Fortnite banana mascot, floating backwards into the void while making the “I’m watching you” gesture with two fingers. It adds a shoutout to the EU’s new Digital Markets Act (DMA) and adds “Apple, the world is watching.”
This is the latest stage in a global faceoff between Apple and Epic as the Fortnite developer (and platform holder) battles to open up the walled garden that is iOS. Epic’s attempts in the US mainly ended in failure, but in the EU it’s a different story and the DMA means Apple must allow customers to access thirdparty app stores and payment methods. The DMA is not just about Apple but all large tech companies that act as gatekeepers to online services, and aims to make it easier for companies to compete on large storefronts without having to jump through hoops that solely benefit the platform-holder.
Epic has used Fortnite symbolically throughout this fight, withdrawing it from the App Store in 2020 (with an advert parodying Apple’s classic 1984 commercial). In its various actions Epic has argued that Apple operates an anti-competitive monopoly that gives developers and players no choice but to go through iOS and cough up 30% commission.
For its part, Apple has announced how it intends to comply with the provisions of the DMA and the chutzpah is kind of amazing: among other things it is demanding install fees above a certain number of users, and that developers wishing to use their own payment services provide a stonking proof of credit. Tim Sweeney, CEO of Epic Games and a man never shy of sharing his opinions, is positively fulminating at what looks like a bad faith attempt to skirt the EU’s demands.
“Apple’s plan to thwart Europe’s new Digital Markets Act law is a devious new instance of Malicious Compliance,” thunders Sweeney. “They are forcing developers to choose between App Store exclusivity and the store terms, which will be illegal under DMA, or accept a new also-illegal anticompetitive scheme rife with new Junk Fees on downloads and new Apple taxes on payments they don’t process.”
Sweeney is referring here to a new developer charge of $0.50 for every install an app has above the one million mark: even if that app is free to the end user. He says Apple’s “twisting this process to undermine competition and continue imposing Apple taxes on transactions they’re not involved in.
“There’s a lot more hot garbage in Apple’s announcement. It will take more time to parse both the written and unwritten parts of this new horror show, so stay tuned.”
Sweeney is not alone in his incredulity at what Apple is proposing here. A particular bone of contention is the requirement that, if you wish to process payments via a thirdparty store on iOS, you’ll first have to provide a €1,000,000 letter of credit, which obviously precludes the vast majority of developers from ever doing so. Incidentally this led to a rather sweet anecdote from Sweeney, who recalled that “Epic was founded with a few thousands dollars in funds that I earned through mowing lawns” and such rules would obviously stop this kind of startup from competing in any meaningful way.
“Under what possible theory of antitrust regulation is it acceptable for a monopoly to decide what companies are allowed to compete with it, and on what terms they can compete,” asks Sweeney. “Apple makes a mockery of free market competition.”
