The U.S. Supreme Court has declined to hear appeals by both Epic Games and Apple in their enormously costly and long-running legal battle over Apple’s App Store fees — a move that’s likely to frustrate both companies, but that does leave Epic with a partial victory.
According to Reuters, the Supreme Court justices gave no reason for declining to hear the appeals.
Epic and Apple have been at war for years over Apple’s refusal to allow developers to circumvent its App Store for downloads and in-app purchases on iPhones and iPads. Apple takes a reported 30% cut on all purchases made through its storefront (as do other platform holders like Nintendo and Valve). Epic (which has brought a similar case against Google, with more success) claims this is anticompetitive and violates antitrust laws. The legal battle has resulted in Fortnite being unavailable on iOS devices since August 2020.
The Supreme Court’s refusal to get involved effectively upholds a 2021 decision by U.S. District Judge Yvonne Gonzalez Rogers, subsequently upheld in 2023 by the 9th U.S. Circuit Court of Appeals. The decision rejected Epic’s claims that Apple was acting as an illegal monopoly, but ruled that Apple was violating the law by not allowing developers to include links to make payments on the web, outside Apple’s ecosystem.
Allowing developers to circumvent the App Store for payments could cost Apple a fortune in revenue. Bloomberg reports that in-app spending is forecast to reach $182 billion in 2024. Apple shares fell 2.6% on the news.
Even if it’s not the crushing victory Epic wanted, allowing developers to offer alternative options for in-app payments is an important step in breaking open iOS to more competition. And it’s just the start — Apple and Google’s app store practices are facing significant antitrust challenges in the European Union, too.
Microsoft, for one, sees the opening up of Android and iOS as a foregone conclusion. It’s planning to launch an Xbox-branded mobile storefront for games in which its acquisition of Activision Blizzard will play a key role.