Information: U.S. Federal Judge and Epic Games Contest Whether Apple has complied with the Order to Allow Payment Steering -
A hearing on the evidence of the Epic Games v. Apple trial is examining the question of whether Apple is in fact complying with U.S. District Judge Yvonne Gonzalez Rogers' order that allowed developers of apps the ability to "steer" users towards third-party payment methods outside of the app's native App Store.
The hearing on Apple's compliance with the law began on Wednesday, May 8. AP is reporting the judge Gonzalez Rogers " questioned whether Apple is putting an array of unnecessary barriers to discourage using alternative payment options in iPhone apps" regardless of the court's directive.
Hearing Focused on Whether Apple Policy is Still Anti-Steering
The AP report further states that the judge Gonzalez Rogers' tone suggested Apple's implementation has primarily focused on protecting Apple's own profits rather than ensuring that it is in line with the purpose of her order to allow steering, and improve iPhone users' ability to switch easily to different available payment methods in the app. The article points out that, according to Epic documents, Apple is still blocking developers from steering consumers to other payment options with less expensive choices.
The AP article continues that in the course of the hearing, the Apple director of the iPhone App Store, Matthew Fischer, disclosed that Apple had only accepted and approved applications for 38 apps that show links to other payment systems, "a fraction of the around 2 million iPhone applications available within the U.S."
PC Mag points out that this small number of apps 38 of the 65,000 app developers who offer in-app purchases- is likely due to costs because the 27 percent Apple charge plus the expense of credit card charges would likely result in a higher overall cost to developers.
Apple Executive 'Unaware' of the Higher Costs Issue
A LAW360 article that ran on Friday, May 10 details the day's events when Epic attorney Yonatan Even and Judge Gonzalez Rogers questioned Apple Finance Vice President Alex Roman. Even suggested the lower cost of 3% that is offered by Apple -- which is 27% for transactions taking place in an application that is not on Apple devices as compared the usual 30percent fee as well as Epic also provided evidence that the typical cost of processing payments across the U.S. is 3.5% and a yoga application CEO testifying that he pays 3.5 percent to 6.5% fees for payment processing. Following that, Roman said he was not aware of the fact, Even reiterated that the purpose was to establish an amount that allowed companies to give users an affordable price. He also asked Roman to clarify what he thought he knew about the significance of that. The judge Gonzalez Rogers is quoted as stating to Roman that "'It sounds like you all had a tendency to make decisions with no data or information,' she stated. It sounds like the intention was to keep ... the revenue you earned in the past.'" Access the LAW360 article here.
I'm glad to see Judge Side With Epic
The CEO David Nachman states that "We're delighted to have the judge agree with Epic in this case We're hoping that this court can force Apple to allow steering for app and game developers without fees and unnecessary restrictions. Its aim is to make it easier for global commerce for software and digital product firms, and we're joining our customers to celebrate the progress towards free commerce on mobile."
Additional Antitrust Affidavit Against Apple Launched by US Justice Department
In addition to being involved in the Epic Games case, the U.S. Justice Department launched an antitrust lawsuit against Apple in the month of March 2024 in which it claimed that Apple is the sole monopoly in the market for smartphones, which includes (among other things) on the subject of digital payments.