Epic Games Complaint vs Google Ties in Apple Search Deal
Fortnite developer Epic Games has been engaged in a heated legal battle with both Apple and Google over anti-competitive practices ever since its prized game was removed from both the App Store and the Google Play Store last year.
After Epic Games tried to cut Apple and Google out of their respective commissions on in-game purchases made by Fortnite players, the developer incurred the collective wrath of both tech giants. Since then, Epic Games has been on a mission to prove antitrust violations against Apple and Google that spans multiple continents.
In an amended complaint against Google filed by Epic Games on Thursday, the developer accuses Google of ‘going easy on the competition’ for mutual gain, alleging that Google’s multi-billion dollar a year search deal with Apple has left the former with no incentive to compete with Apple for market share on the smartphone OS level — reports iMore.
While Epic Games’s first complaint was apparently “more than sufficient”, the developer has decided to up the pressure regardless.
The amended lawsuit not only accuses Google of trying to achieve and maintain a monopoly in the Android space, among other anti-competitive practices, but also questions how Google’s highly lucrative deal with Apple to be the default search engine for Safari, Apple’s resident internet browser that comes pre-loaded on all Apple devices, affects competition between the two companies.
Up until iOS 14, Safari was also the default internet browser on iPhones and could not be switched with an alternative. While Apple and Google command 99% of the smartphone Operating System market together, Epic Games says that the search deal between the two means that Google has no real incentive to try and get iOS users to switch to Android.
As part of the deal, Google pays Apple a significant percentage of revenue generated from searches originating from iOS devices. In 2012, Apple made over $1 billion USD from the arrangement. The figure had grown to $9 billion USD by 2018, and only went up from there.
Epic Games’ amended lawsuit states:
Moreover, the close relationship that Google maintains with Apple further reduces Google’s incentive to compete, innovate, and invest in app distribution because Google benefits by cooperating with its “competitor” Apple… For example, for over 15 years, Google has maintained an agreement with Apple whereby Google pays Apple a significant percentage of revenue derived from searches run on iOS devices—an estimated $8-12 billion per year in recent years, according to the U.S. Department of Justice—in exchange for Apple making Google Search the default search engine on the Safari browser.
Epic Games goes on to insinuate that Google derives so much revenue from the search deal with Apple that it sees no reason to put more of an effort into capturing smartphone market share from the iPhone maker than it already does.
If it did not profit significantly from searches on iOS devices, Google might be more incentivized to, among other things, differentiate its Android platform from Apple with respect to the commissions it charges on app transactions. If Android competed with iOS on app transactions, the market competition would make Android apps cheaper for users and attract developers to launch their apps first (or even only) on Android. Instead, Google and Apple are cozy duopolists, offering virtually the same terms to developers and changing those terms in tandem (if at all).
Epic Games has gone one step ahead of accusing Google and Apple of anti-competitive practices in their own mobile platforms as it was previously doing, claiming that the pair have together developed a duopoly over the smartphone market as a whole.
In response to the lawsuit, Google said the following in a statement:
The open Android ecosystem lets developers distribute apps through multiple app stores. For game developers who choose to use the Play Store, we have consistent policies that are fair to developers and keep the store safe for users. While Fortnite remains available on Android, we can no longer make it available on Play because it violates our policies. We will continue to defend ourselves against these meritless claims.