Judge looks at Apple App Store policies at end of Epic trial

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Legal workers carry documents for the federal Epic Games court case against Apple in the Ronald V. Dellums building in Oakland, California. Epic, the maker of the Fortnite video game, accuses Apple of turning its App Store into an illegal monopoly. (AP Photo / Noah Berger)

AP

The judge who will decide a case contesting Apple’s control over its iPhone app store said Monday that she wanted to promote more competition but without dismantling a commission system that is harvesting billions of dollars for the technology powerhouse.

U.S. District Judge Yvonne Gonzalez Rogers is unlikely to render a ruling until this summer. But she opened a window to her thoughts in a three-hour session with lawyers for Apple and its opponent, Epic Games, on the final day of a three-week trial in Oakland, Calif.

Gonzalez Rogers’ series of questions suggested that she sided with much of the defense Apple has put in place to justify the 15% to 30% commissions it collects for in-app transactions on the Internet. iPhone to help pay for the technology powering its devices.

Epic Games, the creator of the popular Fortnite video game, has tried to prove that the fees are the pricing tool of a monopoly hatched in the “walled garden” that Apple has built around the iPhone, the App Store, its software and other devices. like the iPad and iPod.

To release tight control over Apple, Epic wants Gonzalez Rogers to issue an order that would force Apple to open up the iPhone and its other mobile products to competing app stores. These alternatives would include the still unprofitable Epic app store, which only charges a 12% commission.

Apple’s App Store, on the other hand, has become much more profitable than its late co-founder Steve Jobs ever imagined when he opened it 13 years ago. How profitable was not revealed during the trial, although an Apple executive admitted that the company made at least $ 20 billion in June 2017.

Gonzalez Rogers doesn’t seem to believe the charges are unreasonable, let alone illegal. This is in part because Apple’s commissions mirror those charged on in-app commissions by the App Store powering around 3 billion devices powered by Google’s Android software, as well as those imposed by the major ones. video game consoles – Sony PlayStation, Microsoft Xbox and Nintendo. Switch.

The judge also appeared to support Apple’s right to maintain a tightly controlled product ecosystem that has convinced consumers around the world, including those paying more than $ 1,000 to buy an iPhone.

“Your wording seems to ignore the reality that customers choose an ecosystem,” Gonzalez Rogers told Epic’s attorney Gary Bornstein. “Apple’s business strategy is to create a particular type of ecosystem that is incredibly attractive to buyers, to its consumers. So if these consumers choose to enter an ecosystem… that’s what you know you’re buying into. ”

Bornstein countered that most consumers do not understand how locked into Apple’s ecosystem they will be and often pay little attention to the costs of in-app purchases which are minimal compared to the price of an iPhone.

That still hasn’t seemed to convince Gonzalez Rogers that Apple is operating as a monopoly, but other statements have made it clear that she may still find the company engaging in anti-competitive behavior. At times in the trial, it appeared to be hampered by a provision in Apple stores that prohibits in-app notifications that purchases can also be made through web browsers and other means that are outside of commission’s fees. Apple.

Apple claims that allowing in-app links to other payment options besides its own would expose iPhones and other mobile devices to security and privacy threats. Faced with tough questions from Gonzalez Rogers during his four-hour witness stand on Friday, Apple CEO Tim Cook also admitted that allowing in-app links to other payment options would decrease costs. company profits.

The judge revisited the question during Monday’s sitting. At one point, she wondered aloud if Apple could just allow apps to insert a notice reminding consumers that payments can be made in web browsers, without posting a direct link to the payment stand. That kind of advice, she thought to herself, wouldn’t be much different from a merchant’s display of the various credit cards – Visa, Mastercard, America Express, or Discover – which has long been a staple in cash registers. .

During their closing arguments, lawyers for Epic and Apple each made dramatic presentations in an attempt to get Gonzalez Rogers to see things their own way.

Bornstein has repeatedly claimed that Apple is trying to present itself as a “benevolent overlord” acting in the best interests of consumers and developers of the 1.8 million apps currently in the store, up from just 500 in 2008. “But it is not enough to say it. , “We’re a great company, we’re doing well and we’re a nice guy,” Bornstein said.

Apple attorney Richard Doren reminded the judge that opening the iPhone to other app stores would weaken a security system that protects both consumers and developers. Epic “wants Apple to drop its gloves, stand in the middle of the arena, and tackle malware attacks through unexamined applications,” Doren said.

Gonzalez Rogers said last week that she hoped to make her decision by August 13. But Monday warned she might need even more time to review thousands of pages of information submitted over the course of the case.


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