Changing Apple's App Store model would suck for everyone except Epic Games
Hackers at Magecart are rubbing their grubby hands together at the thought of Apple allowing third-party payments
Challenging Apple's ridiculous 30% cut is one thing. But ending the App Store model would end the level playing field for developers and leave users open to fraud.
Yesterday, Apple booted Fortnite from its App Store after Epic Games added its own payment scheme to get around Apple's 30% fee.
Epic instantly shot back with a pre-prepared 64-page legal filing and a spoof of Apple's iconic 1984 commercial, which it dubbed 'Nineteen Eighty Fortnite'.
But in the court filing, Epic has stated that it is not looking for financial compensation. It wants 'fair competition':
"Epic is seeking injunctive relief to allow fair competition in these two key markets that directly affect hundreds of millions of consumers and tens of thousands, if not more, of third-party app developers," it said.
Now, it looks like Google has booted Fortnite off the Play Store for the same reason -- and Epic has shot back a similar lawsuit, using Google's own "Don't Be Evil" mantra against them.
The opening of Epic's Google lawsuit reads:
In 1998, Google was founded as an exciting young company with a unique motto: “Don’t Be Evil”. Google’s Code of Conduct explained that this admonishment was about “how we serve our users” and “much more than that . . . it’s also about doing the right thing more generally”. Twenty-two years later, Google has relegated its motto to nearly an afterthought, and is using its size to do evil upon competitors, innovators, customers, and users in a slew of markets it has grown to monopolize.
This isn't the first time a tech company has caused a stink with Apple over its 30% "Apple tax".
Basecamp set the stage back in June when it launched its Hey email app without an in-app purchase option -- but after some intense back and forth, they settled. I wrote back then about how this was an obvious marketing tactic. "Picking a fight" was literally one of their key principles in their own marketing book.
That's why I was dubious when I heard about Epic Games picking a fight with Apple yesterday. "Standing up for the indie developer" sounds great in theory, but you don't go to the trouble of writing huge low suits and creating an entire spoof commercial unless you're getting something from it.
Well, it looks like Epic isn't fighting for the extra 30% of Fortnite sales...it's looking for a cut of everyone else's
According to an excerpt from its Apple lawsuit, Epic wants to "provide a competing app store on iOS devices":
First off, the very idea of a "competing app store" sucks.
There's a reason Apple and Google's app stores are so popular -- they're easy to use. Having tons of app stores would be an awful user experience that would force users to go back to slogging through Google to figure out where the heck they should go to download the app they need. Even a 100% cut means nothing if nobody actually downloads your app because they can't find it.
It doesn't stop there. Epic stipulates that users should be given the choice to "use Epic's or another third-party app's in-app payment processing tool."
At a glance, it seems to make sense. Using third-party payment processors would be way cheaper than using Apple or Google. For context, cuts from third-party payment processors can be as low as ~2%, vs. Apple and Google's hefty 30%.
But allowing every app to set up its own third-party in-app payment processing tool wouldn't just be an awful user experience -- it would be incredibly dangerous. Who wants to trust a tiny, unknown developer with their credit card details? Hard pass.
Big brands -- like Epic Games, for example -- would be fine. But it would be the end of the level playing field for smaller businesses.
The problem with using third-party payment processors
While Apple and Google have wildly inconsistent policies for their stores -- Netflix got a free pass from paying Apple Tax on its $853 million U.S. annual iOS revenue back in 2018 -- their payment features are a major asset for developers.
Credit card-stealing malware is already a huge problem. If anyone could link to their own third-party checkout page, Hacker groups like Magecart would shit themselves with excitement. Every checkout page would have to be manually checked.
It would be a huge ask for users to unknown developers with side payments. And Epic certainly isn't a shining example. Its game Fortnite has been described as a 'money laundering paradise', with money launderers using stolen credit cards to buy V-bucks.If third-party side payments were allowed and credit card fraud became a problem --and make no mistake, it would become a problem -- Apple and Google would have zero transparency.
It's right for huge platforms to reduce the huge cuts they take from developers -- but opening up third-party payments is a recipe for disaster.
Desperate for more from Pando? Sign up to our newsletter!