A landmark ruling on Wednesday by Judge Yvonne Gonzalez Rogers of the U.S. District Court for the Northern District of California has ordered Apple to relax its restrictions on the App Store, concluding a significant five-year antitrust battle initiated by Epic Games. This decision challenges Apple’s practice of collecting commissions from app sales, potentially reshaping the digital economy.
Judge Gonzalez Rogers criticized Apple for evading an earlier court order, accusing CEO Tim Cook and other executives of misleading actions. In her previous ruling, she mandated Apple to permit apps to include external links for direct payments, bypassing the 30% commission fee Apple imposed. Despite this, Apple allegedly introduced a new mechanism, charging a 27% fee on external sales and deploying pop-ups to dissuade alternative payments, signaling a defiance of the court’s directive. “Apple sought to maintain a revenue stream worth billions in direct defiance of this court’s injunction,” she remarked.
The court’s latest decision prohibits Apple from collecting commissions on transactions made outside the App Store and restricts the company from discouraging external payment methods. Judge Gonzalez Rogers also urged the U.S. attorney’s office to examine Apple’s actions for possible criminal contempt.
This ruling represents a monumental win for Epic Games, possibly restructuring the app economy by increasing developer earnings while reducing Apple’s revenue stream. Tim Sweeney, Epic’s CEO, hailed the verdict as a breakthrough for both developers and consumers, suggesting that it would lead to better deals in the marketplace.
In a statement, Apple spokeswoman Olivia Dalton expressed strong disagreement with the court’s decision, stating, “We strongly disagree with the decision. We will comply with the court’s order, and we will appeal.” Following the news, Apple’s shares dipped by 1.5% after-hours.
Epic Games, creators of Fortnite, filed the antitrust lawsuit in 2020, alleging that Apple compelled developers to utilize its payment platform to maintain their presence on the App Store, from which Apple reaped up to 30% in commissions. The App Store is a significant component of Apple’s nearly $100 billion annual services revenue.
Although Judge Gonzalez Rogers previously stopped short of declaring Apple a monopoly in the market, she found the company’s practices violated California’s unfair competition laws by obstructing developers from offering alternative payment methods. Epic later contested Apple’s compliance, claiming the company devised new fees and regulations contrary to the ruling.
Documents revealed that internal discussions at Apple focused on maintaining high commission rates. Phil Schiller, Apple’s App Store overseer, initially suggested eliminating the commission, but CFO Luca Maestri argued for a 27% fee, with CEO Tim Cook concurring. Additionally, the documents disclosed Cook’s proposal to present “scare” notifications to users opting for external payment options, warning of compromised security standards.
“Apple knew exactly what it was doing and at every turn chose the most anticompetitive option,” Judge Gonzalez Rogers stated, emphasizing that Apple executives had “outright lied under oath.”
This significant verdict could profoundly impact developers and the broader mobile applications industry, shining a light on the ongoing tensions around antitrust laws and competition issues in tech.
Original Source: https://www.nytimes.com/2025/04/30/technology/apple-epic-app-store-ruling.html
Category : Apple Inc,Epic Games,Gonzalez Rogers, Yvonne (1965- ),Cook, Timothy D,Sweeney, Tim (1970- ),Mobile Applications,Decisions and Verdicts,Antitrust Laws and Competition Issues,Computer and Video Games,Regulation and Deregulation of Industry,Mobile Commerce and Payments,Suits and Litigation (Civil)
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Publish Date: 2025-05-01 07:25:00
