Apple’s compliance plan in the Epic case is insufficient, Meta and Microsoft tell the court

Apple is not complying with the letter or spirit of an order from a California federal judge in its lawsuit against Epic Games. Meta, Microsoft, Match Group and X told the court in an amicus brief on Wednesday.

Judge Yvonne Gonzalez Rogers told Apple in 2021 that it could not prevent app developers from using “buttons, external links or other calls to action” to inform users about payment options outside their apps. Epic and other developers have taken issue with Apple’s 15 to 30 percent fees on in-app purchases, which Apple makes difficult to avoid by preventing them from directing users to lower-price payment options outside the iOS ecosystem. Apple has defended the charges as reasonable compensation for its own services in the App Store.

But the companies that filed the brief Wednesday, all of which say they are subject to Apple’s rules to keep users away from its own payment processing, say Apple’s idea of ​​compliance would not solve the problem. The proposal to have developers refer to an external purchasing link is complex and cumbersome, the companies say.

“Apple’s new restrictions are clearly intended to make alternatives to Apple’s IAP impractical for developers, and inaccessible and unappealing for consumers, thereby circumventing both the spirit and underlying objectives of the ban,” the companies wrote in their letter.

Epic itself has asked the judge to enforce its original order, saying Apple is in “flagrant violation” of the ban. But it’s notable that other major developers, like Meta and Microsoft, have decided to do their part now and show that Apple’s rules can impact even the biggest tech companies.

The amici say Apple’s 12 to 27 percent fee on third-party purchases defeats the purpose of the new requirement because it is only a few percentage points lower than what developers would otherwise have to pay for in-app purchases. The external purchase costs could make it unrealistic for developers to even set up an external payment system, as other transaction costs they might incur through that route would offset the 3 percent profit they would make if they gave up the system of Apple, could destroy it. Furthermore, customers are unlikely to choose the third-party option if it is the same price or higher.

The companies explain how Apple’s in-app payment requirements impact them and how they could harm them and their users. For example, Meta says that in 2022, Apple decided to require Meta to pay the IAP fee for its product that allows advertisers to promote messages in their apps to reach more users. Meta says this change increases the cost of using the feature, which wouldn’t be the case if Meta could direct users to its own payment options.

When asked for comment on the amicus brief, Apple spokesman Fred Sainz pointed to the company’s statement of compliance with the court, saying it has “fully complied with the order” as of January 16. In that earlier filing, Apple said Epic “has never disputed” that “unregulated third-party payment links ‘will harm users, developers, and the iOS platform generally.’” That makes the requirements for the third-party payment links “necessary to protect users protect privacy and security, maintain the integrity of Apple’s ecosystem, facilitate the flow of information, avoid user confusion, and enable efficient review of developers’ apps by App Review,” Apple said.

Apple will have a chance to file a response before the injunction enforcement hearing on April 30.

Update March 20, 2024 4:40 PM: This story has been updated with a response from Apple.

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