While there wasn’t a ton of news on the markets, there was one interesting development that made headlines across all the top financial outlets. Both Apple (NASDAQ:APPL) and Google (NASDAQ:GOOG) ended up kicking off Epic Game’s top product, the widely popular game called Fortnite, off of its platforms.
The move, which was announced by both companies seemingly in unison, came as a surprise to most people following the markets. In response, Epic Games announced that it would be suing Apple over this move, with possible legal actions to come against Google as well.
The announcement from Google and Apple had to do with Epic Games has introduced a new way to make in-game purchases that bypasses the 30% cut that these platforms ask for. Both company’s app stores have a policy where 30% of all app transactions would be paid to the respective owners of the platform. While Fortnite is technically a free-to-play game, the majority of the revenue is generated through in-game purchases. Since its release back in 2017, Fortnite has found over 350 million registered players since then, making it one of the most popular games out there.
Both Google and Apple went on to say that they saw Epic’s decision to bypass their transaction fee as violating their policies, hence the removal of the game. The two tech companies also went on to say that they were willing to work out this issue with Epic games if the game developer is willing.
In response, Epic Games announced it would be filing a lawsuit against Apple, going on to say that “Apple’s removal of Fortnite is yet another example of Apple flexing its enormous power in order to impose unreasonable restraints and unlawfully maintain its 100% monopoly over the iOS In-App Payment Processing Market.”
Considering the amount of scrutiny large tech companies have received recently, this line of attack could hold a lot of sway among both judges and lawmakers alike. Just recently, the CEOs of Apple, Google, Facebook, and Amazon were all called to testify before Congress on the power that large tech companies hold in our economy. Taking this into account, Epic has a good chance of doing reasonably well in a court if things escalate to this level.
Both Apple and Google’s stocks weren’t affected that much by the news, with shares of both companies relatively unmoved in after-hours trading. Both companies have done exceptionally well for themselves since the start of 2020, a trend that looks like its going to continue for quite some time.
Apple Company Profile
Apple designs a wide variety of consumer electronic devices, including smartphones (iPhone), tablets (iPad), PCs (Mac), smartwatches (Apple Watch), and TV boxes (Apple TV), among others. The iPhone makes up the majority of Apple’s total revenue. In addition, Apple offers its customers a variety of services such as Apple Music, iCloud, Apple Care, Apple TV+, Apple Arcade, Apple Card, and Apple Pay, among others. Apple’s products run internally developed software and semiconductors, and the firm is well known for its integration of hardware, software and services. Apple’s products are distributed online as well as through company-owned stores and third-party retailers. The company generates about 40% of its revenue from the Americas, with the remainder earned internationally. – Warrior Trading News