Back in August, Apple made news after it announced it had banned one of the top video games, Fortnite, from its app store. The issue revolved around the videogame developer behind Fortnite opting to sidestep the 30% commission that the Apple store charges by implementing its own in-game purchases. In response, Apple delisted Fortnite from its platform, and in turn, the developer, Epic Games, launched a lawsuit against the company. It now turns out that Apple has responded with its own counter lawsuit against Epic, complicating this issue even further.
Epic has gone on to claim that Apple and similar companies have far too much control over the world of smartphone apps. In response, Apple defended its actions in legal documents that were filed on Tuesday, with the company going so far as to act for punitive damages from the game developer in light of this drama. At the moment, a hearing is scheduled to take place on the 28th of this month, and while things remain uncertain as to how the court will rule, more people are placing their bets on Apple than on Epic Games, whose the underdog in this legal battle.
“Epic’s lawsuit is nothing more than a basic disagreement over money,” Apple stated in its filing on Tuesday, as reported by the Wall Street Journal. “Although Epic portrays itself as a modern corporate Robin Hood, in reality it is a multi-billion dollar enterprise that simply wants to pay nothing for the tremendous value it derives from the App Store.” Epic Games declined to comment on the matter, sticking to its original argument that Apple’s policies only lead to inflated prices for consumers while stifling competition.
The one thing going for Epic Games amidst this lawsuit is the fact that Apple is facing antitrust probes from regulators around the world. Specifically, its 30% fee structure is a hot topic that the company has defended in the past, saying that it’s more or less in line with the industry standard.
Shares of Apple ended up tumbling quite a bit on Tuesday, sliding down around 7%, a big decline for the world’s largest publicly listed company. A big reason why Apple’s stock fell so much was also due to a negative analyst rating from Goldman Sachs, which doubled down on its “sell” rating for the stock. Analysts at the investment bank suspect that the tech giant’s stock could fall by as much as 30% over the next year or two. While big tech stocks have been some of the best performing so far in 2020, it’s hard to see how giants like Apple can continue to grow at a rapid rate.
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
