Apple Just Seriously Upped the Stakes in Its ‘Epic’ Fight with Fortnite

Apple is digging its heels in even further in its war with Epic Games — a war that the Fortnite developer started last week when it snuck an end-run around Apple’s in-app purchasing system into its popular game app, effectively forcing Apple to respond to the flagrant violation of its App Store guidelines.

Make no doubt about it, the whole thing was a carefully — and cleverly — calculated move on Epic’s part, since it knew that there was no way Apple was going to let the violation slide, and Epic already had its guns loaded for Apple’s expected response, with a detailed lawsuit ready to go, accompanied by a clever marketing campaign that threw Apple’s iconic 1984 ad right back in its face.

There was basically zero chance that Apple would have ever taken Epic’s actions lying down, as the introduction of Epic’s own in-app purchasing system was no accident, but rather a deliberate attempt to poke the bear. Apple has spent years vociferously defending its App Store Guidelines, so pretty much everything the company did last week was exactly what anybody would have expected it to do.

Except that now Apple is seriously raising the stakes in this fight with Epic.

In a move that shows a level of brass that’s surprising even for Apple (especially in light of how much antitrust scrutiny the iPhone maker is currently facing), it seems that the company is now threatening to invoke the thermonuclear option against Epic Games — terminating its App Store developer account entirely — if it doesn’t fall back into line with the App Store guidelines.

To be clear, up to this point, Apple’s response to Epic’s stunt has been to take the middle ground, pulling Fortnite from the App Store but otherwise doing nothing to prevent all of those who already had the game installed on their iPhones and iPads — which, let’s face it, is the majority of Fortnite’s user base — from continuing to use it. In fact, due to the way that the App Store works, anybody who has ever installed Fortnite on any Apple device that they own, or who has a family member who has installed the game, will be able to reinstall it from the App Store, since apps that are pulled from sale still remain in a user’s purchase history.

Terminating Epic’s developer account not only stands to change that, but there’s an even bigger game at stake here, since Epic Games is also the company behind the very popular Unreal Engine, the removal of Epic from the Apple Developer program could actually impact all of the apps and games that use the company’s game engine.

Apple specifically stated it would terminate Epic’s access to development tools, including those necessary for Epic to keep offering the world’s most popular graphics engine, the Unreal Engine. The Unreal Engine is used to develop a wide array of products including games, films, biomedical research and virtual reality. Millions of developers rely on the Unreal Engine to develop software, and hundreds of millions of consumers use that software.

Epic Games, in a court filing

To be clear, Apple’s termination of Epic’s developer account wouldn’t have any impact in the short term on those apps using the Unreal Engine. Those by other developers would remain on the App Store exactly as they are right now.

What’s at stake here is Epic’s continued development of the engine for third-party developers, since it would lose access to all of Apple’s iOS development tools. In the long term, the Unreal Engine would no longer be a viable option for other developers, since it would become impossible for Epic Games to maintain it for the iOS platform.

Epic is petitioning the courts for an injunction that would prevent Apple from taking “any adverse action” against it while the lawsuit is pending, including terminating its access to the Apple Developer Program, while also asking the courts to order Apple to restore Fortnite to the App Store in Epic’s original unmodified form.

According to Epic’s motion, it is Apple’s actions that stand to “harm millions of innocent consumers worldwide,” specifically referring to players of Fortnite and other Epic game titles, who will lose access to that content on their iOS devices and will “sever their trust with Epic.” Of course, Epic’s motion ignores the fact that it was its own explicit breach of contract with Apple that created the problem in the first place.

‘No Exceptions’

In a statement to Bloomberg’s Mark Gurman, Apple made it clear that it’s not about to make any exceptions for Epic, or any other company, no matter how big they are.

Apple points out that Epic has “been one of the most successful developers on the App Store, growing into a multibillion business” because of it, while adding that it really does want to keep Epic on board, but it’s basically not going to negotiate with terrorists.

The problem Epic has created for itself is one that can easily be remedied if they submit an update of their app that reverts it to comply with all the guidelines they agreed to and which apply to all developers.

Apple statement

Apple is making it abundantly clear that as far as it’s concerned, Epic is responsible for its own destiny here, and can return to the App Store at any time, as long as it chooses to abide by the rules — rules that haven’t changed at all since Epic originally signed its developer agreement with Apple over a decade ago, and have remained the same through each annual renewal.

Can Apple Do This?

While it may seem like Apple is going too far here, as Daring Fireball’s John Gruber points out, the terms of Apple’s developer program license agreement are actually pretty clear, and from a legal perspective, Apple really does hold all of the cards here. Section 11.2, Termination, makes it clear that Apple can turf any developer who engages in “misleading, fraudulent, improper, unlawful or dishonest acts” which include such things as “hiding or trying to hide functionality from Apple’s review” — which is exactly what Epic Games did in this case.

In fact, technically speaking, Epic has already violated the terms of its contract, meaning Apple has every right to terminate its developer account regardless of whether Epic chooses to remedy the situation or not, but Apple is willing to forget about the breach and let bygones be bygones if Epic basically apologizes.

There is really no question at all that Epic Games flagrantly violated the terms of its agreement with Apple, and it’s unlikely that the courts are going to rule in Epic’s favour on this one. Epic’s position of course is that the terms of its contract with Apple are illegal under antitrust laws, however it’s not necessary to blatantly violate a contract in order to challenge the legality of it. While Epic’s choice to do so does help to demonstrate some tangible harm to its business, it was really done more as an appeal to the court of public opinion, and could actually leave it in worse standing in terms of its actual legal battle, since it’s now starting from a position of bad faith.

Epic is Recruiting Allies

According to The Information, Epic has also been seeking allies in its fight against Apple’s App Store policies, hoping to build a larger “coalition of Apple critics,” that would strengthen its case.

Apparently, Epic began reaching out to other potential partners weeks ago, long before it fired the first shot to begin this whole brouhaha, but so far although it’s found more than a few that are sympathetic with its cause, even going so far as to publicly applaud its decision, even the most vocal critics of Apple’s policies, such as Spotify, haven’t gone so far as to actually sign on as part of Epic’s cause.

As The Information notes, part of the reason for this is uncertainty as to exactly what their role in such a coalition would be, but there’s also the fear that such a move could trigger antitrust laws in the opposite direction, with a coordinated group being seen as an anti-competitive cabal of its own.