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The judge in the Apple vs. Epic Games case has asked a question that’s sure to worry Apple’s legal team and management, as it could potentially lead to a major App Store rule change being recommended.
As Bloomberg reports(Opens in a new window), US District Judge Yvonne Gonzalez Rogers has been listening to expert witnesses presented by both Apple and Epic Games. One of those witnesses is Richard Schmalensee, an economist and Massachusetts Institute of Technology professor who was testifying for Apple. During his testimony, Gonzalez Rogers asked, “What’s so bad about it anyway, for consumers to have choice?”
The question was in relation to Apple’s App Store anti-steering policy, which forbids apps from telling iOS users that they can purchase virtual goods or subscriptions cheaper elsewhere. Gonzalez Rogers was questioning why allowing this to be conveyed to App Store customers would be bad, to which Schmalensee responded, “If the app vendor can say, if you press this button you can buy this for less, that means the App Store can’t collect its commission.” He went on to point out this would be “undercutting” sales on the App Store.
Schmalensee also pointed to the US Supreme Court throwing out a lawsuit in 2018 accusing American Express Co. of preventing competition by prohibiting merchants from “steering customers to cards with lower fees.” Gonzalez Rogers didn’t believe the situation was the same and pointed out customers can see signs for other credit card options in stores, whereas in the App Store, “visual indications of options don’t exist in this circumstance.”
Gonzalez Rogers posed a similar question to Epic’s expert witness and economist David Evans. She asked, “If Apple didn’t have these rules, would the problem be solved?” He responded by pointing out that on its own, it wouldn’t be enough. “That wouldn’t eliminate the market power Apple has here, but it would certainly diminish it … it would not be much of a solution at all.”
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Bloomberg notes that the judge could explore potential compromises to resolve the case. As Apple currently holds a very tight grip over everything that happens on the App Store, any compromise, however small, would reduce that control.
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Source link : https://www.pcmag.com/news/apple-epic-judge-asks-why-offering-consumers-a-choice-is-bad