(CN) --- Apple and Epic Games clashed over security and privacy on their respective platforms on Friday, as an antitrust trial between the two industry titans wrapped its first week.
Epic sued Apple after it was banned from the App Store in August 2020 for breaching Apple’s strict rules in order to launch its own game store and alternative system for processing payments for in-app purchases by iPhone users.
Epic is arguing that Apple’s App Store functions like a monopoly that crushes developer innovation by forcing them to use Apple’s payment system for in-app transactions and imposing stringent app review guidelines, as well as taking a 30% commission on all purchases.
Apple claims its processing solution is the most secure and reliable, and that its app review guidelines ensure the best experience for consumers. Its review team rejected 40% of app submissions in 2020– 215,000 of them for violating its privacy guidelines, head of App Review Trystan Kosmynka said on the stand Friday.
"From a competitive standpoint, the App Store is regarded as the safest and most trusted App Store. The review process itself is regarded as rigorous, I’m not sure how we would do this without Apple employees, Apple investment and infrastructure,” he said under questioning by Apple attorney Veronica Moyé.
Kosmynka said he took offense to Epic’s characterization of App Review is a “sham” intended to protect Apple’s monopoly.
“Do you believe third parties can be just as good at app review as your team?” Moyé asked, to which Kosmynka answered “no.”
Epic attorney Lauren Moskowitz tried to wear Kosmynka down on cross, peppering him with questions on the litany of scam, copycat and malware apps that still make it through the App Review process.
“Fraudulent apps do make their way through App Review,” she said, to which Kosmynka replied, “Everyone makes mistakes.”
Moskowitz fired off a slew of examples of apps that made it through, including one getting reviews like, ”The best school shooting game on the App Store #killkids."
“I’m dumbfounded with how this could be missed” Kosmynka said in an email shown in court.
In June 2020, Kosmynka received an email from Apple executive Phil Schiller about an app that involved shooting cannons at protesters. “WTF,” Schiller wrote.
On redirect from Moyé, Kosmynka tried to clear things up. “We proactively catch the vast majority of issues. We certainly miss some but it's a small fraction,” he said. “We work diligently to try to close those loopholes."
He said the examples Moskowitz showed in court originated from customer complaints, which must show that the App Store “is a safe and trusted place to get apps.”
U.S. District Judge Yvonne Gonzalez Rogers, who will be deciding the case instead of a jury, brought up whether the lack of App Store competition on iOS might stymie innovation that would otherwise improve the process.
“One of the concerns is that if you aren’t letting parties compete on these topics, things won’t improve,” she said, asking Kosmynka whether Apple looks to see what any of its competitors are doing with respect to privacy and security and preventing so-called "bad apps” from slipping through review.
“I do pay attention to multiple platforms,” Kosmynka said, noting that he primarily looks at Google’s Android. “But I don't know what their success rate is.”
With Epic Games Store Manager Steven Allison taking the stand in the afternoon, Apple went on the attack.
Apple attorney Karen Dunn hammered on the “offensive and sexualized content” offered in the Epic Games Store through its connection to a separate game storefront available for download from the EGS.
Allison was careful to note the distinction that Epic only hosts those games, but does not make them available for direct download on its store.
The Epic Games Store launched in 2018 and boasts that it only takes a 12% commission from developers.
Allison said developers were initially reluctant to leave the popular gaming storefront Steam for an exclusivity deal with Epic, but Epic sweetened the deal with a "recoupable minimum guarantee” based on estimates of 12 months of the developers’ sales on Steam.
The whole idea of a lower commission, Allison said, was to help developers keep more revenue for themselves.
"The sentiment by 2018 was, fairly broadly, that the 30% could be considered unreasonable,” he said. He also noted that unlike Apple, Epic allows developers to use their own payment processing systems.
But Dunn attacked Epic's exclusivity deals with game developers, pointing out Epic's own apparent effort to lock customers into its gaming ecosystem. When Allison said the agreements were only exclusive for a short period, Dunn countered, “Your hope is that players will stay in Epic Games Store ecosystem. and make more purchases in the Epic Games Store.”
“In theory yes,” he conceded.
When Dunn observed, ”These agreements caused some consternation within the developer community,” Allison said, “I wouldn't call it that.”
Dunn pointed to a blog post from the creators of the farming game “Ooblets” that said exclusivity deals are “exactly what Marx warned us about!”
It continues: “Just imagine if other companies got it in their head to offer funding in exchange for exclusives. What’d be next? Game consoles paying for games to be exclusive on their consoles? Netflix paying for exclusive shows? Newspapers paying for exclusive articles? It’d be some sort of late capitalist dystopia.”
Allison said the post was intended to jokingly push back at critics. “This entire post is sarcastic,” he said.
Epic’s attorneys expect to finish presenting their case by the end of next week.
Follow @MariaDinzeo
Subscribe to Closing Arguments
Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.
