There’s finally a chink in Big Tech’s armor.
On Friday, a federal judge handed down a mixed ruling in Epic Games’ antitrust lawsuit against Apple. The judge determined that Epic had failed to prove that Apple was a monopoly — score one for Apple.
However, she also found that Apple was violating California laws mandating that companies provide transparent consumer choice. As a result, Apple won’t be able to force game developers to make all game purchases in the app itself — of which Apple takes a 15 percent to 30 percent cut. Score one for Epic, and every other app maker, too.
This certainly deals a blow to Apple’s App Store business. But it’s also a new chapter in the antitrust saga that is just beginning to unfold as law makers, advocates, and companies take on Big Tech. Because it shows that Big Tech just might be vulnerable.
“It matters that Apple lost.”
“I don’t think it’s nothing that this is actually the first major ruling where a big tech firm was dealt a blow,” Matt Stoller, the director of research at the antitrust advocacy organization American Economic Liberties Project, said over the phone. “It matters that Apple lost.”
Stoller thinks the ruling could also indicate that judges might be willing to rule against Apple and other companies, which he said, five years ago, “would have been seen as crazy.”
“It suggests that judges are more inclined to rule against Big Tech these days,” Stoller said.
Those firsts and portents aside, the ruling doesn’t necessarily mean sunny skies and smooth roads are ahead for antitrust warriors. That’s because of the portions of the case that Apple won, in which Epic failed to prove that Apple constitutes a monopoly.
“In the current state of antitrust, private litigation has become so difficult that this case may be a clear example that it is not as effective of a tool as it should be in restraining the conduct of a monopolist like Apple,” Daniel Hanley, a senior legal analyst at another anti-monopoly organization called Open Markets Institute, said over email.
There are actually pros to that takeaway, too. There are anti-trust laws currently making their way through Congress. Hanley said this case could show the urgency for antitrust reform, since the current laws apparently aren’t sufficient to rein in Big Tech. It could serve as galvanizing evidence showing that “real reform,” as Hanley put it, is needed.
Regarding the App Store fees portion of the case that came down on Epic’s side, the ruling also demonstrates that, for lawyers looking to take on companies like Apple, there are a variety of tools in the anti-trust toolbelt beyond federal law.
“I think this case will have huge implications on state regulatory efforts,” Hanley said. “The case clearly shows that state regulations matter and they can have a real effect on what practices are allowed or prohibited, despite any shortcomings of federal regulations.”
In other words, this fight is far from over. Big Tech, take note.