As the DMA comes into effect, Apple terminates Epic’s developer account

Epic, the developer of popular game Fortnite, yesterday issued a press release titled “Apple Terminated Epic’s Developer Account”. It explains that Apple had recently approved a developer account that would enable the Epic Games Store to appear on iOS devices in Europe, something it seems to have been obliged to do as part of its grudging compliance with the DMA.

“To our surprise, Apple has terminated that account and now we cannot develop the Epic Games Store for iOS,” says the press release. “This is a serious violation of the DMA and shows Apple has no intention of allowing true competition on iOS devices. The DMA requires Apple to allow third-party app stores, like the Epic Games Store.

“In terminating Epic’s developer account, Apple is taking out one of the largest potential competitors to the Apple App Store. They are undermining our ability to be a viable competitor and they are showing other developers what happens when you try to compete with Apple or are critical of their unfair practices.”

It goes on to claim that Apple has made the move to punish Epic for criticizing Apple’s compliance with the DMA, as illustrated in the tweet from the Epic CEO below. The release also includes selected correspondence between Epic and Apple in which the latter appears to make the approval of developer accounts conditional on there being no public criticism of Apple. As is so often the case, that self-interest was disguised as a matter of ‘safety’.

The legal letter announcing the termination of Epic’s developer account was dated 2 March 2024 but Epic presumably delayed the publication of its press release to make it coincide with the EU announcement that the DMA comes into effect today. As you can see from the quotes below, Apple’s actions certainly seem to go against the spirit of the DMA, but its lawyers have presumably concluded they don't break the letter of it.

“Today, the Digital Markets Act kicks in for all the gatekeepers we have designated half-a-year ago,” said Margrethe Vestager, European Commission EVP in charge of competition policy. “Our new set of rules will now make online markets more open and contestable for small, innovative businesses to also get a fair chance of making it. And as consumers we will have more affordable options online. This will deeply change how online markets work and open up the digital marketplace, for the benefit of all European players, and users.”

“The DMA sets precise obligations and the possibility to sanction large online platforms should they not comply,” Thierry Breton, Commissioner for Internal Market. “We have been in discussions with gatekeepers for months to help them adapt. And we can already see changes happening on the market: competitors can set up alternative app stores, European users have more control over their data and are now empowered to make choices they did not have before due to default settings. Any company found to be non-compliant will face severe sanctions, including as last resort a breakup.”

That imperious and threatening tone is classic Breton but he doesn’t seem to have said anything publicly about the Apple move yet. However, it is being widely reported that the EC is definitely looking into it, so Breton will have the opportunity to back up his tough talk with concrete action soon.

Apple, meanwhile, gave the following statement to 9to5mac: “Epic’s egregious breach of its contractual obligations to Apple led courts to determine that Apple has the right to terminate ‘any or all of Epic Games’ wholly owned subsidiaries, affiliates, and/or other entities under Epic Games’ control at any time and at Apple’s sole discretion.’ In light of Epic’s past and ongoing behavior, Apple chose to exercise that right.”  It seems to be referring to this partial legal win in 2021.

The challenge for Breton and co will be to untangle the demands of the DMA from the right of platforms to attach onerous strings to their compliance. Apple has once more thrown the gauntlet to the EC and a failure to respond robustly could fundamentally undermine the DMA by setting a bad-faith compliance precedent. Your move, Thierry.