Apple reverses course, approves Epic Games for app store in Europe

Tim Sweeney, chief executive officer of Epic Games Inc., speaks during an interview in Seoul, South Korea, on Tuesday, Nov. 16, 2021. 

SeongJoon Cho | Bloomberg | Getty Images

Apple has approved Epic Games’ developer account in Sweden, which will allow the company to offer a competing app store on iPhones in Europe under a new antitrust regulation, the Digital Markets Act.

Earlier this week, Epic Games CEO Tim Sweeney said Apple had retaliated against the company for lawsuits and social media criticism by blocking the Sweden account, citing an email from Apple App Store chief Phil Schiller to Sweeney.

The episode was one of the first challenges to the European DMA from one of the technology giants it regulates, and raised questions about whether the law’s fines and penalties would be sufficient to curb some of the practices targeted by the law. Apple’s quick about-face suggests that European regulators will be able to enforce the law.

“This sends a strong signal to developers that the European Commission will act swiftly to enforce the Digital Markets Act and hold gatekeepers accountable,” Epic Games said in a statement.

Apple’s App Store takes 30% of game purchases and 15% of most online subscriptions. Before Europe’s DMA, it was essentially the only way to install apps on an iPhone. The new regulation forces Apple to allow third-party app stores on iPhones in Europe, but Apple says it can charge half of a euro per download, a pricing strategy that has drawn criticism from app developers.

European regulators immediately said after Epic’s announcement that they would press Apple for answers about the incident. On Friday, Sweeney said on social media that Apple had allowed Epic Games to launch the store after a European Commission inquiry.

Earlier this week, Sweeney said that Apple continuing to block the company’s developer account in Europe was egregious. Schiller, Apple’s App Store chief, wrote a letter to Sweeney asking if he would comply with Apple’s contracts going forward — in light of the 2020 lawsuit — and Sweeney said yes. Still, according to emails provided by Epic Games, a lawyer for Apple rejected Sweeney’s statement and blocked Epic’s European account.

An Apple spokesperson confirmed that Epic Games’ account had been restored after Epic told Apple it will follow its platform policies.

“Following conversations with Epic, they have committed to follow the rules, including our DMA policies. As a result, Epic Sweden AB has been permitted to re-sign the developer agreement and accepted into the Apple Developer Program,” a spokesperson told CNBC in a statement.

Epic Games said it would use the account to publish Fortnite for iPhones in Europe as well as its own Epic Games store.

The conflict between Epic Games and Apple goes back to 2020, when Epic Games updated the shooter game Fortnite to bypass Apple’s 30% cut of App Store sales. Apple kicked Fortnite off of its stores, and Epic sued in the U.S. to force Apple to open up its platform.

Epic mostly lost the suit but won some concessions under California law.

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