Some tech giants will testify before the U.S. Congress this week about monopolistic behaviour, among other antitrust issues. On the verge of that hearing, Epic Games CEO Tim Sweeney accused two of those giants, Apple and Google, of being a “duopoly.”
Epic is the company behind Fortnite, a popular battle royale game that has spread like wildfire in part thanks to its massive availability. Gamers can download Fortnite on just about anything, from a PC to a traditional console to their mobile phone or tablet. However, the mobile market is where the problems lie for Epic.
In an interview with Bloomberg TV, Sweeney said Apple and Google charge way higher fees for access to their app stores than what it costs to run them. Sweeney used Epic as an example, noting that its game store on PC charges a 12 percent fee and generates a five to seven percent profit margin.
Apple and Google take a 30 percent cut of revenue from paid apps that use their stores. That includes upfront purchases as well as in-app transactions. It can also include subscription-based revenue. The practice has come under fire in recent years as businesses, both large and small, have taken issue with it. That includes Epic, which notoriously dodged the Google Play Store to get Fortnite onto Android phones — an impossible practice on Apple’s iOS.
However, earlier this year, Epic decided to launch Fortnite through the Play Store as well. In part, the change was because of Android security measures that Epic says put apps from outside the Play Store at a disadvantage.
“You can’t have a tech monopoly dominating all interactions between consumers and businesses on a scale of billions of users,” Sweeney said in the interview.
Sweeney also offered a solution to the problem. He said that unbundling different services offered by tech companies would create more choice in the market. That could mean allowing competing stores, like Epic’s, to list in the rival stores.
“They don’t allow competing stores,” Sweeney said. He likened it to a town allowing a Target but blocking all other stores from coming in. “That’s totally un-American and uncompetitive.”
Source: Bloomberg
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