Apple made more than $100 mln in commissions from 'Fortnite' - executive at trial

aap Implantate AG

19/05/2021 19:49

By Stephen Nellis
    May 19 (Reuters) - Apple Inc  AAPL.O  made more than $100
million in commissions from Epic Games' "Fortnite" during the
two years the online game was on the App Store, an Apple
executive testified on Wednesday.
    Michael Schmid, Apple's head of game business development
for the App Store, took the stand during the third week of an
antitrust trial in federal court in Oakland, California. Apple
kicked the popular game off its App Store last year after Epic
introduced its own system for in-app payments.
    Epic then sued Apple alleging that the iPhone maker had
abused its power over developers by forcing them to use Apple
in-app payment technology, which charges commissions of 15% to
30%. Apple has said it requires developers to use its systems to
ensure the security and privacy of its App Store and that the
rates its charges are similar to those of other gaming platforms
such as Microsoft Corp's  MSFT.O  Xbox.
    Before Apple's relationship with Epic soured, Schmid
testified, the App Store, which maintains an editorial team that
highlights certain apps, had featured "Fortnite" and spent about
$1 million in marketing the game over the previous 11 months.
Apple had previously disclosed that Epic earned $700 million
from the iOS version of "Fortnite" but said nothing about its
own commissions.
    The disclosure of "Fortnite" commissions is significant
because Epic's legal team has pressed Apple executives on the
stand over whether the company tracks profits from its App
Store, with Apple executive saying they do not and view the App
Store as feature of the iPhone.
    At a hearing before the U.S. Senate last month, Apple Chief
Compliance Officer Kyle Andeer, a former government antitrust
lawyer, testified that Apple did not produce a publicly
available profit and loss statement for the App Store.
    During the antitrust trial, Epic's attorneys secured a
document from the files of Chief Executive Tim Cook that they
argued tracked operating profits from the App Store. The
document remains under seal.
    Schmid said Apple's App Store team only began tracking
commissions from "Fortnite" after it had been featured by the
App Store editorial team.

 (Reporting by Stephen Nellis in San Francisco; Editing by
Richard Chang)
 ((Stephen.Nellis@thomsonreuters.com; (415) 344-4934;))