Epic’s Battle Against the Giants: A David vs. Goliath Story?

Epic’s Battle Against the Giants: A David vs. Goliath Story? image
By Mariam Ahmad 17 October 2024

How will Epic’s landmark court case against the monopolies of Google, Samsung, and Apple impact the broader mobile gaming industry? Could this be the breakthrough indie studios have been waiting for, signaling that there’s still hope for fair competition?

 

An Epic legal battle 

It all started in 2020 when Epic Games threw down the gauntlet, aiming at the towering giants of Apple and Google. Through "Project Liberty," they bypassed the restrictive 30% cut these tech behemoths take from in-app purchases, patching Fortnite to offer direct payments. As expected, Apple and Google swiftly retaliated by booting Fortnite from their stores, triggering a multi-year legal war.

Since then, the battle has escalated through multiple courtrooms, with Epic framing the fight as a fight for app developers’ freedom. Their lawsuits accuse Apple and Google of antitrust violations, citing unfair monopolistic control over the app distribution ecosystem.

What went down? 

Fast forward to 2024, and the legal brawl has led to some seismic shifts. Epic secured partial wins, such as Apple's forced allowance of external payment links, though other demands—like app store independence—remain unresolved. With the Supreme Court recently denying Apple’s final appeals, the repercussions are rippling across the industry, giving smaller developers a glimmer of hope for breaking free from the stranglehold of these massive platforms.

The battle with Google reached a significant turning point in October 2024, when a U.S. judge ordered Google to open up its Play Store to third-party app stores and alternative billing systems. This ruling marks a major win for Epic, forcing Google to permit rival app stores to access its Play Store's catalog and provide developers with new billing options. Google will have three years to comply with these changes, but it has already announced plans to appeal the ruling, emphasizing concerns about competition with Apple and potential security risks.

Opportunities: Lower costs, more control, and emerging platforms

Epic’s legal victories, particularly the ability to bypass app store fees, offer developers more control over their revenue. Indie studios now have the opportunity to reclaim a larger portion of their earnings, which can be reinvested into game development, marketing, and growth. Beyond reduced fees, the recent launch of the Epic Games Store on mobile—albeit with some early friction—marks a significant step toward breaking the dominance of Apple and Google over mobile app distribution.

The Epic Games Store presents an exciting new avenue for developers, offering a 12% revenue cut for payments processed through Epic and 0% for third-party payments. This is far more favorable than the 30% cut taken by traditional app stores, which could make it an attractive option for indie studios looking to maximize their returns. Programmes like Epic First Run and Epic Rewards also aim to incentivize developers to launch or transition their games onto the platform, offering visibility and promotional support that may help mitigate the challenges of leaving Apple’s and Google’s ecosystems.

Additionally, as alternative mobile stores slowly gain traction, developers might find more diverse opportunities to reach niche audiences that are less accessible via the major platforms. With Epic planning to expand its mobile store globally and other companies, like Microsoft, entering the mobile game distribution space, the potential for a truly competitive mobile marketplace is emerging. This could shift power further away from the dominant app stores and into the hands of developers.

Challenges: Reduced visibility, friction, and fragmented ecosystems

While Epic’s legal victories have opened the door to alternative payment systems and distribution models, the road ahead remains difficult for indie developers. Even with new freedoms, distributing games through alternative app stores or payment methods may come with significant friction. As demonstrated by Epic's own mobile store launch, users faced complex installation processes involving multiple "scare screens" and lengthy downloads, which hurt early adoption numbers. This highlights a critical issue: new stores may technically be allowed, but entrenched user habits and the control that Google and Apple have over device ecosystems can make it extremely hard to attract users away from the default platforms.

Moreover, while the ability to bypass app store commissions is a financial win, smaller developers could still face higher operational costs. Managing multiple platforms, each with different requirements and user bases, adds complexity. Epic itself is appealing to regulators worldwide to ease this process, but until substantial progress is made, indie developers may find it difficult to compete on the same level as they do within the current ecosystems.

Epic’s battle, while making progress, is still regionally fragmented. Rules that benefit developers in the EU don’t necessarily apply in other markets like the U.S., making it harder to create a unified strategy across platforms and regions. This fragmentation, paired with existing challenges in visibility and user acquisition, underscores the uncertainty still surrounding the larger implications for indie developers.

What does the industry think?

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Epic ruling signals shift towards inclusive mobile app ecosystem

Absolutely, and developers must lean into what we call the alternative mobile ecosystem – one that supports the goals of ALL involved. The latest Google vs. Epic ruling marks another milestone in the democratization of the app ecosystem. The decision opens doors and removes the high fees and rigid policies that have long hindered developer control, but there’s still more progress needed to shape an ecosystem that allows developers to thrive—one that supports their ability to scale, innovate, and reach users in impactful ways. 

In light of DMA changes and the latest Google vs. Epic news, developers are already showing inclination towards exploring and testing new alternative channels. The relatively low entry barriers (SDK integration) and the fact that the world's leading app developers like Epic, King and Playrix are already testing alternative stores simplifies the decisions of other app developers. Shalom Michaeli, MD, Global Alternative Distribution & Growth, Digital Turbine

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Epic's legal battle fuels new path for game distribution and revenue beyond traditional app stores

The ongoing legal battles reflect a growing frustration among developers with the limitations imposed by app store ecosystems. Issues like massive game downloads, storage demands, and a lack of meaningful innovation in app store policies have left some developers and users feeling underserved.

Epic's fight is paving the way for alternative app distribution models, especially those that bypass traditional revenue-sharing frameworks. This encourages developers to explore direct-to-consumer platforms, enabling them to retain more revenue and market directly to their audiences using data-driven engagement strategies. Such shifts are likely to push the gaming industry toward more personalized, community-driven marketing approaches.

As companies embrace these new distribution methods beyond centralized app stores, they’ll need to adopt innovative monetization strategies. This evolution presents an exciting opportunity for decentralized platforms like Aethir, which can support third-party payments through in-game economies and other creative revenue streams without the typical limitations, offering game developers greater revenue potential. Developers need not rely solely on moving off app stores entirely; instead, they can enhance their revenue strategies by reaching a subset of users through alternate platforms. Additionally, direct-to-consumer versions of games can be leveraged for game testing, reducing user acquisition costs (CPI), and boosting discoverability.

Aethir’s decentralized cloud gaming platform is aligning with this shift by offering gamers instant, platform-independent access while giving developers more control over monetization and distribution. This flexibility enables gaming companies to refine their marketing and revenue strategies in tandem with app stores—a win-win for everyone involved. - Paul Thind, CRO, Aethir

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