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Apple Inc. is back before a United States federal appeals court Tuesday contesting an order forcing it to open its lucrative mobile App Store to links to cheaper payment options.
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The hearing before the 9th Circuit Court of Appeals in San Francisco is the latest twist in a more than five-year saga pitting the tech giant against Epic Games Inc., maker of the popular Fortnite game.
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Apple is appealing an April ruling from U.S. District Judge Yvonne Gonzalez Rogers that the company “willfully” defied her 2021 order to open up its App Store, which brings in billions of dollars annually for the company from the commissions it takes on digital sales.
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The April ruling blocks Apple from charging commissions on transactions that take place outside the App Store. It also limits Apple from placing restrictions on the language and design that developers use to send customers to their own websites to make sales. The same three judges who upheld Rogers’ earlier 2021 decision will hear the current appeal.
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Apple doesn’t separately report revenue on App Store sales though it said that it “facilitated” more than US$400 billion in developer sales in 2024. Appfigures, a mobile analytics and intelligence platform, estimated that Apple generated US$10 billion in the U.S. in 2024 from its App Store.
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Several developers, including Epic, Amazon.com Inc. and Spotify Technology SA, already have changed their apps to allow customers to buy directly from them outside Apple’s App Store. In June, the appeals court declined to pause Rogers’ ruling during Apple’s appeal.
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Following a 2021 trial, Gonzalez Rogers largely sided with Apple in finding that its App Store policies didn’t defy federal antitrust law. However, she found the company violated California state law and ordered Apple to allow developers to direct consumers to cheaper payment options online. The ruling was upheld by the 9th Circuit and U.S. Supreme Court.
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In response, Apple allowed developers to point users to the web for transactions, but it imposed a new 27 per cent commission on revenue generated that way. Epic then accused Apple of flouting the 2021 ruling by imposing the new commission along with other restrictions on the placement and design of links.
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After several weeks of hearings, Rogers concluded that Apple “willfully” violated her injunction and referred the company to federal prosecutors for a possible criminal probe.
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Apple is also fighting off an antitrust lawsuit from the Justice Department and a group of state attorneys general, as well as regulations in Europe designed to curb the market power of the world’s largest tech companies.
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—With assistance from Leah Nylen.
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English (US)