TechMar 7, 2024
Apple Won’t Let Its App Store Monopoly Go Down Without A Fight (Even If It Costs Them Billions)
Regulatory Storm
Noah Weidner
Discover
Apple has fallen far from the tree that gave it life. The company has been tangled in a long battle with Fortnite creator Epic Games, who sued the tech giant in 2020 — charging that Apple’s 30% commission on app sales was anti-competitive.
The US Supreme Court decided not to hear appeals from Epic Games and Apple regarding their dispute. Meanwhile, the European Union (EU) passed the Digital Markets Act (DMA) — forcing Apple to allow third-party app stores. And that’s where things get heated.
Apple goes dark mode: Epic Games had plans to launch one of the first third-party iOS stores, circumventing Apple’s fees. However, right before the EU’s new DMA rules came into force this week, Apple terminated Epic Games’ developer account, saying it represents a “threat” to its ecosystem. Epic alleged that the ban was retaliatory and represented a “serious violation of the DMA” — prompting an investigation by EU regulators.
Investors have heard no shortage of negative Apple news in recent weeks. iPhone sales have slowed dramatically in key markets like China, top talent has departed, and the US Department of Justice is expected to file an antitrust lawsuit this month. But two missteps stood apart for their significance (and cost):
Buffett of bad news: is down 8% year-to-date, but Mizuho analyst Jordan Klein warns that things could worsen if Warren Buffett, the company’s largest non-ETF shareholder, decides to sell more of his holdings. Apple hasn’t been this oversold in years, and Klein thinks Buffett could sell billions in stock as Apple continues to underperform. Now, how much further will Apple roll from the tree?
