“Fortnite” battle is the new TV blackout

Epic filed a federal lawsuit after Apple and Alphabet’s Google kicked “Fortnite” out of its app stores

  
Epic Games booth for the game Fortnite is shown at E3, the annual video games expo revealing the latest in gaming software and hardware in Los Angeles, California, U.S., June 12, 2019.

Epic Games booth for the game Fortnite is shown at E3, the annual video games expo revealing the latest in gaming software and hardware in Los Angeles, California, U.S., June 12, 2019.

Reuters/Mike Blake

(The author is a Reuters Breakingviews columnist. The opinions expressed are her own.)

NEW YORK  - The more things change, the more they stay the same. “Fortnite” owner Epic Games is picking a fight with Apple and Alphabet over the lock they have on distribution. Like the spats between U.S. cable companies and media networks, monopolistic-type dealings over carriage often lead to the content creators digging in. There, public battles can end with smalls wins for content. The video-game maker can expect the same.

Epic filed a federal lawsuit on Thursday after Apple and Alphabet’s Google kicked “Fortnite” out of its app stores. The technology firms said that Epic was violating their company’s policies: “Fortnite” was encouraging consumers to pay it directly to avoid their approximate 30% cut from in app-purchases. Epic says it doesn’t want money – just to challenge the rules based on antitrust.

The popular video game’s public relations campaign – a cheeky parody of Apple’s famous “1984” commercial – is about painting Big Tech as greedy monopolists. This tact has been tried with others, including Spotify Technology, which also got in a public feud with Apple. And it’s not unlike satellite and cable distributors such as Dish Network and broadcasters like CBS that take it to the mat over carriage fees.

Often the content creators – ViacomCBS’s "SpongeBob SquarePants," say – can force a blackout where for a period a viewer can’t watch a certain network. Consumers complain directly to the cable company or, worse, quit it all together. The stronger the content, the stronger the hand. The outcome often hinges on public pressure.

The rise of streaming services from the likes of Walt Disney and others can hurt distributors and Epic has options too. Sure gamers use Apple and Google to download “Fortnite,” but many of them play on consoles and pay Epic outright.

Epic still needs Apple to reach its millions that own iPhones just like media firms have a mutual though fraught dependence on cable companies. But it has an ace in the hole. U.S. watchdogs are chomping at the bit to get at Big Tech. “Fortnite” may be back in the app store but that doesn’t mean Apple and Google won’t feel the nips at their ankles.

CONTEXT NEWS

- Epic Games, the parent of “Fortnite,” filed a federal lawsuit against Apple and Alphabet on Aug. 13 after the two tech firms pulled the popular game from their app stores.

- Epic is not seeking money from the companies that take roughly a 15% to 30% cut from apps sold in their stores. Rather the lawsuit is challenging their rules on the grounds of antitrust.

- Apple and Alphabet’s Google kicked “Fortnite” out of their stores because they alleged Epic Games violated their internal policies. This followed Epic introducing a new payment method that avoided paying Apple and Alphabet a commission on in-app purchases.

(The author is a Reuters Breakingviews columnist. The opinions expressed are her own.)

(Editing by Lauren Silva Laughlin and Amanda Gomez) ((jennifer.saba@thomsonreuters.com; Reuters Messaging: jennifer.saba.thomsonreuters.com@reuters.net))

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