Fortnite maker and Apple duel in filings as App Store trial nears

SAN FRANCISCO, United States - Epic Games and Apple dueled on Thursday in legal filings ahead of a trial over whether to break the iPhone maker's tight grip on the App Store.

Epic, the maker of the massively popular Fortnite game, accused Apple of trapping people in its mobile device world and collecting "outsized commission" at the App Store that serves as the only source of digital content.

Apple countered that it has no monopoly when it comes to digital games and that the suit is part of an effort by Epic to portray "Apple as the 'bad guy' so that it can revive flagging interest in Fortnite."

Apple pulled Fortnite from its App Store in August of last year after Epic released an update that dodges revenue sharing with the iPhone maker, and the companies are now locked in a legal battle.

A trial in the case is set to begin May 3 in US federal court near San Francisco.

Apple chief Tim Cook as well as Epic founder and top executive Tim Sweeney are among those expected to testify.

"Apple constructed the iOS ecosystem, using a combination of technical and contractual means, to restrict distribution of iOS apps, foreclosing competition, harming the competitive process, and harming consumers," Epic contended in a filing.

The iOS software runs Apple mobile devices.

The App Store is home to more than 1.8 million apps worldwide, generating billions of dollars in revenue for developers since it was launched in 2008.

People spent $70.3 billion at the App Store last year alone, according to market tracker Statista.

Apple's commission on App Store transactions ranges from 15 percent to 30 percent, and the online shop has been part of the Silicon Valley titan's effort to ramp up revenue from digital content and services.

Epic has called the App Store bite of transactions an "Apple Tax" and contended that the vetting of apps there is "cursory."

Apple maintains that the commission is standard for the market, and is warranted given the company's investments in security, privacy and innovation.

It has argued that Epic "would like to reap the benefits of the App Store without paying anything for them."

Apple said Epic has benefitted from the iOS ecosystem with some 130 million downloads in 174 countries, which earned Epic more than half a billion dollars, before changing its tune and seeking "special treatment."

The dispute comes with Apple and other tech giants facing increased scrutiny for their dominance in various economic sectors, allowing them to grow even as much of the economy contracts from the impact of the coronavirus pandemic.

Agence France-Presse

Apple adding privacy fact labels to App Store items

SAN FRANCISCO, United States - Apple on Monday began adding labels that reveal what user data is gathered by games, chat or other software offered in the App Store for its popular mobile devices.

The iPhone maker announced plans for such "privacy labels" when it first unveiled the new version of its iOS mobile operating system, which it released in September.

"App Store product pages will feature summaries of developers' self-reported privacy practices, displayed in a simple, easy-to-read format," Apple said in a blog post when iOS 14 launched.

"Starting early next year, all apps will be required to obtain user permission before tracking."

Apple began pushing out the labels on Monday, with the rule applying to new apps for iPhones, iPads, Apple Watch, Apple TV and Mac computers.

The labels will contain information provided by developers when they submit apps for approval to appear on the App Store's virtual shelves, according to the Silicon Valley-based company.

Apple last week began requiring developers to submit privacy information for use in labels.

"Apple recently required that all apps distributed via their App Store display details designed to show people how their data may be used," Facebook-owned smartphone messaging service WhatsApp said in a blog post explaining what data the app gathers.

"We must collect some information to provide a reliable global communications service."

The aim, according to Apple, is for users to be able to easily see and understand what apps do with their data, from lists of contacts to where they are.

Data types added to labels will include tracking in order to target advertising or sharing with data brokers, as well as information that could reveal user identity.

Apple and Android mobile operating systems provide tools for controlling the kinds of data apps can access once they are installed.

Agence France-Presse

Epic Games asks court to force Apple to reinstall Fortnite

SAN FRANCISCO, United States - Epic Games is trying to convince a California court to reinstate Fortnite on the Apple App Store pending legal proceedings, arguing that doing so is in the "public interest," court documents show.

If not, the game could suffer "irreparable harm," the company's lawyers said in a new lawsuit delivered Friday.

The gambit comes amid a battle over whether Apple's tight control over the App Store, and its 30 percent cut of revenue, counts as monopolistic behavior.

Apple pulled Fortnite from its online mobile apps marketplace on Aug. 13 after Epic released an update that dodges revenue sharing with the iPhone maker.

Last month a US court rejected Epic's bid to have Fortnite reinstated on the App Store, saying its eviction by Apple was a "self-inflicted wound."

"Over 116 million registered users have accessed Fortnite through iOS — more than any other platform," Epic says in the new complaint.

"By eliminating many of these players from Fortnite, and blocking Fortnite's ability to access over a billion iOS users, Apple is irreparably harming Epic's chances," it continues.

Daily active users have dropped by more than 60 percent since Fortnite was removed, it says, while Epic's reputation has also taken a hit.

"Epic may never see these users again," the lawsuit says.

But it did not back down from its fight against Apple, stating that the tech giant "is a monopolist."

Due to the legal row, Fortnite fans using iPhones or other Apple products no longer have access to the latest game updates, including the new season released at the end of August.

Apple does not allow users of its popular devices to download apps from anywhere but its App Store.

Agence France-Presse

How Apple’s 30 percent app store cut became a boon and a headache

OAKLAND, California — Twelve years ago, Apple introduced the App Store, a peculiar online marketplace for the year-old iPhone. It had 500 offerings. Apple told app makers it would take a 30 percent cut of their sales, and few complained.

Today, the App Store is one of the world’s largest centers of commerce, facilitating half a trillion dollars in sales last year alone. And Apple still takes 30 percent of many apps’ sales.

That commission has proved hugely consequential for Apple. It has been the primary driver of growth in recent years for a company that has nearly $275 billion in annual sales. And it has created some of Apple’s biggest headaches, drawing antitrust scrutiny, fury from app makers and lawsuits from consumers and partners.

The headaches intensified this week when Epic Games, the maker of “Fortnite,” arguably the world’s most popular video game, sued both Apple and Google, accusing the companies of breaking antitrust laws by forcing app makers to pay their 30 percent fees. The lawsuits followed Apple and Google’s removal of “Fortnite” from their app stores because Epic encouraged users to pay it directly, rather than through Apple or Google, to avoid their fees.

“I think we’re realizing that 30% is way too much,” said Phillip Shoemaker, a former senior App Store executive, who left Apple in 2016. Credit card companies charge roughly 3 percent to process payments. “It should be closer to that,” he said.

That is the rising sentiment among app developers, consumers and regulators. Apple and Google, which together are worth more than $3 trillion, make the software that backs virtually all of the world’s smartphones. That dominance has allowed them to keep their commissions high.

But now that the tech giants’ smartphones have become the only way other businesses reach millions of people, those businesses are increasingly pleading: Do you really need a third of my sales?

“There are very few companies out there that have a 30 percent profit margin,” said Andy Yen, the chief executive of ProtonMail, an email service. “The only way we can support this fee is by passing that cost on to customers.” ProtonMail charges 30 percent less for subscriptions purchased on its website, but when the company advertised that to its iPhone users, Apple restricted its app.

Likewise, Spotify increased its monthly subscription to $13 from $10 in 2014 to account for Apple’s fee. A year later, Apple introduced a competing music service — priced at $10. To compete, Spotify opted out of Apple’s payment system, enabling it to avoid the commission. Now customers can still use Spotify’s app, but they must subscribe on Spotify’s website. Yet Apple bars Spotify from saying that in its iPhone app.

“Either we lose because we have to pay them a 30 percent tax just to operate and raise our prices for consumers as a result, or we lose because it becomes much more expensive to convert users from free to premium,” Horacio Gutierrez, Spotify’s chief legal officer, told reporters in June after European regulators opened an antitrust investigation into Apple based on Spotify’s complaint.

Even consumers have spoken up. An enormous class-action lawsuit accuses Apple of breaking antitrust laws to enforce its commission, inflating app prices for iPhone users. The Supreme Court ruled last year the lawsuit could proceed.

On Friday, Facebook chimed in, complaining that Apple is collecting 30 percent of sales on its new live-events service, where people can sell expert talks, fitness classes and cooking tutorials on Facebook’s app. Facebook said it wanted to process the payments itself so it could pass on 100 percent of the sales to the small businesses selling the talks and classes, but Apple declined.

Apple argues that it has actually cut software developers a break. Tim Cook, Apple’s chief executive, suggested to Congress last month that when software was still sold in brick-and-mortar stores, 50 percent to 70 percent of the retail price went to middlemen.

“In the more than a decade since the App Store debuted, we have never raised the commission or added a single fee,” he told lawmakers. “The App Store evolves with the times, and every change we have made has been in the direction of providing a better experience for our users and a compelling business opportunity for developers.”

For Google, the stakes are lower. It allows people to download apps from outside its Android app store, meaning app makers like Epic have ample ways to still reach consumers using Android devices. And Google’s vast online advertising business makes its app store a much smaller portion of its overall business.

Over the past year, Apple has collected $19 billion of the $63.4 billion in sales of digital goods and services on iPhone and iPad apps, according to Sensor Tower, an app analytics firm. Google collected $10 billion of the $33.8 billion in similar spending on its app store, Sensor Tower said.

Before Cook’s testimony to Congress, at a House hearing focused on the power of Big Tech, Apple commissioned a study that showed its cut was in line with what many other platforms charged for similar distribution, including the app stores from Google, Microsoft and Samsung, and the game stores from Nintendo, Sony’s PlayStation and Microsoft’s Xbox.

Amazon’s Twitch gaming platform collects 50 percent, according to the study. By comparison, Amazon, eBay and Walmart charge 6 percent to 17 percent for sales of goods on their websites, the study said.

What the study didn’t note: Apple popularized the 30 percent cut.

It applied that rate on any purchases of an app in 2008, and then a year later on any transactions inside of apps for digital goods and services, such as a virtual currency in a game or a subscription to a music, TV or dating app. Apple does not take a cut of apps’ sales of advertising or physicals goods, and thus most apps don’t pay a fee.

Epic made $1.8 billion on “Fortnite” last year, in large part by selling digital currency that players need to buy new features inside the game. The game itself is free.

On Thursday, Epic started its confrontation with the tech giants by allowing “Fortnite” users to pay it directly in its iPhone and Android apps, rather than via Apple or Google’s payment systems.

Epic also offered a 20 percent discount on all purchases that used its payment system. That meant that if Apple and Google charged a 10 percent commission, their price would be about the same as the one Epic was offering its customers.

Jai Chulani, one Apple executive, said in an email to colleagues that he worried that if Apple charged 30 percent of the first year of a subscription “we may be leaving money on the table.”

Eddy Cue, one of Apple’s most senior executives, responded with a better idea: “For recurring subscriptions, we should ask for 40 percent.”

The New York Times Company

Plague simulation game tops App Store gaming charts amid virus scare

MANILA -- Plague Inc., a game that recently went viral amid the global spread of the novel coronavirus or 2019-nCoV, topped Apple's App Store gaming charts as of Thursday. 

This, despite reminders from the game developers that the game was "not a scientific model" to follow amid the global outbreak. 

The gaming app -- which allows players to create a pathogen in an effort to destroy the world with a deadly plague -- took over the top spot as Apple's "Top Paid" game, followed by NBA 2k20.

UK-based independent games studio Ndemic Creations previously said it has seen a trend in increase of players when a disease spreads across the world. 

However, it has also advised against "sensationalizing real-world issues" such as the global spread of the virus and recommended that players get information directly from local and global health authorities.

"We specifically designed the game to be realistic and informative, while not sensationalizing serious real-world issues. This has been recognized by the CDC and other leading medical organizations around the world," the developers said in a statement. 


The death toll from the Wuhan coronavirus has jumped past 500 and confirmed infections piled to around 30,000. 

Local health authorities have also reiterated that majority of those infected with the virus recover from the illness. 

source: news.abs-cbn.com

Apple News users reach 100 million, App Store sales rise

SAN FRANCISCO -- Apple Inc's news service has reached 100 million monthly active users and customers spent more than $1.4 billion in the App Store between Christmas and New Year, the latest signs of growing revenue from the iPhone maker's services business.

With demand for smart phones and other hardware peaking, Apple has been striving to boost sales from purchases of apps and subscription services like its newly launched Apple TV+ streaming service or Apple Care maintenance packages.

The company said that between Dec. 24, 2019, and Jan. 1, 2020, its customers spent $1.42 billion in the App Store, a 16 percent increase over the previous year, and $386 million on Jan. 1 alone, a 20 percent increase.

The number of users of the News app rose nearly 18 percent from a year ago, although the company did not break out subscriber numbers for the Apple News+ service, which costs $9.99 per month.

The numbers also point to a big shift in spending in the Thanksgiving to Christmas holiday season in the United States, with consumers splurging on apps and online shopping rather than in brick-and-mortar stores.

Mastercard Inc's data tracking retail sales from Nov. 1 through Christmas Eve showed US shoppers spent almost a fifth more online during this year's holiday shopping season than a year ago, accounting for 15 percent of all retail sales.

The App Store growth numbers were roughly in line with the overall trend for Apple's services segment revenue, which rose 16 percent to $46.3 billion in its most recent fiscal year ended in September. In comparison, iPhone sales fell 14 percent to $142.4 billion in the same period.

Apple keeps between 15 percent and 30 percent of the sales through its App Store, depending on whether users buy software as a one-time purchase or recurring subscription.

The company launched several new services in 2019, including the streaming service, a video game service and a credit card.

Shares of the company were marginally down in early trading.

Agence France-Presse

How Apple stacked App Store with own products

If you opened the App Store on an iPhone recently and typed “music” in the search box, the first result would have been Apple’s iTunes.

The next would have been Apple Music. Then several more from the company, including some not related to music at all, like iMovie. On some days, you would have had to scroll through as many as eight Apple apps before finding one made by a different publisher.

This, according to Apple, was how the App Store was supposed to work. And that, critics say, is the problem.

Top spots in App Store search results are some of the most fought-over real estate in the online economy. The store generated more than $50 billion in sales last year, and the company said two-thirds of app downloads started with a search.

But as Apple has become one of the largest competitors on a platform that it controls, suspicions that the company has been tipping the scales in its own favor are at the heart of antitrust complaints in the United States, Europe and Russia.

Apple’s apps have ranked first recently for at least 700 search terms in the store, according to a New York Times analysis of six years of search results compiled by Sensor Tower, an app analytics firm. Some searches produced as many as 14 Apple apps before showing results from rivals, the analysis showed. (Though competitors could pay Apple to place ads above the Apple results.)

Presented with the results of the analysis, two senior Apple executives acknowledged in a recent interview that, for more than a year, the top results of many common searches in the iPhone App Store were packed with the company’s own apps. That was the case even when the Apple apps were less relevant and less popular than ones from its competitors. The executives said the company had since adjusted the algorithm so that fewer of its own apps appeared at the top of search results.

The Times’ analysis of App Store data — which included rankings of more than 1,800 specific apps across 13 keywords since 2013 — illustrated the influence as well as the opacity of the algorithms that underpin tech companies’ platforms.

Those algorithms can help decide which apps are installed, which articles are read and which products are bought. But Apple and other tech giants like Facebook and Google will not explain in detail how such algorithms work — even when they blame the algorithm for problems.

Philip Schiller, Apple’s senior vice president who oversees the App Store, and Eddy Cue, the senior vice president who oversees many of the Apple apps that benefited from the results, said there was nothing underhanded about the algorithm the company had built to display search results in the store.

The executives said the company did not manually alter search results to benefit itself. Instead, they said, Apple apps generally rank higher than competitors because of their popularity and because their generic names are often a close match to broad search terms.

“There’s nothing about the way we run search in the App Store that’s designed or intended to drive Apple’s downloads of our own apps,” Schiller said. “We’ll present results based on what we think the user wants.”

Apple added its apps to the App Store in June 2016. Since then, it has been the top result for many popular search terms, according to the Sensor Tower data. Those Apple apps held on for years while top rivals remained stuck below, sometimes hundreds of spots down the list, the data shows.

An Apple spokeswoman said the company could not verify the data because it did not keep a record of historical search results.


The company is facing the most direct legal challenge in the United States to the clout it has built up through its App Store. In May, the Supreme Court voted 5-4 to allow an antitrust class action against Apple to move forward, saying consumers should be allowed to try to prove that the technology giant had used monopoly power to raise the prices of iPhone apps.

When multiple Apple apps packed the search results, such as in searches for “music,” the Apple executives attributed the results to a feature of the App Store search engine that sometimes grouped apps by maker. They tweaked that feature in July so Apple apps would no longer look as if they were receiving special treatment. Many Apple apps dropped as a result.

Still, the executives denied that there had been a problem that needed fixing.

“It’s not corrected,” Schiller said.

“It’s improved,” said Cue.

Several consultants who study the App Store algorithm to help companies rank higher said Apple’s consistent success in the marketplace was suspicious. Algorithms are automated systems designed to largely run on their own. But it is humans who decide what algorithms measure. And those decisions can be subjective.

“I find it hard to believe that organically there are certain Apple apps that rank better than higher-reviewed, more downloaded competitors,” said Todd Dunham, chief executive of the ASO Project, which consults app makers on how to rank higher in the results.

Some of the search results found in The Times’ analysis appeared “steered,” said Eric Enge, an App Store consultant for Perficient, a consulting firm. “It’s no question that the app universe is one of the major battlegrounds out there, and there’s just a ton to be gained commercially by dominating,” he said.

The search algorithm in the App Store was built by a small team of engineers in Cupertino, California, some of whom said in a separate interview arranged by Apple that they hadn’t noticed for months that Apple was dominating search results for music and other categories.

Once they did notice, they said, a single engineer decided to change the algorithm.

The engineers said they had to be vague when talking about how their algorithm worked, to avoid revealing too much to fraudsters looking to game it. The algorithm examines 42 different signals, they said, including an app’s relevance to a given search, its ratings, and its popularity based on downloads and user clicks.

Apple introduced the App Store in 2008, and it quickly revolutionized the mobile-phone industry, creating a new marketplace for people to download games, tools for work and social-networking services. More than 2 million apps are available on the App Store.

Apple’s tight control of its App Store has led to a marketplace that appears to be less susceptible to fraud than the Play Store, the app marketplace on Android smartphones that is run by Google. Google’s Play Store results are partly personalized, so each person might see a different set of results.

Companies like Facebook, Spotify and Yelp have thrived on Apple’s platform, which typically generates more money for app developers than Google’s Play Store.

To get their apps discovered, companies try to push them up the ranks in the App Store’s search results. There is an industry of consultants who charge for their expertise on setting the right title, description and other details to please the App Store algorithm.

But Apple’s algorithm also appears to have been a boon for its own apps.

On Aug. 21, Apple apps ranked first in 735 of roughly 60,000 search terms tracked by Sensor Tower. Most of the tracked searches were obscure, but Apple’s apps ranked first for many of the popular queries. For instance, for most of June and July, Apple apps were the top result for these search terms: books, music, news, magazines, podcasts, video, TV, movies, sports, card, gift, money, credit, debit, fitness, people, friends, time, notes, docs, files, cloud, storage, message, home, store, mail, maps, traffic, stocks and weather.

The Wall Street Journal also found that Apple apps regularly ranked first for many searches in an analysis of 600 searches over two days in June.

Apple succeeded in some of the App Store’s most hotly contested search results. At least four Apple apps led the results for “TV” from at least June 2018 to last month. Netflix has been stuck mostly in the hundreds.

In searches for “music,” Spotify was for years the first result, but the Apple Music app took the top spot shortly after it was arrived in the App Store in June 2016. By the end of 2018, the top eight results were Apple apps, some unrelated to music.

If you searched for “podcast” in May 2018, you would have had to scroll through as many as 14 Apple apps before finding one made by another publisher.

While the Apple Podcasts app has held the No. 1 spot for “podcast” searches since June 2016, other popular podcast apps have struggled in the rankings. A competitor named Stitcher, for instance, has been stuck in the hundreds of podcast search results since June 2018.

That has taken a toll on Stitcher’s business. Amy Fitzgibbons, Stitcher’s marketing chief, said people searching “podcast” accounted for the majority of Stitcher’s downloads on Google’s rival Play Store. “In the Apple App Store, ‘podcast’ did not even rank as a source of downloads for us,” she said.

The Times analysis uncovered other surprising examples of Apple apps’ success. On March 25, the company unveiled an Apple-branded credit card that can be used via the Apple Wallet app. The next day, Apple Wallet was the No. 1 result in searches for “money,” “credit” and “debit.” The app had not ranked for those search terms before then.

Cue and other Apple executives speculated that the team marketing the Apple Wallet app had added “money,” “credit” and “debit” to the underlying description of the app, causing it to appear for those search results.

Then people searched those terms, found the Apple Wallet app and clicked on it, telling the algorithm that it should be the first result.

“We can just tell you that we’ve not done anything to drive that — that is, other than launching a great wallet, an Apple Card and marketing the heck out of it,” Schiller said.

When search results were flooded with Apple apps, Apple executives said, the algorithm concluded that people were looking for a specific Apple app and decided to surface other apps by the same developer.

That wasn’t always to Apple’s benefit. For instance, they said, searching “office” returns a series of Microsoft apps because the algorithm recognizes they are looking for Microsoft Office tools.

Apple engineers said the algorithm believed people searching “music” wanted just Apple Music because users clicked on the Apple Music app so frequently. Apple Music had a distinct advantage over other apps: It comes pre-installed on iPhones. Apple said some people used the search engine to find apps that were already on their phones.

When people search “music,” the App Store reminds them that they already have Apple Music installed. Many people then click on the app, the engineers said, adding to its popularity in the eyes of the algorithm.

Over the past several months, Apple engineers said, they began noticing how the algorithm was packing results with Apple apps. First, they stopped the algorithm from doing that for certain searches. In July, they turned it off for all Apple apps.

On July 12, many Apple apps dropped sharply in the rankings of popular searches. The top results for “TV” went from four Apple apps to two. “Video” and “maps” changed from three top Apple apps to one. And Apple Wallet dropped from the No. 1 spot for “money” and “credit.”

Schiller and Cue said the algorithm had been working properly. They simply decided to handicap themselves to help other developers.

“We make mistakes all the time,” Cue said.

“We’re happy to admit when we do,” Schiller said. “This wasn’t a mistake.”

2019 The New York Times Company

source: news.abs-cbn.com

App Store in crosshairs as Apple courts developers

SAN FRANCISCO -- Apple is set to court software savants at its annual developers conference beginning Monday while contending with criticism that the iPhone maker has made its App Store a walled garden.

The App Store is the lone shop for content for Apple devices, with the technology giant deciding which software creations to accept and taking a 30 percent cut of financial transactions.

But last month the US Supreme Court ruled that a 2011 consumer lawsuit accusing Apple of illegally monopolizing the store and driving up prices may proceed.

"We only collect a commission from developers when a digital good or service is delivered through an app," Apple said in a page recently established in defense of the App Store.

Launched 11 years ago, Apple says the App Store has helped create millions of jobs and generated more than $120 billion for developers.

Apple chief executive Tim Cook will likely update that stunning figure during his keynote presentation kicking off the company's annual Worldwide Developers Conference (WWDC) in the Silicon Valley city of San Jose.

PUSHING PRIVACY

As in years past, Apple will also use the gathering to showcase improvements to the operating systems powering its Mac computers and mobile devices as well as to the software it designs.

But the App Store dispute will be closely watched at the WWDC, which is already expected to be of heightened importance as the company emphasizes digital content and services to offset a pullback in the once-sizzling smartphone market.

Apple has maintained that its tight control of the store allows it to protect user privacy and guard against malicious software by vetting what goes on its virtual shelves. Apple also gets to make sure apps work smoothly with its operating software.

In contrast, applications tailored for mobile devices powered by iOS rival Android can be obtained at online venues aside from Google's Play Store, where the Internet firm can screen offerings.

Cook has repeatedly portrayed Apple as a champion of user privacy, saying data gathered by its devices or software is zealously guarded.

Critics, however, contend that Apple is not as conscientious when it comes to data such as location, browsing history and more collected by apps made by outside developers.

Among announcements rumored to be in store at the gathering is that it will tighten limits on sharing data gathered by children's apps.

MONOPOLY?

In May's 5-4 Supreme Court ruling, the justices rejected Apple's argument that consumers lacked standing to proceed with their lawsuit because the tech giant was merely an intermediary with app developers.

The opinion written by the court's newest member, Justice Brett Kavanaugh, said consumers had a right to pursue their case because they have a direct relationship with Apple.

The case must now go back to a lower court for trial.

"We're confident we will prevail when the facts are presented and that the App Store is not a monopoly by any metric," Apple said in an emailed statement.

"We're proud to have created the safest, most secure and trusted platform for customers and a great business opportunity for all developers around the world."

The ruling came amid a growing backlash against major tech companies that dominate key segments of the online economy. Democratic presidential candidate Elizabeth Warren has argued that big firms such as Facebook, Google and Apple should be broken up through antitrust enforcement.

And Apple faces charges in Europe of abusing its platform by discriminating against rival apps, including one complaint from streaming music service Spotify. 

Spotify filed a formal complaint with the EU Commission taking issue with restrictions that Apple places on apps that don't use the App Store payment system.

Apple dismissed Spotify's accusations of anti-competitive behavior, saying the Swedish music streaming giant was trying to enjoy the benefits of its online market without paying the cost of its upkeep.

"Spotify wouldn't be the business they are today without the App Store ecosystem, but now they’re leveraging their scale to avoid contributing to maintaining that ecosystem for the next generation of app entrepreneurs," Apple said in an online post.

"We think that's wrong."

source: news.abs-cbn.com

Top US court allows consumer lawsuit on Apple app store monopoly

WASHINGTON -- The US Supreme Court ruled Monday that a consumer lawsuit accusing Apple of illegally monopolizing the company's App Store may proceed, opening a new avenue of antitrust litigation against the iPhone maker.

In a 5-4 ruling, the justices rejected Apple's argument that consumers lacked standing to proceed with their lawsuit because it was merely an intermediary with app developers.

The class-action lawsuit maintains that Apple, which takes a 30 percent commission on app sales, abuses its monopoly position, resulting in higher prices.

The opinion written by the newest court member, Justice Brett Kavanaugh, said consumers had a right to pursue their case because they have a direct relationship with Apple.

"If a retailer has engaged in unlawful monopolistic conduct that has caused consumers to pay higher-than-competitive prices, it does not matter how the retailer structured its relationship with an upstream manufacturer or supplier," the opinion said.

Kavanaugh was joined by liberal justices Ruth Ginsburg, Elena Kagan, Stephen Breyer and Sonia Sotomayor.

A dissenting opinion written by Justice Neil Gorsuch and joined by other conservatives on the court agreed with Apple's argument that developers, not the company, sell to consumers and that the lawsuit is based on "pass-on" liability.

"The problem is that the 30 percent commission falls initially on the developers," Gorsuch wrote.

"So if the commission is in fact a monopolistic overcharge, the developers are the parties who are directly injured by it. Plaintiffs can be injured only if the developers are able and choose to pass on the overcharge to them in the form of higher app prices that the developers alone control."

Apple's online marketplace is the sole avenue for apps for its iPhone and other mobile devices, and the company has paid out more than $100 billion to developers since launching the store a decade ago.

Apple did not immediately respond to an AFP query on the decision.

source: news.abs-cbn.com

Apple App Store monopoly suit reaches US Supreme Court

WASHINGTON -- The US Supreme Court agreed Monday to hear a case on whether Apple can be sued under antitrust law for monopolizing the distribution of mobile applications on its App Store.

The case which could have important implications for Apple and its mobile ecosystem hinges on whether the iPhone maker has a right to have a "closed" system where only the company can distribute mobile apps.

In the lawsuit filed by buyers of iPhones and iOS apps claimed Apple's monopoly leads to inflated prices and that consumers should be able to purchase the applications from outside parties without Apple's 30 percent service charge.

A lower court dismissed the complaint, but an appellate panel reversed the decision and said the lawsuit court proceed.

The high court thus accepted Apple's appeal and will rule on whether the case can go to trial.

The Justice Department backed Apple's position in the case, which will be heard by the justices later this year.

Apple said in its brief that the case "presents issues of national importance given the increasing prevalence of electronic commerce and the agency sales model."

The case could impact the multibillion-dollar app ecosystem, and efforts by companies like Apple to establish a so-called "walled garden" for software on their devices.

In the case which dates back to an original lawsuit filed in 2011, a California appeals court ruled last year that Apple could be sued because the company rather than developers was selling apps to consumers.

source: news.abs-cbn.com

Apple's iOS App Store suffers first major attack

BOSTON - Apple Inc. said on Sunday it is cleaning up its iOS App Store to remove malicious iPhone and iPad programs identified in the first large-scale attack on the popular mobile software outlet.

The company disclosed the effort after several cyber security firms reported finding a malicious program dubbed XcodeGhost that was embedded in hundreds of legitimate apps.

It is the first reported case of large numbers of malicious software programs making their way past Apple's stringent app review process. Prior to this attack, a total of just five malicious apps had ever been found in the App Store, according to cyber security firm Palo Alto Networks Inc (PANW.N).

The hackers embedded the malicious code in these apps by convincing developers of legitimate software to use a tainted, counterfeit version of Apple's software for creating iOS and Mac apps, which is known as Xcode, Apple said.

"We’ve removed the apps from the App Store that we know have been created with this counterfeit software," Apple spokeswoman Christine Monaghan said in an email. "We are working with the developers to make sure they’re using the proper version of Xcode to rebuild their apps."

She did not say what steps iPhone and iPad users could take to determine whether their devices were infected.

Palo Alto Networks Director of Threat Intelligence Ryan Olson said the malware had limited functionality and his firm had uncovered no examples of data theft or other harm as a result of the attack.

Still, he said it was "a pretty big deal" because it showed that the App Store could be compromised if hackers infected machines of software developers writing legitimate apps. Other attackers may copy that approach, which is hard to defend against, he said.

"Developers are now a huge target," he said.

Researchers said infected apps included Tencent Holdings Ltd's (0700.HK) popular mobile chat app WeChat, car-hailing app Didi Kuaidi and a music app from Internet portal NetEase Inc.

The tainted version of Xcode was downloaded from a server in China that developers may have used because it allowed for faster downloads than using Apple's U.S. servers, Olson said.

Chinese security firm Qihoo360 Technology Co (QIHU.N) said on its blog that it had uncovered 344 apps tainted with XcodeGhost.

Tencent said on its official WeChat blog that the security flaw affects WeChat 6.2.5, an old version of its popular chatting app, and that newer versions were unaffected. A preliminary investigation showed there had been no data theft or leakage of user information, the company said.

Apple declined to say how many apps it had uncovered.

source: www.abs-cbnnews.com

Flappy Bird creator set to release new game

MANILA -- Dong Nguyen, the creator of the phenomenal Flappy Bird game, is set to release his follow-up to the highly addicting game later this week.

According to a report from gaming website TouchArcade, Swing Copters will be available on app stores starting Thursday for free, with an option to pay a small fee to remove ads.

The game, which has several similarities to Nguyen's earlier hit, features a man wearing a propeller helmet instead of a flying bird as the main character.

The goal is virtually the same as Flappy Bird -- users have to navigate through a series of obstacles and score as much points as possible.

Nguyen, a game-maker from Vietnam, earlier made headlines when his first game, Flappy Bird, became the most downloaded free game in Apple's App Store.

It reportedly earned him over $50,000 in ad revenue a day but was controversially pulled from the online store in February.

Nguyen explained that the reason he removed the game was because of the "unwanted" attention he has been receiving since Flappy Bird's shot to fame.

He tweeted at the time: "I'm sorry Flappy Bird users, 22 hours from now, I will take Flappy Bird down. I cannot take this anymore."

source: www.abs-cbnnews.com