Today the judge in Epic v. Apple issued a lengthy ruling holding that Epic failed to prove that Apple has a monopoly in mobile gaming transactions. Importantly, the court also held that Apple’s rules preventing other payment options in the App Store are anti-competitive, and issued an injunction telling Apple to cut it out.
Specifically, the court said that “Apple is engaging in anticompetitive conduct,” and that “Apple’s anti-steering provisions hide critical information from consumers and illegally stifle consumer choice.”
To fix that, the court issued the following permanent injunction barring Apple from having rules against other payment systems. I’ve bolded the most relevant bit:
Apple Inc. and its officers, agents, servants, employees, and any person in active concert or participation with them (“Apple”), are hereby permanently restrained and enjoined from prohibiting developers from (i) including in their apps and their metadata buttons, external links, or other calls to action that direct customers to purchasing mechanisms, in addition to In-App Purchasing and (ii) communicating with customers through points of contact obtained voluntarily from customers through account registration within the app.
This specific wording is lifted directly from Apple’s App Store rule 3.1.1, which says “Apps and their metadata may not include buttons, external links, or other calls to action that direct customers to purchasing mechanisms other than in-app purchase,” so it’s tempting to think that the judge just declared that rule anti-competitive and crossed it out.
But it’s a little more complicated than that — now that this text is in a judicial order, it no longer belongs to Apple or needs to be interpreted how Apple wants. Indeed, the court was clear that it will enforce this rule, and that if anyone thinks Apple is breaking it, it wants to know. Again, my bolding:
The Court will retain jurisdiction over the enforcement and amendment of the injunction. If any part of this Order is violated by any party named herein or any other person, plaintiff may, by motion with notice to the attorneys for defendant, apply for sanctions or other relief that may be appropriate.
So now comes the really complicated part. What does this injunction mean for Apple and the App Store? Let’s break this rule down piece by piece — the difference between a “button” and an “external link” is going to be remarkably important here.
- not allowed to prohibit developers from including in their apps and their metadata
- external links, or
- other calls to action
- that direct customers to purchasing mechanisms
- in addition to In-App Purchasing.
We can make some versions of this sentence make sense really easily:
- Apple is not allowed to prohibit developers from including external links in their apps that direct customers to purchasing mechanisms.
- Apple is not allowed to prohibit developers from including calls to action in app metadata [like descriptions in the App Store] that direct customers to purchasing mechanisms.
But consider the following version of this sentence:
- Apple is not allowed to prohibit developers from including buttons in their apps that direct customers to purchasing mechanisms.
Well, shit. Here is an example of a button that takes you to a purchasing mechanism in the Amazon app:
This is the ball game! What does it mean for a button in an app to “direct a customer to purchasing mechanisms”? Is it a checkout button? Can Amazon add a cart, a checkout button, and payments to the Kindle app now? The court isn’t stupid — it specified buttons and external links, which means they are presumed to be distinct. So a button can’t just be an external link that kicks you to Safari.
Apple will try to say that “button” just means what something looks like, while developers will say that “button” means how something works.
That means that a fair reading of the plain text of this injunction suggests that buttons in iOS apps can direct users to purchasing mechanisms in the app — if the button just kicks you out to the web, it would be an external link!
I am confident a lot of developers are going to test this language in aggressive ways, and that Apple will find itself developing new rules to protect its lucrative in-app purchasing system from competition. And I’m confident Apple will try to say that “button” just means what something looks like, while developers will say that “button” means how something works. (There is a lot of irony in this for Apple.)
But in the end, it won’t be up to Apple to decide what this order means — it will be up to the court. And that is a delicate position to be in, because the court explicitly thinks the anti-steering rule is very anti-competitive.
Apple did not respond to a request for comment on the difference between buttons and external links.