“Epic’s lawsuit is nothing more than a basic disagreement over money,” Apple said in its filing. “Although Epic portrays itself as a modern corporate Robin Hood, in reality it is a multi-billion dollar enterprise that simply wants to pay nothing for the tremendous value it derives from the App Store.”
It’s the latest salvo in a legal battle Epic launched when it sued Apple last month in response to the company’s decision to effectively block the popular “Fortnite” game from its App Store, as my colleague Reed Albergotti notes. The company made the move after it offered game customers a way to pay without using the Apple payment system, which app developers have criticized for taking a 30 percent cut of their revenue.
The lawsuit highlights the heavy-handed approach Apple takes against critics who say it is a monopoly.
Apple’s aggressive tone and denial of monopoly power underscore the company’s readiness to fight back hard against snowballing criticism from app developers. The company’s defensive stance offers a preview of what to expect as antitrust scrutiny of the company mounts in Washington.
From tech analyst Carolina Milanesi:
Apple is among the companies that House lawmakers have zeroed in on in their broad investigation of Silicon Valley’s power. Apple chief executive Tim Cook appeared alongside the executives of Facebook, Google and Amazon at a key antitrust hearing earlier this summer. (Amazon chief executive Jeff Bezos owns The Washington Post.)
But Apple’s tough talk risks alienating more developers who are already critical of the company’s fees.
Marco Arment, a prominent web developer, warned the iPhone maker of the risks of taking such an aggressive stance when its relations with developers are strained.
Epic Games is hardly the first company to criticize Apple’s App Store rules or the company’s fees.
A growing number of tech executives are speaking out about the company’s practices, including Facebook chief executive Mark Zuckerberg, who is also facing antitrust scrutiny of his own company in Washington. Zuckerberg told “Axios HBO” that Apple’s App Store behavior deserves scrutiny.
“So, I do think that there are questions that people should be looking into about that control of the App store and whether that is enabling as robust of a competitive dynamic,” he told Axios.
Epic Games’s legal fight could have key implications for how consumers view Washington’s antitrust battles.
Antitrust regulations can sometimes seem like a wonky issue, but consumers might feel more strongly about the subject if they’re unable to download a favorite app on their phones.
Pradheep J. Shanker, the chief executive of the Neoavatara Foundation, says he’s already seeing anecdotal evidence that Epic Games’s strategy is winning over some younger customers:
Epic did not immediately respond to a request for comment from the Washington Post yesterday.
Our top tabs
Senate Republicans introduced a new bill that would overhaul the tech industry’s prized legal shield.
The ‘‘Online Freedom and Viewpoint Diversity Act” would modify Section 230 of the Communications Decency Act, which protects companies from lawsuits objecting to content posted on their platforms. It would condition the liability protections on an “objective reasonableness standard” that the content falls within the scope of the law.
The legislation would grant legal immunity only in instances in which online platforms chose to restrict access to certain types of content, including content “promoting terrorism,” “unlawful” content and content that promotes “self-harm.” Republican Sens. Roger Wicker (Miss.), Lindsey O. Graham (S.C.) and Marsha Blackburn (Tenn.) introduced the legislation.
Wicker is chairman of the Senate Committee on Commerce, Science, and Transportation. Graham is the chairman of the Senate Judiciary Committee and Blackburn leads the Senate Judiciary Committee’s Tech Task Force.
The trio of Republicans introduced the legislation the same day Trump called on members of Congress, including Blackburn, to repeal Section 230. President Trump signed an executive order in May that called for the Federal Communications Commission to rethink the law.
This is just the latest in a slew of legislation introduced this year taking aim at the crucial tech shield.
Sens. Brian Schatz (D-Hawaii) and John Thune (R-S.D.) in June introduced a bill that would amend Section 230 to require companies to remove illegal content within 24 hours of becoming aware of it. The bipartisan EARN It Act, led by Graham, would strip companies of the legal protections when their users share materials that exploit children.
Sen. Josh Hawley (R-Mo.) also introduced legislation that would only allow companies to keep immunity granted under Section 230 if they submit to an external audit by the Federal Trade Commission that “proves by clear and convincing evidence that their algorithms and content-removal practices are politically neutral.”
The increasing calls for legislation come as a new report from New York University’s Paul M. Barrett finds that Section 230 should be preserved but significantly amended.
Another Facebook engineer quit over the company’s handling of racist speech.
The nearly 1,300-word document cited the company’s role in fueling genocide in Myanmar and its failure to remove a militia-style group’s event encouraging people to bring guns to protests ahead of fatal shootings last month in Kenosha, Wis. Chandwaney also cited Facebook’s refusal to remove a post by President Trump in May, which said, “When the looting starts, the shooting starts,” and dismissed the company’s response to civil rights issues as public relations maneuvers.
“It is clear to me that despite the best efforts of many of us who work here, and outside advocates like Color Of Change, Facebook is choosing to be on the wrong side of history,” Chandwaney wrote.
Facebook denied allegations that it profits off hate.
“We don’t benefit from hate,” Facebook spokeswoman Liz Bourgeois said. “We invest billions of dollars each year to keep our community safe and are in deep partnership with outside experts to review and update our policies.”
Uber promises 100 percent of its rides in the United States and Canada will be in electric vehicles by 2030.
Uber struck partnerships with General Motors and the Renault, Nissan and Mitsubishi alliance to help provide drivers with discounts. Uber will also introduce a fare surcharge for the vehicles. Uber rival Lyft has also pledged to go completely electric by 2030 but will not provide any support to drivers making the switch.
Uber also released its first-ever report on the environmental impact of its business. The company decreased the carbon intensity of rides by 6.1 percent between 2017 and 2019.
“The world is at a critical juncture, and we all have a role to play. Uber is aiming high,” Uber chief executive Dara Khosrowshahi said in a letter accompanying the report. “The ultimate success of our business will rest on our ability to transition our platform to clean energy in partnership with drivers, industry innovators, and governments.”
A February study found that Uber and Lyft generate nearly 70 percent more pollution than the trips than they displace, including bike rides and public transit, the Verge reported.
Rant and rave
A summer of protest and upheaval has put pressure on the tech industry to become more equitable and inclusive.
And then there’s this job listing Recode’s Teddy Schleifer found:
The job includes the innovative tasks of tracking their boss’s vacation home guests … and optimizing their credit card reward points.
Does anyone know what this means?? NBC News’s Olivia Solon
Our suggestion for the movie name? The Devil Wears Patagonia.
The Financial Times’s Dave Lee.
Inside the industry
Virtual Kitchen, a start-up founded by two ex-Uber executives, has raised $20 million.
The company specializes in technology to set up commercial kitchens designated for delivery, or “ghost kitchens,” CNBC reports. The company will go up against a similar business by former Google chief executive Travis Kalanick, who has raised $400 million for his company Cloud Kitchens.
- The Center for Democracy and Technology hosts Sen. Ron Wyden (D-Ore.) and FCC Commissioner Geoffrey Starks for a virtual conversation moderated by CDT President and CEO Alexandra Givens today at noon.
- The House Oversight and Reform Committee will hold a hearing on “Ensuring a Free, Fair, and Safe Election During the Coronavirus Pandemic” today at 1 p.m.
- USTelecom will host a virtual conversation on how industry and government are fighting illegal robocalls with FCC Chairman Ajit Pai and Colorado Attorney General Phil Weiser today at 1:45 p.m.
- The House Oversight and Reform Committee will hold a hearing on “Providing the Census Bureau with the Time to Produce a Complete and Accurate Census” on Thursday at 11 a.m.
- European Justice Commissioner Didier Reynders will participate in a Brookings virtual panel discussion on advancing the transatlantic dialogue on data privacy, security, artificial intelligence and consumer protection on Thursday at 10 a.m.
- The Justice Department’s Antitrust Division and the Federal Trade Commission will co-host the 19th annual International Competition Network (ICN) Conference online from Sept. 14-17.
- The Senate Judiciary Committee will hold a hearing, “Stacking the Tech: Has Google harmed competition in online advertising?” Sept. 15 at 2:30 p.m.
- Facebook Connect will take place virtually on Sept. 16.
- The Senate Judiciary Committee will hold a hearing to examine threats to U.S. intellectual property, focusing on cyberattacks and counterfeits during the coronavirus pandemic on Sept. 23 at 2:30 p.m.
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