During a recent Y Combinator event, Epic Games CEO Tim Sweeney took a bold stand against what he describes as “gangster-style businesses” practiced by tech giants Apple and Google. Sweeney, whose company is behind the wildly popular Fortnite and the game development tool Unreal Engine, did not hold back in criticizing the tech behemoths for engaging in practices that he claims are illegal and detrimental to competitors.
Epic Games has a history of challenging major tech companies over alleged monopolistic behaviors, notably suing both Apple and Google regarding their app store practices. The legal battles have seen mixed outcomes; Epic won its case against Google but not against Apple. Nevertheless, the court did rule that Apple must allow developers to include links to alternative purchasing systems, a ruling that theoretically should reduce Apple’s grip on in-app transactions. However, Epic is still in legal wrangles with Apple, accusing them of skirting the court’s decision by introducing a token commission reduction that fails to offer genuine choice and benefit for developers.
At the event, Sweeney didn’t mince words, accusing Apple and Google of operating with a blatant disregard for law and ethics. He pointed out that these companies tend to choose illegal practices when the potential financial penalties are smaller than the would-be lost revenue, a strategy he referred to as “malicious compliance” with court verdicts.
The impact of these practices on Epic’s business was another focal point of Sweeney’s talk. He pointed to how Google’s warning about “unknown sources” discourages Android users from downloading the Epic Games Store, claiming that this deterrent leads to a significant 50-60% user drop-off. Similarly, Sweeney noted that on iOS in Europe, where the Epic Games Store is permitted by new regulations, Apple issues warnings that trigger an equivalent rate of user abandonment.
Such obstacles, which Sweeney labels as “textbook self-preferencing,” underscore the hurdles faced by companies attempting to compete with or operate alongside these tech giants. Sweeney argued that this kind of behavior pays off for big tech and will persist unless enforcement becomes significantly more stringent.
Further complicating matters is Apple’s imposition of a 50-cent core technology fee on each install for apps exceeding one million downloads, effectively making it economically unviable for many free-to-play games to launch through the Epic Games Store on iOS.
Despite these challenges, Sweeney shared that the Epic Games Store on iOS has managed to acquire some back-catalog games. He’s optimistic that with the Android version opening to developer submissions later this year, the platform’s library might see substantial growth. This move could provide newer opportunities for developers and offer a wider array of games to consumers, potentially shifting the current dynamics in the app marketplace.
