 Alright, folks, we get to talk about Epic's lawsuit against Apple, because for those who don't know, they're not happy that Apple gets a 30% cut of the in-game currency purchases. They basically increase the prices to maintain the same cut they get in general, and Epic tried to circumvent this by offering people's ability to directly purchase virtual currency in Fortnite in their game, and Apple got so mad about that that they removed Fortnite from their devices. Same thing happened with the Google App Store as well. However, with Android, there are workarounds to get Fortnite still on Android device, because Android is not a locked platform. So the lawsuit's mainly focused on Apple right now, because Apple does hold a completely walled garden approach. In fact, Microsoft can't even launch an xCloud app on them because of Apple's strict requirements with how Apple wants to handle how games are accessed on their platform. They don't want people streaming games on xCloud. They just don't want that. They want people buying games through their App Store. They don't want streaming games. Now, other companies have found web browser-based workarounds, and it doesn't look like Microsoft is working on a web browser-based workaround for Apple users as well. But again, not ideal. It would be much more popular if they could get it into the App Store. And one approach to this is that that could benefit Microsoft is this lawsuit about Epic and their walled garden. However, one lesser talked about aspect of this lawsuit is that there's actually ramifications that if Epic wins, it's going to affect a lot more than Apple, while Epic is not actively suing Microsoft, Sony, and Nintendo. All three platform holders have the same walled garden with the same 30% cut. Why Epic is purposely going after Apple and not those platform holders? I have no idea. Maybe it's just because of a longer standing relationship thanks to Unreal Engine. But whatever the case might be, Epic isn't going after them. But the result of the lawsuit, if it goes in Epic's favor, could massively change the entire industry as the walled garden approach, a.k.a. there's only one way to get games, only one way to pay for games on these platforms is completely removed. So this is on Nintendo Life. It says, Epic's Apple lawsuit could have significant and serious ramifications for platform holders like Nintendo. So it says, Epic's Apple lawsuit could have significant and serious ramifications for platform holders like Nintendo, a judge warned. After its Battle Royale juggernaut Fortnite was removed from the App Store in August for violating terms and conditions, Epic called out Apple for taking 30% of the cut from developers and declared war. However, according to the latest court documents published on Friday, Judge Yavanna Gonzalez Rogers notes how it's not all that distinct from console platforms that charge developers the same 30% fee. So if you didn't know, anytime you buy something on the Internet eShop, whether it's virtual currency, whether it's buying a game, 30% of that purchase goes to Nintendo. Now what's interesting is, there's actually a cut of every game that releases on these platforms that go to the platform holders. So it's very interesting, this walled garden approach and combating it because to release a game physically on Switch, a cut of that game goes to Nintendo as well. So I don't think it's 30% however for the physical but it's still a percentage and I just find it extremely interesting that this is coming under fire for these platforms. So, according to the latest court documents published on Friday, Judge Rogers notes that it's going to be the same 30% fee. Indeed, Sony, Nintendo and Microsoft all operate similar walled gardens or closed platform models as Apple, whereby the hardware, operating system, digital marketplace and IEPs are all exclusive to the platform holder. Judge Rogers also mentions how the Nintendo Switch gaming laptops and tablets could have a significant overlap with the iOS platform due to their portable design. A final decision should be better informed regarding the impact of the walled garden model given the potential for significant and serious ramifications for Sony, Nintendo, Microsoft and their video game platforms. Basically, what the judge is trying to say and the court case will not be heard on trial until July of next year. So after E3D of next year is when we'll have to start worrying about this a bit and what the outcome is. The judge is saying they cannot fairly judge this just against Apple. They need to include Microsoft, Sony and Nintendo into their considerations. And whether or not there is a negative and significant impact on not only consumers but also businesses on this walled garden approach. And obviously what negative impacts would be on these platform holders as well and do these platform holders have the right to wall the garden. Now, on Android, they are completely open platforms. So having a walled garden on Android isn't possible because it is such an open platform. Yes, a lot of people use the Google App Store, but there's also the Amazon App Store. There's also APKs. You could just download off the internet and install on your Android phone. So there isn't really a walled garden there, even though a lot of people do use the Google App Store. But again, it's not walled off. Whereas Apple, Nintendo, Sony and Microsoft are all walled off. There is no other way to buy games on their platforms legally, anyways, without using their App Store. So they have closed ecosystems, closed OSs. Much to the chagrin of hackers out there who find a way around this stuff. Reality is that these are closed platforms and they've always been closed platforms and there's been nobody who's challenged whether or not they should be closed platforms. So does Apple, Nintendo, Sony and Microsoft have the right on platforms they provide and they create and they sell to have a closed OS to have a closed sale ecosystem? Do they have the right? And that's what's being fought for in court right now. This isn't just about Apple as the judge specifically mentioned that we can't just make this about Apple. We have to include these other platforms as well and take full consideration of the whole impact of this decision because they can't just make this about Apple, even though Epic is only making it about Apple. The judge has said this case is not just about Apple. It's about the entirety of walled gardens and if they should be allowed. And this is a very interesting discussion because I don't know which side of the fence I fall on. On one hand, I do think that platform holders have a bit of a right to do what they do because it's their platform. It's Apple's platform. It's Nintendo's platform. It's Microsoft and Sony's platform. They have a right to wall it off if they want because it's theirs. And if you don't like it, don't buy their platforms. Of course, there's not really alternatives to those platforms that exist either unless you consider the PC market, which is an open platform. That's why we have Steam. That's why we have Origin. That's why we have good old games. That's why we have the Epic Game Launcher. Like there's a lot of options on PC. Yes, a majority of people tend to use Steam, but not everyone. There are multiple options for most games. And if games choose to only be available on one of those platforms, you know, like Battle.net where you can get World of Warcraft or something. That's the developer's choice, right? They chose to only provide it that way, but they could provide it through other methods. So this is going to be interesting because I don't think Fortnite's issue is that their game is only available through the App Store. I don't think that bothers them. What bothers them is the 30% cut. But the lawsuit overall is talking about the walled garden approach in general. Rather than approaching that 30%, is this is too high of a cut? That there should be a custom amount of cut. Like maybe you charge 30% to buy software wholesale, but then digital currency is a smaller percentage cut, like a 10% cut or something. That could be a lawsuit that I could see having some interesting ramifications on these companies as they have to lower or at least equal what they charge physically. So as an example, Nintendo gets about 10% of every physical game sold. Now, this is not considering the money they make off the cartridges because the companies do need to purchase the cartridges wholesale from Nintendo. They're the only ones that make Switch cartridges. So they purchase those cartridges from Nintendo wholesale. But setting aside the cost of the carts, when you look at just the physical all the way up to the sale of the game, Nintendo gets about 10% of every physical game sold from these third party and indie companies. So the argument could be made legally that Nintendo, Sony and Microsoft need to match the digital percentages to the physical percentages. It can also be legally argued that because it's much easier to get digital purchases versus physical purchases that the percentages should be lower. But then the counter argument is, yeah, but you need to go through our shop to buy it. So we have a say at how much we can charge. And then that gets all the way back to the beginning of the lawsuit where this judge is like, Hey, is this even like an OK thing to do? Should Nintendo, Sony, Microsoft and Apple be forced to open up their operating system to allow other app stores? And, you know, does this create security concerns? Or is this purely just about who gets the money? Or should these closed off platforms still exist? But the actual sales platform, aka the eShop, the Xbox shop, the PlayStation network shop or the Apple app store be opened up? Should Apple have to drop a majority of their fees? And what makes the case interesting for Apple is there are certain cases where Apple doesn't charge 30%. And that makes things even stickier because depending on what kind of app you are changes the percentages that Apple takes. And that is really, really fishy because Nintendo, Microsoft and Sony are straight 30%. We don't care who you are. 30% it's ours. So I find this to be an extremely interesting court case. And I know a lot of people don't think, you know, that Epic is going to win because Apple is too big. And if the judge is going to drag Microsoft, Sony and Nintendo in, they're too big. They have more money as big as they are. Those three companies come out and even Microsoft on their own, Apple on their own could fight this. But, you know, those three companies are four companies coming together. How could their lawyers possibly lose this case? But again, it's going to be going to trial. There's going to be a jury. And in any case like this, the jury is the best way for a quote unquote underdog to come ahead. And I'm very curious to see what happens because Epic has a chance. We can't ignore that Epic has a chance. They would have dropped this lawsuit if they didn't feel like they had a chance. But they feel like they got a big chance. I mean heck, phones, iPhones that have Fortnite on them are selling for thousands of dollars on eBay right now because people want to play Fortnite on their phones, on Apple phones. So I think this is going to be something that's going to be hotly contested. And Epic obviously, maybe Epic knew that this was going to eventually drag Nintendo, Sony and Microsoft in. So maybe they're hoping to get support from other major third party devs like Activision and EA or something like that. Try to get them involved in the lawsuit as well because, you know, they could make potentially more money. But then again, these companies don't like to piss off platform holders because platform holders can easily just say your games can't come to our platform anymore. But then again, that's the walled garden. Can do companies have a right to tell you you can't bring your product. It's such a sticky situation that Epic's creating. But they have a point. This is why I don't know where I stand because I think that companies have a right to wall off their platform and charge whatever percenters they want to charge. But I also think companies have a right to say that that's wrong and that that's too much and that this is not good for consumers because it increases price for consumers and it's not good for the developers. So like I could see both sides of the argument and that's why I don't know which side I stand on. It's easy to say, you know what, you know, Epic back off, leave the status quo the way it is. Everyone's been fine with the status quo for decades. Why are we even challenging it? But at the same point, sometimes the status quo needs to be changed because this 30 percent cut was created, you know, decades ago. And, you know, should that stand in a day and age when digital purchases are a bigger deal than they've ever been? Like, should this change? Should it be a game by game basis? Should it be different for in-game currency versus overall game purchases? This is just such a sticky situation. And why is Epic only going after Apple? Is it because of their partnerships with Microsoft, Sony and Nintendo? Because of the Unreal Engine? Maybe they have so many partnerships. They don't want to jeopardize that. But the judge is going to bring that in the question too. I don't know what to think. There's going to be people hotly for one side or the other. It's almost like a political debate because it's going to court. It's kind of becoming political, right? Like this is about who's in the right? Should platforms be closed off and get the charge 30 percent? Or should they be opened up and developers get 100 percent of profits? I don't know. Because you can argue, well without the platform, you wouldn't have the consumer base to buy the game. So then that's fair for these companies to take a cut. But I don't know, man. I just don't know. This isn't going anywhere anytime soon. And again, won't have a resolution. Maybe. Possibly. If there's not more trials and more countersuits and all that stuff. Until July of next year. All right, folks. I'm Tenor RoboJets from Tenor Prime. Thank you so much for tuning in. And I'll catch you in the next one.