1 00:00:04,400 --> 00:00:07,800 Speaker 1: Welcome to Tech Stuff, a production from I Heart Radio. 2 00:00:11,800 --> 00:00:14,239 Speaker 1: Hey there, and welcome to tech Stuff. I'm your host, 3 00:00:14,360 --> 00:00:17,080 Speaker 1: Jonathan Strickland. I'm an executive producer with I Heart Radio. 4 00:00:17,120 --> 00:00:20,880 Speaker 1: And how the tech are you. I am currently on vacation, 5 00:00:21,000 --> 00:00:23,680 Speaker 1: so hopefully right now I'm doing great. I hope you 6 00:00:23,720 --> 00:00:26,319 Speaker 1: are too. But obviously I don't want to leave you 7 00:00:26,360 --> 00:00:29,400 Speaker 1: without an episode, so we are going to have a rerun. 8 00:00:29,560 --> 00:00:34,240 Speaker 1: This episode is called the Epic Epic versus Apple Battle. 9 00:00:34,720 --> 00:00:37,879 Speaker 1: It originally published in twenty twenty, and I think this 10 00:00:37,920 --> 00:00:42,320 Speaker 1: one is an important episode because if you have been 11 00:00:42,360 --> 00:00:46,000 Speaker 1: paying attention, you know that Apple is facing pressure around 12 00:00:46,000 --> 00:00:50,279 Speaker 1: the world due to its policy of making developers use 13 00:00:50,400 --> 00:00:54,840 Speaker 1: the in Apple payment processing system, where Apple gets a 14 00:00:55,480 --> 00:01:01,360 Speaker 1: thirty chunk in most cases of every transaction. And Epic 15 00:01:01,800 --> 00:01:04,520 Speaker 1: found kind of a work around on that and then 16 00:01:04,560 --> 00:01:06,720 Speaker 1: got into hot water with Apple, and then Apple got 17 00:01:06,720 --> 00:01:09,680 Speaker 1: into hot water all around the world. So really, while 18 00:01:09,720 --> 00:01:13,160 Speaker 1: I wouldn't say this is the very beginning of the 19 00:01:13,200 --> 00:01:17,360 Speaker 1: world pushing back on Apple, UH, for those policies, UH, 20 00:01:17,520 --> 00:01:21,920 Speaker 1: this is probably the highest profile case. So let's sit 21 00:01:21,959 --> 00:01:26,440 Speaker 1: back and listen to this episode. As I record this, 22 00:01:26,560 --> 00:01:30,240 Speaker 1: it is August twenty twenty, and there is an epic 23 00:01:30,520 --> 00:01:36,360 Speaker 1: showdown going on between two tech companies, an epic epic showdown, 24 00:01:37,200 --> 00:01:41,360 Speaker 1: or or maybe an epic epic showdown. What I mean 25 00:01:41,360 --> 00:01:44,920 Speaker 1: to say is that the company Epic or Epic Games, 26 00:01:45,000 --> 00:01:48,160 Speaker 1: known for video games in general and the juggernaut game 27 00:01:48,360 --> 00:01:53,560 Speaker 1: Fortnite in particular, is facing off against the sometimes trillion 28 00:01:53,680 --> 00:01:58,560 Speaker 1: dollar monolithic company Apple, and things are getting spicy. But 29 00:01:59,320 --> 00:02:04,160 Speaker 1: why are these two companies feuding and how are things escalating? 30 00:02:04,720 --> 00:02:07,200 Speaker 1: As I research and write this, the fight is just 31 00:02:07,360 --> 00:02:10,799 Speaker 1: gearing up, but it promises to get much nastier over time. 32 00:02:11,160 --> 00:02:15,079 Speaker 1: Today we're going to learn about the conflict between these companies, 33 00:02:15,280 --> 00:02:17,520 Speaker 1: as well as get a deeper understanding of the way 34 00:02:17,520 --> 00:02:22,320 Speaker 1: that apps, services and Apple make money, because really that's 35 00:02:22,320 --> 00:02:25,280 Speaker 1: what this all boils down to, the method that companies 36 00:02:25,320 --> 00:02:28,160 Speaker 1: follow to make money and how they can make more 37 00:02:28,240 --> 00:02:31,000 Speaker 1: money and keep more of the money they make. So, 38 00:02:31,760 --> 00:02:35,239 Speaker 1: you know, spoiler alert, that's really what this is all 39 00:02:35,280 --> 00:02:39,160 Speaker 1: about when you get down to it. But first some background. Now, 40 00:02:39,600 --> 00:02:43,280 Speaker 1: I've done an episode about Fortnite that published back in 41 00:02:43,400 --> 00:02:45,799 Speaker 1: February of two thousand nineteen, so I'm not going to 42 00:02:45,919 --> 00:02:49,240 Speaker 1: go over the entire history of Fortnite. But let's do 43 00:02:49,320 --> 00:02:52,400 Speaker 1: a quick rundown of Epic Games so we understand where 44 00:02:52,400 --> 00:02:57,240 Speaker 1: they're coming from. Way back in, a guy named Tim 45 00:02:57,320 --> 00:03:01,120 Speaker 1: Sweeney was programming video games and saying them onto floppy 46 00:03:01,200 --> 00:03:04,720 Speaker 1: disks and then sending those disks out over the mail. 47 00:03:05,080 --> 00:03:09,240 Speaker 1: And he was using the company name Potomac Computer Systems. 48 00:03:09,840 --> 00:03:12,320 Speaker 1: He hired on a couple of important people as well, 49 00:03:12,520 --> 00:03:18,080 Speaker 1: Mark Rhyan and Cliff Blazynski. In Sweeney would rename this 50 00:03:18,160 --> 00:03:21,960 Speaker 1: company and it became Epic Mega Games, and the founders 51 00:03:22,040 --> 00:03:25,600 Speaker 1: started creating lots of games that got a pretty good reception. 52 00:03:26,080 --> 00:03:30,040 Speaker 1: A few years later, as computers got more powerful and 53 00:03:30,120 --> 00:03:33,960 Speaker 1: graphics cards began to be a thing, Epic evolved into 54 00:03:34,040 --> 00:03:37,840 Speaker 1: Epic Games and the company released a computer engine, a 55 00:03:38,160 --> 00:03:42,560 Speaker 1: game engine called the Unreal Engine. So computer engines or 56 00:03:42,680 --> 00:03:45,320 Speaker 1: video game engines are sort of a block of code 57 00:03:45,520 --> 00:03:49,400 Speaker 1: that provide tools to game developers, like physics engines and 58 00:03:49,480 --> 00:03:53,080 Speaker 1: graphics engines, and a game engine saves game developers a 59 00:03:53,120 --> 00:03:55,360 Speaker 1: lot of time and a lot of effort. It provides 60 00:03:55,760 --> 00:04:00,360 Speaker 1: some basic functionality that the game developers can then build upon. 61 00:04:00,440 --> 00:04:03,320 Speaker 1: It's like the framework, and it keeps developers from having 62 00:04:03,360 --> 00:04:05,920 Speaker 1: to reinvent the wheel every time they want to build 63 00:04:05,920 --> 00:04:10,080 Speaker 1: a game. The Unreal Engine would become a really popular 64 00:04:10,240 --> 00:04:13,120 Speaker 1: game engine, and that will play an important part in 65 00:04:13,160 --> 00:04:17,120 Speaker 1: our story. Around two thousand and six, Epic Games began 66 00:04:17,200 --> 00:04:21,600 Speaker 1: to saunter casually over to the world of console video games, 67 00:04:21,880 --> 00:04:26,520 Speaker 1: developing titles or adapting existing PC games for the Xbox 68 00:04:26,560 --> 00:04:30,320 Speaker 1: three sixty. The company was branching out beyond PC and 69 00:04:30,520 --> 00:04:34,000 Speaker 1: Mac titles. Some of their earliest games that you know 70 00:04:34,080 --> 00:04:37,520 Speaker 1: Epic produced were available on the Mac computer. That will 71 00:04:37,600 --> 00:04:41,040 Speaker 1: also play an important part of our story. The company 72 00:04:41,080 --> 00:04:44,520 Speaker 1: announced Fortnite in two thousand eleven, it would take a 73 00:04:44,520 --> 00:04:49,240 Speaker 1: few years before it actually would debut, and in a 74 00:04:49,360 --> 00:04:53,400 Speaker 1: Chinese company called ten Cent Holdings ended up buying a 75 00:04:53,560 --> 00:04:57,560 Speaker 1: forty percent stake in Epic Games for a three hundred 76 00:04:57,680 --> 00:05:02,880 Speaker 1: thirty million dollars, a princely sum. This, by the way, 77 00:05:03,120 --> 00:05:07,160 Speaker 1: makes Epic another potential target in the ongoing political and 78 00:05:07,240 --> 00:05:11,039 Speaker 1: trade battle between the United States and China for much 79 00:05:11,120 --> 00:05:15,240 Speaker 1: the same reason that TikTok is under scrutiny. But that's 80 00:05:15,279 --> 00:05:18,760 Speaker 1: a different topic that will probably not come back into 81 00:05:18,800 --> 00:05:21,240 Speaker 1: this episode. I think I don't know. I'm just at 82 00:05:21,279 --> 00:05:24,760 Speaker 1: the beginning of writing this, I'm reading my old notes, okay, 83 00:05:24,760 --> 00:05:27,200 Speaker 1: so I can say definitively no, that's not going to 84 00:05:27,279 --> 00:05:31,040 Speaker 1: come back in. In two thousand and fourteen, Epic announced 85 00:05:31,160 --> 00:05:34,200 Speaker 1: that when Fortnite would launch, it was going to be 86 00:05:34,279 --> 00:05:37,040 Speaker 1: a free to play game. Now, this is also a 87 00:05:37,080 --> 00:05:40,200 Speaker 1: big part of our story. So a free to play 88 00:05:40,320 --> 00:05:44,839 Speaker 1: game is a little bit deceptive. It is free to 89 00:05:45,040 --> 00:05:48,400 Speaker 1: download and install and play one of these games, but 90 00:05:48,440 --> 00:05:53,480 Speaker 1: it typically has in game transactions, and these are transactions 91 00:05:53,480 --> 00:05:57,719 Speaker 1: where players can spend real world money and enhance their 92 00:05:57,760 --> 00:06:00,760 Speaker 1: game play in some way. Games do this different ways. 93 00:06:00,960 --> 00:06:04,599 Speaker 1: Some games allow players to purchase upgrades that give them 94 00:06:04,640 --> 00:06:08,680 Speaker 1: an advantage in the game. The derogatory name for this 95 00:06:08,839 --> 00:06:12,400 Speaker 1: style of game is called pay to win, the implication 96 00:06:12,480 --> 00:06:16,160 Speaker 1: being that a mediocre player can dominate people who have 97 00:06:16,240 --> 00:06:19,040 Speaker 1: spent more time and developed more skill in the game 98 00:06:19,440 --> 00:06:22,919 Speaker 1: just by dishing out more cash for upgrades, and a 99 00:06:22,960 --> 00:06:27,400 Speaker 1: lot of gamers view this as being inherently unfair. Other 100 00:06:27,440 --> 00:06:31,320 Speaker 1: games only allow for cosmetic transactions, so it's stuff that 101 00:06:31,440 --> 00:06:34,520 Speaker 1: changes the appearance of different elements in the game, like 102 00:06:34,960 --> 00:06:39,320 Speaker 1: a player's outfit or their weapons, skins or whatever. And 103 00:06:39,400 --> 00:06:43,760 Speaker 1: some games incorporate are element of randomness in the transactions 104 00:06:43,760 --> 00:06:47,440 Speaker 1: with loot boxes. With these games, you don't buy specific 105 00:06:47,600 --> 00:06:52,440 Speaker 1: upgrades or cosmetic changes. Instead, you buy a crate or 106 00:06:52,520 --> 00:06:56,119 Speaker 1: a loot box which you then open within the game, 107 00:06:56,279 --> 00:06:58,760 Speaker 1: and only then do you find out what you've got 108 00:06:58,960 --> 00:07:02,880 Speaker 1: from inside the crate or box. It's a classic mystery 109 00:07:02,960 --> 00:07:06,000 Speaker 1: bag idea. If you ever went into a store where 110 00:07:06,240 --> 00:07:07,960 Speaker 1: the country stores used to do this all the time 111 00:07:08,000 --> 00:07:10,480 Speaker 1: where I was growing up, where you would have bags 112 00:07:10,520 --> 00:07:13,080 Speaker 1: that would just be a a mystery bag. There'd be 113 00:07:13,120 --> 00:07:14,920 Speaker 1: a toy inside, but there'll be no way of knowing 114 00:07:14,960 --> 00:07:17,480 Speaker 1: what toy was in there until you bought the bag 115 00:07:17,760 --> 00:07:19,920 Speaker 1: and then you could open it, So you have no 116 00:07:19,960 --> 00:07:22,360 Speaker 1: clue what's inside, and you have to take a gamble 117 00:07:22,600 --> 00:07:25,239 Speaker 1: if you purchase it, maybe it will be something cool 118 00:07:25,400 --> 00:07:28,440 Speaker 1: or maybe it'll be something lame. And on a side note, 119 00:07:28,520 --> 00:07:32,120 Speaker 1: there's a definite art to designing these style of loot boxes. 120 00:07:32,440 --> 00:07:34,920 Speaker 1: You want there to be just enough payout to keep 121 00:07:34,960 --> 00:07:38,720 Speaker 1: players engaged and buying the crates, So you need to 122 00:07:38,800 --> 00:07:42,360 Speaker 1: keep those payouts just rare enough so that it feels 123 00:07:42,400 --> 00:07:46,000 Speaker 1: like an accomplishment to get, you know, a rare skin 124 00:07:46,240 --> 00:07:49,200 Speaker 1: or something like that, but not so rare that people 125 00:07:49,200 --> 00:07:52,280 Speaker 1: feel they're getting nothing but garbage every time they buy 126 00:07:52,280 --> 00:07:55,040 Speaker 1: a lootbox. So this is not easy to do, and 127 00:07:55,080 --> 00:07:58,920 Speaker 1: it's also something that can encourage unhealthy behavior as akin 128 00:07:59,000 --> 00:08:01,680 Speaker 1: to addiction. And it's set the core of why games 129 00:08:01,720 --> 00:08:05,120 Speaker 1: that have these sorts of transactions often come under scrutiny 130 00:08:05,160 --> 00:08:09,040 Speaker 1: by various advocacy groups and governments around the world. Now 131 00:08:09,080 --> 00:08:12,240 Speaker 1: that's another kettle of fish, but the micro transactions get 132 00:08:12,280 --> 00:08:14,720 Speaker 1: to the very heart of the matter we're looking at 133 00:08:14,760 --> 00:08:18,559 Speaker 1: in this episode. In two thousand nineteen, Epic Games made 134 00:08:18,640 --> 00:08:23,440 Speaker 1: another big move. They launched the Epic Games Store. Now, 135 00:08:23,480 --> 00:08:27,680 Speaker 1: over its relatively short history, the PC games industry has 136 00:08:27,720 --> 00:08:30,760 Speaker 1: seen some pretty massive changes in how companies sell and 137 00:08:30,800 --> 00:08:34,640 Speaker 1: distribute games. So in the old old days, you had 138 00:08:34,679 --> 00:08:37,880 Speaker 1: game programmers like Sweeney who would build a game and 139 00:08:37,920 --> 00:08:41,360 Speaker 1: then make copies of it on discs floppy discs, and 140 00:08:41,360 --> 00:08:45,160 Speaker 1: then sell them either by mail order or sometimes going 141 00:08:45,200 --> 00:08:48,880 Speaker 1: through like a local computer hobby store. And that evolved 142 00:08:48,920 --> 00:08:52,720 Speaker 1: into game developers and publishers selling games through brick and 143 00:08:52,760 --> 00:08:56,280 Speaker 1: mortar retail shops like game Stop or best Buy or 144 00:08:56,320 --> 00:09:00,840 Speaker 1: Walmart or whatever. But over the last decade, the model 145 00:09:01,040 --> 00:09:06,439 Speaker 1: has shifted dramatically over toward digital distribution. The vast majority 146 00:09:06,520 --> 00:09:10,160 Speaker 1: of games are now sold through digital downloads, more than 147 00:09:10,240 --> 00:09:14,520 Speaker 1: eighty percent since two thousand eighteen. This changes the model 148 00:09:14,840 --> 00:09:17,280 Speaker 1: a lot, and it's one of the reasons why companies 149 00:09:17,320 --> 00:09:20,280 Speaker 1: like game Stop are really in trouble these days. But 150 00:09:20,400 --> 00:09:23,560 Speaker 1: you still need a place to sell your games. You 151 00:09:23,600 --> 00:09:26,720 Speaker 1: need a shopping portal or something. Now you could try 152 00:09:26,760 --> 00:09:29,960 Speaker 1: and do this through your own company's web page, but 153 00:09:30,000 --> 00:09:32,920 Speaker 1: the problem with that is that you're asking gamers to 154 00:09:32,960 --> 00:09:35,680 Speaker 1: go to a lot of different websites when they're in 155 00:09:35,720 --> 00:09:38,760 Speaker 1: the mood to buy a game. Most gamers like to 156 00:09:38,800 --> 00:09:42,040 Speaker 1: play a variety of titles from a variety of companies. 157 00:09:42,240 --> 00:09:44,400 Speaker 1: There are very few gamers who are like, I'm only 158 00:09:44,400 --> 00:09:47,559 Speaker 1: going to buy games from this one company, and smaller 159 00:09:47,600 --> 00:09:50,440 Speaker 1: independent developers have a hard time standing out with so 160 00:09:50,520 --> 00:09:53,800 Speaker 1: many big companies that are in the industry. So having 161 00:09:53,880 --> 00:09:57,679 Speaker 1: a centralized digital store where you can look at titles 162 00:09:57,720 --> 00:10:01,000 Speaker 1: from big or small companies that ended up being a 163 00:10:01,040 --> 00:10:04,000 Speaker 1: really great idea, And that was an idea that a 164 00:10:04,000 --> 00:10:07,880 Speaker 1: company called Valve, famous for video game series like Half 165 00:10:07,920 --> 00:10:12,040 Speaker 1: Life in Portal had the Valve Digital store gave PC 166 00:10:12,200 --> 00:10:15,679 Speaker 1: gamers a centralized location where they could shop for games, 167 00:10:16,040 --> 00:10:19,600 Speaker 1: and Valve would end up making truckloads of cash off 168 00:10:19,640 --> 00:10:22,839 Speaker 1: of this, because the company would take a cut out 169 00:10:22,920 --> 00:10:27,080 Speaker 1: of every transaction made through the Valve Steam Store. If 170 00:10:27,120 --> 00:10:29,559 Speaker 1: you bought a title on Steam, whether it came from 171 00:10:29,640 --> 00:10:33,600 Speaker 1: Valve or not, Valve would get some of that cash, 172 00:10:34,040 --> 00:10:37,400 Speaker 1: and for a while, it was effectively the only game 173 00:10:37,440 --> 00:10:40,400 Speaker 1: in town, so to speak, unless you were to go 174 00:10:40,559 --> 00:10:45,120 Speaker 1: directly to each publisher. In two thousand nineteen, that changed. 175 00:10:45,480 --> 00:10:48,520 Speaker 1: Epic announced the Epic Game Store and also announced that 176 00:10:48,600 --> 00:10:51,200 Speaker 1: it was going to take a smaller cut than what 177 00:10:51,440 --> 00:10:54,640 Speaker 1: Valve was taking in their Steam Store. That would mean 178 00:10:54,640 --> 00:10:57,560 Speaker 1: that video game companies would get to keep more of 179 00:10:57,600 --> 00:11:00,760 Speaker 1: the money from those sales, and it would also mean 180 00:11:00,800 --> 00:11:02,760 Speaker 1: that if a company were to hold a sale, like 181 00:11:02,800 --> 00:11:05,560 Speaker 1: if they were to discount a title, they wouldn't take 182 00:11:05,600 --> 00:11:08,840 Speaker 1: as big a hit on revenue as a result, and 183 00:11:08,880 --> 00:11:12,920 Speaker 1: it introduced competition in the digital marketplace. Some of epics 184 00:11:13,000 --> 00:11:17,599 Speaker 1: moves upset gamers, particularly when they heard about specific titles 185 00:11:17,640 --> 00:11:21,600 Speaker 1: that would be exclusively sold through the Epics Store. Gamers 186 00:11:21,600 --> 00:11:24,280 Speaker 1: are not crazy about the idea of having to manage 187 00:11:24,480 --> 00:11:27,080 Speaker 1: to store accounts, I guess, but you could make a 188 00:11:27,080 --> 00:11:30,280 Speaker 1: strong argument that competition would ultimately be a good thing, 189 00:11:30,600 --> 00:11:32,520 Speaker 1: even if it meant you had to go to two 190 00:11:32,559 --> 00:11:36,040 Speaker 1: stops when you were shopping for games instead of just one, 191 00:11:36,440 --> 00:11:39,319 Speaker 1: And that really sets the stage for the show down 192 00:11:39,360 --> 00:11:44,360 Speaker 1: with Apple. Epic Games has done something really smart with Fortnite. Actually, 193 00:11:44,400 --> 00:11:47,200 Speaker 1: they've done a lot of smart things, including lifting the 194 00:11:47,280 --> 00:11:50,600 Speaker 1: battle Royal concept that was working so well for video 195 00:11:50,640 --> 00:11:54,600 Speaker 1: games like Player Unknowns Battlegrounds and then applying it to Fortnite. 196 00:11:54,600 --> 00:11:57,600 Speaker 1: That transformed that game and made it into the juggernaut 197 00:11:57,679 --> 00:12:00,120 Speaker 1: it is. But Epic has followed what I think of 198 00:12:00,360 --> 00:12:04,600 Speaker 1: as the Netflix strategy. One of the things that Netflix 199 00:12:04,720 --> 00:12:07,920 Speaker 1: really got right early on when it started making movies 200 00:12:07,960 --> 00:12:11,520 Speaker 1: available to stream online is that the company worked hard 201 00:12:11,840 --> 00:12:14,800 Speaker 1: to make sure that this service would be available across 202 00:12:14,880 --> 00:12:18,800 Speaker 1: a ton of different platforms. Netflix wanted to make sure 203 00:12:18,840 --> 00:12:21,600 Speaker 1: that users would be able to access the service no 204 00:12:21,640 --> 00:12:25,520 Speaker 1: matter how they watch video, So that meant that Netflix 205 00:12:25,559 --> 00:12:28,679 Speaker 1: had its web based interface, and then it also had 206 00:12:28,679 --> 00:12:32,440 Speaker 1: an interface for smart TVs and one for smartphones and 207 00:12:32,440 --> 00:12:36,559 Speaker 1: one for video game consoles. Essentially, the idea was, if 208 00:12:36,600 --> 00:12:40,160 Speaker 1: this thing can play video, Netflix wants an interface to 209 00:12:40,200 --> 00:12:43,120 Speaker 1: go on it, and the strategy paid off big time. 210 00:12:43,120 --> 00:12:47,000 Speaker 1: It meant Netflix could cast a truly wide, you know, 211 00:12:48,200 --> 00:12:52,560 Speaker 1: net to capture as much audience as possible. Epic has 212 00:12:52,600 --> 00:12:56,360 Speaker 1: done something similar with Fortnite. Game developers often have to 213 00:12:56,360 --> 00:13:00,000 Speaker 1: weigh some pretty tough decisions when it comes to making games. 214 00:13:00,720 --> 00:13:04,559 Speaker 1: One strategy is to build games for a specific platform 215 00:13:04,760 --> 00:13:08,160 Speaker 1: and just to focus on that exclusively. And that gives 216 00:13:08,160 --> 00:13:11,440 Speaker 1: you the ability to really refine the game for that 217 00:13:11,559 --> 00:13:14,839 Speaker 1: specific platform and and and make sure that everything is 218 00:13:14,880 --> 00:13:17,800 Speaker 1: working well, and you end up with the most polished, 219 00:13:17,880 --> 00:13:22,160 Speaker 1: well designed game you can create. So if you want 220 00:13:22,240 --> 00:13:24,640 Speaker 1: the game to be available on more than one platform, 221 00:13:24,920 --> 00:13:26,560 Speaker 1: such as let's say that you want the game to 222 00:13:26,559 --> 00:13:30,160 Speaker 1: be playable on PC as well as on a PlayStation console, 223 00:13:30,800 --> 00:13:33,280 Speaker 1: well then you have to devote time to adapting the 224 00:13:33,320 --> 00:13:37,559 Speaker 1: game to work on the other platform. Because games are 225 00:13:37,559 --> 00:13:40,400 Speaker 1: not just something you can copy and paste over on 226 00:13:40,720 --> 00:13:43,760 Speaker 1: to one thing from the other. You can't just pull 227 00:13:43,840 --> 00:13:46,200 Speaker 1: the code from a PC game and PLoP it into 228 00:13:46,200 --> 00:13:49,040 Speaker 1: the PlayStation store. It doesn't work that way. So you 229 00:13:49,080 --> 00:13:52,920 Speaker 1: really have two choices, one of which doesn't make much sense. 230 00:13:53,520 --> 00:13:56,920 Speaker 1: That choice is to essentially recreate the game entirely for 231 00:13:56,960 --> 00:14:00,360 Speaker 1: the new platform. This would mean building the same game 232 00:14:00,480 --> 00:14:03,840 Speaker 1: two times, at least only the second time you're doing 233 00:14:03,840 --> 00:14:08,440 Speaker 1: it for a different system. That's not really efficient. That's 234 00:14:08,440 --> 00:14:10,520 Speaker 1: not a great way to go about it. It's certainly 235 00:14:10,520 --> 00:14:12,959 Speaker 1: not a cost effective way to go about it. So 236 00:14:13,000 --> 00:14:16,800 Speaker 1: the other way is to port the game over, which 237 00:14:16,840 --> 00:14:19,920 Speaker 1: means you're really trying to keep as much of the 238 00:14:19,960 --> 00:14:24,440 Speaker 1: basic code you built for the original game whatever platform 239 00:14:24,480 --> 00:14:27,880 Speaker 1: moves on, like for PC, and only focus on making 240 00:14:27,960 --> 00:14:31,600 Speaker 1: changes where it's necessary in order to run on a 241 00:14:31,680 --> 00:14:35,640 Speaker 1: different platform like the PlayStation or whatever other platform you're 242 00:14:35,640 --> 00:14:39,040 Speaker 1: developing for. Either way, it's a process that takes more 243 00:14:39,080 --> 00:14:43,000 Speaker 1: time and resources to complete. Some companies will farm this 244 00:14:43,160 --> 00:14:46,400 Speaker 1: sort of work out to other game developers, and this 245 00:14:46,480 --> 00:14:49,440 Speaker 1: gives the original company the freedom to do other stuff 246 00:14:49,480 --> 00:14:53,680 Speaker 1: like developed downloadable content or otherwise known as DLC for 247 00:14:53,760 --> 00:14:56,520 Speaker 1: that original title, or to work on a brand new 248 00:14:56,600 --> 00:15:01,680 Speaker 1: game with Fortnite, Epic developed versions for pretty much every 249 00:15:01,760 --> 00:15:05,680 Speaker 1: conceivable platform. There are versions of Fortnite that you can 250 00:15:05,680 --> 00:15:09,640 Speaker 1: play on PC, on Mac, on the Xbox One, the 251 00:15:09,680 --> 00:15:14,560 Speaker 1: PlayStation four, the Nintendo Switch, on Android, phones and iOS 252 00:15:14,600 --> 00:15:19,000 Speaker 1: devices like iPhone and iPads. So epics approach is again, 253 00:15:19,880 --> 00:15:23,520 Speaker 1: if this thing can play games, we want to be there. Now. 254 00:15:23,560 --> 00:15:26,680 Speaker 1: I say that knowing there are other gaming platforms out there, 255 00:15:27,160 --> 00:15:29,480 Speaker 1: like you know, handhelds and stuff like that, So don't 256 00:15:29,560 --> 00:15:32,240 Speaker 1: yell at me, you know what I mean. What's more, 257 00:15:32,800 --> 00:15:36,200 Speaker 1: as an added value to the game, Epic has included 258 00:15:36,200 --> 00:15:40,120 Speaker 1: the ability to have a lot of cross platform play. Now, 259 00:15:40,160 --> 00:15:43,440 Speaker 1: this means that people playing the game on totally different 260 00:15:43,480 --> 00:15:48,240 Speaker 1: systems can potentially play together in the same game or match. This, 261 00:15:48,360 --> 00:15:50,360 Speaker 1: by the way, helps illustrate the fact that all these 262 00:15:50,400 --> 00:15:54,320 Speaker 1: systems are ultimately computers when you really get down to it, 263 00:15:55,120 --> 00:15:58,240 Speaker 1: and that would mean that you could play on PC, 264 00:15:58,400 --> 00:16:00,600 Speaker 1: your friend could be on a PlayStation, and the two 265 00:16:00,640 --> 00:16:02,760 Speaker 1: of you could actually play in the same game. Now, 266 00:16:02,800 --> 00:16:07,080 Speaker 1: typically that doesn't really happen that much. At first, this 267 00:16:07,200 --> 00:16:10,680 Speaker 1: cross platform ability wasn't quite universal. You would run into 268 00:16:10,680 --> 00:16:14,200 Speaker 1: weird situations where player A could play with player B, 269 00:16:14,760 --> 00:16:17,640 Speaker 1: but they couldn't play with players C, and player B 270 00:16:17,800 --> 00:16:21,400 Speaker 1: could play with either A or CE, but they could 271 00:16:21,440 --> 00:16:24,960 Speaker 1: not play with both at the same time. However, over time, 272 00:16:24,960 --> 00:16:28,080 Speaker 1: Epic would roll out more a cross platform support. In 273 00:16:28,120 --> 00:16:31,200 Speaker 1: two thousand nineteen, they tweaked this a bit so that 274 00:16:31,360 --> 00:16:34,640 Speaker 1: players who were on Nintendo Switch would by default get 275 00:16:34,720 --> 00:16:37,720 Speaker 1: grouped into games with mobile players, you know, people on 276 00:16:37,760 --> 00:16:41,520 Speaker 1: Android phones or iOS devices, whereas Xbox and PS four 277 00:16:41,560 --> 00:16:46,200 Speaker 1: players were by default grouped together. The company still allowed 278 00:16:46,440 --> 00:16:50,240 Speaker 1: people to create parties to form across these technological divides 279 00:16:50,280 --> 00:16:53,360 Speaker 1: if they really wanted to. It's just the differences and 280 00:16:53,520 --> 00:16:57,720 Speaker 1: system power and controls really make a big impact on gameplay. 281 00:16:57,920 --> 00:17:00,360 Speaker 1: It could be very difficult for someone on mobile to 282 00:17:00,720 --> 00:17:03,960 Speaker 1: compete head to head against someone on PC, for example. 283 00:17:04,560 --> 00:17:07,720 Speaker 1: But anyway, that's epics set up. When we come back, 284 00:17:08,000 --> 00:17:10,320 Speaker 1: we'll do a brief rundown on Apple and then we'll 285 00:17:10,359 --> 00:17:14,119 Speaker 1: talk about why these companies are waging war. But first 286 00:17:14,560 --> 00:17:27,160 Speaker 1: let's take a quick break. So Apple, I've done a 287 00:17:27,280 --> 00:17:31,520 Speaker 1: series of episodes about Apple, and it was one of 288 00:17:31,560 --> 00:17:34,719 Speaker 1: the early personal computer companies to emerge out of the 289 00:17:34,760 --> 00:17:39,040 Speaker 1: hobbyist scene of the nineteen seventies. The original Apple computer, 290 00:17:39,240 --> 00:17:43,520 Speaker 1: the Apple one, was really a hobbyist computer. It wasn't 291 00:17:43,560 --> 00:17:46,040 Speaker 1: until the introduction of the Apple two line that you 292 00:17:46,080 --> 00:17:48,280 Speaker 1: started seeing machines that could appeal to people who were 293 00:17:48,680 --> 00:17:50,399 Speaker 1: you know, they were geeks, but they weren't you know, 294 00:17:50,480 --> 00:17:55,720 Speaker 1: like hardcore computer hobbyists geeks. Then you had the introduction 295 00:17:55,760 --> 00:17:59,359 Speaker 1: of the Macintosh computer in four that's going to have 296 00:17:59,400 --> 00:18:02,639 Speaker 1: an interesting call back later in this episode. Then co 297 00:18:02,800 --> 00:18:06,600 Speaker 1: founder Steve Jobs either quit or was fired from the company. 298 00:18:06,760 --> 00:18:11,560 Speaker 1: He was definitely pushed aside, And so even if he quit, 299 00:18:12,119 --> 00:18:15,960 Speaker 1: that was because he had essentially been neutralized by company 300 00:18:16,000 --> 00:18:20,000 Speaker 1: management at that time. Now, after the ousting of Steve Jobs, 301 00:18:20,280 --> 00:18:24,640 Speaker 1: Apple executives would make a series of really bad decisions 302 00:18:24,880 --> 00:18:28,480 Speaker 1: that ultimately put the computer in jeopardy. Now I'm not 303 00:18:28,520 --> 00:18:31,280 Speaker 1: going to go into detail because they aren't really relevant 304 00:18:31,320 --> 00:18:34,119 Speaker 1: for this episode, except to say I'm sure that the 305 00:18:34,160 --> 00:18:38,080 Speaker 1: brushes with bankruptcy shaped the company as a result and 306 00:18:38,119 --> 00:18:41,960 Speaker 1: created a sort of steely resolve to reverse course. So 307 00:18:42,000 --> 00:18:45,920 Speaker 1: Steve Jobs, who had left the company in nineteen five, 308 00:18:46,240 --> 00:18:49,359 Speaker 1: would end up being called back to Apple a little 309 00:18:49,400 --> 00:18:53,879 Speaker 1: more than a decade later in to act as something 310 00:18:53,920 --> 00:18:57,159 Speaker 1: of a like a counselor or advisor, And before long 311 00:18:57,440 --> 00:19:00,919 Speaker 1: he was able to regain control or if you prefer, 312 00:19:01,080 --> 00:19:05,600 Speaker 1: rest control of the company, first as an interim CEO 313 00:19:05,720 --> 00:19:10,199 Speaker 1: and then ultimately as the permanent CEO. Apple was in 314 00:19:10,320 --> 00:19:13,320 Speaker 1: bad shape and Jobs was determined to fix it and 315 00:19:13,320 --> 00:19:15,560 Speaker 1: then make sure the company would never be in such 316 00:19:15,600 --> 00:19:19,080 Speaker 1: a precarious position again. I think it's fair to say 317 00:19:19,560 --> 00:19:22,720 Speaker 1: he had a bit of a ruthless edge to him. 318 00:19:22,800 --> 00:19:26,679 Speaker 1: He was also a remarkable salesman and always had been. 319 00:19:27,240 --> 00:19:31,960 Speaker 1: While the course corrections helped improve Apple standing, what really 320 00:19:32,000 --> 00:19:34,919 Speaker 1: turned things around for the company was the introduction of 321 00:19:34,960 --> 00:19:38,199 Speaker 1: a little device that could play music files. This was 322 00:19:38,240 --> 00:19:42,040 Speaker 1: called the iPod, and Jobs unveiled it on October twenty 323 00:19:42,119 --> 00:19:47,200 Speaker 1: three one. Two years later, Apple would launch the iTunes store, 324 00:19:47,359 --> 00:19:52,480 Speaker 1: and that would really be a transformative moment for the company. Now, 325 00:19:52,520 --> 00:19:55,639 Speaker 1: the iPod helped Apple get a new foothold in the 326 00:19:55,680 --> 00:19:59,280 Speaker 1: consumer market. The company would strengthen that over time with 327 00:19:59,359 --> 00:20:02,639 Speaker 1: the introduction the iPhone and, to a lesser extent, the 328 00:20:02,640 --> 00:20:06,359 Speaker 1: iPad and the eye Watch. But the iPod and iPhone 329 00:20:06,680 --> 00:20:11,280 Speaker 1: were slam dunks or touchdowns or Grand Slam home runs 330 00:20:11,320 --> 00:20:14,200 Speaker 1: or whatever impressive sports analogy you would like to use. 331 00:20:14,520 --> 00:20:19,119 Speaker 1: That's what they were. They weren't just popular, they became iconic. Heck, 332 00:20:19,160 --> 00:20:22,919 Speaker 1: the iPod didn't invent the MP three player, but it 333 00:20:23,240 --> 00:20:27,479 Speaker 1: certainly defined the MP three player. We usually call shows 334 00:20:27,520 --> 00:20:31,359 Speaker 1: like mine like tech stuff podcasts for a reason, and 335 00:20:31,400 --> 00:20:34,720 Speaker 1: that reason is the Apple iPod. But I want to 336 00:20:34,720 --> 00:20:38,720 Speaker 1: tell you guys an important fact. The iPod helped turn 337 00:20:38,760 --> 00:20:43,120 Speaker 1: Apple around. The iPhone secured Apple's place as the company 338 00:20:43,160 --> 00:20:48,119 Speaker 1: that makes status symbols that are esthetically appealing technology. Though 339 00:20:48,160 --> 00:20:50,400 Speaker 1: I should also admit that the company was on that 340 00:20:50,440 --> 00:20:53,320 Speaker 1: path already with the redesign of Mac computers and the 341 00:20:53,359 --> 00:20:56,800 Speaker 1: evolution of the iPod. But one thing that would truly 342 00:20:56,880 --> 00:20:59,800 Speaker 1: set Apple apart was the introduction of the iTunes store 343 00:21:00,000 --> 00:21:02,960 Speaker 1: back in two thousand three. So the company had first 344 00:21:03,400 --> 00:21:06,880 Speaker 1: made an iTunes program in two thousand one, but at 345 00:21:06,920 --> 00:21:10,600 Speaker 1: that time, iTunes was really just about letting users rip 346 00:21:10,760 --> 00:21:13,199 Speaker 1: music from their c d s and then load the 347 00:21:13,240 --> 00:21:16,840 Speaker 1: files onto their iPods. In two thousand three, the company 348 00:21:16,840 --> 00:21:20,240 Speaker 1: began to act as a sort of music retailer, offering 349 00:21:20,320 --> 00:21:24,080 Speaker 1: up downloads of individual songs. And this was the start 350 00:21:24,160 --> 00:21:27,520 Speaker 1: of a massive change in how the music industry had 351 00:21:27,560 --> 00:21:31,399 Speaker 1: been working. And it would presage you like that word, 352 00:21:31,880 --> 00:21:35,040 Speaker 1: the change in the video game industry by you know, 353 00:21:35,080 --> 00:21:38,520 Speaker 1: like a decade. So since the introduction of the long 354 00:21:38,560 --> 00:21:42,639 Speaker 1: playing album or LP record, companies have been marketing full 355 00:21:42,720 --> 00:21:46,040 Speaker 1: albums as sort of the preferred product. Now you could 356 00:21:46,080 --> 00:21:49,199 Speaker 1: go and buy a single, typically with a B side 357 00:21:49,400 --> 00:21:53,040 Speaker 1: song attached to it, but that was less common and 358 00:21:53,359 --> 00:21:55,200 Speaker 1: for those of you who have never dealt with music 359 00:21:55,320 --> 00:21:58,320 Speaker 1: on a physical medium, an album is a collection of 360 00:21:58,359 --> 00:22:01,680 Speaker 1: songs by a band or ourist, and a single is 361 00:22:01,720 --> 00:22:05,000 Speaker 1: a particular song off an album. Usually it's one that 362 00:22:05,040 --> 00:22:07,960 Speaker 1: the artist and the music label feels has a particularly 363 00:22:08,040 --> 00:22:10,840 Speaker 1: catchy vibe to it. The goal of picking a single 364 00:22:10,920 --> 00:22:13,640 Speaker 1: is to pick out the standout hit or hits from 365 00:22:13,640 --> 00:22:17,280 Speaker 1: an album. In other words, but now Apple was allowing 366 00:22:17,280 --> 00:22:22,240 Speaker 1: people to purchase not just albums, but individual songs. Sometimes 367 00:22:22,600 --> 00:22:25,840 Speaker 1: your favorite song off an album might not be a single, 368 00:22:26,080 --> 00:22:28,880 Speaker 1: which means you normally wouldn't be able to buy just 369 00:22:29,520 --> 00:22:32,160 Speaker 1: that song. You would have to buy the whole album, 370 00:22:32,320 --> 00:22:35,320 Speaker 1: And if it's the only one you like off that album, 371 00:22:35,440 --> 00:22:38,080 Speaker 1: you might deliberate about whether or not it's worth it 372 00:22:38,160 --> 00:22:40,399 Speaker 1: to purchase the whole thing or not. Why would you 373 00:22:40,440 --> 00:22:44,240 Speaker 1: spend your money if you really just want one song. Now, 374 00:22:44,240 --> 00:22:47,919 Speaker 1: at the time Apple was introducing the iTunes store, music 375 00:22:48,000 --> 00:22:51,520 Speaker 1: piracy was running wild. People were using all sorts of 376 00:22:51,520 --> 00:22:55,679 Speaker 1: different services to share music and download specific songs. For 377 00:22:55,800 --> 00:22:59,240 Speaker 1: the music industry, Apple was helping solve a problem by 378 00:22:59,280 --> 00:23:03,399 Speaker 1: guarantee quality and safety to things that were not a 379 00:23:03,480 --> 00:23:08,040 Speaker 1: guarantee if you were, you know, using piracy, Apple could 380 00:23:08,080 --> 00:23:12,280 Speaker 1: convince people to buy music rather than just share it illegally. 381 00:23:12,760 --> 00:23:15,359 Speaker 1: If a song costs less than a dollar and you 382 00:23:15,440 --> 00:23:17,640 Speaker 1: knew it was going to be really good audio quality, 383 00:23:17,880 --> 00:23:20,840 Speaker 1: plus it wasn't going to infect your computer with a virus, 384 00:23:21,200 --> 00:23:23,919 Speaker 1: you might just go and purchase it. In fact, a 385 00:23:23,920 --> 00:23:27,000 Speaker 1: lot of research shows that piracy doesn't always come about 386 00:23:27,040 --> 00:23:29,520 Speaker 1: because people just don't want to pay for stuff. It 387 00:23:29,720 --> 00:23:33,040 Speaker 1: usually grows because people don't have options when it comes 388 00:23:33,080 --> 00:23:36,920 Speaker 1: to buying the stuff they like. So if you provide options, 389 00:23:37,280 --> 00:23:41,080 Speaker 1: you remove some of the motivation for piracy. Now, this 390 00:23:41,160 --> 00:23:44,600 Speaker 1: gave the iTunes store a nice healthy amount of support 391 00:23:44,720 --> 00:23:48,840 Speaker 1: early on, and in return, because iTunes was acting as 392 00:23:48,880 --> 00:23:52,640 Speaker 1: a sort of retail store for this music, Apple would 393 00:23:52,640 --> 00:23:56,800 Speaker 1: take a cut of the transaction. The music label would 394 00:23:56,800 --> 00:24:00,200 Speaker 1: get most of the money, but Apple would pocket air 395 00:24:00,240 --> 00:24:04,280 Speaker 1: percentage as well. And for music labels this wasn't that 396 00:24:04,440 --> 00:24:09,040 Speaker 1: big of a roadblock. Producing music on physical media is expensive. 397 00:24:09,359 --> 00:24:12,720 Speaker 1: You're dealing with actual materials like c d s or 398 00:24:12,760 --> 00:24:15,840 Speaker 1: cassettes or vinyl or whatever. It is. You want to 399 00:24:15,880 --> 00:24:19,600 Speaker 1: produce enough of that to meet consumer demand, but you 400 00:24:19,600 --> 00:24:22,320 Speaker 1: also don't want to go overboard and make more copies 401 00:24:22,359 --> 00:24:24,359 Speaker 1: than you can sell, because that's just a waste of 402 00:24:24,400 --> 00:24:27,719 Speaker 1: money in space. You also have to store that stuff, 403 00:24:27,760 --> 00:24:30,240 Speaker 1: and you have to ship it. In other words, there's 404 00:24:30,240 --> 00:24:34,639 Speaker 1: a cost associated with actually producing and selling music on 405 00:24:34,800 --> 00:24:40,080 Speaker 1: physical media. Going digital helped reduce or even remove a 406 00:24:40,080 --> 00:24:44,119 Speaker 1: lot of those costs, lowering the overhead, and so even 407 00:24:44,160 --> 00:24:46,919 Speaker 1: with Apple taking a cut, this looked like a pretty 408 00:24:46,920 --> 00:24:50,639 Speaker 1: good deal. That deal would send a precedent, one that 409 00:24:50,800 --> 00:24:53,560 Speaker 1: Apple would extend when it debuted the App Store for 410 00:24:53,600 --> 00:24:56,280 Speaker 1: the iPhone in the summer of two thousand eight. The 411 00:24:56,359 --> 00:24:59,320 Speaker 1: iPhone had come out the year before, and its launch 412 00:24:59,400 --> 00:25:03,480 Speaker 1: had been an enormous hit. The media went bonkers over 413 00:25:03,520 --> 00:25:09,800 Speaker 1: the introduction of the attractive, sleek, exciting smartphone called the iPhone. Now, 414 00:25:10,280 --> 00:25:12,919 Speaker 1: Apple was introducing the world to a marketplace where you 415 00:25:12,920 --> 00:25:17,240 Speaker 1: could download apps to enhance your phone experience. You might 416 00:25:17,440 --> 00:25:21,880 Speaker 1: download games, or productivity apps, or lifestyle apps or whatever 417 00:25:22,240 --> 00:25:25,399 Speaker 1: I mean you you know what apps are. Some of 418 00:25:25,440 --> 00:25:28,920 Speaker 1: those apps were free, some of them cost money. Some 419 00:25:29,000 --> 00:25:33,000 Speaker 1: included ways to make a purchase within the app. Itself. 420 00:25:33,640 --> 00:25:37,440 Speaker 1: So for most apps that involved any sort of transaction, 421 00:25:37,720 --> 00:25:40,800 Speaker 1: whether that was the purchase of the app itself or 422 00:25:40,840 --> 00:25:44,600 Speaker 1: a transaction that happened within the app, Apple would take 423 00:25:44,640 --> 00:25:48,400 Speaker 1: a cut because it was the facilitator, it was the 424 00:25:48,520 --> 00:25:52,560 Speaker 1: retail space, the marketer, the support system, it was how 425 00:25:52,760 --> 00:25:56,080 Speaker 1: people could get access to that software in the first place. 426 00:25:56,359 --> 00:26:00,240 Speaker 1: So it took a thirty across the board cut for 427 00:26:00,359 --> 00:26:05,040 Speaker 1: certain transactions. Now, if an app is subscription based, Apple 428 00:26:05,040 --> 00:26:11,120 Speaker 1: would reduce that to upon the second year of a subscription, 429 00:26:11,520 --> 00:26:15,280 Speaker 1: but that covers a much smaller percentage of apps. Also, 430 00:26:15,320 --> 00:26:18,480 Speaker 1: I should point out that for some transactions, Apple does 431 00:26:18,560 --> 00:26:21,960 Speaker 1: not take a cut. For example, a ride hailing app 432 00:26:22,040 --> 00:26:25,639 Speaker 1: like Lift or Uber doesn't have to share of affair 433 00:26:25,720 --> 00:26:28,800 Speaker 1: with Apple. Nor does a food delivery service have to 434 00:26:28,800 --> 00:26:32,000 Speaker 1: give Apple a cut for every order made through the 435 00:26:32,080 --> 00:26:36,080 Speaker 1: iPhone app on that food delivery service. But in many cases, 436 00:26:36,320 --> 00:26:40,200 Speaker 1: for every dollar spent within an iPhone app, Apple gets 437 00:26:40,240 --> 00:26:42,960 Speaker 1: thirty cents and the other seventy cents go to the 438 00:26:43,000 --> 00:26:46,600 Speaker 1: app developer or you know, whatever entity owns the rights 439 00:26:46,640 --> 00:26:50,960 Speaker 1: to that app. Apple services make up a pretty sizeable 440 00:26:51,119 --> 00:26:54,359 Speaker 1: chunk of Apple's revenue. Now, it's not the biggest chunk. 441 00:26:54,640 --> 00:26:57,920 Speaker 1: iPhone sales are still the king there. They can make 442 00:26:58,000 --> 00:27:03,480 Speaker 1: up to around of all revenue for the company. That's impressive. However, 443 00:27:03,880 --> 00:27:07,520 Speaker 1: revenue and profit are two different things. Revenue is how 444 00:27:07,600 --> 00:27:10,840 Speaker 1: much money you bring in by selling stuff. Profit is 445 00:27:10,840 --> 00:27:13,480 Speaker 1: how much money you have left over once you deduct 446 00:27:13,520 --> 00:27:17,320 Speaker 1: the costs of producing and selling things, essentially the costs 447 00:27:17,359 --> 00:27:21,240 Speaker 1: of business from the money that you brought in. So yeah, 448 00:27:21,359 --> 00:27:24,600 Speaker 1: iPhone sales make up the lions share of revenue, but 449 00:27:24,720 --> 00:27:29,119 Speaker 1: it still costs money to produce each iPhone, though not 450 00:27:29,320 --> 00:27:32,520 Speaker 1: that much money compared to how much Apple sales them for. 451 00:27:32,720 --> 00:27:35,520 Speaker 1: But that's another matter. Now. While I haven't seen the 452 00:27:35,560 --> 00:27:39,720 Speaker 1: figures and I can't make any definitive statements, I feel 453 00:27:39,800 --> 00:27:43,480 Speaker 1: fairly confident that the profit margin on Apple's App store 454 00:27:44,080 --> 00:27:48,359 Speaker 1: is much better than its iPhone sales. The more apps 455 00:27:48,400 --> 00:27:52,120 Speaker 1: that join with in app transactions, the more money Apple 456 00:27:52,240 --> 00:27:56,240 Speaker 1: collects as a result. Oh and there's one other important 457 00:27:56,240 --> 00:27:59,840 Speaker 1: element to this. Apple only allows users to get iPhone 458 00:27:59,880 --> 00:28:03,520 Speaker 1: apps through the Apple Store. That means, if you want 459 00:28:03,560 --> 00:28:06,680 Speaker 1: to run an app on your iPhone and you don't 460 00:28:06,680 --> 00:28:08,480 Speaker 1: want to go through the trouble figuring out how to 461 00:28:08,640 --> 00:28:12,160 Speaker 1: hack your phone. So you can sideload apps, you have 462 00:28:12,280 --> 00:28:15,000 Speaker 1: to go through the official app store. There is no 463 00:28:15,080 --> 00:28:18,480 Speaker 1: other game in town. So any company that wants to 464 00:28:18,520 --> 00:28:21,199 Speaker 1: make apps for iPhones, and there are a lot of 465 00:28:21,200 --> 00:28:24,840 Speaker 1: companies that do, they have to play ball with Apple. 466 00:28:25,600 --> 00:28:29,800 Speaker 1: Most companies just deal with this, partly because iPhone users 467 00:28:29,840 --> 00:28:33,520 Speaker 1: tend to spend more money on apps than other smartphone 468 00:28:33,600 --> 00:28:37,879 Speaker 1: users do. Numerous analysts have estimated that when it comes 469 00:28:37,920 --> 00:28:42,600 Speaker 1: to consumers spending money on or within an app, more 470 00:28:42,640 --> 00:28:45,960 Speaker 1: than six of the dollars spent on apps are going 471 00:28:46,040 --> 00:28:50,480 Speaker 1: to io S app transactions, in other words, Apple transactions. 472 00:28:51,000 --> 00:28:54,840 Speaker 1: Now that's particularly amazing because while the iPhone is popular, 473 00:28:55,280 --> 00:28:59,840 Speaker 1: Android phones outnumber them in the world by a huge amount. 474 00:29:00,120 --> 00:29:02,880 Speaker 1: Way more people have an Android phone than an iPhone. 475 00:29:03,520 --> 00:29:07,920 Speaker 1: But we're seeing more people spend money through the iOS 476 00:29:08,000 --> 00:29:11,640 Speaker 1: ecosystem than through the Android ecosystem. So while we've got 477 00:29:11,680 --> 00:29:14,800 Speaker 1: way more Android apps out there in the wild, we 478 00:29:14,840 --> 00:29:17,840 Speaker 1: don't have a lot of people spending money on apps 479 00:29:17,960 --> 00:29:21,600 Speaker 1: through Android, not compared to Apple. So this means if 480 00:29:21,600 --> 00:29:24,480 Speaker 1: you're a developer and if you want to make money 481 00:29:24,520 --> 00:29:28,000 Speaker 1: off of the app you're developing, chances are you're going 482 00:29:28,040 --> 00:29:31,160 Speaker 1: to want to make something specifically for Apple. It just 483 00:29:31,520 --> 00:29:36,120 Speaker 1: makes business sense anyway. Developers have to submit apps to 484 00:29:36,200 --> 00:29:39,240 Speaker 1: Apple for approval before it will be featured in the store. 485 00:29:39,600 --> 00:29:42,640 Speaker 1: And note from Jonathan in the past, that was a 486 00:29:42,640 --> 00:29:45,280 Speaker 1: lot of app noises all at once. I hope future 487 00:29:45,360 --> 00:29:48,360 Speaker 1: Jonathan can say them without stumbling. I like it when 488 00:29:48,400 --> 00:29:52,440 Speaker 1: I leave notes to myself. Developers also agree to keep 489 00:29:52,600 --> 00:29:56,760 Speaker 1: in app transactions within the Apple ecosystem as well, meaning 490 00:29:56,880 --> 00:30:00,240 Speaker 1: you can't sneakly do an out of app d le 491 00:30:00,400 --> 00:30:04,920 Speaker 1: or a direct payment option and change things within the 492 00:30:04,960 --> 00:30:07,960 Speaker 1: app that is running on iOS. You can't do that. 493 00:30:08,040 --> 00:30:10,200 Speaker 1: You're not allowed to. You have to do it through Apple. 494 00:30:10,800 --> 00:30:14,200 Speaker 1: So we've got Fortnite, a game that makes its money 495 00:30:14,200 --> 00:30:17,840 Speaker 1: primarily through in game purchases, and we've got Apple, a 496 00:30:17,880 --> 00:30:21,320 Speaker 1: game that generates revenue largely by taking a cut from 497 00:30:21,480 --> 00:30:24,480 Speaker 1: an app purchases. I bet you can see where I'm 498 00:30:24,520 --> 00:30:29,080 Speaker 1: going here. Epic Games decided to pick a fight with Apple, 499 00:30:29,280 --> 00:30:32,800 Speaker 1: and this fight also extended to Google, but we'll cover 500 00:30:32,920 --> 00:30:35,400 Speaker 1: that as well. And this is not an opinion. This 501 00:30:35,480 --> 00:30:39,000 Speaker 1: is based on the timing of events that the company 502 00:30:39,040 --> 00:30:42,400 Speaker 1: had clearly anticipated what was going to unfold. And I 503 00:30:42,440 --> 00:30:44,920 Speaker 1: think Epic is counting on other companies to join in 504 00:30:44,960 --> 00:30:48,800 Speaker 1: the fight at some point to protest apples cut. But 505 00:30:48,920 --> 00:30:54,600 Speaker 1: here's how it played out. On August, Epic announced a 506 00:30:54,720 --> 00:30:58,520 Speaker 1: change in the price of v bucks v as in Victory. 507 00:30:58,560 --> 00:31:01,240 Speaker 1: That's the in game current and see for Fortnite, so 508 00:31:01,400 --> 00:31:04,760 Speaker 1: you can give it as a virtual currency, so players 509 00:31:04,760 --> 00:31:08,480 Speaker 1: will purchase v bucks with real cash, then they can 510 00:31:08,520 --> 00:31:12,120 Speaker 1: spend the v bucks in the game itself on whatever 511 00:31:12,160 --> 00:31:16,719 Speaker 1: they want. Epic called the change of price a mega drop, 512 00:31:17,120 --> 00:31:20,440 Speaker 1: and announced that in game purchases would now cost twenty 513 00:31:20,520 --> 00:31:24,440 Speaker 1: percent less than they had previously, So if you played 514 00:31:24,480 --> 00:31:27,720 Speaker 1: Fortnite on PC or on a game console, you would 515 00:31:27,760 --> 00:31:30,640 Speaker 1: see those prices reflected within the game itself. Whenever you 516 00:31:30,640 --> 00:31:32,800 Speaker 1: went to make a purchase, you would see it at 517 00:31:33,000 --> 00:31:36,719 Speaker 1: seven dollars nine cents for a thousand V bucks instead 518 00:31:36,800 --> 00:31:41,000 Speaker 1: of nine dollars and cents. But for mobile it was 519 00:31:41,000 --> 00:31:45,040 Speaker 1: a different story. Playing the game on either an iOS 520 00:31:45,160 --> 00:31:47,840 Speaker 1: or Android device would mean that when you went to 521 00:31:47,880 --> 00:31:50,880 Speaker 1: purchase v bucks, you would be presented with a choice. 522 00:31:51,240 --> 00:31:54,440 Speaker 1: One choice was to purchase the virtual currency through the 523 00:31:54,520 --> 00:31:59,440 Speaker 1: official Approved App Store or Google Play Store route, and 524 00:31:59,480 --> 00:32:02,600 Speaker 1: that would also mean having to pay the older higher 525 00:32:02,680 --> 00:32:06,760 Speaker 1: price of nine dollars and cents to get that tent 526 00:32:07,600 --> 00:32:11,520 Speaker 1: marked down. You could make a direct purchase from the 527 00:32:11,560 --> 00:32:15,680 Speaker 1: Epic Games Store by passing the app Store transaction in 528 00:32:15,720 --> 00:32:20,560 Speaker 1: the process, so gamers would get that reduced price. But 529 00:32:20,760 --> 00:32:23,680 Speaker 1: while the gamers might save some money on a transaction, 530 00:32:24,000 --> 00:32:27,040 Speaker 1: there was a much bigger price to be paid. More 531 00:32:27,080 --> 00:32:30,640 Speaker 1: on that in a second, but first let's take another 532 00:32:30,720 --> 00:32:42,560 Speaker 1: quick break. Epic sidestepping the in app purchase part of 533 00:32:42,600 --> 00:32:46,880 Speaker 1: having Fortnite run on iOS and on Android was a 534 00:32:47,000 --> 00:32:51,040 Speaker 1: big no no, because that deal is codified. If you 535 00:32:51,120 --> 00:32:55,320 Speaker 1: submit an app to iOS or Android, you're doing so 536 00:32:55,640 --> 00:33:02,480 Speaker 1: with the understanding and the express agreement that you are 537 00:33:02,080 --> 00:33:05,400 Speaker 1: on board with the conditions of that deal. And one 538 00:33:05,440 --> 00:33:10,320 Speaker 1: of those conditions is that cut going to Apple or Google. 539 00:33:10,400 --> 00:33:13,200 Speaker 1: I'll just keep talking about Apple because that's really what 540 00:33:13,320 --> 00:33:15,680 Speaker 1: most of the attention is on, but just know that 541 00:33:15,720 --> 00:33:18,600 Speaker 1: a lot of this applies to Google as well. Apple 542 00:33:18,680 --> 00:33:23,040 Speaker 1: responded by removing Fortnite from their app store. Google did 543 00:33:23,080 --> 00:33:27,440 Speaker 1: the same. Apple's official response was that Epic had flagrantly 544 00:33:27,600 --> 00:33:30,920 Speaker 1: broken the rules that everyone had agreed to play by, 545 00:33:31,200 --> 00:33:34,000 Speaker 1: and that they didn't even do it by accident, and 546 00:33:34,080 --> 00:33:37,200 Speaker 1: Epic definitely did do it on purpose. The company released 547 00:33:37,240 --> 00:33:41,000 Speaker 1: a statement that said, currently there are no savings if 548 00:33:41,040 --> 00:33:44,800 Speaker 1: players use Apple and Google payment options, where Apple and 549 00:33:44,840 --> 00:33:49,600 Speaker 1: Google collect an exorbitant fee on all payments. If Apple 550 00:33:49,640 --> 00:33:52,880 Speaker 1: and Google lower their fees on payments, Epic will pass 551 00:33:53,040 --> 00:33:57,520 Speaker 1: along the savings to players end quote. Epic also argued 552 00:33:57,560 --> 00:34:01,800 Speaker 1: that Apple isn't consistent when it comes to applying that fee, 553 00:34:02,120 --> 00:34:05,120 Speaker 1: and pointed out the exceptions like the right hailing companies 554 00:34:05,160 --> 00:34:09,080 Speaker 1: I mentioned earlier, or food delivery services or Amazon purchases. 555 00:34:09,600 --> 00:34:12,359 Speaker 1: So Epic was saying, hey, if these apps can use 556 00:34:12,440 --> 00:34:16,360 Speaker 1: direct payments and not go through the Apple payment process, 557 00:34:16,920 --> 00:34:21,160 Speaker 1: why can't games? Why are you holding us to a 558 00:34:21,200 --> 00:34:26,319 Speaker 1: different standard than these companies? So Apple booted Fortnite from 559 00:34:26,360 --> 00:34:30,080 Speaker 1: the App store, and then Epic filed a lawsuit against 560 00:34:30,120 --> 00:34:33,880 Speaker 1: Apple and launched a media campaign to inspire support for 561 00:34:33,920 --> 00:34:38,920 Speaker 1: its argument among the public and probably among other companies. Now, 562 00:34:38,960 --> 00:34:40,799 Speaker 1: the fact that it was ready to go with all 563 00:34:40,840 --> 00:34:43,920 Speaker 1: of this pretty much proves that Epic knew exactly what 564 00:34:43,960 --> 00:34:46,880 Speaker 1: the consequences were going to be for their actions, and 565 00:34:46,920 --> 00:34:50,400 Speaker 1: in fact, we're counting on it. The lawsuit argues that 566 00:34:50,440 --> 00:34:54,239 Speaker 1: Apple has a monopoly over all iPhone apps because the 567 00:34:54,280 --> 00:34:57,680 Speaker 1: company doesn't allow users to load apps from any source 568 00:34:57,840 --> 00:35:02,560 Speaker 1: other than the Apple Store. Because Apple has this cut 569 00:35:02,600 --> 00:35:07,160 Speaker 1: requirement on some but not all app transactions, Epic argues 570 00:35:07,239 --> 00:35:11,040 Speaker 1: that Apple is engaging in unfair business practices. As for 571 00:35:11,080 --> 00:35:15,279 Speaker 1: the marketing side, Epic got pretty darn cheeky with that. 572 00:35:15,880 --> 00:35:19,480 Speaker 1: They created a parody of an iconic Apple ad. So 573 00:35:19,719 --> 00:35:23,160 Speaker 1: let's do a quick story about that. Back when Apple 574 00:35:23,440 --> 00:35:27,279 Speaker 1: was getting ready to unveil the new Macintosh computer in 575 00:35:27,320 --> 00:35:30,520 Speaker 1: the early eighties, the company was determined to make a 576 00:35:30,600 --> 00:35:33,960 Speaker 1: really big splash and cut through the dominant position that 577 00:35:34,080 --> 00:35:38,840 Speaker 1: was then held by IBM. Apple had done well in 578 00:35:38,880 --> 00:35:41,840 Speaker 1: the personal computer market with the Apple two series, but 579 00:35:42,000 --> 00:35:47,480 Speaker 1: IBM absolutely dominated when it came to office computers. If 580 00:35:47,480 --> 00:35:50,600 Speaker 1: you wanted a machine for productivity and doing you know, 581 00:35:50,920 --> 00:35:55,400 Speaker 1: business e type stuff, you wanted an IBM computer. Plus, 582 00:35:55,680 --> 00:35:59,040 Speaker 1: IBM had been getting into the personal computer market as well, 583 00:35:59,080 --> 00:36:02,279 Speaker 1: and appley to tell the world that the Macintosh was 584 00:36:02,320 --> 00:36:06,160 Speaker 1: a fundamentally different type of computer, one with a graphic 585 00:36:06,239 --> 00:36:09,880 Speaker 1: user interface or gooey and features that the button down 586 00:36:09,920 --> 00:36:15,040 Speaker 1: IBM computers just didn't support. Apple hired on a marketing campaign, 587 00:36:15,520 --> 00:36:18,560 Speaker 1: and that campaign got hold of Ridley Scott, the film 588 00:36:18,600 --> 00:36:22,840 Speaker 1: director who directed the commercial. In the commercial, dozens of 589 00:36:22,880 --> 00:36:27,239 Speaker 1: people in sort of gray colorless outfits shamble into a 590 00:36:27,360 --> 00:36:30,120 Speaker 1: room and are seated in a dark theater to watch 591 00:36:30,160 --> 00:36:34,319 Speaker 1: a big Brother like figure spelled propaganda at them on 592 00:36:34,360 --> 00:36:38,439 Speaker 1: an enormous screen. And then an athletic woman runs into 593 00:36:38,480 --> 00:36:42,200 Speaker 1: the room and she hurls an enormous hammer that flies 594 00:36:42,239 --> 00:36:44,439 Speaker 1: at the screen and destroys it, just as the Big 595 00:36:44,480 --> 00:36:48,840 Speaker 1: Brother figure is, you know, ranting about tyrannical ideologies. And 596 00:36:48,880 --> 00:36:51,600 Speaker 1: the implication was there that Apple was on a mission 597 00:36:51,640 --> 00:36:55,160 Speaker 1: to offer a real alternative, to prove that the IBM 598 00:36:55,200 --> 00:36:58,600 Speaker 1: way of doing things wasn't the only way to do it. 599 00:36:59,000 --> 00:37:01,880 Speaker 1: And it was a really effective commercial, one of the 600 00:37:01,880 --> 00:37:05,920 Speaker 1: most famous commercials of all time. Epic Games produced a 601 00:37:05,960 --> 00:37:09,200 Speaker 1: parody of this. They actually showed it within the game itself, 602 00:37:09,200 --> 00:37:12,520 Speaker 1: but they also released it to other video platforms, and 603 00:37:12,560 --> 00:37:16,880 Speaker 1: they used computer generated Fortnite characters to replicate the whole sequence, 604 00:37:17,200 --> 00:37:20,880 Speaker 1: except this time, the Big Brother figure wasn't IBM, the 605 00:37:20,920 --> 00:37:24,200 Speaker 1: Big Brother figure was Apple, and the woman throwing the 606 00:37:24,239 --> 00:37:29,080 Speaker 1: hammer would represent Plucky Little Fortnite. The video game that 607 00:37:29,239 --> 00:37:36,799 Speaker 1: could plucky little global phenomenon billion dollar game Fortnite, And 608 00:37:36,840 --> 00:37:39,759 Speaker 1: now the message was that Apple was being the tyrannical 609 00:37:39,800 --> 00:37:44,080 Speaker 1: one by demanding this cut. If not for Apple, Epic 610 00:37:44,120 --> 00:37:46,799 Speaker 1: Games was saying companies would be able to price things 611 00:37:46,880 --> 00:37:49,760 Speaker 1: at a more affordable level for users because they wouldn't 612 00:37:49,800 --> 00:37:52,560 Speaker 1: have to build in and a mark up to deal 613 00:37:52,600 --> 00:37:56,560 Speaker 1: with Apple's cut. Big bad Apple's cut meant companies had 614 00:37:56,600 --> 00:37:59,279 Speaker 1: to charge more for stuff in order to make money. Now, 615 00:37:59,360 --> 00:38:02,279 Speaker 1: I admit I'm being a little snarky, you know, I'm 616 00:38:02,280 --> 00:38:06,040 Speaker 1: definitely editorializing a little here, But mostly I want to 617 00:38:06,080 --> 00:38:11,400 Speaker 1: state that from my perspective, nobody is looking particularly rosy 618 00:38:11,560 --> 00:38:14,600 Speaker 1: in this situation, and it's about to get a lot worse. 619 00:38:15,239 --> 00:38:18,920 Speaker 1: I think the industry's general approach to charging off the 620 00:38:18,960 --> 00:38:23,400 Speaker 1: top is flirting with collusion, because it's not that just 621 00:38:23,480 --> 00:38:25,920 Speaker 1: Apple that's doing it. Lots of companies are doing this 622 00:38:26,000 --> 00:38:29,600 Speaker 1: sort of thing. Not that companies have necessarily all tacitly 623 00:38:29,760 --> 00:38:32,640 Speaker 1: agreed that this is the way to do it, but 624 00:38:32,840 --> 00:38:37,600 Speaker 1: effectively it means there's no real competition here. Plus with Apple, 625 00:38:37,760 --> 00:38:41,239 Speaker 1: you could argue that from a pure ecosystem, there's no 626 00:38:41,280 --> 00:38:43,359 Speaker 1: way to compete at all. You have to go through 627 00:38:43,400 --> 00:38:47,400 Speaker 1: the Apple Store to have your game work on iOS, 628 00:38:47,480 --> 00:38:50,200 Speaker 1: so there is no other option. If you take a 629 00:38:50,200 --> 00:38:52,600 Speaker 1: step back, you can say, yeah, but you could just 630 00:38:52,680 --> 00:38:56,359 Speaker 1: develop games for other platforms and leave iPhone alone. And 631 00:38:56,400 --> 00:38:59,120 Speaker 1: that is true. So I guess it really just depends 632 00:38:59,160 --> 00:39:02,520 Speaker 1: on your point of view. You thank you, Obi Wan Kenobi. 633 00:39:03,120 --> 00:39:08,080 Speaker 1: But things escalated beyond Apple pulling Fortnite from the App Store. 634 00:39:08,320 --> 00:39:12,080 Speaker 1: The company subsequently said that unless Epic Games reverse the 635 00:39:12,120 --> 00:39:16,320 Speaker 1: move to offer direct payments, Apple would remove all support 636 00:39:16,520 --> 00:39:20,560 Speaker 1: for Epic Tools in the App Store for developers, not 637 00:39:20,680 --> 00:39:24,680 Speaker 1: just for iOS. That would mean that Epic would no 638 00:39:24,760 --> 00:39:27,839 Speaker 1: longer be able to update anything that was running on 639 00:39:27,960 --> 00:39:32,279 Speaker 1: iOS or the Mac operating system, and that includes the 640 00:39:32,480 --> 00:39:37,240 Speaker 1: Unreal Game Engine. Now this is where things get really nasty. 641 00:39:37,600 --> 00:39:40,480 Speaker 1: I'll quote the statement from Apple which says Epic wouldn't 642 00:39:40,480 --> 00:39:44,520 Speaker 1: be able to perform any quote engineering efforts to improve 643 00:39:44,640 --> 00:39:49,160 Speaker 1: hardware and software performance of Unreal Engine on Mac and iOS. Hardware, 644 00:39:49,520 --> 00:39:53,520 Speaker 1: optimize Unreal Engine on the Mac for creative workflows, virtual 645 00:39:53,600 --> 00:39:57,080 Speaker 1: sets and their c I slash build systems, and adoption 646 00:39:57,120 --> 00:40:00,480 Speaker 1: and support of art Kit features and future or VR 647 00:40:00,560 --> 00:40:05,160 Speaker 1: features into Unreal Engine by their XR teams end quote. Now, 648 00:40:05,200 --> 00:40:10,000 Speaker 1: as I mentioned earlier, hundreds of games rely on the 649 00:40:10,080 --> 00:40:13,040 Speaker 1: Unreal Game Engine, not just those from Epic but from 650 00:40:13,040 --> 00:40:16,520 Speaker 1: other companies as well. So if a company developed a 651 00:40:16,560 --> 00:40:20,840 Speaker 1: game that relied upon the Unreal Engine and they wanted 652 00:40:20,880 --> 00:40:25,520 Speaker 1: to market it on iOS or on the Mac operating system, 653 00:40:25,600 --> 00:40:28,959 Speaker 1: that game would no longer receive any engine updates because 654 00:40:29,000 --> 00:40:31,919 Speaker 1: Apple would have cut off that capability, and that would 655 00:40:31,960 --> 00:40:35,759 Speaker 1: cause an enormous disruption among game companies and could force 656 00:40:35,800 --> 00:40:38,480 Speaker 1: developers who are working on new games to choose a 657 00:40:38,480 --> 00:40:40,959 Speaker 1: totally different game engine when they're building out their games 658 00:40:40,960 --> 00:40:44,799 Speaker 1: in the future, because it would mean that a large 659 00:40:44,840 --> 00:40:49,080 Speaker 1: market for their game would be cut off automatically if 660 00:40:49,120 --> 00:40:52,800 Speaker 1: they used the Unreal Engine. That would be an enormous 661 00:40:52,840 --> 00:40:56,000 Speaker 1: blow to Epic Games as revenue as well, because the 662 00:40:56,000 --> 00:40:58,960 Speaker 1: company makes a lot of money off of other developers 663 00:40:59,080 --> 00:41:03,040 Speaker 1: licensing the Unreal game Engine. I think Apple making that 664 00:41:03,080 --> 00:41:06,839 Speaker 1: move is kind of stupid, you know what. No, No, 665 00:41:06,920 --> 00:41:11,799 Speaker 1: not kind of I think that move is monumentally stupid. Now, 666 00:41:11,800 --> 00:41:15,200 Speaker 1: the reason I think it's stupid is because it appears 667 00:41:15,239 --> 00:41:18,520 Speaker 1: to prove the point that Epic Games claims it is 668 00:41:18,560 --> 00:41:22,600 Speaker 1: making that Apple can and does act like a monopoly, 669 00:41:23,200 --> 00:41:27,160 Speaker 1: because it's very hard to not interpret Apple's move as 670 00:41:27,400 --> 00:41:32,520 Speaker 1: extortion or retaliation, applying brutal leverage against Epic Games to 671 00:41:32,600 --> 00:41:36,840 Speaker 1: force it to comply with Apple's standards. Now, yes, Epic 672 00:41:36,880 --> 00:41:40,799 Speaker 1: Games agreed to those standards just through the process of 673 00:41:40,880 --> 00:41:44,160 Speaker 1: submitting Fortnite to the iOS store in the first place, 674 00:41:44,400 --> 00:41:50,040 Speaker 1: So Epic is not innocent here. They did violate that agreement. However, 675 00:41:50,320 --> 00:41:53,480 Speaker 1: the retaliation and the impact of that retaliation, and the 676 00:41:53,520 --> 00:41:57,120 Speaker 1: implication that Apple could do serious harm to Epic Games 677 00:41:57,120 --> 00:41:59,960 Speaker 1: as business, as well as the business of unrelated companies, 678 00:42:00,239 --> 00:42:03,960 Speaker 1: all that seems to lend credence to Epics argument that 679 00:42:04,000 --> 00:42:08,200 Speaker 1: Apple is imposing its will on other companies. Now, it's 680 00:42:08,200 --> 00:42:10,920 Speaker 1: one thing to remove an app that's in violation of 681 00:42:10,960 --> 00:42:14,839 Speaker 1: the agreed upon policy. To me, that seems like it's 682 00:42:15,000 --> 00:42:17,920 Speaker 1: pretty clearly on the up and up. But then to 683 00:42:18,000 --> 00:42:21,960 Speaker 1: go further and remove all support for Epics products feels 684 00:42:21,960 --> 00:42:25,400 Speaker 1: extreme to me, particularly since this has a cascading effect 685 00:42:25,520 --> 00:42:28,799 Speaker 1: on other companies that did nothing wrong. All those other 686 00:42:28,840 --> 00:42:32,400 Speaker 1: companies did was license a game engine that powers their games. 687 00:42:32,719 --> 00:42:35,720 Speaker 1: So is it fair to make this kind of change 688 00:42:35,840 --> 00:42:38,200 Speaker 1: one that's going to have a negative impact on third 689 00:42:38,239 --> 00:42:40,640 Speaker 1: parties that had nothing to do with the dispute in 690 00:42:40,640 --> 00:42:44,160 Speaker 1: the first place. I think epics experience in launching the 691 00:42:44,160 --> 00:42:47,880 Speaker 1: game Store, which itself was a response to valves Steam 692 00:42:47,960 --> 00:42:51,520 Speaker 1: store policies, gave the company the courage to try and 693 00:42:51,640 --> 00:42:55,360 Speaker 1: launch this battle against Apple and to a lesser extent, Google. 694 00:42:55,960 --> 00:42:59,760 Speaker 1: Seeing the escalation is more than a little bit worrying. 695 00:43:00,239 --> 00:43:02,960 Speaker 1: And while the matter is going to the court system 696 00:43:03,080 --> 00:43:06,400 Speaker 1: thanks to the lawsuits, we're going to have to wait 697 00:43:06,440 --> 00:43:09,839 Speaker 1: a while for that to play out because you know, 698 00:43:10,120 --> 00:43:12,880 Speaker 1: we know, the legal system moves at a let's call 699 00:43:12,920 --> 00:43:16,719 Speaker 1: it a leisurely pace compared to the worlds of technology 700 00:43:16,760 --> 00:43:20,239 Speaker 1: and business, so it might be a while before the 701 00:43:20,320 --> 00:43:23,719 Speaker 1: law is able to really wade in into this now. 702 00:43:23,719 --> 00:43:26,279 Speaker 1: My bet is that Epic is hoping that the more 703 00:43:26,360 --> 00:43:29,960 Speaker 1: recent focus on companies like Apple and Google when it 704 00:43:30,000 --> 00:43:35,160 Speaker 1: comes to antitrust issues will provide political pressure so that 705 00:43:35,520 --> 00:43:40,919 Speaker 1: the companies can negotiate that cut, or somehow Epic can 706 00:43:40,960 --> 00:43:44,800 Speaker 1: force Apple to allow for more direct pay options. Honestly, 707 00:43:44,920 --> 00:43:48,120 Speaker 1: don't know how that's going to go for Epic. Apple 708 00:43:48,280 --> 00:43:52,880 Speaker 1: is a huge and incredibly wealthy company, and it didn't 709 00:43:52,920 --> 00:43:57,480 Speaker 1: get wealthy by capitulating to other companies. I don't think 710 00:43:57,520 --> 00:44:02,240 Speaker 1: there's necessarily a hero in this story, because it really 711 00:44:02,280 --> 00:44:05,600 Speaker 1: just comes down to money. I think Apple has behaved 712 00:44:05,600 --> 00:44:09,160 Speaker 1: in ways that are anti competitive, but when it comes 713 00:44:09,200 --> 00:44:13,640 Speaker 1: to cut that has become fairly standard and digital stores 714 00:44:13,760 --> 00:44:16,439 Speaker 1: across the board, So it's not like Apple is being 715 00:44:16,760 --> 00:44:21,040 Speaker 1: you know, greedier than anybody else's. And granted it is 716 00:44:21,080 --> 00:44:24,560 Speaker 1: not always the case. Epic itself has set itself apart 717 00:44:24,640 --> 00:44:28,360 Speaker 1: by taking smaller cuts of transactions in the Epic Game Store, 718 00:44:28,920 --> 00:44:31,920 Speaker 1: but I don't know that you can argue that Apple 719 00:44:32,040 --> 00:44:35,000 Speaker 1: stands out as being particularly evil because of this policy. 720 00:44:35,080 --> 00:44:39,000 Speaker 1: Lots of digital stores have the exact same policy. Now, 721 00:44:39,000 --> 00:44:41,200 Speaker 1: the fact that you can only get apps on an 722 00:44:41,239 --> 00:44:45,080 Speaker 1: iPhone through the App Store without hacking your phone, that is, 723 00:44:45,520 --> 00:44:47,759 Speaker 1: does make it a little more tricky because there's nowhere 724 00:44:47,800 --> 00:44:50,120 Speaker 1: else to go when it comes to the iPhone, So 725 00:44:50,160 --> 00:44:53,839 Speaker 1: I guess that does set it apart. In fact, this 726 00:44:53,920 --> 00:44:57,240 Speaker 1: is one of the ways that things branch between Apple 727 00:44:57,280 --> 00:44:59,960 Speaker 1: and Google. You can only get apps for the iPhone 728 00:45:00,320 --> 00:45:04,319 Speaker 1: through the Apple App Store, but Android devices support a 729 00:45:04,320 --> 00:45:06,640 Speaker 1: couple of different ways you can get stuff you can 730 00:45:06,719 --> 00:45:09,040 Speaker 1: sideload stuff that's not from the Google Play Store. It 731 00:45:09,040 --> 00:45:11,480 Speaker 1: requires you to change some settings on your phone, but 732 00:45:11,520 --> 00:45:14,600 Speaker 1: you can totally do it, and Android users can download 733 00:45:14,640 --> 00:45:19,040 Speaker 1: Fortnite onto an Android device directly from Epics app launcher. 734 00:45:19,760 --> 00:45:22,799 Speaker 1: Google removed Fortnite from the Play Store itself, so you 735 00:45:22,840 --> 00:45:26,000 Speaker 1: can't just download the app directly through Google Play. But 736 00:45:26,120 --> 00:45:29,120 Speaker 1: you can still get Fortnite on an Android device, and 737 00:45:29,160 --> 00:45:31,560 Speaker 1: you can still run it without a problem, you just 738 00:45:31,640 --> 00:45:34,720 Speaker 1: can't go through the Play Store to do it. Google, 739 00:45:35,000 --> 00:45:38,280 Speaker 1: like Apple, said that they removed the game because epics 740 00:45:38,320 --> 00:45:43,520 Speaker 1: decision to offer direct pay violated store policy. But unlike Apple, 741 00:45:43,760 --> 00:45:47,040 Speaker 1: Google hasn't gone all angry crime lord boss with threats 742 00:45:47,040 --> 00:45:49,719 Speaker 1: about Epics tools set and saying like I want the 743 00:45:49,760 --> 00:45:53,080 Speaker 1: app dead, I want the unreal engine dead, I want 744 00:45:53,120 --> 00:45:57,160 Speaker 1: those s d gys in the ground. They haven't done 745 00:45:57,200 --> 00:46:02,920 Speaker 1: that recently. Apples EO. Tim Cook appeared before Congress and 746 00:46:02,960 --> 00:46:06,960 Speaker 1: he was asked by Representative Hank Johnson, who coincidently represents 747 00:46:07,000 --> 00:46:10,480 Speaker 1: my state of Georgia if the company had ever quote 748 00:46:10,719 --> 00:46:15,000 Speaker 1: retaliated against or disadvantaged a developer who went public with 749 00:46:15,040 --> 00:46:19,160 Speaker 1: their frustrations with the app store end quote Cook's response was, 750 00:46:19,280 --> 00:46:23,719 Speaker 1: quote sir, we do not retaliate or bully people. It's 751 00:46:23,719 --> 00:46:29,160 Speaker 1: strongly against our company culture. End quote. I'm not certain 752 00:46:29,200 --> 00:46:32,920 Speaker 1: how well that would go over today as the Epic 753 00:46:33,080 --> 00:46:36,960 Speaker 1: versus Apple saga has been unfolding again. Not to say 754 00:46:37,000 --> 00:46:40,319 Speaker 1: that Epic is without blame here, but the decision to 755 00:46:40,360 --> 00:46:44,239 Speaker 1: remove Epics access to developer tools for iOS and mac 756 00:46:44,320 --> 00:46:49,799 Speaker 1: os seems like retaliation and bullying to me. Removing Fortnite 757 00:46:49,840 --> 00:46:53,200 Speaker 1: makes perfect sense. I mean, that was the the app 758 00:46:53,280 --> 00:46:57,080 Speaker 1: that violated the policy. That makes sense to me. Removing 759 00:46:57,120 --> 00:47:00,600 Speaker 1: Epics ability to develop for iOS and mac os entirely, 760 00:47:00,680 --> 00:47:05,239 Speaker 1: thus impacting Epic and numerous other companies economically, that one, 761 00:47:05,280 --> 00:47:08,239 Speaker 1: I think is harder to support. As I record this, 762 00:47:08,719 --> 00:47:11,600 Speaker 1: we're in the very early stages of this particular fight 763 00:47:12,080 --> 00:47:14,120 Speaker 1: at the moment, I think it's safe to say that 764 00:47:14,160 --> 00:47:16,760 Speaker 1: the US government has a few irons in the fire 765 00:47:16,880 --> 00:47:20,319 Speaker 1: right now that need tending to plus an election coming up, 766 00:47:20,600 --> 00:47:23,120 Speaker 1: so I wouldn't be surprised if it takes a little 767 00:47:23,120 --> 00:47:25,600 Speaker 1: bit of time to get around to taking another really 768 00:47:25,680 --> 00:47:29,800 Speaker 1: hard look at allegations of you know, monopoly practices or 769 00:47:29,840 --> 00:47:33,680 Speaker 1: anti competitive behaviors in the tech space. But it's clearly 770 00:47:33,760 --> 00:47:37,160 Speaker 1: something that has become a growing concern and government as 771 00:47:37,200 --> 00:47:41,360 Speaker 1: more practices in the tech space are held up to scrutiny. 772 00:47:41,480 --> 00:47:44,280 Speaker 1: Now this gets complicated by the fact that Silicon Valley 773 00:47:44,320 --> 00:47:48,320 Speaker 1: pours a lot of money. I almost used a different 774 00:47:48,719 --> 00:47:52,160 Speaker 1: phrase that is not you know, family friendly, but a 775 00:47:52,239 --> 00:47:56,960 Speaker 1: lot of money into lobbyists and campaign contributions. And thus 776 00:47:56,960 --> 00:48:00,200 Speaker 1: Silicon Valley has a large amount of influence when it 777 00:48:00,239 --> 00:48:03,000 Speaker 1: comes to US politics. But I expect we're going to 778 00:48:03,080 --> 00:48:07,480 Speaker 1: see more shifting as governments feel pressure to regulate or 779 00:48:07,600 --> 00:48:11,759 Speaker 1: break up or otherwise intervene in business practices in the 780 00:48:11,800 --> 00:48:15,960 Speaker 1: tech space. Meanwhile, Fortnite players who play on iPhone or 781 00:48:16,040 --> 00:48:18,800 Speaker 1: Mac are likely watching all of this with a little 782 00:48:18,800 --> 00:48:22,680 Speaker 1: bit of stress and probably makes doing that flossing dance 783 00:48:22,719 --> 00:48:26,800 Speaker 1: a lot harder. But to be less flippant, it really 784 00:48:26,880 --> 00:48:30,040 Speaker 1: is a shame that they are caught in the middle 785 00:48:30,040 --> 00:48:34,000 Speaker 1: of all this, That those players are stuck as these 786 00:48:34,040 --> 00:48:37,520 Speaker 1: two giant companies battle it out. They just want to 787 00:48:37,520 --> 00:48:41,000 Speaker 1: play a game that they enjoy, and they don't really 788 00:48:41,360 --> 00:48:46,359 Speaker 1: have any options as far as having an impact on this. 789 00:48:46,760 --> 00:48:49,840 Speaker 1: They can perhaps shift to playing it on a different platform, 790 00:48:49,880 --> 00:48:53,239 Speaker 1: but not everyone has that, you know, luxury. So I 791 00:48:53,680 --> 00:48:56,960 Speaker 1: really do feel for Fortnite players, even though I personally 792 00:48:57,040 --> 00:49:01,240 Speaker 1: don't like playing Fortnite because I'm old and I don't 793 00:49:01,280 --> 00:49:06,000 Speaker 1: do well at it and it confuses me. But I 794 00:49:06,080 --> 00:49:08,799 Speaker 1: hope that things get resolved, that the players are able 795 00:49:08,800 --> 00:49:11,200 Speaker 1: to play the games they want, and that we're able 796 00:49:11,239 --> 00:49:14,600 Speaker 1: to take a good hard look at how these companies 797 00:49:15,080 --> 00:49:18,480 Speaker 1: generate revenue, how they price things, and really come to 798 00:49:18,719 --> 00:49:23,120 Speaker 1: a good conclusion that works out best for all parties involved, 799 00:49:23,200 --> 00:49:28,880 Speaker 1: including us the consumers. I am skeptical that that will happen, 800 00:49:29,280 --> 00:49:33,359 Speaker 1: but I'm hopeful. I hope you enjoyed that rerun of 801 00:49:33,800 --> 00:49:36,759 Speaker 1: an episode from just a couple of years ago. And 802 00:49:36,800 --> 00:49:40,279 Speaker 1: obviously in those two years that have followed, we've seen 803 00:49:40,440 --> 00:49:45,520 Speaker 1: more pushback against Apple. We've seen Apple resist those regulations 804 00:49:45,560 --> 00:49:48,920 Speaker 1: that have been placed around the world, and the story 805 00:49:49,080 --> 00:49:51,120 Speaker 1: is far from over, so I'm sure we'll do a 806 00:49:51,160 --> 00:49:53,759 Speaker 1: follow up in the future. If you have suggestions for 807 00:49:53,800 --> 00:49:56,680 Speaker 1: topics I should cover on tech Stuff, please reach out 808 00:49:56,719 --> 00:49:59,080 Speaker 1: to me. You can do so on Twitter the handle 809 00:49:59,120 --> 00:50:01,160 Speaker 1: for the show is tech Stuff h s W, or 810 00:50:01,560 --> 00:50:04,560 Speaker 1: you can leave me a talkback message on the I 811 00:50:04,719 --> 00:50:08,840 Speaker 1: Heart radio app. Just go to the text Stuff entry 812 00:50:08,960 --> 00:50:11,440 Speaker 1: in the I heart Radio app. There's a little microphone 813 00:50:11,640 --> 00:50:14,000 Speaker 1: icon in there. You click on that you can leave 814 00:50:14,000 --> 00:50:16,239 Speaker 1: a voice message up to thirty seconds. Remember let me 815 00:50:16,280 --> 00:50:18,520 Speaker 1: know if you want me to use the voice message 816 00:50:18,840 --> 00:50:21,400 Speaker 1: in a future episode, and I'll talk to you again 817 00:50:22,120 --> 00:50:30,680 Speaker 1: really soon. Y text Stuff is an I heart Radio production. 818 00:50:30,920 --> 00:50:33,719 Speaker 1: For more podcasts from I Heart Radio, visit the i 819 00:50:33,840 --> 00:50:37,080 Speaker 1: heart Radio app, Apple Podcasts, or wherever you listen to 820 00:50:37,120 --> 00:50:38,000 Speaker 1: your favorite shows.