READ MORE: Tim Sweeney: Epic will fight Apple and Google to keep the metaverse open (Financial Times)
Epic Games continues to take on Apple, and in its latest broadside called the multi-trillion dollar company “a disservice to developers.”
Epic Games wants to earn the right to deliver Fortnite to iPhone users outside the App Store, or at the very least, be able to use its own payment processing system so it can stop paying Apple commissions for the ability to deliver its software to iPhone users.
It has filed its antitrust case in the UK, and across federal courts, and is doing similar the same with Google.
Epic, whose market value is around $35 billion, is pitching its mission as the David bravely standing up for a free and open next-gen internet against the Goliath gatekeepers of an oppressive monopoly.
In a candid interview with the Financial Times, Epic chief executive Tim Sweeney expressed his concerns that Apple and Google could “unfairly” extend their “stranglehold” on smartphone platforms to “dominate all physical commerce taking place in virtual and augmented reality.”
Sweeney doesn’t pull any punches when it comes to Apple, which he sees as extracting value from creators and undermining the purity of the metaverse to come. In contrast, he claims Epic Games wants to help creators only gain from opportunities in the 3D internet.
“I’m terribly afraid the current monopolies will use their power to become the next monopolies on new generations of platforms and continue to use that power to exclude all competition. They’ve built their platform lock-in which makes it extremely hard for any company to compete, even if they were able to compete on fair terms. But then they don’t let them compete on fair terms.
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He concedes that Apple “won fairly in one market: hardware,” but claims Apple uses that position to gain an unfair advantage over competitors and other markets. “And that breaks all the competitive dynamics that kept the tech industry healthy in the past.”
He continues, “The [Apple] app store is not a service. The app store is a disservice to developers. The app store forces developers to treat their software in a sub-par way to give customers a sub-par experience to charge uncompetitive handling and processing fees to inflate the price of digital goods.”
Epic is fighting Apple and Google currently over their smartphone practices. If these practices continue on smartphone, they’re not only going to dominate digital commerce and digital goods on smartphones, Sweeney maintains, “they’re ultimately going to dominate the metaverse and they’re going to dominate all physical commerce taking place in virtual and augmented reality.”
“The Apple app store is not a service. The app store is a disservice to developers. The app store forces developers to treat their software in a sub-par way to give customers a sub-par experience to charge uncompetitive handling and processing fees to inflate the price of digital goods.”
— Tim Sweeney, Epic Games
As the FT points out, Apple and Google are framed by Epic as its ideological enemies, whereas Microsoft is more of an ally. Where does Meta fit on this spectrum?
“There are two sides to Meta,” Sweeney says. “There’s the metaverse side, where they’ve articulated a really interesting vision. It’s in many ways broader than Epic’s. We see this as a central entertainment medium, and they see this as a medium that will connect everybody across distances for any purpose including work, and just hanging out chatting. And they talk a lot about open platform principles: they’re not building a Meta walled garden, they’re trying to contribute to standards and practices that lead towards an open metaverse. And I really like that vision that they’ve articulated.
On the other hand, he says Meta’s actual existing business practices — its revenue share with creators, its ad economy — “has all the manifestations of an entirely closed ecosystem.”
Sweeney says, “I feel their actual business is not a creator-centric enough ecosystem. So, it is going to be a lot of work if Meta is really to bridge the gap between their current practices and their future vision.”
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However, the nuance with which Sweeney talks about Meta may be more to do with the fact that Epic’s business doesn’t overlap with it in quite the same way as with Apple and Google.
“Currently, Meta doesn’t have a monopoly or even a significant user base in any core businesses in which Epic competes, or intends to compete,” he acknowledges. “Meta isn’t doing anything that stifles us at all.”
He continues, “My understanding is that [Meta’s VR gear] Oculus… don’t force all developers to use their store and they don’t block competing stores, so it’s not analogous to the Apple situation. If it changed I would complain about that, but we’ll have to see.”
Epic envisages an open and collaborative approach to building the metaverse and appears optimistic of it coming to pass, despite the obstruction, as Sweeney would see it, of certain Web2 giants — mainly because the market will demand it.
“In the metaverse evolution… we need to expand and connect all our systems together,” he argues. “We need to connect our economies. We need to move our proprietary technology to open standards, file formats and networking protocols so that all our systems can interoperate and we can all be participants in the metaverse.
“That’s going to be a process that will happen over the next decade. Right now, we have separate executable programs on your computer to run Fortnite and Roblox and other things. In the future, I think you’ll see something more like a metaverse browser that points to the right standard and you can visit any metaverse experience. You’ll have metaverse servers that different companies operate.
He adds, “I think it will win out over anybody’s attempt to build a walled garden, locked-down version of that. I think the major brands will just opt out of companies that aren’t an open road map. They’re going to expect and demand that everybody they work with is a partner. In year one, you open your ecosystem in this way, In year two, you open up this ecosystem in other ways. And within 10 years, we have a completely open metaverse that everybody is now a peer at.”
The fight continues.