Apple and Epic Games Set Ground Rules for App Store Fee Negotiations: A Q&A

The ongoing legal battle between Apple and Epic Games has entered a new phase following the Supreme Court's decision to deny Apple's request to pause a lower court mandate. This mandate compels the two companies to meet and negotiate changes to App Store fees for outbound links. In preparation, they have agreed on a pre-court schedule outlining key actions. Below, we answer common questions about this development.

What did the Supreme Court decide in the Apple-Epic case recently?

On May 6, the Supreme Court declined Apple's request for a stay on a mandate requiring the company to negotiate with Epic Games over new commission rates for App Store purchases made through outbound links. This decision means the legal process moves forward without delay, forcing Apple to engage in discussions about its fee structure. The Supreme Court's refusal to intervene signals that the lower court's ruling stands for now, paving the way for potentially significant changes to how Apple handles payments for apps that direct users to external payment systems.

Why is a meeting between Apple and Epic necessary?

The meeting stems from a prior court ruling that found Apple's anti-steering policies—which prevented developers from informing users about alternative payment options—to be anticompetitive. The court ordered Apple to allow app developers to include links or buttons directing users to purchase digital content outside the App Store. However, Apple proposed charging a commission on such sales, leading to a dispute over the fee structure. The mandated meeting aims to resolve this disagreement and establish fair terms, as per the court's directive.

What is the agreed schedule for this meeting?

In a joint filing to the U.S. District Court for the Northern District of California on May 15, Apple and Epic outlined a multi-point schedule of actions. The schedule includes timeframes for exchanging proposals, responding to counteroffers, and holding mediation sessions. While the exact dates are not public, the plan ensures both parties have clear deadlines to prepare and negotiate in good faith. The schedule also accounts for potential extensions if needed, but both sides have committed to moving swiftly to avoid further delays in the appeals process.

What are the proposed changes to App Store fees for outbound links?

Apple has proposed charging a commission—likely around 27%—on sales made through outbound links, which would be a reduction from the standard 30% in-app purchase fee. Critics, including Epic, argue this still unfairly penalizes developers and may violate the spirit of the court's ruling. Epic insists that any commission on external purchases is anticompetitive and should be eliminated entirely. The negotiations will focus on whether Apple's proposed fee is reasonable or if a different structure—such as a flat fee or lower rate—should apply. The outcome could set a precedent for how app stores charge for link-based transactions.

How has Epic Games responded to this development?

Epic Games has welcomed the Supreme Court's denial of Apple's stay, viewing it as a step toward fairer competition. The company has consistently criticized Apple's App Store policies as monopolistic and has pushed for greater developer freedom. In public statements, Epic has expressed readiness to negotiate but remains firm in its stance that no commission should be applied to outbound link purchases. Epic also continues to campaign for broader reforms, including the ability to offer its own payment systems without Apple's involvement. The forthcoming negotiation is seen as a critical opportunity for Epic to challenge Apple's dominance.

What are the implications for developers and consumers?

If Apple and Epic reach an agreement, it could reshape how app developers handle payment links. For developers, a lower commission on outbound sales might increase profit margins and provide more flexibility in pricing. However, if the fee remains high, small developers may struggle to benefit. Consumers could see lower prices if developers pass savings on, but also potential confusion if they are directed to external payment portals. The broader implication is that this case could influence antitrust regulations globally, prompting other app store operators like Google to adjust their policies. The industry will be watching closely as negotiations unfold.

When will the next court hearing take place?

No specific court hearing date has been set for the next phase. The agreed schedule focuses on pre-court negotiations rather than a trial. However, if the two sides fail to reach a consensus, the case will return to the District Court for further proceedings. The Supreme Court's refusal to stay the mandate suggests that the appeals process will continue, with potential oral arguments later in the year. Legal experts anticipate that the negotiation results could be presented to the court for approval, potentially avoiding a lengthy trial. The next major milestone is the completion of the mediation process.