Apple (NASDAQ: AAPL) is seeking to keep its iron grip on the App Store for a few years longer, or at least keep its 30% commission on all in-app purchases.
On Friday, the iPhone maker said it would appeal September's ruling, which ordered it to allow apps to link to alternative payment systems outside the App Store. The appeal represents the latest in the much-watched legal drama between Apple and its long-time antagonist, Epic Games, the maker of 'Fortnite.'
Apple also asked Judge Yvonne Gonzales Rogers, who made the initial ruling, to hold off on her December 9 deadline for the App Store changes while the case makes its way through the courts. Pushing back the deadline for Apple could mean that its App Store business model could remain in place for a year or longer.
Billions are at stake for Apple. Bloomberg Intelligence estimates reduced commissions from the App Store could strain revenues at the company by $2-4 billion. Also at stake is the entire premise of Apple's digital ecosystem: that consumers need protection in the form of a walled garden where Apple decides what goes in and what goes out.
Friday's legal moves represent quite an about-face on Apple's part, given the vindication it initially expressed after the September ruling. That ruling cleared Apple on 9 of 10 counts of supposed "monopolistic activity." However, Judge Rogers ruled that Apple's "anti-steering" policies stifled consumer choice and said that Apple needed to amend those policies.
"We are very pleased with the Court's ruling and we consider this a huge win for Apple," said Kate Adams, Apple's lawyer, at the time.
The company said it filed the motion in light of a legal deadline this month which would've cut Apple off from further appeals. In its filing, the Cupertino-based tech giant said there was "no reason to expend resources" to make the required changes while the outcome of its case remains uncertain. The company also warned of "downstream consequences" should the initial injunction go into effect by the December deadline.
Epic had no formal comment about Apple's announcement.
However, Epic's CEO Tim Sweeney tweeted: "Apple filed a peel," referring to the 'Fortnite' character Agent Peel, whose nudity in the game Apple used to stir up controversy during the trial.
Apple has removed Fortnite from the App Store until all of Epic's legal options are exhausted, which could take up to five years should both sides bring their battle to the Supreme Court.
A hearing on Apple's request is set for November 16; however, Apple hopes to have the hearing set for November 2.
Apple said it will bring its motion to the Ninth Circuit Court of Appeals should Judge Rogers deny its request.
Paul Gallant, an analyst at Cowen & Co, told Bloomberg that Apple's chance of winning a stay at the Ninth Circuit is high.
Even as the final outcome in the battle of 'Epic v Apple' remains unclear, a bipartisan Senate bill could force Apple to change its App Store model before any judge does. Apple already links users to outside payment sources in Japan in the case of certain apps, just not when it comes to games, which are the most profitable category of in-app purchases.