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Apple Terminates Epic Games App Store Account, As Dispute Heats Up

support@smarteranalyst.com (Ben Mahaney)

Apple (AAPL) has announced that it has terminated the Epic Games account on its App Store, as the dispute between the two companies continues. This means Epic will no longer be able to submit new apps or updates, and the game can no longer be downloaded or re-downloaded.

The dispute hinges on Epic’s use of direct in-game payments in the Fortnite app. Apple’s rules state all purchases must be made through its proprietary payment system.

In a statement the iPhone maker wrote: “We are disappointed that we have had to terminate the Epic Games account on the App Store. We have worked with the team at Epic Games for many years on their launches and releases.”

According to Apple, the court recommended that Epic comply with the App Store guidelines while their case moves forward- and that Epic has refused, despite following these guidelines for the past decade.

“Instead they repeatedly submit Fortnite updates designed to violate the guidelines of the App Store. This is not fair to all other developers on the App Store and is putting customers in the middle of their fight” Apple argued.

The company concluded by adding: “We hope that we can work together again in the future, but unfortunately that is not possible today.”

In response Epic’s founder and CEO wrote on Twitter: “Apple suggests we spammed the App Store review process. That’s not so. Epic submitted three Fortnite builds: two bug-fix updates, and the Season 4 update with this note.”

Tech Crunch states that the removal should not affect Epic’s game engine Unreal Engine, which Epic manages through a separate account.

“Apple needs to make sure the Epic challenge, which is timely in light of anti-trust swirls and growing opposition to Big Tech within the Beltway, does not create a ripple impact which developers globally are watching carefully,” commented Wedbush analyst Daniel Ives.

“We will be watching this situation closely for any ripple impacts that could negatively impact the App Store fee structure going forward” he told investors. However the analyst kept his Buy rating on the stock, and recently bumped up his price target from $515 to $600 (20% upside potential). (See Apple stock-price forecast on TipRanks)

Overall, based on 24 Buys, 7 holds and 2 Sells, the analyst consensus rates Apple a Moderate Buy. The average analyst price target clocks in at $445, implying possible downside of 11% in the coming months. Shares in AAPL have surged 70% so far year-to-date.

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