Apple VS. Epic Games antitrust trial nears conclusion

The Apple VS. Epic Games courtroom battle is expected to end today. Syracuse University Professor of Law and Syracuse Intellectual Property Law Institute Director Shubha Ghosh joins Yahoo Finance Live to discuss.

Video Transcript

AKIKO FUJITA: Lawyers for Apple and Epic Games presenting their closing arguments in court today. A final ruling in the case isn't expected for weeks, but the questions raised in the courtroom could have broader implications for other antitrust cases into the tech giant. Let's bring in Shubha Ghosh, Syracuse University professor of law and Intellectual Property Law Institute director there. Shubha, it's good to talk to you.

The key questions for Apple, of course, going into this was whether, in fact, they'd abused their position in the market in terms of setting up those policies within the App Store, charging some of those commissions. We heard Tim Cook over on Friday say that a lot of this really was about to protect the privacy of users. How do you think this case shapes up right now for Apple, as we round out the closing arguments today?

SHUBHA GHOSH: Yeah, I think it's always a very difficult case for the plaintiffs in antitrust. I think there are some complicated issues here about whether Apple is a monopolist, whether there are alternatives for consumers, and also a question about what exactly is the competitive harm that Epic is complaining about, and how the court can remedy it. I'm not as convinced about the privacy arguments, whether that's really beneficial to Apple, or may even be relevant to the final outcome of the case.

AKIKO FUJITA: How high was the bar for Epic Games going into the case, in terms of proving Apple's monopoly? And do you think the lawyers were able to present a case that met it?

SHUBHA GHOSH: I think, you know, Epic's strategy, it seemed to me, was to basically focus on the platform, to focus on the-- the gaming platform through the App Store, while Apple is trying to argue that there are lots of other alternatives to the Apple Store in order to get access to Epic Games. So it's a fairly high burden, in terms of really trying to characterize this market and in terms of how consumers buy these games and to really convince the court-- and this is a bench trial, not a jury trial-- that the relevant market is the one for the App Store, rather than a broader market for games.

AKIKO FUJITA: There is a broader question about whether, in fact, iOS itself is a monopoly that should be opened up to third-party stores. We heard from Tim Cook on Friday saying-- talking specifically about opening things up. He thought that it would be both insecure and inconvenient, at least when it-- as it relates to sort of the payment processing, you know, argument that those like Epic Games have raised. Did we learn any more from that testimony that we already didn't know about Apple's thinking into the structure of the software?

SHUBHA GHOSH: Yes. I mean, from what I understand about the testimony, I mean, I think this-- this argument about the operating system as being the basis for the monopoly or for the market power may be a bit tenuous. I don't think the court is going to go there. I'm not sure how much more we learned, because it is a fairly hard argument here to make based on the operating system, rather than on the particular App Store and some of the-- the actual application itself, rather than on the underlying software. So I don't see the case going in that direction, and I'm not sure whether the testimony on Friday really changed things in that direction.

AKIKO FUJITA: We're going to be watching closely to see when this ruling come down-- comes down, but of course, there's also the argument here that the trial is sort of the remedy. The fact that Apple has had to go through this with Epic Games challenging them has exposed, some would argue, some flaws within their structure. I mean, what is the damage, you think, if there is any at all, for Apple having gone through this, or you think it's too early to say about the implications beyond the legal arguments that were made in the courtroom?

SHUBHA GHOSH: Well, I think, you know, there are two types of things that are being focused on here. One is the amount of the commission, the 30%, and the other one is the direct contracting from Apple and Epic and its customers, the players, the end users, in terms of some of the options that Epic gave to the end users regarding the internal currency of being able to buy certain add-ons, you know, outside the Apple Store. I see those types of contract-based remedies being-- you know, to the extent that Apple is found liable-- being the way in which the court is going to go. I think the court is less likely to say, well, 30% is too high, but 20% to 25% is probably the right commission. It's largely going to be, if Apple is found liable, allowing more direct contracting to end users, rather than having to rely solely on the Apple Store for various aspects of the game.