We’re continuing to talk about Project Liberty — Apple lawyer hitting on the fact that it was a coordinated effort with a “virtual war room” designed to provoke Apple.
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Apple lawyer: “You talked about creating an item. Is that fun, creating an item?” Epic lawyer: “Yeah. It’s awesome.”
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(This is referencing Fortnite Create.)
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Minus the digression about the implied obscenity of an unclothed banana, questioning is still along two main lines: whether Fortnite is mostly gaming-related, and whether Apple screwed up its side of the promotional deal.
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We just finished Weissinger, and now Epic is calling the first of its expert witnesses: David Evans, chairman of Global Economics Group. Here’s Evans’ testimony (redacted) from earlier:https://storage.courtlistener.com/recap/gov.uscourts.cand.364265/gov.uscourts.cand.364265.527.1.pdf …
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We’re beginning questioning. Evans is an economist focused on platform economics and antitrust economics.
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Lawyer is verifying that Evans doesn’t want to change anything in his earlier testimony based on details that have come out since.
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Evans is here to establish the “relevant market” in this case, which (to oversimplify as a non-lawyer) is Epic trying to establish that iOS can be a discrete market that Apple can have a monopoly in, rather than just a device it makes.
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The market here is iOS apps — Evans is talking about restrictions in the market, like Apple preventing people from installing apps outside its App Store.
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The App Store is a supplier of distribution services, and those customers rely on the App Store for distribution services, Evans says. These apps don’t necessarily compete with each other, but they’re part of the same market.
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We’re getting some weird voice bleedover in the conference line — think somebody on the line is unmuted and is talking over the witness.
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Evans is trying to establish that you can have a single market where the customers aren’t all competing with each other — talking about a bunch of different companies that all buy steel, or a credit card network that services lots of businesses.
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Evans giving his own “phones v. consoles” distinction: “The smartphones can be used anywhere, anytime. And that means a consumer … as long as they have a cellular connection can use that smartphone."
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“A game console on the other hand is typically a fixed device that is not something that people carry around,” except the Switch, which still doesn’t have a cellular connection.
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“A consumer who is interested in using apps at various times and various places during the course of their lives, there are many many situations in which the game console even if it had the relevant app on it, is simply not a relevant device for them to use in their daily lives.”
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Again, this matters because (to Evans) it means that console ecosystems can’t be considered direct competitors to iOS.
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Add to the Epic v. Apple drinking game: witness makes tortured attempt to work the Nintendo Switch into a “mobile v. console” definition.
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all of us got unmuted for one second and nobody took advantage of it, is this the mitigating effect of civilization
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We’re going through the shift in time spent on personal computing: by 2019, 77% of that time is being spent using a smartphone connected to the internet. And 89% of the time people spend online using smartphones is through an app, not a browser.
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US adult spends roughly average of 3 hours a day on a smartphone, Evans says. (And, again, 89% of that is apps.) And one hour on a personal computer. Did you take into account time people spend working on PC, judge asks? No, this is “consumer use,” says Evans.
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Not 100% sure what that means or how they parse it, given the blurry line between work and leisure for many heavy computer/phone users.
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In personal computers, you’ve always been able to get apps from a “variety” of channels. But with the App Store and Google Play, there are “only two channels” where consumers/developers go through for apps, says Evans. “There are really two gatekeepers, in effect."
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The distinction between “general-purpose” and “special-purpose” operating system has come up again — Evans says there’s a “fundamental difference” between them. You may recall this from Day 3:https://www.theverge.com/2021/5/5/22421570/epic-apple-trial-iphone-xbox-console-specific-general-purpose-pc-testimony-day-3 …
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Evans is talking about different new business models for computing — cites that Google is primarily motivated by selling advertising against its phones/apps.
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Evans notes console developers selling at a loss, and judge jumps in — asks if he has actual evidence of this. Looks like Apple has successfully sown doubt about Epic's “consoles sell at a loss” point.
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Judge says you’ve “seen no evidence from Sony, no evidence from Nintendo” that they sell at a loss. Evans hedges. Judge: “I don’t know if this is based on a generic understanding of what’s out there … or if I’m going to be able to verify this theory I’ve heard multiple times."
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Evans is trying to explain his overall market research indicating that consoles sell at a loss. He calls it a “non-controversial point." Incidentally, Sony appears to have recently confirmed the claim for at least some of its consoles:https://www.fool.com/investing/2021/02/09/sony-is-selling-the-ps5-at-a-loss-but-investors-sh/ …
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“You want me to consult my binder?” “Yes please do.” BINDERS
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Evans is going to explain the difference between a “foremarket” and “aftermarket” distinction. A “foremarket” would be buying a printer, for instance, while an “aftermarket” is a purchase made after that initial buy — like toner for that printer.
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This is not as sexy as the naked banana but it’s actually an incredibly important legal distinction.
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The smartphone is a foremarket here, and the apps are an aftermarket, Evans says. Basically, allegation is that Apple is using the foremarket to monopolize the aftermarket.
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Wydaje się, że ładowanie zajmuje dużo czasu.
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