Connect with us

Published

on

Judge Yvonne Gonzalez Rogers handed down a decision in a closely-watched trial between Apple and Epic Games on Friday.

Rogers issued an injunction that said that Apple will no longer be allowed to prohibit developers from providing links or other communications that direct users away from Apple in-app purchasing, of which it takes 15% to 30% of gross sales.

The injunction addresses a longstanding developer complaint and raises the possibility that developers could direct their uses to their website to subscribe or purchase digital content, hurting Apple’s App Store sales.

Apple stock dropped 2% in trading on Friday.

The decision concludes the first part of the battle between the two companies over Apple’s App Store policies and whether they stifle competition. Apple won on 9 of 10 counts but was found to engage in anticompetitive conduct under California law, and will be forced to change its App Store policies and loosen its grip over in-app purchases. The injunction will come into effect in December.

“The Court concludes that Apple’s anti-steering provisions hide critical information from consumers and illegally stifle consumer choice,” Rogers wrote. “When coupled with Apple’s incipient antitrust violations, these anti-steering provisions are anticompetitive and a nationwide remedy to eliminate those provisions is warranted.”

However, Rogers said that Apple was not a monopolist and “success is not illegal.”

“Given the trial record, the Court cannot ultimately conclude that Apple is a monopolist under either federal or state antitrust laws,” Rogers wrote.

The trial took place in Oakland, California in May, and included both company CEOs testifying in open court. People familiar with the trial previously told CNBC that both sides expected the decision to be appealed regardless of what it was.

“Today the Court has affirmed what we’ve known all along: the App Store is not in violation of antitrust law. As the Court recognized ‘success is not illegal,'” Apple said in a statement. “‘ Apple faces rigorous competition in every segment in which we do business, and we believe customers and developers choose us because our products and services are the best in the world.”

Since the trial ended but before the decision was handed down, Apple has made several changes to mollify critics, some as part of settlements with other app developers, including relaxing some rules about emailing customers to encourage them to make off-app purchases and allowing some links in apps.

Rogers wrote in the decision that she disagreed with both Apple and Epic Games over the framing of the market Apple allegedly dominates. Rogers found that it was “digital mobile gaming transactions,” not all iPhone apps, as Epic Games had alleged, nor was it all video games, as Apple had claimed.

Battle over Fortnite

Epic Games is among the most prominent companies to challenge Apple’s control of its iPhone App Store, which has strict rules about what is allowed and not, and requires many software developers to use in in-app payment system, which takes between 15% to 30% of each transaction.

Epic’s most popular game is Fortnite, which makes money when players buy V-bucks, or the in-game currency to buy costumes and other cosmetic changes.

Epic wasn’t seeking money from Apple— instead, it wanted to be allowed to install its own app store on iPhones, which would allow it to bypass Apple’s cut, and impose its own fees on games it distributed. Epic Games CEO Tim Sweeney had chafed against Apple’s in-app purchase rules as early as 2015, according to court filings and exhibits.

Apple CEO Tim Cook is cross examined by Gary Bornstein as he testifies on the stand during a weeks-long antitrust trial at federal court in Oakland, California, U.S. May 21, 2021 in this courtroom sketch.
Vicki Behringer | Reuters

But the public clash between the two companies started in earnest in August 2020, when Epic implemented a plan to challenge Apple called “Project Liberty,” according to court filings.

Epic Games updated Fortnite on its servers to reduce the price of its in-game currency by 20% if players bought directly from the company, bypassing Apple’s take, and violating Apple’s rules on steering users away from its in-app payments.

Apple removed Fortnite from the App Store, meaning that new users could not download it and that it would eventually stop working on iPhones because the app could not be updated. As it planned, Epic then filed a lawsuit that culminated in May’s trial.

Epic Games will also have to pay Apple damages because it breached its contract, Rogers ruled. Epic will pay Apple 30% of all revenue it collected from iOS Fortnite through direct payments.

At the trial, Apple CEO Tim Cook testified on one of the last days, and faced pointed questioning from Judge Rogers over its restrictions on steering users to make purchases off-app, which ended up being the topic of Friday’s injunction.

“It doesn’t seem to me that you feel any pressure or competition to actually change the manner in which you act to address the concerns of developers,” Rogers said at the time.

Epic Games also sued Google over its control of the Play Store for Android phones. That case has not yet gone to trial.

Continue Reading

Technology

Here’s what Elon Musk said about tariffs and their potential effect on Tesla

Published

on

By

Here's what Elon Musk said about tariffs and their potential effect on Tesla

U.S. President Donald Trump talks to the media, next to Tesla CEO Elon Musk with his son X Æ A-12, at the White House in Washington, D.C., U.S., March 11, 2025. 

Kevin Lamarque | Reuters

Elon Musk said on Tuesday that he doesn’t like high or unpredictable tariffs, but any decision on what happens with them “is entirely up to the president of the United States.”

Speaking on his company’s first-quarter earnings call, with tariff-related uncertainty swirling across the economy, Musk said Tesla is in a relatively good position, compared to other U.S. automakers, because it has “localized supply chains” in North America, Europe and China.

Musk said Tesla is the “least-affected car company with respect to tariffs at least in most respects.”

Tesla reported troubling quarterly earnings and sales on Tuesday, including a 20% year-over-year drop in automotive revenue and a 71% plunge in net income. The company also said that it wasn’t providing any guidance for 2025 at least until its second-quarter update.

While Musk is one of President Donald Trump’s closest advisers, tariffs are the one issue where he’s partially broken with the administration. He recently called Peter Navarro, Trump’s top trade adviser, a “moron” and “dumber than a sack of bricks.”

On Tuesday’s call, however, Musk said, “If some country is doing something predatory with tariffs,” or “if a government is providing extreme financial support for a particular industry, then you have to do something to counteract that.”

Tesla’s stock price has been hammered since the president floated his plan for widespread tariffs earlier this month, and that was after the shares plunged 36% in the first quarter, their worst performance for any period since 2022.

Because Tesla manufactures cars that it sells in the U.S. domestically, the company isn’t subject to Trump’s 25% tariff on imported cars. But Tesla counts on materials and supplies from China, Mexico, Canada and elsewhere for manufacturing equipment, automotive glass, printed circuit boards, battery cells and other products.

Musk said he offers his advice to the president on tariffs.

“He will listen to my advice. But then it’s up to him, of course, to make his decision,” Musk said. “I’ve been on the record many times saying that I believe lower tariffs are generally a good idea.”

He added that he’s an advocate for “predictable tariff structures,” as well as “free trade and lower tariffs.”

Musk said Tesla’s energy business faces an “outsized” impact from tariffs because it sources lithium iron phosphate battery cells, used in his company’s cars, from China.

“We’re in the process of commissioning equipment for the local manufacturing of LFP battery cells in the U.S.,” he said. But he said the company can “only serve a fraction of our total installed capacity” with its local equipment.

“We’ve also been working on securing additional supply chain from non-china based suppliers, but it will take time,” he said.

Musk called Tesla the most “vertically integrated car company” but said that there are still plenty of parts and materials that come from other countries. Even though it’s built a lithium refinery in Texas, “we’re not growing rubber trees and mining iron yet,” he said.

WATCH: Tariffs on batteries out of China can end up being really costly

Tariffs on batteries out of China can end up being really costly for tariffs, says Fmr. Tesla President

Continue Reading

Technology

Tesla CEO Musk says time he spends on DOGE will drop ‘significantly’ next month

Published

on

By

Tesla CEO Musk says time he spends on DOGE will drop 'significantly' next month

Elon Musk, CEO of Tesla Inc., in the Oval Office of the White House in Washington, D.C., on Feb. 11, 2025.

Aaron Schwartz | Bloomberg | Getty Images

Tesla CEO Elon Musk began his company’s earnings call on Tuesday by saying that his time spent running President Donald Trump’s Department of Government Efficiency will drop “significantly” starting in May.

Musk, who has watched Tesla’s stock tumble by more than 40% this year, said he’ll continue to support the president with DOGE “to make sure that the waste and fraud that we stop does not come roaring back.”

After spending almost $300 million in the 2024 campaign to help return Trump to the White House, Musk created DOGE and joined the administration with a mission to drastically reduce the size and capability of the federal government.

He said he’ll continue to spend a “day or two per week” on government issues “for as long as the president would like me to do so.”

Musk’s commentary came after his company reported disappointing first-quarter results, including a 20% year-over-year slump in automotive revenue and 71% plunge in net income.

In addition to challenges the company already faced, such as competition out of China and an aging fleet of electric vehicles, Tesla has recently been hit with protests in the U.S. and Europe and brand damage due to Musk’s ties to Trump and his support of Germany’s far-right AfD party.

“The protests that you’ll see out there, they’re very organized,” Musk said on Tuesday’s call. He claimed, without evidence, that some people are likely protesting “because they’re receiving fraudulent money” or are “recipients of wasteful largesse.”

On its website, which was last updated on Sunday, DOGE says its cuts have led to an estimated $160 billion in savings. However, Musk’s estimates of savings have been challenged, and DOGE has deleted some of the largest purported savings.

Over that same stretch, Tesla has lost roughly $600 billion in market cap.

DOGE has also made cuts at agencies charged with oversight of his companies. They include the SEC, Federal Aviation Administration and National Highway Traffic Safety Administration.

The White House said in early February that Musk was serving as a “special government employee,” a designation with fewer requirements when it comes to conflict-of-interest disclosures and ethics policies.

The Department of Justice says the title is for anyone expected to work for the government for 130 days or less in a year. The Trump administration will hit its 130th day at the end of May.

Job cuts from DOGE’s work have come from across the government, at agencies including the Internal Revenue Service, National Park Service, Consumer Financial Protection Bureau, and the departments of Agriculture, Education, Energy, Health and Human Services, Homeland Security, and Veterans Affairs, according to the Associated Press.

As of February, staffers from DOGE had pushed top-ranking officials at the Department of Education out of their offices, rearranged the furniture and set up white noise machines to muffle their voices, according to employees at the agency. U.S. senators expressed concern that DOGE had possibly gained access to federal student loan data on tens of millions of borrowers.

Also in February, the Trump administration said that USAID would shut down as an independent agency and be moved under the State Department.

WATCH: Musk needs to recommit to Tesla

Elon Musk needs to recommit to Tesla and say he's leaving Trump administration: Wedbush's Dan Ives

Continue Reading

Technology

Meta could take a $7 billion hit this year because of Trump’s tough China tariffs

Published

on

By

Meta could take a  billion hit this year because of Trump's tough China tariffs

This photo illustration created on Jan. 7, 2025, in Washington, D.C., shows an image of Mark Zuckerberg, CEO of Meta, and an image of the Meta logo.

Drew Angerer | AFP | Getty Images


Meta’s core online advertising business could take a $7 billion hit this year due to President Donald Trump’s tough China tariffs impacting retailers in the country.

That’s according to a MoffettNathanson research note published Tuesday that analyzes the potential impact of China-linked retailers like Temu and Shien slashing their Facebook and Instagram advertising budgets amid the U.S. and China trade dispute.

The MoffettNathanson analysts pointed to Meta’s latest annual report in which the company revealed that its China revenue was $18.35 billion in 2024, equating to a little over 11% of total its total sales. Like other analysts, MoffettNathanson believe Temu and Shien comprise the bulk of Meta’s China business, and if those online retailers cut back on their ad campaigns this year, the social networking giant’s 2025 ad sales could be impacted by $7 billion.

Meta did not immediately respond for a request for comment.

There are already signs of a pullback, the analysts wrote, citing a CNBC report about Temu reducing its U.S. advertising spending and seeing a big drop in its Apple App Store rankings following Trump’s China tariffs.

“China’s importance to Meta’s business cannot be overstated,” the analysts wrote in the note. “While Meta does not provide a country-level breakdown of revenue within Europe, we logically can presume that China is Meta’s second-largest revenue source after the United States — a remarkable position for a country where Meta has no users or active platforms.”

Meta could be in even more trouble if the broader markets heads into a recession this year, as some analysts and corporate financial chiefs have predicted. A “truly prolonged economic downturn” combined with the U.S. and China trade dispute “could wipe $23 billion in 2025 advertising revenues off Meta’s books and crush our 2025 earnings by -25%,” the analysts said.

“As noted earlier, we believe Meta is particularly exposed to a pullback in ad spend from Chinese advertisers,” the analysts said. “In a scenario where a recession is triggered or exacerbated by escalating trade tensions, Meta would face a dual headwind: cyclical advertising weakness and a targeted decline in Chinese ad spend.”

The MoffettNathanson analysts still maintain a Buy rating on Meta, said they have but decreased their target price by $185 to $525.

Meta shares have dropped about 19% to $499.36 since Trump was officially sworn in as U.S. president for the second time.

The company reports its first-quarter earnings next Wednesday.

WATCH: Fmr. DOJ antitrust chief: Antitrust enforcement is most important.

Fmr. DOJ antitrust chief: Antitrust enforcement is most important in times of tech inflection points

Continue Reading

Trending