What announcements to expect, what’s at stake

What announcements to expect, what's at stake

What announcements to expect, what’s at stake

Apple CEO Tim Cook takes a selfie with an attendee during a special event on September 10, 2019 in the Steve Jobs Theater on Apple’s Cupertino, California campus.

Justin Sullivan | Getty Images

Apple will hold its first product launch event of the year on Tuesday.

On deck: New iPad Pros are expected to be the primary new hardware products Apple unveils. While Apple’s iPad business showed lackluster growth in the mid-2010s, it has seen a boom over the last year as consumers worked and played from home during the pandemic.

But beyond the new gadgets, Apple is facing a decade of increased competition and courtroom battles on numerous fronts from the likes of Facebook, Epic Games, Spotify and lawmakers and regulators around the world. It may feel like just another iPad event. But there’s a lot of tension bubbling under the surface at Apple. And a lot of it could threaten Apple’s next wave of growth as it expands into more digital services and new forms of computing technology.

Here’s a quick look at the conflicts coming to a head as we near Tuesday’s Apple event:

Apple vs. Facebook

Apple vs. Epic Games and other large app developers

Nineteen Eighty-Fortnite ad

Epic Games

On May 3, Apple and Epic Games, maker of the popular game Fortnite, head to trial in their dispute over how Apple manages payments from iOS apps. Last fall, Epic Games purposefully changed the iOS version of Fortnite to allow users to pay Epic directly, circumventing Apple’s App Store rules. Apple ultimately removed Fortnite from the App Store, and Epic had a lawsuit ready to go.

Epic’s complaint against Apple echoes what we’ve heard from several iOS app makers over the last decade: Apple generally takes a 30% cut of digital transactions within apps and sales of paid apps themselves. Developers in Epic’s camp say the so-called “Apple tax” gives Apple too much leverage since it only allows users to download software from its own store. Apple does not allow alternative app stores like Google does on Android.

Large app makers such as Spotify and dating company Match Group support Epic’s lawsuit. Many of these developers also formed a group called the Coalition for App Fairness, which has recently pushed state legislatures in Arizona and North Dakota to pass laws reining in Apple’s control of the App Store. If Apple loses the court battle or is forced to make concessions to Epic and other app developers, it could slow down growth in Apple’s App Store revenue. (The App Store generated about $64 billion in gross sales in 2020, up from about $50 billion in 2019.)

Apple has said it collects the fees in part to maintain the safety and security of the App Store so its customers can feel confident in the software they download. The company recently changed its fee structure so that it will only take a 15% cut from apps that generate less than $1 million in a year.

Apple vs. lawmakers

Apple’s China vulnerability

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