What happened
Shares of Apple's (AAPL 0.21%) fell 3.3% on Friday after a federal judge made a decision that could have wide-ranging implications for the tech industry.
So what
U.S. District Judge Yvonne Gonzalez Rogers issued an injunction that will prohibit Apple from denying developers the ability to direct users to other payment methods outside its App Store.
"The Court concludes that Apple's anti-steering provisions hide critical information from consumers and illegally stifle consumer choice," Rogers said. "When coupled with Apple's incipient antitrust violations, these anti-steering provisions are anticompetitive and a nationwide remedy to eliminate those provisions is warranted."
Image source: Getty Images.
The ruling could dent Apple's fees, which can reach as high as 30% of in-app purchases. These fees are a major part of Apple's booming services business, which generated $17.5 billion in revenue in the third quarter alone. Apple's services segment also enjoys a high gross margin of roughly 70% and, therefore, produces a relatively outsize portion of the company's profits.
Now what
The decision was handed down as part of Epic Games' lawsuit against Apple. The maker of the popular video game Fortnite claimed that the tech titan was a monopoly and sought to loosen Apple's App Store restrictions.
Although Rogers found that Apple was not an antitrust monopolist, her decision to give developers the freedom to steer users away from Apple's App Store could also impact other major platforms, such as those operated by Alphabet's (GOOG +0.52%)(GOOGL +0.58%) Google and Facebook. Investors will thus need to factor this increased regulatory risk into their outlooks for these tech giants.
