Mobile Game Developers Set for Billions in Additional Revenue Following Apple Court Ruling – channelnews

Mobile game developers could gain billions of dollars in additional revenue following a federal court ruling that forces Apple to allow alternative payment methods outside its App Store, according to industry analysts.

Aldora Intelligence estimates that $4.1 billion in revenue could shift from Apple to developers this year alone, based on 2024 figures from the top 25 mobile game publishers.

The projection stems from US District Judge Yvonne Gonzalez Rogers’ ruling last month in the long-running dispute between Epic Games and Apple, which requires the iPhone maker to permit developers to sell digital goods outside the App Store.

The court decision allows developers to bypass Apple’s commission structure, which typically charges 15% to 30% on most transactions.

Wedbush Securities analyst Michael Pachter projects developers could capture as much as $19.5 billion in additional revenue over the next few years that would have otherwise gone to app stores.

“These guys are going to make more money because Apple’s going to make less, dollar for dollar,” Pachter said.

The analyst expects developers will reinvest the additional revenue in player acquisition, potentially creating a cycle where new users generate more spending on digital items.

Some developers are already implementing strategies to direct players away from Apple’s platform.

Epic Games was famously linked to external websites offering discounts on Fortnite’s V-Bucks currency in 2020, prompting Apple to remove the popular game from its store.

The recent ruling provides legal protection for such practices.

Take-Two Interactive, which reported $730 million in mobile bookings last quarter, has established web stores for games including Empires & Puzzles and Zynga Poker.

CEO Strauss Zelnick described the company’s direct-to-consumer stores as “a significant and, indeed, material part of our business” during a recent earnings call.

Aldora Intelligence estimates that mobile game developer commissions to app stores will decline by one-third to approximately 20% as a result of the ruling.

The change comes at a crucial time for the mobile gaming industry, which experienced a 7% revenue decline after Apple implemented privacy changes in 2021 that complicated user acquisition efforts.

Payment processing companies are positioning themselves to benefit from the shift.

Xsolla and Stash have created direct-to-consumer web stores for mobile gaming companies with significantly lower commission rates.

Xsolla offers a 5% processing fee and has developed online calculators helping developers project additional revenue from alternative payment methods.

“It’s a competitive industry fighting for the same customers,” said Justin Kan, co-founder of Stash.

“If you have a way to substantially change your margin, you can’t ignore it.”

Major publishers, including Electronic Arts, Roblox, Scopely, and Tencent-owned Supercell, declined to comment on the ruling’s impact.

The ruling represents a significant shift toward a more open app distribution ecosystem, potentially reshaping the mobile gaming industry’s economics and competitive landscape.