What just happened? Japan regulators are looking into whether Apple may have forced a competing platform out of business.
Yahoo Japan recently launched a game streaming service called “Game Plus,” which allowed users to stream titles from other platforms to their iPhones. Of course, Apple does not like anything running on its hardware unless it can receive a cut of the profits, and allegedly pressured Yahoo Japan to cease operation of its service.
According to Japanese news outlet Nikkei, the company claims it was forced to cut its budget for Game Plus shortly after launching due to threats from the Cupertino powerhouse. The company filed complaints with Japan’s Fair Trade Commission (FTC), which is now looking into the allegations.
While Yahoo Japan has not entirely shut down its platform, it has stopped promoting it. It has already lost support from some high-profile producers including Square Enix, which has canceled an exclusive title that was in the works for the service.
Game streaming is becoming more of a focus for many companies, and while it has not yet ironed out the kinks, many companies have already launched services including Sony, Nvidia, GameFly, and others. Apple can see this as a threat. After all, competition means sharing user base, lowering prices, and losing a ton of revenue.
For example, Epic independently released Fortnite for Android cutting out the Google Play store as the middleman. This move means that Alphabet loses out on 30% of in-game sales. According to TechCrunch, this equates to an approximate projected loss of $50 million over the next five months.
It is unclear what kind of pressure Apple was able to exert to force Yahoo Japan to back down, and we might not know until the FTC finishes its investigation. However, it is highly likely that it was an indirect push.
Nikkei reports that a source close to the case has said that SoftBank Group, which owns nearly half of Yahoo Japan, has taken the position of mediator in the matter and has influenced the company to acquiesce.
“The investment powerhouse, Yahoo's largest shareholder, collects payments made by its cellphone subscribers to the App Store for Apple and keeps a portion of the revenue for itself.”
This would appear to be an apparent conflict of interest. However, issues like this work differently in Japan than they do in the US. An attorney familiar with FTC cases in Japan told Nikkei, “If the parties involved don't cooperate, it's hard to prove wrongdoing.”
In other words, Apple and SoftBank could stonewall the FTC and get off scot-free.
When asked for comment, the FTC said that it could not discuss open cases. We’ll just have to wait to see where this one goes.