ANTITRUST

Apple and Epic Games Vie for Victory Royale

A business beef with more leadup than a pay-per-view fight wrapped up its trial yesterday, when Apple CEO Tim Cook took the stand. The kerfuffle started last summer when Fortnite maker Epic Games skirted Apple’s 30% fee for in-game purchases such as hamburger helmets and demogorgon skins.

While we don’t have a verdict yet on whether or not Apple’s App Store policies represent illegal monopolistic behavior, the three-week trial spilled the business world’s equivalent of piping hot tea: Epic’s finances were revealed through court documents. It’s a private company so these are juicy deets, and they made it clear why Epic wants to maximize per-hamburger helmet profit: Epic made 98% of its estimated $9.7 billion in revenue exclusively from Fortnite in 2018 and 2019. 

And Apple allegedly took an outsized bite out of that revenue to unfairly benefit its bottom line. US District Judge Yvonne Gonzalez Rogers said that Apple makes more money off of gaming apps than any other category, quipping, “You’re charging the gamers to subsidize Wells Fargo.”

What did Tim Cook have to say about all this?

He played defense, responding “idk” to several lines of questioning. But when asked about his stance on apps steering customers away from the App Store for purchases (the reason Fortnite was booted off iOS last August), he said, “It would be akin to Apple going down to Best Buy and advertising that you can go across the street to the Apple Store and get an iPhone.”

Cook also argued that Apple does not closely track the App Store’s profit and loss; in other words, the company’s bean-counting doesn’t interfere with the App Store’s integrity as a marketplace for users to discover apps. Epic’s lawyers pulled up emails suggesting otherwise.

Looking ahead…If Apple loses, it may have to “basically rewrite iOS,” according to The Verge. But even if it ends up defeating Epic, this trial has perma-flipped flashlight mode onto Apple’s App Store. 

COVID

Vaccine Tracker

Today, we’re tossing out the usual Vaccine Tracker format to talk about the main question vexing US health officials: With vaccines widely available, what's the most effective way to motivate people to get a shot?

1. Hold a lottery: Ohio pioneered the tactic with its “Vax-a-Million” lottery awarding $1 million each to five vaccinated residents, and preliminary numbers show it’s working: The state reported a 53% week over week increase in first doses administered following the announcement. On Thursday, New York also introduced a lottery incentive for residents to get vaccinated.

2. Use vaccines as an aphrodisiac: In partnership with the White House, popular dating apps including Hinge, Tinder, OkCupid, and Bumble will soon introduce features that allow users to a) broadcast they’ve been vaccinated and b) find other vaccinated singles who are down to dose-si-do. 

3. Go door-to-door: With more than 60% of adults vaccinated in NYC, public health officials are encouraging community groups to start knocking on doors, specifically in Black and Hispanic neighborhoods where vaccination rates are lower. 

MEDIA

Tribune’s Alden-or-Nothing Vote

Despite loads of opposition, shareholders voted yesterday to approve the sale of Tribune Publishing and its legendary newspaper chain—including the Chicago Tribune, Baltimore Sun, and a number of other local dailies—to Alden Global Capital for $633 million. 

Unions representing Tribune employees fought the sale over the last year, fearing the New York hedge fund’s aggressive cost-cutting strategies would lead to job cuts and office closures. The sale ultimately came down to one hotly debated vote from shareholder and LA Times owner Dr. Patrick Soon-Shiong.

• Soon-Shiong abstained from the vote, but didn’t actually check the “abstain” box, so it was counted as a “yes.” 
• If the “abstain” box would have been checked (even a little bit), it would have been counted as an “against” vote and the sale wouldn’t have been approved.

Zoom out: Alden, which already owns ~200 other local newspapers, has been the Tribune’s largest shareholder since 2019. When the deal is finalized, Alden will take Tribune private and become the second-largest newspaper owner in the country.

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GRAB BAG

Key Performance Indicators

Stat: Skyrocketing share prices for vaccine makers have minted nine new billionaires in Big Pharma, according to the People’s Vaccine Alliance. Moderna CEO Stéphane Bancel and BioNTech (Pfizer’s vaccine bff) CEO Ugur Sahin are both worth more than $4 billion each.

Quote: “Don’t kiss or snuggle backyard poultry.”

The CDC told amateur farmers to put those chickens down right this instant after a salmonella outbreak sickened 163 people across 43 states, as of Thursday. Pigeons are still fair game.

Read: In the final installment of our series on Black Wall Street, we collected a list of resources to help you learn more about the Tulsa Race Massacre of 1921. (Morning Brew)

SPORTS

Your Epic Sports Weekend Primer

Racing 

ANDREJ ISAKOVIC/AFP via Getty Images

After a one-year absence, Formula One returns to the French Riviera for the glamorous Monaco Grand Prix on Sunday. Here’s a cool video on the logistical challenges of turning the tiny country into a race track. 

Golf

Keyur Khamar/PGA TOUR via Getty Images

The PGA Championship is entering the third round at the stunning-but-gusty Ocean Course at Kiawah Island in South Carolina. Measuring 7,876 yards, it’s the longest golf course in major championship history.

Basketball

C. Taylor Crothers/Getty Images

For their (long-awaited) playoff game vs. the Atlanta Hawks on Sunday, the Knicks will host 15,000 fans at Madison Square Garden. Officials say it will be the largest indoor gathering in NYC since the pandemic began. 

WHAT ELSE IS BREWING

• Snap is buying WaveOptics, the supplier of its augmented reality displays, for more than $500 million.
• Kansas City Southern accepted a $30 billion merger offer from Canadian National Railway, ditching another (smaller) bid from Canadian Pacific.
• Netflix is looking to hire an executive to lead an expansion into video games, according to The Information.
• Existing US home sales fell in April for the third straight month, likely due to the inventory crunch pushing up prices.
• New airline Breeze Airways will start service on May 27. Breeze says that 95% of its early routes have no other nonstop flights. 

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New Music Saturday: BTS spread Butter on our summer, Olivia Rodrigo dropped a tangy new album, Lil Nas X made the soundtrack to Earth’s next sunset, St. Vincent released an album, Niall Horan & Anne-Marie did a duet...do you think we’re cool now?

Weekend conversation starters:

• What’s the best early-2000s phone design?
• If everyone had your personality, what would the world look like?
• To the over 30 crowd: What’s the saddest way you’ve injured yourself?   
• How do you manage anxiety? 

FROM THE CREW

Brew's Bookshelf

Every other week, Brew’s Bookshelf brings you a few of our favorite, business-related reads. 

1. President and CTO of Greenwood Financial Aparicio Giddins recommends The Color of Money by Mehrsa Baradaran. To understand the racial wealth gap, you have to understand the segregated economy it was built on.
2. Augustine Sedgewick’s Coffeeland explores the brutal history of coffee cultivation in El Salvador and charts how capitalism, geopolitics, and marketing reshaped consumer habits around a cup of brew. 

GAMES

Brew Crossword

Hopefully you don’t get no-hit by today’s puzzle, called Cover Your Bases. Kudos to the creator Zach Keller for the timely theme. 

Play the crossword here.