The Fee War (6)
Johnny Myren stared at the man across from him, dumbfounded. Compared with Enple, both Legend Games and Continue Capital were the weaker parties. If the other side had come in with its head bowed, he would have been willing to negotiate, at least to a point—as long as the contract itself stayed out of the public eye. But the way they were acting now was practically an invitation to fight. What the hell is this guy? Fury rose in him, but Johnny forced it down almost at once.
"We can't accept those conditions."
Han Miru nodded as if he'd expected exactly that.
"I see. But I've been wondering for a while—how did you arrive at 30 percent in the first place? Why 30, and not 29 or 31?"
Tom Scott, sitting beside him, cut in with a sharp edge to his voice.
"Game makers build the games, and game makers run the games. So what exactly did Enple do to deserve 30 percent?"
Johnny Myren's voice turned cold.
"If Enphones had never existed, do you think so many game companies would have even come into being? We built Enstore. We built the mobile game market. You agreed to that 30 percent fee when you signed the contract, and now that revenue has grown, you're saying 30 percent is too much?"
"How much has Enstore revenue grown compared to ten years ago? A thousandfold? Ten thousandfold? A hundred thousandfold? Enple's profits have risen by the same astronomical amount. And yet the fee is still 30 percent. Fine—I'll concede that whatever Enstore charges is Enple's business. But why block outside payments?"
"It's a perfectly normal measure to protect customers."
"That's funny. So if customers pay through Enple, they're protected, but if they pay outside, they're somehow in danger?"
"This doesn't refer only to encryption and security at the point of payment. It includes arbitration and refunds in the event of disputes. If you don't like Enstore's policies, then simply don't offer your service on Enstore."
"We're asking to be allowed to use other app markets so we can avoid offering our service on Enstore. Just like Andromeda allows other app markets besides PlayMarket."
"That's impossible."
Han Miru muttered from the side, almost to himself.
What Enple's belongs to Enple, and what belongs to the game companies belongs to the game companies. Is that really so hard?
Johnny frowned.
"It seems you never intended to negotiate from the start."
"No. I'm simply saying that before we can negotiate, Enple has to give up its monopoly."
"If a game succeeds, it's because the game company did a good job. In the same way, if Enstore's revenue has grown, it's because Enple did a good job. Success isn't a crime, and there's no reason to criticize it."
Han Miru answered immediately.
"It's only natural for a company to pursue profit, and I have no intention of condemning that. But you're using a monopolistic position to interfere with competitors' business and extort 30 percent from developers. And even now you're spouting nonsense about how much you care about developers. That's what I'm criticizing. Through this lawsuit, we intend to show the world exactly what kind of company Enple is."
Johnny Myren rose from his seat with a cold smile.
"There's no point in talking any further. Let's take the rest of this to court."
"I don't know how much you know about me, but would you like me to make a prediction? Win or lose, Enple will have no choice but to lower its fee."
"Do you honestly think that will happen?"
"You'll see whether my prediction was right."
As he turned to leave the conference room, Han Miru called after him.
"Ah—and one more thing. If you have anything to say from now on, tell CEO Tim Keaton to come himself."
Vice president Johnny Myren stormed out with the lawyers in tow.
Tom Scott looked at me and said,
"Looks like I got him angry."
"Does it?"
We exchanged a smile. Harrison, the lawyer, looked utterly lost.
"You provoked him on purpose, didn't you?"
"Yes."
"Why?"
"If Enple lowers the fee on its own, it'll be hard to keep this fight going. It's better for us if they come at us harder."
The situation this time was different from the first run.
Because Enple might choose a different response, we had to strike first.
I said to Tom Scott,
"From here on out, your role becomes important. You can handle that, right?"
He was up against a supergiant like Enple, but instead of looking scared, he seemed almost thrilled.
"Of course. I'll do everything I can."
He looks even more motivated than he does when developing games.
Well, people always work harder when they're doing something they actually want to do.
If Stevie Schiller was the inventor and innovator who built the Enple empire, Tim Keaton was the manager.
As an SCM specialist, he cut down the number of component suppliers and arranged factories close enough to one another that they could function as a linked network, reducing component inventory to ten days' worth, lowering costs and raising profits.
A company isn't done once it releases a new product. It has to manufacture that product on time and get it into stores. Without Tim Keaton's support, Enphones would never have conquered the world so quickly.
In recognition of that achievement, he was promoted to COO in just ten years and named Stevie Schiller's successor as the next CEO.
Even then, people's reaction was the same.
Who the hell is Tim Keaton?
That was how little presence he had outside the company.
But Tim Keaton was a different kind of genius from Stevie Schiller.
Enple was a vast empire.
It had thousands of partner companies and tens of thousands of components flowing in from them. If even one small part was missing, production would grind to a halt.
Tim Keaton looked over the supply chain as if it were laid out in the palm of his hand, and he directed it so that everything ran without a hitch. In that way, he steadily expanded the empire he had inherited from Stevie Schiller.
People often said that after Stevie Schiller died, Enple's innovation had come to an end. But that wasn't true.
Innovation wasn't only about releasing products the world had never seen before.
Having one billion active devices around the world was innovation in itself!
Put up one ad and a billion people saw it; release one app and a billion people used it.
Building on that, Tim Keaton rolled out EnpleMusic, the music-streaming app, and EnpleTV, the OTT service, one after another, growing revenue in the services sector.
Recently, the areas that had caught his eye most were games and fintech.
Those were markets on a scale that made music and movies look small by comparison. So Enple launched Bazarr, its subscription-based game app, and followed it with Enple Pay and Enple Wallet.
Those services didn't generate huge profits right away. But they did let Enple get its hands on users' payment data and keep them locked inside the Enple ecosystem.
The end goal was almost to make Enple Wallet replace the physical wallet altogether.
Enple had also signed partnerships with Visa, Master, and Union, and by directly checking customers' credit information it was collecting personal data with the intention of eventually moving into retail finance—deposits, loans, and the rest.
In short, Enple was trying to become a bank as well.
And yet....
Bazarr had been completely crushed by its competition with Block Valley, and Legend Games had filed suit over the fee issue.
On the surface, it was about in-app payment fees, but underneath that lay a battle over fintech.
Continue Capital created the stablecoin Penny and built its own payment system without partnering with the existing financial sector or card companies.
What's more, it had recently been expanding Penny's uses at breakneck speed, led by game companies.
That was a major threat to Enple's fintech business.
CEO Tim Keaton received Vice President Johnny Myren's report with a calm expression.
"So they told you to come to them directly if I had anything to say?"
"That's right."
If they withdrew Penny payments, he was even prepared to concede somewhat on the fee. That was why he'd begun the secret talks in the first place—but Continue Capital had blown the table up first.
Are they trying to drag this fight into the mud?
His instinct as a manager told him one thing: this wasn't going to end easily.
But....
"Enple must never waver. Do you understand what I'm saying?"
Johnny Myren nodded with a hardened face.
"Yes, sir."
Now Enple, too, had reached a point where it could no longer back down.
Enple made its own operating system, NOS, and sold the Enphone, a smartphone loaded with it.
Guble, on the other hand, only developed and distributed its operating system, Andromeda. It did make its own smartphones as well, but they were a tiny part of the business.
For that reason, Yuseong Electronics was a competitor to Enple, but it maintained a close partnership with Guble.
Thanks to adopting the Andromeda operating system, Yuseong Electronics became the company that sold the most smartphones in the world, but at the same time its dependence on Guble only deepened.
It hadn't been as though no one had ever tried to break away from that arrangement, but every attempt had failed.
And now they were suddenly pushing to grow CosmicStore.
They didn't just upload games to the app market. They ran a massive promotional event and aired TV commercials across the world.
At the end of the Nightlight and Block Valley game ads, the words Download it from CosmicStore appeared on screen.
Users of CosmicPhones saw the articles and the ads, then downloaded Nightlight and Block Valley through CosmicStore.
And other Andromeda phone users installed CosmicStore just to download the games.
Guble was thrown into confusion by the movement.
Andromeda could still route around the problem through other app markets, but Enple had no way to offer services outside Enstore.
With the antitrust suit still underway, Enple made its move.
First, it sent notices to the mobile game companies that supported PC and cross-platform play, asking them to stop bypassing in-app payments through the Legend Games Store.
It was worded as a request, but the pressure the game companies felt was impossible to ignore.
That wasn't the end of Enple's measures.
As if in retaliation for the lawsuit, it went after Legend Games' developer accounts, saying it would delete them and cut off access to the admin tools.
Game companies relied on Enple for tools like SDKs and APIs so their games could run smoothly on NOS.
But once the developer accounts were deleted, those tools could no longer be used.
One might think it wouldn't matter now that the game had been taken down, but Legend Games was a game engine developer before it was a game developer.
If they couldn't access the admin tools, it would become difficult to develop and manage games based on Surreal Engine that were being serviced on NOS.
And because even the hundreds of games currently listed on Enstore could be damaged by this, Enple had gone straight for the throat.
It was almost a warning to other game companies: cut ties with Legend Games.
In response, Legend Games filed for an injunction with the U.S. District Court for the Northern District of California, asking the court to stop Enple from deleting its developer accounts.
The judge issued an order telling Enple to keep Legend Games' developer account active for the time being.
Thankfully, Legend Games would be able to keep its account until the lawsuit was resolved, but its request to have Nightlight relisted on Enstore was denied.
CEO Tom Scott, too, went on the counterattack.