SAN RAMON, Calif .– Apple CEO Tim Cook has described the company’s unwavering control over its mobile app store as the best way to serve and protect iPhone users, but he has been faced with tough questions about competition concerns from a judge on Friday over allegations he oversees an illegal monopoly.
The rare courtroom appearance by one of the world’s best-known executives came during the closing phase of a three-week trial over an antitrust case brought by Epic Games, the creator of the popular video game Fortnite.
Epic is trying to overthrow the so-called “walled garden” for iPhone and iPad apps that welcomes users and developers while blocking out the competition. Created by Apple co-founder Steve Jobs, a year after the iPhone debuted in 2007, the App Store has become a key revenue stream for Apple, helping the company to make a profit of $ 57 billion. dollars in its last fiscal year.
The essay focuses on Epic’s claim that Apple has turned its store into a price-jacking vehicle that not only earns a 15% to 30% commission on in-app transactions, but prevents them from being sold. apps to offer other payment alternatives. This ban extends to showing a link that would open a web page that offers commission-free means of paying for subscriptions, in-game items, etc.
When asked amicably by a lawyer for the company, Cook made polite remarks that sometimes sounded like an advertisement for the iPhone and other Apple products.
But the normally unfazed CEO seemed annoyed at times as he was toasted by Epic lawyer Gary Bornstein. His unease was especially evident when pressed for profit levels at a store Jobs initially thought were lucky to break even. He appeared to stumble slightly again when Bornstein confronted him about a deal in China that could compromise user privacy, even as the company maintains that protecting its customers’ personal information is a top priority.
Cook, however, has never wavered for nearly four hours of testifying to his position that Apple’s grip on the App Store allows him to keep things simple for a loyal customer base that buys iPhones in. knowing that they are getting “something that works”.
âThey’re buying across a whole ecosystem when they buy an iPhone,â said Cook, who wore a face shield but no mask in a courtroom in Oakland, Calif., Whose access is limited due to of the pandemic.
After lawyers finished their questioning, U.S. District Judge Yvonne Gonzalez Rogers asked why Apple couldn’t allow rival stores to offer a built-in transaction option on iPhones, iPads, and iPods that could charge lower commissions. . This is something Epic is fighting to make this happen, in part because it has a still unprofitable store that charges a 12% commission.
Gonzalez Rogers appeared particularly troubled by a survey indicating that 39% of iPhone app developers are unhappy with the current distribution system. She also questioned the fairness of a commission system forcing video game makers to pay the bulk of commissions, while digital services offered in other industries such as banking pay nothing, even if they use the technology that powers iPhones.
“The gaming industry seems to generate a disproportionate amount of money compared to the [intellectual property] that you give them and everyone? In a way, it’s almost like they’re subsidizing everyone, âsaid Gonzalez Rogers.
Cook accepted the grant, but insisted there was always a balance, as video game makers are able to reach a wider audience of consumers who become gamers while visiting the store by looking at other apps. He took issue with the idea that most app makers aren’t happy with the store’s current setup.
âWe are returning the place to the developers,â Cook said.