Apple CEO Tim Cook Likens Competition for Attracting Developers to a 'Street Fight for Market Share' in Smartphone Business

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Apple CEO Tim Cook is today testifying in an antitrust hearing with the U.S. House Judiciary Antitrust Subcommittee, where he was questioned about Apple's App Store policies.


Cook was hit with complaints from developers that the committee has spoken to. Apple was accused of making its App Store rules unavailable to developers, arbitrarily enforcing those rules, changing them at will, enforcing rules that benefit Apple, and discriminating between smaller and larger app developers.

In response, Cook claimed that Apple treats all developers the same, with open and transparent rules. "We care deeply about privacy and quality. We look at every app, but the rules apply evenly to everyone." Cook said that some developers are not favored over others and that Apple examines all apps, small or large.

Cook was questioned about reduced commission rates for apps like Amazon Prime, which Cook said are available to "anyone meeting the conditions." The Congressman questioning Cook went on to ask whether Apple uses data collected from the App Store to decide whether it would be profitable for Apple to develop a competing app, a question that Cook skirted.

Cook was then asked what was stopping Apple from potentially raising its App Store commissions and fees, something that Apple has never done. Cook said that there's competition to attract developers just like there's competition to attract customers, likening the battle for developers to a "street fight for marketshare."
There's competition for developers just like there's a competition for customers. And so competition for developers, they can write their apps for Android, or Windows, or Xbox, or PlayStation. We have fierce competition at the developer side and the customer side. Essentially, it's so competitive I'd describe it as a street fight for market share in the smartphone business.
Cook also said that Apple does not retaliate or bully app developers who do not agree to Apple's App Store rules. "It's strongly against company culture," said Cook.

The antitrust hearing is ongoing, and can be watched live over on YouTube. The antitrust subcommittee is also questioning Facebook CEO Mark Zuckerberg, Google/Alphabet CEO Sundar Pichai, and Amazon CEO Jeff Bezos. Most of the questions so far have been for Pichai and Zuckerberg, but we'll share additional details on anything else notable Cook has to say.

Article Link: Apple CEO Tim Cook Likens Competition for Attracting Developers to a 'Street Fight for Market Share' in Smartphone Business
 

ouimetnick

macrumors 68030
Aug 28, 2008
2,633
1,969
Beverly, Massachusetts
I can’t watch the livestream while at work but I’ve been reading some of the questions. I’d like to know why these politicians are wasting everyone’s time asking stupid questions? They should bring in people who understand how these companies operate to ask questions, not people with the same level of understanding as my 70 year old parents. 🙄
 

aaronhead14

macrumors 65816
Mar 9, 2009
1,052
4,728
As a consumer, all I want is for my experience on the iPhone to not feel crippled. But right now, with Apple effectively blocking their competitors’ services from fully functioning on iOS, I’m unable to have a very good experience as a consumer.

Two examples that come to mind are: 1) The inability to purchase movies in the Vudu app. 2) The inability to purchase eBooks in the Kindle app.

Apple prefers you buy movies from iTunes/AppleTV, and eBooks from iBooks. So they intentionally cripple the competition.

This is not only hostile to developers, but hostile to consumers.

Android is not affected by either of these issues. Both of those apps are fully functional on Android.

Apple, please do what’s best for consumers. Stop crippling apps.
 

Analog Kid

macrumors 603
Mar 4, 2003
5,229
3,405
Have there been examples of Apple creating an app directly for profit based on another app that looks successful?

I've seen Apple buy companies with apps they like, and I've seen Apple bundle new apps into their OS (which I suppose indirectly encourages HW sales), but I feel like most of the Apple entries have been aimed at improving user experience.

And it's not like there aren't a ton of knock off apps splayed across the AppStore that aren't developed by Apple Inc. Frankly, I'd like Apple to somehow take a stronger hand in pruning away the knock offs. Not sure exactly how to do that, and "knock off" is rather subjective, but the proliferation of tiny, crappy, apps is an indication to me that the AppStore reduces rather than increases friction to market.

He also said developers don’t pay for shelf space. Except for that 30%...
I'm not watching, so didn't hear the comment, but could he have meant "shelf placement"?
 

m11rphy

macrumors 6502
Dec 26, 2009
413
75
As a consumer, all I want is for my experience on the iPhone to not feel crippled. But right now, with Apple effectively blocking their competitors’ services from fully functioning on iOS, I’m unable to have a very good experience as a consumer.

Two examples that come to mind are: 1) The inability to purchase movies in the Vudu app. 2) The inability to purchase eBooks in the Kindle app.

Apple prefers you buy movies from iTunes/AppleTV, and eBooks from iBooks. So they intentionally cripple the competition.

This is not only hostile to developers, but hostile to consumers.

Android is not affected by either of these issues. Both of those apps are fully functional on Android.

Apple, please do what’s best for consumers. Stop crippling apps.
Maybe you should of bought a android, was you not aware of these limitations when you purchased your iPhone?
 

ArtOfWarfare

macrumors G3
Nov 26, 2007
8,750
4,445
He also said developers don’t pay for shelf space. Except for that 30%...
Also that annual $99-299 fee.

Total BS. Apple isn't fighting to keep developers on the App Store. Epic and Steam fight each other for apps to populate their stores. There is no other store for iOS, and Apple knows it, and so Apple has zero competition. If developers want to distribute to people on iOS, their options are either a web app with all the compromises that entails (compromises which Apple dictates, by the way, since web browsers with alternative engines aren't allowed), or via the iOS App Store with the hundreds of rules Apple arbitrarily enforces, or via a variety of backdoors (jailbreaking, sideloading, etc... legally gray area to be going here, where Apple will retaliate if they find you doing it.)
 

jent

macrumors 6502a
Mar 31, 2010
736
189
He also said developers don’t pay for shelf space. Except for that 30%...
Another commenter referenced placement, or slotting fees, and I presume that's what Tim Cook was referring to. In the world of supermarkets, for example, there are complex contracts where the grocer charges the manufacturer for the right to shelf space. It can be a flat fee, a percentage of sales, or any combination of factors. I don't know very much about it but it's safe to assume Tim was basically saying "We're not like those stores where you have to specifically pay extra just to have your item up for display, and Apple only takes a cut when you sell." Another parallel would be Costco, where apparently they offer very difficult negotiations for the right to sell your products at their store, but with the high volume most sellers are happy. That said, Apple offers the same 70% of sales to all developers, so the treatment is the same across the board.
 

MauiPa

macrumors 6502a
Apr 18, 2018
924
1,245
As a consumer, all I want is for my experience on the iPhone to not feel crippled. But right now, with Apple effectively blocking their competitors’ services from fully functioning on iOS, I’m unable to have a very good experience as a consumer.

Two examples that come to mind are: 1) The inability to purchase movies in the Vudu app. 2) The inability to purchase eBooks in the Kindle app.

Apple prefers you buy movies from iTunes/AppleTV, and eBooks from iBooks. So they intentionally cripple the competition.

This is not only hostile to developers, but hostile to consumers.

Android is not affected by either of these issues. Both of those apps are fully functional on Android.

Apple, please do what’s best for consumers. Stop crippling apps.
point taken, but you are wrong. Apple does not cripple the apps, the developers do. They are avoiding the ripple store fees, by forcing you to buy via the web and then you can watch them for free. Which maybe you are suggesting a new fee structure where an app like Spotify pays a fixed fee of whatever or whatever per user for already subscribed customers instead of zero.

You really have to point the finger in the right direction.
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So he said absolutely nothing more than his usual platitudes.
when the platitudes are right, are they still platitudes?
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Because Tim said so? It makes no sense.
Seriously?
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Maybe you should of bought a android, was you not aware of these limitations when you purchased your iPhone?
these are amazon and vudu limitations, if they in fact exist, I have downloaded books from kindle on my iPhone, so not sure what he means, don't use vudu, so I have no idea if they limit purchase or not, but it is not apple limiting purchase, they would be happy that you used their services. also, I have no idea what google charges for these services from google play
 
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I7guy

macrumors Core
Nov 30, 2013
22,935
11,051
Gotta be in it to win it
As a consumer, all I want is for my experience on the iPhone to not feel crippled. But right now, with Apple effectively blocking their competitors’ services from fully functioning on iOS, I’m unable to have a very good experience as a consumer.

Two examples that come to mind are: 1) The inability to purchase movies in the Vudu app. 2) The inability to purchase eBooks in the Kindle app.

Apple prefers you buy movies from iTunes/AppleTV, and eBooks from iBooks. So they intentionally cripple the competition.

This is not only hostile to developers, but hostile to consumers.

Android is not affected by either of these issues. Both of those apps are fully functional on Android.

Apple, please do what’s best for consumers. Stop crippling apps.
Apple isn't stopping the purchase of content, the developers are...because they don't want to play by Apple's rules. Maybe Apple's rules are unfair, but ultimately we are not the judge of the that and the correct powers that be will address it.

So, don't blame apple, blame the app developer.
 

jmgregory1

macrumors 68000
As a consumer, all I want is for my experience on the iPhone to not feel crippled. But right now, with Apple effectively blocking their competitors’ services from fully functioning on iOS, I’m unable to have a very good experience as a consumer.

Two examples that come to mind are: 1) The inability to purchase movies in the Vudu app. 2) The inability to purchase eBooks in the Kindle app.

Apple prefers you buy movies from iTunes/AppleTV, and eBooks from iBooks. So they intentionally cripple the competition.

This is not only hostile to developers, but hostile to consumers.

Android is not affected by either of these issues. Both of those apps are fully functional on Android.

Apple, please do what’s best for consumers. Stop crippling apps.
As someone who has worked for consumer product manufacturers, selling into retail for the past 25+ years, the idea that Apple‘s Stores (app, product or physical) should have to sell products that don’t allow them to make money is ridiculous. Do you think any retailer should have to sell another retailer’s product, where they can’t make money on said item?

You also can’t go to Burger King and buy a Filet o‘ Fish (where BK makes no money on it). Or a Honda dealership to buy a Toyota (where Honda makes no money on the sale).

It’s just not how it works for any other business, so suggesting Apple is crippling to developers or hostile to consumers - you’d have to then demand that this same system be done for every other consumer product.
 

aaronhead14

macrumors 65816
Mar 9, 2009
1,052
4,728
Apple isn't stopping the purchase of content, the developers are...because they don't want to play by Apple's rules. Maybe Apple's rules are unfair, but ultimately we are not the judge of the that and the correct powers that be will address it.

So, don't blame apple, blame the app developer.
It’s not the developers. It’s Apple. Developers aren’t choosing to make their apps unusable. Apple is pushing them into a corner and making ludicrous demands. That’s why their apps are fully functional on all other platforms except for iOS.

There’s no sense in defending Apple’s tactics which result in you having a worse experience as a consumer than you’d otherwise have. That’s illogical, my dude.
 

I7guy

macrumors Core
Nov 30, 2013
22,935
11,051
Gotta be in it to win it
Also that annual $99-299 fee.

Total BS. Apple isn't fighting to keep developers on the App Store. Epic and Steam fight each other for apps to populate their stores. There is no other store for iOS, and Apple knows it, and so Apple has zero competition. If developers want to distribute to people on iOS, their options are either a web app with all the compromises that entails (compromises which Apple dictates, by the way, since web browsers with alternative engines aren't allowed), or via the iOS App Store with the hundreds of rules Apple arbitrarily enforces, or via a variety of backdoors (jailbreaking, sideloading, etc... legally gray area to be going here, where Apple will retaliate if they find you doing it.)
Apple doesn't retaliate, they would go down fast if that were in fact the case. Every move, I'm sure is run through their internal and external counsel.
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Remember the skeuomorphic designs? Apple stole the bookshelf look from an indy dev from the app store.
So you need to go back to some minor example 10 years ago...and a citation that has some credibility would help.
 

aaronhead14

macrumors 65816
Mar 9, 2009
1,052
4,728
the idea that Apple‘s Stores (app, product or physical) should have to sell products that don’t allow them to make money is ridiculous. Do you think any retailer should have to sell another retailer’s product, where they can’t make money on said item?
Nobody suggested Apple should sell products that wouldn’t make them money. Not sure where you got that idea from. Apple should simply take a reasonable fee, rather than an outrageous one. Apple is clearly the problem here. These apps work perfectly on other platforms. iOS is the only platform where they are crippled.
 

Naaaaak

macrumors 6502a
Mar 26, 2010
607
1,972
Tim misdirected.

> they can write their apps for Android, or Windows, or Xbox, or PlayStation.

Only one of those is another phone platform. Ignoring iOS or Android is not viable if you want to reach a lot of customers. The Apple+Google duopoly inhibits innovation and artificially raises costs.
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Remember the skeuomorphic designs? Apple stole the bookshelf look from an indy dev from the app store.
Apple's stolen a lot over the years.

Watson -> Sherlock
Konfabulator -> Dashboard
 
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