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

[rjp1]

"We care deeply about privacy and quality. We look at every app, but the rules apply evenly to everyone."

He’s lying. Their apps don’t have the same rules applied to them.

I constantly get nagged by apps that need background location info to continue to allow access. Apple apps never nag for your continued background location info, but they continue to access it.

Disappointed that he’d lie like this. Steve would have at least explained why he thought Apple didn’t need to play by the same rules or something, but not tell such obvious lies.

 

[m11rphy]

But some sellers can go to Best Buy, Target, Walmart, etc... to sell their products. Epic Games took THE biggest game Fortnite off google play store and went and sold it on their own store on android still. Why can't developers have options? Sell on Apple App store and their own store which can be accessed on Apples device like Android?

And was that better for Android customers? Is it better for them they cant buy the app through google play store and now have to set up a new payment with a new company for just one app. Would it be good for you as apple user if in the future you have to the same 10 plus times for the apps you use as you can now longer get them from the App Store?

 

[DeadeyeM]

Ok Tim China

 

[Brandon916]

And was that better for Android customers? Is it better for them they cant buy the app through google play store and now have to set up a new payment with a new company for just one app. Would it be good for you as apple user if in the future you have to the same 10 plus times for the apps you use as you can now longer get them from the App Store?

It's not about better. It's about option. The developer can now keep 100% of the profit. Are you saying you would rather go to only Walmart to buy something vs having the option to go to Walmart, Target, Amazon, Best Buy, etc...? Imagine if the other store is charging the same apps at a lower price? Are you saying you wouldn't mind paying a little less for the same apps? That is what competition do. It lowers the prices for consumers. It's been long proven. Taught in all business classes.

 

[ArtOfWarfare]

$99 pays for 3 hours of app review time. hardly accounts for CDN servers storing your app.

My iPhone has hundreds of apps occupying 10 GB of space - we'll say that a TB can only store 10K apps, though. A 12 TB drive costs $240, so the cost to store 10K apps is about $20, or about $0.002 for each app stored.

For the $99 Apple charges, they can store 50K apps. There's an estimated 2M apps on the iOS app store - those probably occupy around 200 TB, which Apple could store for about $50K. Could multiply the figure by 3 to allow for backups, but that's probably around what it costs Apple per year, and they collect the fees annually, so that's probably about fair.

 

[m11rphy]

It's not about better. It's about option. The developer can now keep 100% of the profit. Are you saying you would rather go to only Walmart to buy something vs having the option to go to Walmart, Target, Amazon, Best Buy, etc...? Imagine if the other store is charging the same apps at a lower price? Are you saying you wouldn't mind paying a little less for the same apps? That is what competition do. It lowers the prices for consumers. It's been long proven. Taught in all business classes.

That is not what happened with Fortnight, what happened was they removed the game from the google App Store and it had to be side loaded, there was still only one place to buy the game for android and the price stayed the same. This didn't benefit android users in anyway.

All this will lead to is people unwittingly installing an app from some random website that hasn't been reviewed by apple and next thing we know that app contains spy ware or peoples credit card details get exposed and all the headlines will say Apple iPhone App .............. Then its apple problem to deal with.

People buy apple because its simple and secure, all that your proposal will do is force people to download apps from god knows where and leave them selfs open to cyber attacks. Your proposal will create a new industry in iPhone antivirus software, Norton will make some money tho lol

 

[boss.king]

Can we get a "wide gate" tally?

 

[m11rphy]

My iPhone has hundreds of apps occupying 10 GB of space - we'll say that a TB can only store 10K apps, though. A 12 TB drive costs $240, so the cost to store 10K apps is about $20, or about $0.002 for each app stored.

For the $99 Apple charges, they can store 50K apps. There's an estimated 2M apps on the iOS app store - those probably occupy around 200 TB, which Apple could store for about $50K. Could multiply the figure by 3 to allow for backups, but that's probably around what it costs Apple per year, and they collect the fees annually, so that's probably about fair.

Dude you think the whole App Store is stored on $50k worth of external HDDs? Apple will use data farms that cost 100s of millions if not billions

 

[Homerpalooza]

(snip)

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.

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.

You are conflating the issue. Apple isn't crippling the apps. Vudu and Kindle are. The developers have chosen to not to make IAP (In app purchases) part of their app because they want to circumvent the commissions.

App Store Guidelines are specific and detailed. If you make an IAP (and Apple is the billing agency) you have to pay Apple the 30% charge. If the purchase is a physical product then Apple does not take the 30%. Amazon.com for example. Or pick a billion other apps that are storefronts. Ebay, etc. But you aren't using Apple's App Store an billing to pay for your Amazon products.

Apple allows VUDU and Kindle to allow users to buy content directly from Vudu and Kindle, and watch it on their apps. They don't block VUDU or Kindle purchases from being seen or consumed.

Apple's approach is the most fair way to do that. If you want to use Apple's billing processes, then you are going to pay Apple a commission. Spotify will let you create an account, log in, and move to the premium service within the App, and they pay Apple the commission. It was a strategic move by Spotify to make it easier for users of the App.

 

[i-John]

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.

While not directly, but they are. If you want an in-app purchase, you have to use their payment processor and give them 30% of what you charge. For a lot of developers, that's a lot of money. Also doesn't allow them to use their own processing in-app. That is an Apple rule, so it's limiting what a developer can do in-app. They even removed apps that had a link to the developer site to pay outside of the app.

These aren't developer decisions, they are Apple limitations. The old "they don't have to develop for iOS. Partly the reasons for these hearings is regarding market dominance and how they may be abusing their place in the market.

Just remember, they convicted Microsoft for anti-competitive behavior because they pre-installed their own browser, and though allowed any other browser to be installed for free, was illegal.

 

[Ethosik]

What a ridiculous thing to say. Buying an Android phone is not the solution to fixing iOS.

Fixing iOS is the solution to fixing iOS.

Absolutely not. iOS is not a problem. This is like demanding AMD to change because they do not offer CUDA while NVIDIA does. If you need CUDA, get NVIDIA. Why bash on AMD? Same thing here. If you want a more open environment, go with Android. iOS is not a problem, the consumer's needs conflict with iOS so they should look at an alternative.

 

[monkeybongo]

It's not that black and white. I like iOS. It's a good operating system and I prefer it to Android. Just because iOS has one bad limitation does not mean I will switch to Android. That's silly, because I still prefer iOS as a whole.

Instead, we should fix iOS.

I like chocolate cake but I don't like the "chocolate" in chocolate cake. I could get vanilla cake but I want to have chocolate cake.

Instead, we should fix chocolate cake.

/s

 

[Ethosik]

I just wish that these congressman and congresswomen would allow the CEOs to actually speak instead of bombarding them with statements and interrupting them while they’re talking. I found myself laughing out loud at how often he interrupted Cook. Most of the others haven’t been much better.

Well to be fair they only have 5 minutes. And sometimes they just wanted a Yes or No. Not an essay response.

I mean why waste time like this:

"Did you sign the papers to approve acquiring company X?"

"Thank you congressman, I like this question. Here at Company X we like to do X Y Z ABC."

Just say Yes or No!

 

[I7guy]

While not directly, but they are. If you want an in-app purchase, you have to use their payment processor and give them 30% of what you charge. For a lot of developers, that's a lot of money. Also doesn't allow them to use their own processing in-app. That is an Apple rule, so it's limiting what a developer can do in-app. They even removed apps that had a link to the developer site to pay outside of the app.

These aren't developer decisions, they are Apple limitations. The old "they don't have to develop for iOS. Partly the reasons for these hearings is regarding market dominance and how they may be abusing their place in the market.

Just remember, they convicted Microsoft for anti-competitive behavior because they pre-installed their own browser, and though allowed any other browser to be installed for free, was illegal.

Right, so the app developer doesn't want to play by Apple's rules. Apple is a minority player, the market dominance they have is in revenue, not market share.

As far as the Microsoft analogy, this is years later and nobody knows where this will head, if anywhere.

 

[farewelwilliams]

My iPhone has hundreds of apps occupying 10 GB of space - we'll say that a TB can only store 10K apps, though. A 12 TB drive costs $240, so the cost to store 10K apps is about $20, or about $0.002 for each app stored.

For the $99 Apple charges, they can store 50K apps. There's an estimated 2M apps on the iOS app store - those probably occupy around 200 TB, which Apple could store for about $50K. Could multiply the figure by 3 to allow for backups, but that's probably around what it costs Apple per year, and they collect the fees annually, so that's probably about fair.

You're over simplifying. It's not just one binary + backups.

Developers distribute bitcode versions of their app to the App Store. App store creates device-optimized versions. For example, some devices uses 2x resolution of images assets (for retina displays) while some devices uses 3x resolution (iPhone X for example). Some devices has a 32-bit processor while others have a 64-bit processor so different compiled binaries are needed. Some assets are meant for iPhone only while some are meant for iPad only. Apple creates a binary specific to those device families and only includes assets necessary for a device to run it. This is to cut down the app size.

Essentially, there's about a 10x10 device matrix where 10 different iPads and 10 different iPhones each have their own device optimized binary. A single ~1GB game can end up having ~50-100GB worth of device optimized binaries. Then there's backups, there's previous versions that Apple keeps (which users can download), there's IAP purchases for additional DLC packs like extra levels for games which could be 1-2 GB each, redundant copies stored at edge servers (especially in China where customers can't download from USA servers), and etc...this could amount to several TBs of total cloud storage across all of Apple's servers just for one app.

1TB of S3 from Amazon costs more than $200/year.

On my iPhone, Call of Duty from the App Store is 2.6GB. On my iPad Pro, it's 2.7GB. On my iPad mini, it's 2.6GB. Each device has their own optimized binary.

And that's not even including the app review times that Apple has to pay out to their employees (app reviewers make about $30/hr) or the many services Apple provides developers.

 

[Brandon916]

That is not what happened with Fortnight, what happened was they removed the game from the google App Store and it had to be side loaded, there was still only one place to buy the game for android and the price stayed the same. This didn't benefit android users in anyway.

All this will lead to is people unwittingly installing an app from some random website that hasn't been reviewed by apple and next thing we know that app contains spy ware or peoples credit card details get exposed and all the headlines will say Apple iPhone App .............. Then its apple problem to deal with.

People buy apple because its simple and secure, all that your proposal will do is force people to download apps from god knows where and leave them selfs open to cyber attacks. Your proposal will create a new industry in iPhone antivirus software, Norton will make some money tho lol

Hence you get option. If you wanna side apple, that is totally fine. Having options lower prices which is better for consumers. Consumers can still go to the app store to get their apps. For any consumers willing to setup a new payment method for the 100x since (like having amazon, walmart, apple, google, etc), that's for them to deal with. I like having options. I would love to buy apps off the app store if I can get them for a cheaper price just like how I would buy from Target if it's cheaper then walmart. You can still buy only apps from apple app store as well. We both win.

 

[monkeybongo]

Absolutely not. iOS is not a problem. This is like demanding AMD to change because they do not offer CUDA while NVIDIA does. If you need CUDA, get NVIDIA. Why bash on AMD? Same thing here. If you want a more open environment, go with Android. iOS is not a problem, the consumer's needs conflict with iOS so they should look at an alternative.

I'm with you on this.

People and developers always have the power to vote with their spending. Android is a fully complete OS ecosystem with a ton of options for hardware. If one day I decide to switch, I don't think I'll serious regret it. If enough people do, then Apple will have to change their tune.

 

[I7guy]

Hence you get option. If you wanna side apple, that is totally fine. Having options lower prices which is better for consumers. Consumers can still go to the app store to get their apps. For any consumers willing to setup a new payment method for the 100x since (like having amazon, walmart, apple, google, etc), that's for them to deal with. I like having options. I would love to buy apps off the app store if I can get them for a cheaper price just like how I would buy from Target if it's cheaper then walmart. You can still buy only apps from apple app store as well. We both win.

Why would the prices be lower? The dev would just pocket the difference. Actually I would think twice about buying an app if every app I bought I had to give out my cc number.

 

[Ethosik]

I'm with you on this.

People and developers always have the power to vote with their spending. Android is a fully complete OS ecosystem with a ton of options for hardware. If one day I decide to switch, I don't think I'll serious regret it. If enough people do, then Apple will have to change their tune.

Yep, Absolutely. Everyone here, do you want to know what speaks to companies the most? Your wallet. If you do not like the way iOS does things, and you are still buying them, you are just reinforcing to Apple that they are doing what the world wants. If you want to make a change, vote with your wallet. You know, if an open environment is very important to you, get Android instead.

There are some things I do not like about iOS. Similarly, there are things I do not like about macOS, Windows, Android and so on. But its their operating system, and I choose to live with some of the items I do not like vs the alternative where the list of what I do not like is larger.

I do not think anyone can say they are 100% happy with anything. They have ZERO issues with anything. Windows? MacOS? Android?

 

[m11rphy]

Hence you get option. If you wanna side apple, that is totally fine. Having options lower prices which is better for consumers. Consumers can still go to the app store to get their apps. For any consumers willing to setup a new payment method for the 100x since (like having amazon, walmart, apple, google, etc), that's for them to deal with. I like having options. I would love to buy apps off the app store if I can get them for a cheaper price just like how I would buy from Target if it's cheaper then walmart. You can still buy only apps from apple app store as well. We both win.

You have missed the point buddy, the developer of the game fortnight totally removed the app from the google App Store and the only option was to side load the app. People couldn't still buy from the App Store and the price stayed exactly the same. You didn't get more options all that happened was you could no longer buy from Walmart but you had to go to some random store in a dodgy back ally and still pay the same price while hopping not to get robbed.

 

[Rogifan]

Tim Cook just said 84% of the apps on the App Store are “free” and Apple doesn’t earn any commission on them. Well if they’re free what could Apple charge a commission for? Also if they have ads and you pay to remove ads Apple gets a cut of that transaction. If they’re games and you pay to get more coins, turns, dice rolls etc. Apple gets a cut of that transaction. Cook also said the cost of distributing software before the App Store was 50-70%. That’s nonsense. We didn’t go from B&M stores to Apple’s App Store. There was digital distribution. I remember downloading lots of apps from the web. It’s disingenuous for Apple to pretend digital distribution didn’t exist prior to the App Store.

 

[Abazigal]

Hence you get option. If you wanna side apple, that is totally fine. Having options lower prices which is better for consumers. Consumers can still go to the app store to get their apps. For any consumers willing to setup a new payment method for the 100x since (like having amazon, walmart, apple, google, etc), that's for them to deal with. I like having options. I would love to buy apps off the app store if I can get them for a cheaper price just like how I would buy from Target if it's cheaper then walmart. You can still buy only apps from apple app store as well. We both win.

Except that your response bears no link to the example you quoted in the first place. Fortnite didn’t give users the option on android; they went with the option that was the most convenient and beneficial for themselves, at the expense of user security.

By contrast, the iOS App Store, through a lack of choice, forced fortnite to be released through their App Store. Users didn’t have to jump through hoops to sideload the app, prices were still the same, and consumers ultimately were the beneficiaries.

Therein lies the irony. Fortnite had a choice on android, and they ultimately chose to benefit themselves at the expense of the end user.

That, on the flip side, is the power of the iOS App Store - the lack of choice keeping developers in line, and customers benefit in the form of safer apps, and a more secure and intuitive purchasing method. This is to me is worth way more than the option to buy an app at a slightly cheaper price outside the App Store, while potentially introducing a whole slew of potential security and stability issues.

 

[swm]

Why can't developers have options? Sell on Apple App store and their own store which can be accessed on Apples device like Android?

it is not impossible, at least, not technically. once you persuade your wannabe customers to install the downloadable developer certificate onto their i-device, they can install apps from that source. there were even attempts to do a 3rd party app store with this technique.

is it cumbersome? yes.
is it any better for the customer? doubt.

does it mean that the sw house can essentially build a sandbox where he can enforce monopolistic rules at their own discretion? pretty much that's the case.

remember, all it takes to have a multi-10billion dollar app store is create a best-in-class device with superior customer experience and great reliability, and build an entire ecosystem around it so you will attract customers, who then finally decide to buy stuff from your store ;-)

 

[HiVolt]

They're all snake oil salesmen. Hardly any of them answered any question directly and to the point, there was always spin attached to the answers, especially from Google and Facebook.

The questions for Tim Cook with regard to the App Store monopoly on Apple devices were poorly prepared and poorly presented IMO.

I don't think anyone mentioned the preferential treatment Apple's own apps enjoy on Apple devices with regard to software & hardware access, that not enough API's are available to developers to access features, or are often delayed by years, and still often limited in functionality, while Apple's own apps enjoy full access.

Nobody suggested any alternatives to the 30% cut, like tiered commission pricing based on volume of apps sold or subscriptions sold, or a flat rate fee to host the apps on the App store (nobody expects Apple to do it for free) - and allow developers who choose that option to use other verified payment processors - or allow people to sign up for services outside of the App store - while still charging either tiered or flat rates for hosting on app store.

 

[Ethosik]

They're all snake oil salesmen. Hardly any of them answered any question directly and to the point, there was always spin attached to the answers, especially from Google and Facebook.

The questions for Tim Cook with regard to the App Store monopoly on Apple devices were poorly prepared and poorly presented IMO.

I don't think anyone mentioned the preferential treatment Apple's own apps enjoy on Apple devices with regard to software & hardware access, that not enough API's are available to developers to access features, or are often delayed by years, and still often limited in functionality, while Apple's own apps enjoy full access.

Nobody suggested any alternatives to the 30% cut, like tiered commission pricing based on volume of apps sold or subscriptions sold, or a flat rate fee to host the apps on the App store (nobody expects Apple to do it for free) - and allow developers who choose that option to use other verified payment processors - or allow people to sign up for services outside of the App store - while still charging either tiered or flat rates for hosting on app store.

Yeah sometimes they only wanted a Yes or a No, and Google/Facebook wanted to give them an essay response. Respect the time, they only have 5 minutes!