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Today marked the kickoff of the third week of the Epic Games v. Apple trial, and this week is notable because Epic has finished with its witnesses and we're now transitioning to Apple witnesses, including notable Apple executives.

fortnite_apple_featured.jpg

Apple Fellow and former marketing chief Phil Schiller, who is in charge of the App Store, took the stand today. Schiller will testify for up to nine hours, and will see the most questioning out of all of Apple's witnesses.

Schiller's hours of commentary will see him explaining just how the App Store works, the value of the App Store and Apple's SDKs, and why it's important that the judge side with Apple to maintain security and privacy for customers.

Questioning today started with the history of the iPhone, where Schiller made sure to say that security and privacy were the "most important" considerations when developing the iPhone. "This new computing device in your pocket means it's capable of new things," he said. "It's going to store information around our lives that we aren't used to having in our pocket."

Schiller covered how the App Store was set up from the beginning. The iPhone's software is "part of the product" that Apple creates, which is very different from Android, which is licensed to device makers. This licensing model "reduces quality" and the "speed of innovation," Schiller said in defense of Apple's setup.

Early questioning covered the transition from Apple-only apps on iPhone to third-party app support, and the security and privacy risks that Apple had to contend with. After the launch of the iPhone, Apple heard from developers that they wanted to create native apps, which Apple viewed as the first "demand for quality and security" on iPhone.

Apple has always been concerned about jailbroken apps and rogue app developers creating content without documented APIs, which could lead to "unreliable, unstable devices." He pointed out the importance of protecting users from malware to keep devices functioning. "This is your phone in your pocket that needs to work reliably," he said.

Schiller has also been speaking about Apple's App Store policy to treat developers large and small the same, and his testimony has included some interesting little tidbits. Apple wanted to charge $99 for the App Store developer program to prove that an app that's being worked on is "important" and that developers are "serious about making a quality app."

Notably, Schiller said that it costs Apple $50 million for every Worldwide Developers Conference event that it puts on annually, which was used as evidence that Apple's App Store profit margins are not as high as Epic Games has implied.

Schiller also said that 17 percent of the hundreds of thousands of games on the App Store use the freemium model, which was another interesting tidibt that was shared. 75 percent of games are free to download, and six percent require a payment.

On the topic of physical goods, Schiller said that in 2019, the App Store drove $400 billion+ in transactions like food delivery, Amazon purchases, Uber, and more, which are not subject to a 30 percent cut. According to Schiller, Apple does not take a cut of physical purchases because Apple can't guarantee they will actually arrive.

We'll undoubtedly hear additional interesting details from Schiller as his testimony continues, and later this week or early next week Apple CEO Tim Cook is expected to take the stand.

Article Link: Apple's Phil Schiller Takes the Stand in Epic Games v. Apple Trial
 
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Realityck

macrumors 601
Nov 9, 2015
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YouTube live audio, you can listen in.

Alternately you can do this
Apple and Epic Games’ court hearing begins on May 3 and will run for roughly three weeks. Members of the public can tune in and listen to the court hearing by dialing the phone number (877) 336-1839. Once dialed callers will be asked to enter a pin number, type in 9403112 and then press the pound (#) key. This information has been provided by the court.
 

1258186

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Feb 5, 2021
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YouTube live audio, you can listen in.

Alternately you can do this
Apple and Epic Games’ court hearing begins on May 3 and will run for roughly three weeks. Members of the public can tune in and listen to the court hearing by dialing the phone number (877) 336-1839. Once dialed callers will be asked to enter a pin number, type in 9403112 and then press the pound (#) key. This information has been provided by the court.
Given the interest in this case they could at least provide a better sound quality feed.
 

1258186

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Feb 5, 2021
813
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Wow. These developers are so greedy. After all, they need money to improve Xcode and other things like that, as well as maintaining the App Store. 30% is nothing compared to traditional stores. Dang, Epic and other companies just want money, that's all.
Of course it’s all about money. The same goes for Apple, Google, etc who are just as greedy.
 

dguisinger

macrumors 65816
Jul 25, 2002
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Wow. These developers are so greedy. After all, they need money to improve Xcode and other things like that, as well as maintaining the App Store. 30% is nothing compared to traditional stores. Dang, Epic and other companies just want money, that's all.

Used to be the platform was the product, and the developers applications were the lock-in / incentive to keep buying new versions of the platform. Microsoft and Apple never made a % off what you sold at Egghead or Best Buy or CDW.


With Apple giving away iPhones, I guess they really need that 30% forever revenue on every app you buy. Which lets be clear, while its less money the developer is getting out of the sale price, is 30% coming out of your pocket.

Wait, ....no, Apple has industry leading profit margins on iPhone..... they don't need that 30% at all to subsidize the iPhone business. Face it, Apple is greedy, and want as much of the pie as they can have without crossing any line that gets them in legal trouble.

Its such a scam to say Apple deserves 30% of digital subscription revenues. If you go to any brick and mortar store and you buy a game off the shelf, or any other software package.... that store makes nothing on your recurring subscriptions. And that makes sense, they aren't facilitating any part of it. Same thing if you took a magazine off the shelf, filled out the subscription card and started getting magazines. The store had nothing to do with that sale, it didn't deserve or take any of it.

Apple too, isn't facilitating anything of importance. They aren't designing the content, they aren't hosting it, they aren't distributing it, they aren't advertising the DLC/streaming content. The only reason Apple in a lot of these cases is handling the subscription is because for most things they pretty much force you to use them. On the open market, Stripe and other payment processors with recurring billing charge around 3%, not 30. Google does it too you say, ok. Your friend shot someone in the face, does that mean its right?

At least Playstation and Xbox market places are based on subsidized hardware... let me know when Apple decides to subsidize theirs, I'll upgrade more often.
 

alex2792

macrumors 65816
Jun 13, 2009
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There’s no way it costs $50 MILLION to put on a developers conference. Apple could rent out the whole convention center for a month for that much $$$. It’s also driving distance from Apple campus so it’s not like they’re flying their engineers in from halfway across the world.
 
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ArPe

macrumors 65816
May 31, 2020
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There’s no way it costs $50 MILLION to put on a developers conference. Apple could rent out the whole convention center for a month for that much $$$. It’s also driving distance from Apple campus so it’s not like they’re flying their engineers in from halfway across the world.
$50 million includes the cost of preparing for ONE YEAR. Prepping, redecorating, presentations, employees, media production, event space, travel plans for guests, etc etc etc etc
 

jonblatho

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Jan 20, 2014
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Never been to one, but it seems that the life ones include not only lots of hired personell but also plenty Apple engineers being on site to host seminars and such and those don't cost 15$/hour.

So yeah the number does seem a bit high but also not completely outlandish.
It’s still completely outlandish. A rough estimate reveals it probably costs them a couple million dollars to have Apple engineers on-site for the week (as if they wouldn’t be paid anyway if they were instead working at the office); then we’ll spitball a guess and double it to include other hired personnel. That gets you to about $5 million.

Where’s the rest?
 
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Bug-Creator

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as if they wouldn’t be paid anyway if they were instead working at the office

Sure they be working on products, so yeah pull them of to another project (like WWDC) and accounting will bill all the cost associated to that project.

Add renting the convention center, doing all the deco, flying in VIPs etc and your are in 8 figures, so I'd say "So yeah the number does seem a bit high but also not completely outlandish."
 

jom3500

macrumors newbie
Apr 28, 2021
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How does it cost $50m to run WWDC. Some creative accounting going on there.
I was one of many people responsible for organizing the annual general meeting for Siemens in Germany which lasts around 5-8h (1d). We spent over 4 Mio. € every year for this small event. You have no idea what things you have to plan and take into consideration. It‘s really not that easy
 

jav6454

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Schiller is an absolute cheerleader for Apple and I am sure he will ensure his points are clear and concise and give Apple a major win in this stupid trial.
To a point I disagree with Schiller. They didn't want an App Store. They stole the App Store idea from Installer. Heck, the App Store's icon color-scheme is reminiscent of Installer from back in the day. Even today.
 
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