Apple CEO Tim Cook faces sharp questioning from judge in Epic Games trial

Tim Cook, chief executive officer of Apple Inc., heart, arrives at U.S. district court docket in Oakland, California, on Friday, Would maybe maybe 21, 2021.

Nina Riggio | Bloomberg | Getty Images

Apple CEO Tim Cook faced sharp questioning on Friday from Resolve Yvonne Gonzalez Rogers about Apple’s App Store change mannequin on the tip of his testimony within the Fable Video games v. Apple trial.

The questioning gave a preview into Resolve Rogers’ pondering earlier than she decides whether Fable Video games’ argument is solid sufficient to power Apple to permit it to set up change app retail outlets on the iPhone and steer certain of the App Store’s 30% payment on in-app purchases.

Rogers requested Cook what his field became once with allowing iPhone customers the need of a lower payment, specifically for games. Cook said that customers hang a desire between iPhones or Android gadgets.

She followed up by asking about whether Apple has a field with giving customers facts to fetch the same in-app purchases thru a web based browser, bypassing Apple’s 30% payment, suggesting a compromise where Apple would allow a company admire Fable Video games to hyperlink app customers to a web based browser to make transactions, as but every other of forcing them to utilize Apple’s in-app steal mechanism.

“The gaming industry appears to be like to be producing a disproportionate amount of cash to the IP you is probably going giving them and all and sundry else,” Rogers said to Cook. “In essence, or no longer it’s nearly admire they are subsidizing all and sundry else.”

Cook said that Apple faced fierce competitors for developers and customers.

“You can well presumably presumably no longer hang competitors in these in-app purchases, though,” Rogers spoke back.

Rogers moreover expressed doubt that Apple’s Shrimp Alternate Program, which cut App Store charges in half of for diminutive developers, became once made out of tension for diminutive companies throughout the Covid pandemic, as Cook testified on Friday.

“That perceived to be the tip consequence of the stress gathered thanks to investigations, of complaints,” Rogers said.

Cook said that complaints had been within the again of his head, nonetheless what brought on this technique became once fear over diminutive companies throughout Covid.

Rogers remarked that she had seen a discover that 39% of Apple developers are upset with the App Store.

“It would now not appear to me that you just the truth is feel any stress or competitors to the truth is change the style whereby you act to handle the troubles of developers,” Rogers said.

Cook disagreed and said that Apple “turns the space the opposite plot up for developers.”

Friday became once the first time Cook has testified in court docket, he said.

The three-week trial will finish on Monday, nonetheless Resolve Rogers warned this week it could well presumably take weeks or months except she makes a name. After that, the dispute is probably going to be appealed, she said.

Fierce competitors

Forward of Cook became once questioned by Rogers, he testified on Friday that Apple faces fierce competitors in smartphones and within the US, the iPhone most productive has “excessive 30s” p.c of market share. Internationally, the iPhone has about 15% market share, Cook said.

The market share figures cited by Cook are a uncommon example of Apple discussing the market share of its most foremost product, the iPhone, to be in a position to recount it does no longer dominate the smartphone market.

“There is a complete list of assorted handset competitors. Or no longer it’s fiercely competitive,” Cook said.

Apple’s U.S. share cited by Cook is lower than many external estimates. As an example, a original file from Counterpoint Analysis pegged it between 40% to 65% relying on the quarter since 2019.

Apple has argued that its regulate of its App Store, the best formula for patrons to set up system on iPhones, is foremost for the company’s security and privacy guarantees to its customers, and a foremost distinguishing feature in a competitive market for smartphones.

“Lets no longer make the promise of privacy, security, and security” if Fable Video games prevails, Cook testified, announcing that the App Store could well presumably be a “toxic mess” without Apple’s guidelines and insurance policies that Fable is stopping in court docket.

Fable Video games argues security is an excuse to extract charges and regulate what system makers function, and that Apple could well presumably safely originate up its platform to competing app retail outlets.

Cook mentioned Samsung, Vivo, Oppo, Huawei and Google as handset competitors, all of which utilize a version of Google’s Android. He said Apple moreover faces competitors from other app retail outlets, in conjunction with Google Play, and consoles admire Microsoft Xbox and Sony PlayStation.

Apple CEO Tim Cook testifying in Fable Video games trial

Vicki Behringer

When questioned by Fable Video games lawyers, Cook declined to answer to a quiz about whether Apple’s iPhone competes with Google’s Android within the working system market.

“Customers don’t bewitch working programs. They bewitch gadgets,” Cook said.

Cook said that Apple makes utilize of surveys to trace whether iPhone customers switch to Android gadgets. “Making efforts to fetch Android other folks to interchange to iPhone, that is a foremost job for us,” Cook said.

Cook said on Friday that Fable Video games’ dash final One year to avoid Apple’s 30% in-app steal charges on Fortnite, its shooter sport, became once “malicious.” Apple therefore removed the app from the App Store.

Cook dodges App Store earnings and Google licensing questions

Mighty of Cook’s testimony on Friday surrounded a non-public, inner Apple document that became once despatched to him describing profitability trends for various Apple divisions, in conjunction with the App Store. Fable’s lawyers said it showed that Apple’s App Store is amazingly a hit, making an strive to bolster its argument that Apple makes utilize of its regulate to raise its hang profits.

Cook said that the document became once no longer “fully loaded” with the overall costs Apple spends on the App Store and that it became once a “benchmarking” exercise. He said that he has a “the truth is feel” for the App Store’s profitability, nonetheless did no longer provide a quantity. An accountant employed by Fable Video games previously testified that Apple had an working earnings margin of 77.8% in 2019.

Fable Video games lawyers moreover requested Cook about Apple’s take care of Google to be the default search on the iPhone browser, which became once estimated at $10 billion per One year by a Congressional file citing a Wall Boulevard examine present. Cook said he did no longer undergo in mind how important Google pays.

Cook became once moreover questioned by Apple lawyers about iMessage, Apple’s messaging program that is constructed into iPhones and new to Apple merchandise. Cook said that he didn’t assume the dearth of iMessage on Android has refrained from iPhone customers from switching to competitors.

Cook pushed apart concerns that folk switching from an iPhone to an Android system could well presumably omit textual declare messages, announcing that “that it’s probably you’ll well without anxiousness flip off your iMessage.”

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