Tim Cook to defend App Store's 30% cut in antitrust hearing

Apple CEO Tim Cook is set to defend the tech company in a historic congressional antitrust hearing on Wednesday, July 29, asserting it “does not have a dominant market share in any market where we do business."

Cook is expected to be grilled on several issues, particularly on the App Store.

App developers have repeatedly criticized the company for its supposed unfair revenue sharing policies, which takes 30% of in-app purchases – a scheme that David Cicilline, chair of the US House subcommittee on Antitrust, called “highway robbery.”

“After beginning with 500 apps, today the App Store hosts more than 1.7 million – only 60 of which are Apple software,” said Cook in his prepared statement released ahead of the hearing.

"Clearly, if Apple is a gatekeeper, what we have done is open the gate wider. We want to get every app we can on the store, not keep them off."

Calling the App Store a "revolutionary alternative" to physical software stores, Cook will say that developers set their own prices for their apps and never pay for shelf space.

Cook will also claim that for "a vast majority of apps," developers keep all of the profits per sale and that the only apps subject to a commission are “those where the developer acquires a customer on an Apple device and where the features or services would be experienced and consumed on an Apple device."

"Apple's commissions are comparable to or lower than commissions charged by the majority of our competitors. And they are vastly lower than the 50 to 70% that software developers paid to distribute their work before we launched the App Store,” Cook said.

Cook is also expected to highlight that Apple never raised its commission rate and never added a “single fee.” Instead, Apple "reduced them for subscriptions and exempted additional categories of apps."

Cook, in his prepared statement, says that while he is open to scrutiny, the company will make "no concession on the facts."

Cook will join other big tech CEOs – Amazon’s Jeff Bezos, Google’s Sundar Pichai, and Facebook’s Mark Zuckerberg – in testifying before lawmakers in Washington as part of a House judiciary subcommittee hearing, which will be conducted virtually due to the coronavirus pandemic. – Rappler.com

Camille Elemia

Camille Elemia is Rappler's lead reporter for media, disinformation, and democracy. She won an ILO award in 2017. She received the prestigious Fulbright-Hubert Humphrey fellowship in 2019, allowing her to further study media and politics in the US. Email camille.elemia@rappler.com

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