Apple CEO Tim Cook delivers the opening address during the Apple Developers World Conference (WWDC) at the San Jose Convention Center on June 3, 2019 in San Jose, California.
Justin Sullivan | fake pictures
On Monday, Apple CEO Tim Cook will join Amazon, Facebook and Google CEOs in a hearing before the House Judiciary Committee as part of an antitrust investigation into big tech companies.
For Cook, the question is expected to focus on Apple’s App Store, which is the only way to install consumer software on an iPhone. For years, developers alleged that Apple engages in anti-competitive behavior, with complaints focusing on cutting 30% of Apple’s digital products and business practices such as requiring developers to use Apple’s payment system for digital purchases. .
On Wednesday, Apple put forward some arguments in defense of the App Store that could take into account next week’s testimony. While the company says it’s not a preview of what Cook will say at Monday’s hearing, it commissioned an Analysis Group study released on Wednesday that finds that Apple’s app store fees and practices are largely on in line with other digital markets, including the Google Play store app and the Amazon app store.
“Commission rates charged by digital markets most similar to the App Store, like other app stores and digital video game markets, are generally around 30%,” the study authors wrote.
The Apple-backed study has four main findings:
- Most app stores charge the same 30% discount on digital products.
- Retailers, travel booking services and other markets may charge more than 30% for their services.
- Software distribution through an app store is less expensive than distribution through traditional retailers.
- Other app stores and digital markets often require users to use their in-app payment mechanism, and prohibit sellers from redirecting buyers to finalize the transaction elsewhere.
The House’s investigation of the big tech companies won’t result in the app, but it can spur legislation that could restrict Apple and other big tech companies. The investigation was announced in June 2019, and collecting the CEO’s testimony is one of the final steps before completing the investigation, likely to result in proposed new legislation. Cook previously appeared before the Senate in 2013 to discuss Apple’s tax policies.
Apple’s App Store is one of the company’s most important services. While Apple doesn’t break down how much service revenue comes directly from the App Store, services is a fast-growing unit that generated $ 46 billion in 2019 and accounted for 18% of the company’s revenue. Investors see services as a growth engine for the company as iPhone sales stagnate.
Developers who produce software for Apple platforms have criticized other company practices in addition to the 30% cut, including the fact that Apple could use what’s hot on the App Store to create apps or features for Apple’s competition, and an opaque review process that can lead to applications removed from Apple’s platform about what developers see as minor or unfair reasons.
Apple is also facing an investigation by the European Commission into the App Store and Apple Pay, the company’s payment processing software.
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