Tim Cook, in his first court appearance as Apple’s CEO, sought to defend the tech giant from accusations of abusing its market power by portraying it as a principled company with an obsessive focus on users.
Under questioning from Apple’s lawyer on Friday morning, Cook stated that the company’s mission is to “make the best products in the world that truly enrich people’s lives,” citing the company’s tens of billions of dollars invested in research, privacy, and security. He went on to say, “We have a maniacal focus on the user.”
Apple’s chief executive took the stand to conclude the company’s high-profile antitrust trial with Epic Games. The lawsuit revolves around Fortnite, Epic’s hugely popular video game that was kicked out of Apple’s App Store last summer for defying Apple’s digital payment rules by creating its own system. Apple (AAPL) takes 30% of many in-app purchases made on iOS devices and does not accept alternative payment methods. Epic filed a lawsuit against Apple after Fortnite was removed from the App Store.
Epic claims that Apple has monopolistic control over its “walled garden” iOS operating system, claiming that app developers are forced to adhere to onerous restrictions in order to reach hundreds of millions of iPhone and iPad users. Apple claims that users can buy apps in a variety of places and that its commission helps the company improve and secure its devices.
Judge Yvonne Gonzalez Rogers grilled Cook on Apple’s claims at the end of his testimony, and a decision is expected in the coming weeks.
In a tense exchange with Apple CEO Tim Cook, Rogers questioned why the company couldn’t offer users a cheaper option for games and content than the iPhone.
“I think they have a choice today, they have a choice between many different Android models of smartphones or an iPhone,” Cook said, referring to Google’s Android smartphone operating system. “That iPhone has a set of principles behind it in safety, security and privacy,” he added.
In response to a question from Gonzalez Rogers, he also defended Apple’s rule that iPhone apps can’t let users know if their products are cheaper elsewhere, claiming that it would hurt Apple’s intellectual property return.
Despite the fact that the majority of apps on the App Store are free, Cook claims that apps that pay Apple a commission benefit from the large audience that free apps bring to the store, as well as Apple’s technical updates and support for developers.
“We’ve made a choice,” he said. “There are clearly other ways to monetize, but we chose this one because this one overall is the best way.”
Cook was the last of several Apple executives to testify, with Craig Federighi, Apple’s senior vice president of software engineering, and Phil Schiller, an Apple Fellow and former head of marketing, both testifying earlier this week. The first witness in the trial, which has lasted nearly three weeks and is set to end on Monday, was Epic Games CEO Tim Sweeney.
Cook’s testimony focused on now-familiar themes raised by Apple’s executives and lawyers throughout the trial, such as how the company’s products and services prioritize privacy and security while competing with many others in the smartphone and app markets. (Cooker)
(Cook mentioned Samsung and Google, as well as Chinese brands such as Oppo, Vivo and Huawei.)
He also emphasized the significance of Apple’s app review process, which the company claims makes its devices safer.
“You can imagine if we turned review off, how long it would take the App Store to just become a toxic kind of mess, and that would be terrible for the user,” he said.
Cook was grilled extensively on Apple’s claims that it does not break out profits for the App Store separately, as well as the in-app payments at the heart of the lawsuit, which he claimed were simply a more “efficient” way to collect commissions from developers, under cross examination by one of Epic’s lawyers, who cited internal financial documents.
When asked about Fortnite’s removal from the App Store and Cook’s description of the game’s actions as “malicious,” Cook said the game would be welcomed back on Apple devices if it followed the rules.
When Epic’s lawyer asked if Apple is considering the revenue — in excess of $100 million in commissions — it receives from Epic and Fortnite, Cook said that Apple is focused on doing what’s best for users rather than any financial benefits.
He explained, “The user is caught between two companies.” “It has nothing to do with money,” says the narrator.
There’s more at stake for Cook and Apple than just this high-profile court case. Cook’s testimony on Friday is expected to set the tone for Apple’s battle against mounting antitrust pressure. Spotify and Match Group, the parent company of Tinder, have both accused the App Store of being anticompetitive. Apple’s rules have also been investigated by regulators in several countries, including the United States and the United Kingdom.