Apple’s Phil Schiller defends tight control of App Store

On Wednesday, Apple Inc Chief Executive Tim Cook will face questions from U.S. lawmakers about whether the iPhone maker’s App Store practices give it unfair power over independent software developers. When the App Store launched in 2008, Apple executives viewed it as an experiment in offering a compellingly low commission rate to attract developers, Phil Schiller, Apple’s senior VP of Worldwide Marketing who oversees the App Store, told Reuters.

Apple App Store on Apple devices
Apple’s App Store

Stephen Nellis for Reuters:

“One of the things we came up with is, we’re going to treat all apps in the App Store the same – one set of rules for everybody, no special deals, no special terms, no special code, everything applies to all developers the same. That was not the case in PC software. Nobody thought like that. It was a complete flip around of how the whole system was going to work,” Schiller said.

In the mid-2000s, software sold through physical stores involved paying for shelf space and prominence, costs that could eat 50% of the retail price, said Ben Bajarin, head of consumer technologies at Creative Strategies. Small developers could not break in.

Bajarin said the App Store’s predecessor was Handango, a service that around 2005 let developers deliver apps over cellular connections to users’ Palm and other devices for a 40% commission.

With the App Store, “Apple took that to a whole other level. And at 30%, they were a better value,” Bajarin said.

But the App Store had rules: Apple reviewed each app and mandated the use of Apple’s own billing system. Schiller said Apple executives believed users would feel more confident buying apps if they felt their payment information was in trusted hands.

“We think our customers’ privacy is protected that way. Imagine if you had to enter credit cards and payments to every app you’ve ever used,” he said.

MacDailyNews Take: Apple and their App Store provides developers with a safe, secure, highly lucrative distribution method to the richest personal computer, smartphone, and tablet demographics ever assembled.

Apple built the Mac. Apple built the iPhone. Apple built the iPad. Apple built the App Store. Apple created the most verdant ecosystem ever created for developers by far. Only the losers and those developers who can’t read and follow simple rules are whining incessantly.

If anything, Apple takes too little of a cut for all that the App Store provides developers.

We look forward to Apple CEO Tim Cook’s schooling of confused U.S. lawmakers this Wednesday.

33 Comments

  1. “One of the things we came up with is, we’re going to treat all apps in the App Store the same – one set of rules for everybody, no special deals, no special terms, no special code, everything applies to all developers the same. That was not the case in PC software. Nobody thought like that. It was a complete flip around of how the whole system was going to work,”

    BS!

    What put the P in PC was Personal. The user owner decided what runs. He could censor his store as he sees fit, but in tying the singular and mandatory store to devices he doesn’t own and Apps he doesn’t own, he is censoring the entire platform.

    “In the mid-2000s, software sold through physical stores involved paying for shelf space and prominence, costs that could eat 50% of the retail price, said Ben Bajarin, head of consumer technologies at Creative Strategies. Small developers could not break in.”

    BS!

    Bajarin is shilling! He’s telling a small portion of the story. Developers could sell and customers could buy from numerous sources- Physical retail, online in multiple ways, and even get applications emailed to them.

    Then, it was not only Handango, there was PPC4All, Mobileplanet, BVRP, and scores more. Then he neglects shareware repositories completely.

    “Apple and their App Store provides developers with a safe, secure, highly lucrative distribution method to the richest personal computer, smartphone, and tablet demographics ever assembled.”

    Fine! That’s a possible valid opinion, and but one choice. The exclusion of competition or imposing any requirement outside their property is censorship. They don’t own the Apps, and they don’t own the devices.

        1. “Funny things these facts,, among delusionals.”

          Oh, sweetie, you poor thing. You think because I’m replying to you I’m not ignoring you. I knew you didn’t understand but you take missing the plot to a new level. You’re so wrapped up in yourself you can’t tell when others are dismissing you completely while they’re talking to you. Many people on this site do that to you. It’s a little sad to watch. Just like that mumbling guy on the street who thinks anyone who even looks at him or says anything at all to him is seriously engaging him.

  2. Apple invented the better mousetrap. They created the winning model. And they should be left alone to run their App Store business they way they see fit until two things happen: 1. they become a monopoly (not even close) and then 2. they abuse that monopoly.

    So far, Apple has done neither.

      1. That’s nonsensical. That’s like saying GM has a monopoly on Corvettes. The question is does the iPhone have a monopoly? Not at all. And monopolies aren’t unlawful. Even if Apple had a monopoly in the smartphone or tablet markets, there’s no law against creating your own development environment or fostering a well managed ecosystem around your platform. That alone doesn’t amount to an ‘abuse”.

        1. If Apps are ‘gas’ and your iOS device is a ‘vehicle’ it is like saying Apple has the monopoly on the only fuel that the vehicle will take

          I don’t have a problem with Apple making their own developed Apps exclusive to their App store. However, the moment a 3rd party App is being sold, that ‘vendor’ should be allowed more than one venue from which to distribute their App and maintain at least a semblance of market competition.

          1. Gas is a terrible analogy. The production and distribution of gas is highly regulated and quality-controlled so that it is safe and won’t cause problems in engines. Gas is exactly like the app store. Different gas stations are just like developers and they have to follow strict rules and all use gas that meets the equally strict rules about production and distribution. You just made an argument for the app store and you didn’t even realize it. Too funny.

            1. The point is specialized fuel that your vehicle has no choice but using lest it become just slightly more useful than a brick. Imagine if you bought a Toyota and the only places you could fuel it was at Toyota fuel stations. That you extend the analogy to nitpick about gasoline being regulated across the industry (not true of App stores of different code bases) misses the point.

          2. “If you make Apple the regulator similar to the gas industry you would have to agree also that Apple should be separated from operating ANY App store to avoid conflict of interest.”

            I’m fine with that. I don’t care who is regulating the app store, or app stores. I care that they ARE regulated in a manner consistent with how gas is regulated to ensure the entire gas-using community is safer and can enjoy quality gas. Right now Apple is the only entity doing that. Hand it off to a government regulator today and the app regulations won’t be anywhere close to sufficient to maintain safety and quality. But if the regulations can be on par with Apple’s then I have no problem with another entity being the regulator. Both you and applecynic have presented and argument FOR Apple’s current app store model. Your only gripe is who is doing the regulating. Unless you are both hypocrites and what you really want is an open free-for-all when it comes to apps but wait… when it comes to my gas you better regulate the heck out of that because my car cost a lot of money. Which is it?

            1. I think you mistake our argument for ‘choice’ with supporting Apple’s current model. I believe we are advocating for 3rd party iOS App stores that would encourage pricing competition and provide other venues for developers and users for otherwise safe Apps that Apple deems not acceptable for their App Store for other non-privacy/safety related policy reasons.

              I don’t disagree with Apple regulating their own App Store, but as I have stated earlier if they wish to regulate (for safety/privacy reasons) other App Stores, they must relinquish operating their own App Store by spinning it off as a separate public traded entity to avoid claims of conflict of interest.

        2. It may be your “platform”, but it’s not your device.

          Adherence to the Apple App Store should be entirely optional both to the developer and the user.

      2. “For all App Stores”

        So you’ve just admitted that alternate app stores would have to follow the exact same strict rules as the Apple app store. That is how it works with gas. Good idea.

        1. Your either incredibly stupid, arrogant (something I know something about) or just a terrible troll.

          No dummy, if regulated they would need to follow the regulators rules.

          1. Ummm, that’s what I said. Gas has to be regulated and quality-controlled no matter where it is produced, distributed, or sold. All gas has to follow these rules all the time no matter the end seller (in your words the alternate app stores). You can have your alternate app stores but your own argument says those other app stores have to behave exactly as Apple’s app store in order to maintain the quality and safety of apps just like we do with gas. I’m fine with that. What you can’t do with gas is allow different distribution and production channels to have their own set of rules and regulate themselves. You would have so many safety issues and wrecked engines from poor quality or downright dangerous gas. No, I like your idea where all app stores have to follow the same strict rules as Apple’s app store. You should email that idea to Apple.

          2. “Correct, and the regulators, not Apple make the rules when it comes to the law.”

            Apple is the regulator in this case. Everyone involved in the production, distribution, and sale of apps has to follow very strict rules which ensure as best as is possible the safety and quality of apps in the store. The production, distribution, and sale of gas works exactly the same way. The problem with your idea of a regulator other than Apple enforcing rules is that strict rules like those that govern gas just don’t exist for apps and it is Apple that created a system akin to how gas is strictly regulated. When you talk of a regulator enforcing rules in the same way as gas is regulated you’re talking about Apple and no other entity.

            You seem not to realize you are pro-Apple in this case. Now you’re desperately trying to separate Apple and some nebulous regulator now that you realize your own argument is pro-Apple’s app store. Whoops.

  3. Both “languages” and “gas” are poor analogies. They fail to account for the complexities of the modern platforms, devices, and ecosystems our mobile experiences are based on, as well as the threats and mitigation strategies that are used to counter those threats. Apple has done a great job creating a model that works well for users and developers.

    1. Hmm.. Ok, how about ink-jet printer cartridges. We’ll make Epson the surrogate for Apple. There was a time when Epson (as well as other printer companies) made sure that only their sourced cartridges (Apps) worked with their printers. This was done physically at first (cartridges from one printer maker usually differed greatly from another even between models) then more recently through chips in the cartridge to ‘verify’ Epson authentic product to prevent you from using ‘fake’ ink.

      These days you can buy 3rd party cartridges that Epson ink-jet printers will recognize as ‘non-original’ but still allow you to use after confirming a warning message giving the consumer a choice of sourcing the ink. Yes, it may be unsafe but that is left to the consumer to decide. It may actually turn out the 3rd party product is even more ‘clean’ and extends the life of your printer. The original lack of competitive option is IMO a similar situation with what Apple is facing with the scrutiny of their App Store today.

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.