In his first-ever court appearance, Apple CEO Tim Cook last Friday laid out his case for why Apple should be the only company to sell apps on the iPhone, saying that allowing third-party app stores would expose consumers to malware and hackers.
Testifying in game developer Epic’s antitrust suit against Apple, Cook called the notion of putting third-party app stores on the iPhone “an experiment I wouldn’t want to run.” He’s not alone, either. According to New York University Tandon School of Engineering professor Justin Cappos, opening up the iPhone would imperil every iPhone owner.
“I think there’s a very clear line to draw to say that if you let basically people go and run their own effective app stores,” Cappos told Yahoo Finance, “even if they’re installing things like kind of within an app, the potential for malicious code and malicious behavior on the iPhone increases dramatically.”
Of course, there’s more to Apple’s objection to having third-party app stores on the iPhone than simply protecting consumers. There’s also the 30% fee Apple collects on the sale of many apps and in-app purchases made through the App Store.
MacDailyNews Take: Under Apple’s “App Store Small Business Program,” introduced in 2020, developers earning up to $1 million per year only have to pay a 15% commission on in-app purchases. This $1 million threshold will be based on how much existing developers made across all their applications on a post-commission basis. So, developers could actually earn up to $1.3 million in gross revenue ans still qualify for the 15% commission fee. The reduced fee will also apply to new developers launching their apps for the first time.
The vast majority of apps on App Store pay nothing to Apple beyond the $99 annual Apple Developer Program fee.
In his testimony, Cook suggested opening up the iPhone would come with grave risks.
He provided a stark contrast between the amount of malware on Apple’s iOS versus Google’s (GOOG, GOOGL) Android and Microsoft’s (MSFT) Windows, which do allow third-party app stores.
Cook told the judge that while iOS devices account for 1% to 2% of all malware infections, Android and Windows devices account for 30% to 40%. “If you look at malware on iOS versus Android and Windows, it’s literally an off-the-chart level,” he said…
Both Apple and Google have automated processes that detect malicious software in their stores, but Google has run into trouble by allowing consumers to access third-party app stores. Most security experts will tell you to avoid downloading apps from third-party stores due to the increased risk of malware…
It’s now up to Judge Gonzalez Rogers to determine if Apple should be forced to open up iOS to third-party stores. If not, the company could also be required to cut its store fees, or allow app developers to offer their own payment systems, cutting into Apple’s profits.
MacDailyNews Take: Clearly, third-party App Stores for iPhone and iPad would harm users. And, since when do judges get to set prices for stores, determine what types of payments stores accept, or force stores to allow manufacturers to set up free ads next to their products for competing stores that offer lower prices?
We’re all for Apple allowing app developers to inform users that the App Store isn’t their only shopping option, as long as Epic Games or any other developer simply pays Apple a 15% – 30% advertising fee for each sale they make as a result of being offered the alternative payment option via Apple’s App Store.