In his court testimony on Monday, Apple Fellow Phil Schiller, the executive responsible for overseeing the program Store, stated that he had initially expressed concerns regarding the 27% commission that the iPhone manufacturer intended to charge program developers for transactions made outside of the App Store. He said the price would lead to an “antagonistic relationship” between Apple and developers, in addition to being a possible compliance issue. In order to determine whether or not they owed Apple money for the purchases that occurred outside of the App Store, it appeared that Apple needed audit rights.
Due to the Epic Games v. Apple decision, Apple lowered its usual 30% commission on in-app sales to 27%. Despite not being a monopolist, the court ruled in 2021 that the tech giant would have to stop preventing app developers from linking to payment methods other than Apple’s in-app purchases (IAP).
By amending its App Store Guidelines to allow developers to link to their websites from their iOS and iPadOS apps, Apple formally complied with the order and provided customers with an alternate method of payment.
For these sales, Apple only lowered its commission by 3%, though.
Tim Sweeney, the CEO of Fortnite maker Epic Games, criticized Apple at the time for “bad-faith” compliance, claiming the tech giant had violated a 2021 ruling by U.S. District Judge Yvonne Gonzalez Rogers that had given developers permission to include buttons or links to alternative payment methods in addition to Apple’s IAP.
In order for Rogers to decide whether Apple broke her initial ruling requiring the App Store to open to greater competition, Apple and Epic Games have subsequently returned to federal court.
Schiller testified that at first, he was against commissions on these outside acquisitions.
“… I had great concerns about the collections of funds from developers,” he said, specifically “the change in the role of the App Store to now an organization that needs to collect money from developers.”
He expressed concern about the App Store’s ability to pursue developers who failed to pay commissions making it “some kind of a collection agency” that had “rules around how we handle nonpayment and whether ultimately it means we’re going to have to do audits of developers.”
Schiller stated he worried about
“how all of those things change the relationship between Apple and developers in a way I thought would be detrimental.”
Apple examined the financial effects on developers who decided to link out to their own websites, according to documents cited in court.