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Apple's App Store is increasingly facing antitrust accusations. Illustration by Jesus Escudero.

The Guardians of Apple’s App Store Gird for Battle

By  |  April 29, 2021 11:53 AM PDT
Photo: Apple's App Store is increasingly facing antitrust accusations. Illustration by Jesus Escudero.

For the next three weeks, one of Apple’s most senior executives, Phil Schiller, will spend his days in a sterile courtroom in Oakland, Calif., 50 miles from Apple’s gleaming spaceship-like headquarters in Cupertino. Schiller, who helped launch the App Store 13 years ago and still oversees it, is the designated “corporate witness” for the company’s trial, which pits it against Epic Games. The videogame developer claims that Schiller and his colleagues have operated the App Store as an illegal monopoly by, among other things, requiring app makers to pay a 30% fee to Apple for all in-app transactions.

Schiller’s constant presence at the trial, which starts Monday, is a sign of how seriously the company is taking the matter. The company has a clear legal edge over Epic, but much is at stake: The App Store commissions, which developers like Epic are complaining about, have fueled Apple’s profits in recent years even as iPhone sales have stagnated. (Apple’s March quarter results, released on Wednesday, showed iPhone sales rebounding strongly this fiscal year, however).

The underlying issues at stake in the trial aren’t new. For more than a decade, Apple has faced repeated accusations by some app developers of abusing its control of the store in ways that also hurt customers. In that period, Schiller, Apple CEO Tim Cook, and Kyle Andeer, the company’s chief compliance officer and top antitrust lawyer, have been the App Store’s most visible defenders. Yet these Apple executives didn’t fully anticipate how complaints by developers—and multiple, ongoing government inquiries into those complaints—would grow to their current level, according to several people who have worked with them. As a result, Apple has found itself lumped in with a bigger public debate about the market power of the biggest technology companies, including Alphabet, Facebook and Amazon.

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