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Tim Cook Says App Store Would Become a 'Flea Market' if Third-Party Payment Systems Were Allowed

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In a recent interview with the Toronto Star, Apple CEO Tim Cook spoke about a wide variety of topics, ranging from App Tracking Transparency to Apple's ongoing legal battle over App Store policies with Fortnite creator Epic Games.

epic iap feature 3
Notably, Cook said that Epic Games' desire for Apple to let developers offer their own payment systems in apps "would make the App Store a flea market":

At the heart of the Epic complaint is they'd like developers to each put in their own payment information. But that would make the App Store a flea market and you know the confidence level you have at the flea market.

The volume of people going into such a market would be dramatically lower, which would be bad for the user, because they would miss out on the innovation like we just heard with the four developers. And the developers would be left out because they wouldn't have a huge audience to sell to. So nobody wins in that environment.

Apple's App Store Review Guidelines require apps to use Apple's in-app purchase system, with direct payment systems forbidden.

Cook said he is confident that Apple should prevail in its lawsuit against Epic Games, so long as it is able to communicate the facts clearly. The U.S. bench trial is scheduled to begin May 3 in Northern California federal court.

Cook also revealed in the interview that Apple reviews 100,000 apps submitted for review every week and rejects about 40,000 of them. He said that by curating the App Store, users have "a safe and trusted place" to discover apps.

Timed with Cook's interview with the Toronto Star, Apple has issued a press release touting the success of the App Store in Canada. In the press release, spotted by the blog iPhone in Canada, Apple said the App Store now supports more than 243,000 jobs in Canada and added that developers across the country have generated more than $2 billion CAD in total earnings since the App Store launched in 2008.

Tags: App Store, Epic Games, Epic Games vs. Apple Guide, Tim Cook

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Top Rated Comments

macintoshmac Avatar
macintoshmac
67 months ago
Did macOS with its open app system become a flea market then, by Tim’s standards?
Score: 30 Votes (Like | Disagree)
timborama Avatar
timborama
67 months ago
I love flea markets!
Score: 28 Votes (Like | Disagree)
sw1tcher Avatar
sw1tcher
67 months ago

At the heart of the Epic complaint is they'd like developers to each put in their own payment information. But that would make the App Store a flea market and you know the confidence level you have at the flea market.

The volume of people going into such a market would be dramatically lower, which would be bad for the user, because they would miss out on the innovation like we just heard with the four developers. And the developers would be left out because they wouldn't have a huge audience to sell to. So nobody wins in that environment.
:rolleyes:


Having a 3rd party payment would be an additional payment option, Tim. An option. You know what "option" means, Tim?

Having a 3rd party payment option wouldn't make the App Store a flea market... no more so than a brick and mortar store having payment options aside from cash.

Does a brick and mortar store offering cash, check, debit, and credit card payments make it a flea market? No.
Does it dramatically lower the volume of customers going to the store? No.
Would it be bad for the customer? No.

The only thing that would be bad is Apple losing out on their 15% or 30% cut of the transaction. That's what Apple is worried about.

Want to talk about "confidence level," Tim. Let's talk about the confidence an app store user had in your App Store which lead to the loss of 17.1 bitcoins ('https://forums.macrumors.com/threads/bitcoin-scam-app-approved-by-apple-robs-iphone-user-of-600-000.2290123/') or of the App Store allowing scammers to rake in millions through the fake apps ('https://forums.macrumors.com/threads/scam-ios-apps-still-raking-in-millions-in-revenue-on-app-store-updated.2283962/').
Score: 27 Votes (Like | Disagree)
K
Kkspire
67 months ago

Yeah, agree with others that Apple's choice of term to describe a lower-quality App Store perpetuates racist and ethnocentrist ideologies. The fact that no one in marketing/legal caught this illustrates the ubiquity of implicit bias.

Bad form, Apple.
So now it’s racist to say you never know what you’re gonna get shopping at flea markets. Hahahaha. Jesus. Ironically, you characterized him comparing to a flea market as a lower standard. :)
Score: 27 Votes (Like | Disagree)
N
now i see it
67 months ago
They're all going to defend their monopoly with whatever convoluted logic they can dream up
Score: 25 Votes (Like | Disagree)
B
britboyj
67 months ago
If Visa or Mastercard were charging merchants 30% they'd be out of business. Apple abuses its position to set this rate.

Given the profits Apple sees from App Store revenues, it's clear that 30% more than covers the overhead (which is their argument) for store maintenance. It should be closer to the 3-5% that payment processors IRL charge. I'd even go as high as 10% considering Apple must also pay Visa/MC/etc. fees as well.
Score: 19 Votes (Like | Disagree)
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