7/29/2020 All Questions Answered by Tim Cook about Apple at Antitrust Hearing
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xdavid

July 31, 2020

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On 7/29/2020, the House Judiciary Committee’s investigation into the market power of Amazon, Apple, Facebook and Google ran to nearly six hours. Democrats and Republicans asked the CEOs of those companies a combined 217 questions. This video contains only questions relating to Facebook and answered by CEO Mark Zuckerberg. They directed most of their questions to Mr. Zuckerberg and Mr. Pichai, then to Mr. Bezos, according to a tally by The New York Times. Mr. Cook was asked the fewest questions.

In response to questions about whether Apple favored some app developers over others, Mr. Cook said there were “open and transparent rules” that applied “evenly to everyone.” Rep. Val Butler Demings (D-FL) asked Cook about Apple removing third-party parental control apps that used mobile device management (MDM) tech, a move that raised questions about whether it was shutting out competition for a newly launched feature. Cook maintained that the move was done purely for privacy-related reasons. “We apply the rules to all developers evenly,” he said. “There’s over 30 parental controls on the App Store today, so there’s plenty of competition in this area. And I would point out this is not an area where Apple gets any revenue at all.”

Democratic Rep. Lucy McBath of Georgia cited Apple’s decision to remove parental control apps, such as OurPact, shortly after Apple introduced Screen Time, a competing service. “We were concerned, congresswoman, about the privacy and security of kids,” Cook said, noting that OurPact was vulnerable to third-party takeovers. “So we were worried about their safety.”

But McBath remained skeptical. She pointed to an email in which an Apple employee responds to a mother complaining about the removal of parental control apps. The Apple representative suggested that the mother download Apple’s Screen Time. “Even some of the largest companies in the country fear your power. Our evidence suggests that your company has used its power to harm your rivals and boost your own business,” McBath said. “This is fundamentally unfair,” she said. “Ultimately, it reduces the competition and the choices made to consumers and that’s a great concern to all of us.”

Check out our other videos for Facebook, Google and Amazon CEOs answers.
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Statement of Tim Cook Apple Ine.

U.S. House of Representatives Judiciary Committee
Subcommittee on Antitrust, Commercial and Administrative Law

July 29, 2020

Chairmen Cicilline and Nadler, Ranking Members Sensenbrenner and Jordan and Members of the
Subcommittee, thank you for the opportunity to offer testimony.

Before I begin, I want to recognize the life and legacy of John Lewis. I join you in mourning a
hero and someone I knew personally. Getting to host Congressman Lewis at Apple was one of the
great honors of my life, and his example inspires and guides me. Every American owes him a debt,
and I feel fortunate to hail from a state and a country that benefitted profoundly from his leadership.

My name is Tim Cook. I have been Apple’s chief executive officer since 2011 and a proud
employee since 1998.

Apple is a uniquely American company whose success is only possible in this country. Motivated
by the mission to put things into the world that enrich people’s lives, and believing deeply that the
way we do that is by making the best not the most, Apple has produced many revolutionary
products, not least of which is the iPhone.

We do this, in part, by making ourselves and our customers a promise—a promise that we will
only build things that make us proud. Apple’s founder Steve Jobs used to put it a little differently:
we only make things that we would recommend to our family and friends.

Since 2007, the iPhone has been one such product. The iPhone has redefined the mobile phone
through its seamless integration of hardware and software, its effortless user experience, its
simplicity of design and a high-quality ecosystem.

To our customers, these are essential to why they choose Apple—and why they keep coming back.
We focus ceaselessly on our users and their experience, and we see the iPhone’s 99% satisfaction
rating in consumer surveys as not only a key driver of the product’s growth over time, but also our
best measure today that we are still on the right track.

As much as we believe the iPhone provides the best user experience, we know it is far from the
only choice available to consumers.

The smartphone market is fiercely competitive, and companies like Samsung, LG, Huawei and
Google have built very successful smartphone businesses offering different approaches.

Apple does not have a dominant market share in any market where we do business. That is not just
true for iPhone; it is true for any product category.

What motivates us is the continuous improvement of the user experience, and we focus relentlessly
on and invest significantly in new breakthroughs, innovative features and deepening the principles that set us apart.

Privacy and security are key examples of this drive. This is true for the iPhone and for every device
we make. We build products that, from the ground up, help users protect their fundamental right
to the privacy of their personal data. This principle is foundational and touches everything else we
do.

We created the App Store in 2008 as a feature of the iPhone. Launching with a little more than 500
apps, it was our ambitious attempt to dramatically expand the features and customizability of every
user’s device. We wanted to create a safe and trusted place for users to discover apps-—and a means
of providing a secure and supportive way for developers to develop, test and distribute apps to
iPhone users globally.

Curation has always been one of the App Store’s chief features and sources of value for our users.
We held a quality department store as a model: a place where customers can find a great variety
of options, but can feel confident that the selection is high-quality, reliable and current.

But we held ourselves to an even higher standard. In our pursuit of improving the user experience,
we wanted to provide a venue for creators large and small to not only bring their ideas to life, but
to reach many millions of users and build a successful business in the process.

When the App Store was created, the prevailing distribution options available to software
developers at the time did not work well. Brick-and-mortar stores charged high fees and had
limited reach. Physical media like CDs had to be shipped and were hard to update.

From the beginning, the App Store was a revolutionary alternative.
App Store developers set prices for their apps and never pay for “shelf space.”

Apple continuously improves, and provides every developer with cutting-edge tools like
compilers, programming languages, operating systems, frameworks and more than 150,000
essential software building blocks called APIs. These are not only powerful, but so simple to use
that students in elementary schools can and do make apps.

The App Store guidelines ensure a high-quality, reliable and secure user experience. They are
transparent and applied equally to developers of all sizes and in all categories. They are not set in
stone. Rather, they have changed as the world has changed, and we work with developers to apply
them fairly.

For the vast majority of apps on the App Store, developers keep 100% of the money they make.
The only apps that are subject to a commission are those where the developer acquires a customer
on an Apple device and where the features or services would be experienced and consumed on an
Apple device.

Apple’s commissions are comparable to or lower than commissions charged by the majority of our
competitors. And they are vastly lower than the 50 to 70 percent that software developers paid to
distribute their work before we launched the App Store.

In the more than a decade since the App Store debuted, we have never raised the commission or
added a single fee. In fact, we have reduced them for subscriptions and exempted additional
categories of apps. The App Store evolves with the times, and every change we have made has
been in the direction of providing a better experience for our users and a compelling business
opportunity for developers.

I am here today because scrutiny is reasonable and appropriate. We approach this process with
respect and humility. But we make no concession on the facts.

After beginning with 500 apps, today the App Store hosts more than 1.7 million—only 60 of which
are Apple software. Clearly, if Apple is a gatekeeper, what we have done is open the gate wider.
We want to get every app we can on the Store, not keep them off.

More than 1.9 million American jobs in all 50 states are attributable to the App Store ecosystem—
from Fortune 500 companies that got their start on the iPhone, to small independent developers
and students bringing the next big idea to life.

An Apple-commissioned study by economists at the Analysis Group found that, in 2019 alone, the
App Store ecosystem facilitated over half a trillion dollars in commerce worldwide and $138
billion just in the United States. This is nothing short of an economic miracle in a relatively brief
span of time.

We continue to invest heavily and constantly in the App Store’s improvement, giving every
developer access to the very latest technology. We relentlessly evangelize coding education at all
levels, from elementary schools to community colleges. We do these things not out of obvious
financial interest, but because we realize that we have a long-term stake in the health, dynamism
and vitality of the whole system.

We recognize that with pride in what we have built, comes responsibility for what it contains. Our
users expect and deserve the highest standard of privacy, security and quality in what they discover
on the App Store.

I share the Subcommittee’s belief that competition is a great virtue, that it promotes innovation,
that it makes space for the next great idea and that it gives consumers more choices.

Since Apple was founded, these things have defined us. The first Mac brought opportunity and
possibility into the home. The iPod created new opportunities for musicians and artists to share
their creations and be paid fairly for it.

This legacy does much more than make us proud. It inspires us to work tirelessly to make sure
tomorrow will be even better than today.

Thank you very much. I look forward to answering your questions.
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Tim Cook Biography

Tim Cook is the chief executive officer of Apple Inc. and serves on its board of directors.

Before being named chief executive officer in August 2011, Tim was Apple’s chief operating
officer and was responsible for all of the company’s worldwide sales and operations. He also
headed Apple’s Macintosh division and played a key role in the continued development of strategic
reseller and supplier relationships, ensuring flexibility in response to an increasingly demanding
marketplace.

Prior to joining Apple, Tim was vice president of Corporate Materials for Compaq and was
responsible for procuring and managing all of Compaq’s product inventory. Previous to his work
at Compaq, Tim was the chief operating officer of the Reseller Division at Intelligent Electronics.

Tim also spent 12 years with IBM, most recently as director of North American Fulfillment where
he led manufacturing and distribution functions for IBM’s Personal Computer Company in North
and Latin America.

Tim earned an MBA from Duke University, where he was a Fuqua Scholar, and a Bachelor of
Science degree in Industrial Engineering from Auburn University.

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