China privacy

[11:12 a.m. PT]

Apple hasn’t just had to contend with Epic’s antitrust suit. The New York Times published a story Monday outlining Apple’s complicated relationship with the Chinese government. One of the story’s revelations was that Apple potentially reduced Chinese user’s data, and proactively took down thousands of apps from its App Store that could run afoul of the Chinese government’s laws.

Epic’s lawyer suggested that allowing third-party app stores would take pressure off Apple, reducing the danger of Apple being generally barred from China for what happens on an app. Epic, for example, refused to work in Vietnam over privacy fears, he adds.

Cook pushed back, saying Apple follows the laws in places it operates. “I strongly believe it’s in the best interests of the people there that we do operate,” he added.

Also worth noting: Chinese tech giant Tencent owns about 40% of Epic. Epic has said in the past that Tencent doesn’t have any say in its day-to-day operations. CEO Tim Sweeney said two years ago that he was the controlling shareholder, and has been since 1991.

Other app stores

[10:52 a.m. PT]

In cross examination, Epic’s lawyer pushed Cook on why not have alternative app stores available on the iPhone. The lawyer asserted that even if there were alternative stores, Apple could still run its own and it could use its marketing might to convince people to use its store.

“It seems like a decision they shouldn’t have to make,” Cook said. “When they buy an iPhone today, they just buy something that works.”

The two did agree though that they wouldn’t know whether Apple would succeed in this hypothetical situation because it hasn’t been done.

Google deal

[10:27 a.m. PT]

Apple and Google have a famously odd relationship. Google’s former CEO Eric Schmidt sat on Apple’s board when the iPhone was launched. The two companies worked together on a version of Google Maps for the iPhone for years before Apple Maps launched.

But as Google’s Android grew, Schmidt left the board and the two companies took a more competitive stance. But they still work together. Apple for example has an agreement with Google to make the search giant the default for Safari searches on the iPhone, iPad and Mac.

Epic’s lawyer pushed, noting public reporting that suggested Google paid as much as $10 billion for that deal. Why pay so much? Cook said it was a question better put to Google.

Epic’s lawyer pushed again. Cook eventually answered, “I believe they paid for search results, which they get from being the default search engine.”

Who are your competitors?

[9:44 a.m. PT]

During the trial, experts from Epic and Apple debated one of the odder contentious issues of the lawsuit: Who does Apple compete with on operating systems? Some argued Apple has no competitor, others said it competes with Google.

When one of Epic’s lawyers asked Cook to settle the debate, and say who he believes Apple’s competitors were, Cook said Apple competes against the devices Google’s software enables. So he sees Samsung and others as competitors.

“So your testimony is that you do not compete against Google in operating systems?” Epic’s lawyer asked.

Epic then played a video of Cook speaking at a meeting of Berkshire Hathaway shareholders in 2019, in which he gives his boiler plate speech about how Apple competes against Microsoft and Google “on the operating system side,” and competes with Samsung and Huawei and other phone makers “in the hardware space.”

The lawyer then asked Cook if that video was him saying those words.

“Well, that certainly looked like me,” Cook said. “And it sounded like me too.”

Green bubbles

[9:10 a.m. PT]

Epic lawyers at one point have raised the argument that iMessage is one of the features Apple uses to lock users into iOS. The service, which offers encrypted chat by default and makes it easier to share video and photos. Additionally, when you use iMessage, the chat bubbles are blue. When you use SMS, like when texting with an Android user, the chat bubbles are green.

Some people argue that the status of having a blue bubble keeps people on iPhones, especially since iMessage isn’t available for Android. Cook disagreed. He noted that it’s easy to turn off iMessage if people want.

Generally, Cook said he believes it’s easy to switch from Apple to Android. He noted that photos in particular are easy to move between Google, Facebook and Apple. And, he added, the popularity of streaming music and movies means you just need to re-download the app and sign in on your new device.

Billboard

[8:51 a.m. PT]

Epic and Apple spent much of the past three weeks arguing over one sticking point, that Apple doesn’t even allow app developers to have a notice in their app saying customers can go to their site to pay a lower price to buy something or sign up or whatever else.

Cook sees allowing developers to point users to their website for discounts as akin to putting up a sign outside Best Buy saying they’d get a better deal on an iPhone at the Apple Store. “It’s the same kind of thing.”

Economic “miracle”

[8:46 a.m. PT]

Cook talked about the impact of the App Store. “I think it’s been an economic miracle,” he says. Apple started with 500 apps, and now has 1.8 million. He notes that almost 2 million people are estimated to have had jobs created through the app store. Commerce, according to one study, he says is half a trillion. “It’s likely been one of the most important job segments out there in a growth point of view over the last decade,” he added.

One of the most important issues

[8:26 a.m. PT]

Cook began his testimony by bolstering Apple’s argument before the court that its control is about its commitment to privacy and security. “Privacy, from our point of view, is one of the most important issues of the century. And safety and security are the foundation that privacy is built upon.”

He also equated these issues with civil liberties and freedom of expression.

Judge gives indications

[8:12 a.m. PT]

Rogers, who will be ruling on this case instead of a jury, has tipped her hand a couple times during the trial. She’s expressed doubt at some of both company’s arguments — in Epic’s case, the game company’s argument that Apple is a bad marketing partner. And in Apple’s case, its acknowledgement that it hasn’t studied whether other app stores or app moderation companies could do a better job than Apple’s App Store review team.

As court was starting Friday, Rogers asked lawyers to include in their final filings some discussion of “remedies,” or how to solve this problem. She said she’s still debating the question of whether Apple has an illegal monopoly over its own products. And she said the lack of competition for 30% commissions worries her.

Cook is in court

[7:53 a.m. PT]

A group of reporters were waiting for Cook outside the courtroom today, but rumor was he entered in through the garage. So, no iconic photos of him walking up.