App Store and Other Legal Controversies

With Apple’s earnings call taking place less than 24 hours after US Judge Yvonne-Gonzalez Rogers issued a scathing ruling against Apple’s behavior with the App Store, it’s not a big surprise that Cook was asked to comment on that and some of the other “high-profile legal cases that touch on Apple.” It’s a valid question, as investors are understandably concerned that these could hit Apple’s Services revenue. However, Cook declined to say anything beyond what an Apple spokesperson had already shared.

The case yesterday, we strongly disagree with. We’ve complied with the court’s order and we’re going to appeal. In the DOJ case that you referenced with Google, that case is ongoing and I don’t really have anything to add beyond that. And so we’re monitoring these closely. But, as you point out, there’s risk associated with them and the outcome is unclear.

Tim Cook

In the case of the App Store ruling, Apple is now required to allow developers to use their own in-app purchasing solutions in the US that can entirely bypass Apple’s commission structure. That will potentially impact Apple’s bottom line, but it’s hard to say by how much since it comes down to how many developers take advantage of it.

The Google antitrust case referenced above doesn’t directly involve Apple. However, the company could see a significant fallout if the courts rule that the multibillion search deal between the two companies is illegal and needs to end.