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Phil Schiller correctly saw the future of Apple’s 30% “Tax” a decade ago

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Apple Fellow Phil Schiller has been with the company for a long time. In fact, the very first public call made on an iPhone was between the late Steve Jobs, Jony Ive, and Mr. Schiller on January 9th, 2007. That was the date when Jobs first introduced the device that changed the world. If you think that the comment is an exaggeration, check out any busy street in any city in the world and watch how many people are looking down while they walk.

Schiller, who remains a major player in Apple’s new product introductions, had some suggestions that he mentioned in an email back in 2011 that might have kept Apple from being lambasted by lawmakers and considered a monopoly by critics. The 30% “Apple Tax” is the main issue although Apple’s refusal to allow developers to promote alternative payment platforms to users (hello Epic Games) is also a major point of contention.    
9to5Mac reports that way back in 2011, Schiller had written the aforementioned email to Eddy Cue, who is now Apple’s senior vice president of Internet Software and Services. In the email, Schiller wrote “Do we think our 70/30 split will last forever? While I am a staunch supporter of the 70/30 split and keeping I simple and consistent across our stores, I don’t think that 70/30 will last that unchanged forever.”

Schiller added that “Just as one thought, once we are making over $1B a year in profit from the App Store, is that enough to then think about : model where we ratchet down from 70/30 to 75/25 or even 80/20 if we can maintain : 51B a year run rate? I know that is controversial, l just tee it up as another way to look at the size of the business, what we want to achieve, and how we stay competitive.”

Phil had the right idea at the right time. “Whenever we make a change we do it from a position of strength rather than weakness. That we use any such change to our advantage.”

In other words, what he was saying 10 years ago was that it would be to Apple’s advantage to make a change at that moment when no one was really bothering Apple about the 30% cut. Now there are many lawmakers calling Apple anticompetitive and not just in the U.S. And Apple has had to appear in highly publicized lawsuits with its in-app payment platform in the spotlight.

They say that hindsight is 20/20 and all Apple can do is wonder how different things might be now if it listened to Phil Schiller a decade ago.

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