In a surprising revelation, Apple Fellow Phil Schiller, the executive in charge of leading the App Store, testified in court on Monday that he had originally raised concerns about the 27% commission the iPhone maker planned to charge app developers on any purchases made outside the App Store.

Schiller's testimony shed light on the internal debates within Apple regarding the company's compliance with the Epic Games-Apple ruling in 2021. The court had determined that although Apple was not a monopolist, it would have to stop blocking app developers from linking to other ways for customers to pay beyond Apple's own in-app purchases (IAP).

Apple technically complied with the ruling by changing its App Store Guidelines to permit developers to link to their websites from their iOS and iPadOS apps to give customers an alternative way to pay. However, Apple only reduced its commission by 3% for these purchases, from 30% to 27%. This move was criticized by Epic Games CEO Tim Sweeney, who accused Apple of "bad-faith" compliance.

Schiller's concerns, as revealed in court, centered around the potential compliance risks and the impact on Apple's relationship with developers. He worried that the App Store would be perceived as a "collection agency" that would have to audit developers who didn't pay the commissions, leading to an "antagonistic relationship" between Apple and developers.

The hearing has unearthed the extensive process Apple underwent while debating the merits of still charging a fee. Documents and emails presented in court detailed the back-and-forth that took place internally at Apple as executives weighed different options regarding its compliance with the court's order.

A pricing committee, which included Apple CEO Tim Cook, former CFO Luca Maestri, and Apple's legal team, alongside Schiller, ultimately decided to charge developers a commission on these outside purchases. The committee also decided to apply the same 3% fee reduction to developers in its Small Business Program, lowering their already reduced commission of 15% to 12% for transactions outside the App Store.

Apple's analysis of the financial impact on developers who chose to link out to their own websites revealed that the company modeled the "less seamless experience" of using a non-IAP method to determine when the links would stop being an advantage to developers. This would push them back to using IAP. The company also explored the financial impact of excluding some other partners from the new program.

The company weighed different options for when to charge commissions, too. At one time, it thought to charge its 27% fee on external purchases that took place within 72 hours of when the link was clicked. When the new guidelines went live, however, that time frame had been stretched to seven days.

Cook was involved in crafting the warning to App Store customers, recommending an update to the text that appears when the external links were clicked. In one version, that link warned customers they were "no longer transacting with Apple." Later, the link was updated to subtly suggest there could be privacy or security risks with purchases made on the web.

The revelations have significant implications for the ongoing battle between Apple and Epic Games, as well as the broader app development ecosystem. As the court continues to deliberate on whether Apple violated its original order, the tech industry will be watching closely to see how this saga unfolds.