But he has made little headway in his discussions with Apple, he said: "We have a reverse conflict because they are not providing video for free, but we are. We are interested, but we don't want to jump into anything that will have our hands tied behind our backs."
When asked about it, Mr. Jobs said: "He's right. We will compete." He added, "That's a discussion to have."
Twenty-five percent of the first 500 applications at the store will be free, Mr. Jobs said. Of the commercial applications, 90 percent will be sold for $9.99 or less, he said, adding that a third of the first wave of applications will be games.
Mr. Jobs insisted that the 30/70 split is a more generous deal for developers than what is common in the video game industry. And he said that Apple would provide distribution and marketing.
The question that remains unanswered is how Apple and Mr. Jobs will manage the relationship with software developers. When the iPod was released, music executives hailed him as a savior for their flagging business. But they later complained they were not paid enough. Hollywood studio executives were even more cautious, dragging their feet for months before allowing full-length movies on iTunes.
Mr. Jobs declined to elaborate on how he expected to foster a more positive relationship with software developers, but Mr. Murphy of the iFund said: "He can't kill the golden goose. The promise of the iPhone is developers. If you choke them off, there are a lot of other platforms waiting."