The Numbers Behind Apple’s Controversial Approach to China

Apple’s approach to China has stoked a lot of controversy in recent days. Wired looked at the numbers that may be driving the company’s policy. You may agree with the conclusions. You may disagree. But the article provides some important context to what is going on.

Last week, China temporarily suspended ties with the NBA after Daryl Morey, the general manager of the Houston Rockets, tweeted – and quickly deleted – his support for Hong Kong’s pro-democracy protesters, forcing the NBA to publicly apologise for the move. That same week, Blizzard controversially banned a Hearthstone tournament player after he made a political statement in support of Hong Kong protesters during a post-tournament interview. But more significant are the actions of Apple. The company has removed two apps from its App Store after receiving widespread criticism from Chinese state media. One of these was the app for news website Quartz, which has extensively covered the Hong Kong protests; the other was the app after authorities claimed that protesters were using the app to target and attack the police. These moves by Apple are part of a wider pattern of behaviour by the company to appease China, which has become one of its most important markets. And a closer look at the numbers reveals just how important China has become to the Cupertino-based firm – and how far it’s willing to go to keep the world’s most-populous onside.

Check It Out: The Numbers Behind Apple’s Controversial Approach to China

4 thoughts on “The Numbers Behind Apple’s Controversial Approach to China

  • Yes, Apple wants to sell product in China, but real reason Apple must play by China’s terms and conditions is they don’t want to jeopardize their manufacturing supply chain with Foxconn et. al.

    “Designed in California” doesn’t produce an ounce of revenue. “Manufactured in China” produces billions.

    Just wait and see what happens when China has had enough with Hong Kong, Taiwan, or a territorial / navigation rights dispute in the South China Sea.

  • Charlotte:

    This should come as no surprise to anyone who is paying attention.

    As I argued in a comment on Andrew’s editorial the other day, it is a bit unfair to single out Apple amongst international corporations attempting to do business in China, and indeed unrealistic to expect that they, and indeed the corporate world writ large, can resist compliance with demands and terms set by the ruling Communist Party when entire nation states and international organisations representing consortia of nation states are discovering that they have to concede to the Communist Party’s terms, or be prepared to endure a ‘long march’ of pain trying to outlast China in a war of wills. And make no mistake, is will be a war.

    The other piece to this cultural. China, like many rapidly emerging countries and economies (eg India) is experiencing a wave of nationalism and cultural pride. To expect that any nation or people will conform to expectations and stereotypes externally imposed upon them by a world unaccustomed to embracing these emerging giants as peers and equals is frankly insulting to that people, as anyone working in these settings can attest.

    There are solutions that would be remedial to many of the issues around basic human rights, or even recognition of the unique status of HK or the recognition of Taiwan, or norms of conduct regarding IP and fair play in mainland China, however, in the estimation of analysts who have spent decades following the region, nearly all of these would require leadership and coordination amongst the world’s major powers for full effect. Under these terms, the private sector, with limited resources relative to China, could push back against those demands they deem hostile to human rights and could successfully appeal infringements on their IP and other unfair practices.

    In the absence of that leadership and coordination, we should expect that corporations will act in their own best interest to secure footing in the world’s second largest economy by compromising on anything that is not essential their core mission of growth. Any company that does otherwise, as exemplified in the Wired piece, had better have a plan B or be prepared to face the music from the financial sector.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.