The closing of the iBook Store and iTunes movies in China might be the country’s first steps toward shutting Apple out, according to a leading expert on global political risks for corporations.
China has already become the second largest market for Apple in terms of sales, but the iPhone-maker could find itself banned from the country just like Facebook due to its privacy strategy that has already come under fire from government regulators.
“It’s very possible,” Ian Bremmer, founder of the Eurasia Group told CNBC. “I’d be very surprised in five years’ time if we see Apple having the kind of access to the Chinese consumer that they presently enjoy.”
iTunes and Apple Music launched in China 6 months ago, but the government decided to force Apple to shutdown the iBook Store and iTunes Movies last week after the government changed its mind. China is a crucial market for Apple which has pinned its hopes for growing iPhones sales on the country, however, Bremmer suggests Apple may have to change its strategy if it wants to suceed where many Western tech companies have failed.
“Either Apple has to change their model, which I don’t think they’re going to do. Or they’re going to have a big problem gaining access to the Chinese consumer,” claims Bremmer.
Apple has already made a number of concessions to the Chinese government. In 2014 the company gave into the government’s demands power iCloud for Chinese customers on China’s telecom servers. Apple also faced a long battle to get Apple Pay approved, and the company has seen its devices get booted from the government’s list of approved state purchases.
Despite some minor setbacks though Tim Cook has continued to focus on China which has the largest consumer market in the world. The Apple CEO has defended the country’s struggling economy over the last six months, made numerous visits to the country to strengthen Apple’s relationship with government officials, and says Apple now has China in mind when designing new products.
Buster Hein is a freelance writer who lives in Phoenix, Arizona. Twitter: @bst3r.
4 responses to “Apple could get shut out of China”
No they won’t. China won’t kick Apple out and Apple won’t leave China. And Apple Pay won’t have a tiny single chance against local payment services like Webo Pay. Those ‘experts’ knows nothing about China.
Not gonna happen. Apple accounts for several hundred thousand to millions of supply chain jobs in China. Apple is in some ways more of a Chinese company than US company. Apple couldn’t leave without significant cost, time and effort, but the Chinese government isn’t stupid enough to do this either. Any loss to Apple sales is a loss to Chinese industry.
China hates appl
China will be the real test of Tim Cook’s corporate ethics. The Chinese government drew them in knowing that once they were in too deep it would cost them millions and millions to cut their losses and leave. Will Apple look the other way and let the Chinese government have their way? Will they exit the country? Will the Chinese government give in to Apple demands? We shall see.