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.