China's restrictive Internet policies are known for blocking Web users who want to reach Google, Facebook or other banned apps. But now some of those policies are affecting Apple, one of the few remaining U.S. tech giants with a presence in the country — and the issue is raising questions about Apple's moral standing around the world.
Over the weekend, Apple began pulling apps from its Chinese App Store that may conflict with a new Chinese law aimed at shoring up the country's online censorship regime. The removed apps were all providers of virtual private networks, or VPNs. If you're unfamiliar with VPNs, the tools allow users to get around China's “Great Firewall” by making it look like they are actually surfing the Web from some other country. (VPNs have also seen growing interest from U.S. users who are cautious about their privacy.)
“Our preliminary research indicates that all major VPN apps for iOS have been removed,” ExpressVPN, a provider based in the British Virgin Islands, said in a blog post Saturday.
Only the Chinese App Store has been affected by the change, meaning that Chinese iOS users can still download a VPN app if they use someone else's VPN to try to get to any of Apple's non-China App Stores. And Chinese iOS users can still communicate with iOS users outside of China through the use of iMessage, Apple's proprietary messaging app, though research suggests iMessage is dwarfed in China by WeChat, a competing app that's grown popular due to its availability on the Android operating system.
But the bigger question facing Apple is the same that many tech companies grapple with when it comes to doing business in a country of more than 730 million Internet users. How far is it appropriate to go to remain on Beijing's good side?
For Apple, it's more than a question of ethics. China is one of the company's biggest markets, with more iPhone owners there than in the United States. Apple's courtship of Chinese consumers dates back years, and the relationship has only become more intense as China's smartphone market has matured. Although the iPhone is the most popular smartphone in China, other manufacturers such as Samsung are not far behind, according to Chinese government statistics. Xiaomi and Huawei, two of China's biggest domestic manufacturers, accounted for more than 29 percent of the market last year.
Apple's growth in smartphones is highly linked to the Chinese market. So when Beijing announced this year that all VPN services in China would need to get a government permit or risk operating illegally, it put Apple in a tough spot as a company that makes VPNs available in its app store.
What could happen to Apple if it continues to offer apps that have been deemed illegal isn't entirely clear. But the company appears to be taking no chances with its interpretation of the rules, saying in a statement that "we have been required" to remove VPNs from the Chinese App Store.
If Apple refused to keep the government happy, the decision could prompt Beijing to try to block individual downloads of VPN apps from the App Store, said Adam Segal, a cybersecurity and China scholar at the Council on Foreign Relations. Failing that, he said, the government could try to block the entire App Store outright, cutting off Apple's primary way of getting third-party software and services to customers. That would be bad news for Apple's performance in China.
Rather than play out these scenarios, other tech companies such as Google have opted to withdraw from China altogether. Some of Apple's critics have suggested that by not doing the same, it not only loses the moral high ground but also sets a precedent that other governments, including the United States, will seek to exploit.
“Apple’s capitulation to China’s VPN crackdown will return to haunt it at home,” reads the headline for a post by Mike Butcher on TechCrunch.
The headline is a nod to some of the highly public battles Apple has gotten into with U.S. law enforcement. Last year, the Justice Department fought with tech companies over whether and how authorities could peer into the encrypted communications of consumers. Companies such as Apple argued that letting the government break encryption would undermine the security of all users, while law enforcement said it was a necessary step for fighting terrorism.
Now that Apple has complied with Chinese law, critics say, what's to stop regulators worldwide from imposing rules of their own and forcing Apple to comply?
There are at least a couple of hurdles in the United States that could block such a move. One is that, politically, the United States rarely cites China as a model for behavior. In fact, many of the debates over Internet policy tend to focus on how Washington should avoid following Beijing's lead or on how to prevent China from having too much say in decisions affecting the rest of the Internet.
Second, the decision-making process in the United States involves many more actors and inputs than in China. Not only would a similar U.S. action likely draw federal lawsuits, it would also run up against America's cultural deference toward private-sector actors.
It's too soon to say what Apple's decision on VPNs will mean for the future of its business in China, or for its policy battles elsewhere. But China appears more committed than ever to clamping down on freedom of information, and as long as it remains a growing market, foreign companies will have to grapple with those policies.