Tech Battle 2016: Apple Services Shutdown in China amidst brewing Trade War

by Matt Klassen on April 25, 2016

apple-chinaFor several years now China’s relations with the U.S. tech industry have been steadily deteriorating. It started ages ago with the communist regime’s stance against Google, to which it added an on-again, off-again (most off-again) relationship with Facebook, a fight with Android for mobile dominance, antitrust allegations against chip maker Qualcomm, and a weirdly awkward and uncomfortable relationship with Apple.

In regards to the latter, it seemed a huge victory when Apple truly broke into China, as for years the country has been seen as the most lucrative growth mobile market available. In fact, while Beijing has always attempted to stem the growth of American tech companies operating in the country, it seemed that Apple was, by and large, exempt from the ire of the government, the two coming to some sort of tenuous understanding. For Apple it was a position of privilege, for Beijing, it was an alliance with a necessary evil.

But as always, there comes a point when the communist regime can no longer abide the power and control gained and wielded by foreign capitalists, and to that end it seems that Apple has worn out its welcome, as the Cupertino company is facing a strong regulatory push to shut down its services in China in a move that could signal a freezing of once lukewarm relations.

Last week Apple’s newly minted iBooks Store and iTunes Movies were inexplicably shut down in China, a mere six months after they began. From what reports have gathered, it does seem Apple had the government’s approval to introduce such services, but then the regulatory body, the State Administration of Press, Publication, Radio, Film and Television, stepped in and demanded the services be shuttered.

“We hope to make books and movies available again to our customers in China as soon as possible,” an Apple spokeswoman said in a statement.

As I mentioned, this is but the latest move in a growing tech Cold War between the U.S. and China, as both have made moves in this proxy war against tech and/or telecom companies operating the other’s home turf. For America, it was the action taken against Huawei, were the Chinese hardware giant was accused of spying and acting as a front for the communist government, for China, well the list is far longer.

But the added motivation for China is the country’s desire to lessen dependence on foreign technology, particularly since most American companies get their popular devices and gadgets manufactured in China to begin with. Last year China controversially decreed that it wanted all its civic and economic infrastructure (government, military, banking etc…) to use home-grown technology by 2019, clearly the country’s own take on popular U.S. propaganda to “Buy American.”

So what happens when two of the world’s largest trading partners become more interested in protecting their own interests against foreign invasion? A tech trade war of course, which is exactly what is brewing. While Apple was the latest victim in this proxy war, it certainly won’t be the last.

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Written by: Matt Klassen. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

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