Beijing Stifle’s Apple’s Growth In China
Beijing has a record of cutting back western technology companies once there seems a probability of them becoming dominant in their society. Apple has always seemed to be safe from that trend but Beijing has finally cut it back too. Apple has been facing quite some setbacks when it comes to China in the recent past. China houses the second-largest market for Apple after the United States and has become responsible for bringing about the downfall in Apple sales for the first time in the last five years.
Apple lost exclusive rights to use the Apple trademark in China to a company owned by Xintong Tiandi that sells leather goods i.e. mobile covers and bags. The basis of losing this lawsuit was that Xintong Tiandi registered his company in China two years earlier than the launch of Apple in the country. Though Apple spokesperson has revealed that Apple plans on fighting for its trademark, this dispute has caused Apple quite a fortune and its trademark. In addition, Apple has not yet launched its products in China similar to those produced by Xintong Tiandi’s company. Nevertheless, Apple claims that Xintong Tiandi is using the fame and trust associated with the Apple brand to sell unauthentic products with Apple trademark. In a similar scenario of 2012, Apple had paid a Chinese company $60 million to settle the dispute over the ‘iPad’ name.
In addition to losing the right to use its own trademark in China, Apple has also faced a serious setback when Apple’s iBooks Store and iTunes Movies services were forced shut in China which caused the suspension of its entertainment facilities. This was done on orders of the government’s media watchdog, the State Administration of Press, Publication, Radio, Film and Television and claimed to be an attempt to bring media and the web under the government’s control. Also, two of Apple’s online stores were shut down after a mere period of half a year of its launch. Such complications faced by the US technology giant has somewhat unsettled the stakeholders of Apple as Carl Icahn, billionaire activist investor said in an interview this month that he has sold all his Apple stakes considering the China situation. According to him, Apple does not seem to be recovering in China from the government intervention anytime soon.
In the light of these developments, rumors are caught flying around that the Chief Executive of Apple Tim Cook will be visiting China in a few weeks to meet with government officials bearing high offices. Cook has been paying China frequent visits in the last five years since he became Chief Executive. Though it will be as always, a business trip for him, this trip is presumed to be of greater importance given the obstacles Apple is facing. He will likely be discussing the issues involving the interference with government officials as well as certain communist leaders, to discuss the source of this propaganda. However, the plan is not official yet and therefore has not been made public.