Since launching AppleCensorship.com in 2019, we've continuously advocated for Apple to end its censorship of Chinese users. Despite Apple's stance of complying with increasingly stringent Chinese laws, we believe change is possible.
Apple's reliance on China for manufacturing and as a significant market is challenging, but not insurmountable. Contrary to some experts' views that Apple cannot or will not leave China, we contend that Apple has a range of options for ethical conduct, extending beyond the prospect of leaving China.
While exploring options for ethical conduct may not be cost-free, maintaining the status quo is also expensive for Apple. In the past decade, Apple has invested over $65 million in lobbying efforts in the United States alone, with annual expenditures increasing each year.
Last year, the company spent nearly $10 million, a steep rise from $3.37 million in 2013, and is likely to surpass this figure in 2023. In the EU, Apple's lobbying expenses doubled to about €7 million from October 2020 to September 2021, as per lobbyfact.eu.
We propose three strategies for Apple to address its situation in China and the problematic role it plays as an "app censorship bureau" for the Chinese Communist Party.
These strategies aim to strike a balance between operational continuity and honoring the fundamental freedoms and rights to information of Chinese users.
Strategy 1: Diversifying Production and Markets
Consider the possibility of Apple swiftly relocating its production out of China to escape Beijing's censorship demands.
While experts like the Financial Times or Bloomberg highlight the complexity of Apple's Chinese-built supply chain, suggesting a lengthy transition period, J.P. Morgan's estimates indicate that by 2025, about 25% of Apple products could be made outside China, up from 5% currently.
Contrary to the belief that exiting China is a long-term process, we argue that, if necessary, Apple could expedite this move, mirroring tech giants like Samsung and LG who have already transitioned their production to regions like India and Southeast Asia.
Apple's rapid response to the Russia-Ukraine conflict in 2022, which included halting sales and limiting services in Russia, demonstrates its capacity to quickly adjust its market strategy in response to geopolitical events.
This precedent suggests Apple's potential to adapt its operations in China more swiftly than anticipated.
There are compelling financial reasons for Apple to accelerate its "decoupling from China." With diminishing cost advantages in China and projections that a third of electronics manufacturing may move abroad soon, Apple has an incentive to explore this shift.
While diversifying production locations to places like India and Vietnam, Apple should also seek new market opportunities beyond China, bracing for potential backlash. Initial financial setbacks are likely, but the long-term gain of independence is substantial.
Currently, Apple's relocation efforts are modest, with a significant portion of its products still manufactured in China. Recent political developments, such as the investigation into Foxconn, Apple's primary iPhone supplier, over tax and land use issues, underscore the urgency for Apple to reevaluate its China strategy.
This probe, considering Foxconn's established relations with Chinese authorities, highlights the complexities Apple faces and the need for decisive action.
Strategy 2: Maintain Presence in China but Implement Sideloading
If exiting China isn't currently feasible for Apple in terms of production or market presence, a viable alternative is implementing sideloading. This change, already enacted in iOS 17.2 due to the Digital Markets Act, albeit limited to EU countries, marks a shift from the App Store’s exclusivity.
Apple benefits from using third-party distributors for its physical products, allowing for competition and a broader reach alongside its flagship stores. This model should inspire a similar approach in app distribution.
As it stands, app developers are limited to distributing through Apple's App Store, with no direct distribution option. Implementing sideloading in China could challenge the App Store's monopoly, thereby enhancing user access to a wider array of apps and information, a critical step towards ensuring digital freedom.
Yet, introducing sideloading in China is a delicate process, requiring Apple to tactfully navigate local laws without violating them. Apple's history in China shows its capability in dealing with complex legal environments.
This step, while challenging, would align with Apple's commitment in its Human Rights Policy to engage in dialogue and tackle tough compliance issues.
Thus, while sideloading presents its challenges, it could be a significant step towards empowering Chinese users within Apple's ecosystem, aligning with global shifts in digital rights.
Strategy 3: Increase Transparency in the Interim
As Apple deliberates on its future actions, a crucial interim step is enhancing transparency about app removals at the behest of authorities. Current Transparency Reports fall short, offering vague and incomplete information that often aligns more with public relations than genuine disclosure.
Apple must shift its approach, providing comprehensive details in its Transparency Reports, thereby offering a clearer view of its compliance with Chinese regulations and the specific nature of content censorship.
Increased transparency may not undo censorship, but it can apply pressure on China and better inform the global community, potentially fostering more ethical practices.
Each proposed strategy, whether immediately actionable or requiring more time, presents its own set of challenges and opportunities.The current situation demands that Apple make a bold, well-informed decision in response to the growing challenges in China. It's crucial for Apple to act decisively, choosing a path that navigates these complexities while upholding its ethical standards.
