- Apr 12, 2001
As a ban on WeChat and other apps originating in China looms, companies who do business in China and iPhone users in the country are concerned about how the ban could impact device sales and daily device usage.
It's still unclear whether the ban applies to the WeChat app only in the United States or if it will result in the removal of the WeChat app from iPhones across the globe. Tencent, which owns WeChat, said it believes the ban applies only in the U.S., but it is seeking clarity. The wording in the executive order is vague, banning any transaction that is related to WeChat, and it is up to the Commerce Department to work out the details.
A WeChat ban in the United States has the potential to cause a minor drop in sales, but a WeChat ban in China would be devastating for Apple as many Chinese iPhone users feel their devices would be useless without the WeChat app.
In a Weibo survey highlighted by Bloomberg, for example, 95 percent of the 1.2 million people who responded said they would switch to an Android smartphone over an iPhone rather than give up WeChat. WeChat has more than 1.2 billion monthly active users, many of them in China.
One user in Hong Kong, Kenny Ou, told Bloomberg that a WeChat ban would turn the iPhone into "electronic trash," while another, Sky Ding, said WeChat is so important that most Chinese users would prefer to swap phones. "My family in China are all used to WeChat and all our communication is on the platform," said Ding.
Many U.S. companies, including Apple, Ford, Walmart, and Disney have been aiming to convince the Trump administration not to ban WeChat. According to The Wall Street Journal, more than a dozen U.S companies raised concerns in a call with White House officials on Tuesday, with Apple included in the call.
In a recent note to investors, Apple analyst Ming-Chi Kuo said that global iPhone shipments could decline by 25 to 30 percent if Apple is forced to remove WeChat from its App Store worldwide. If WeChat is only removed from the U.S. App Store, however, iPhone sales could be impacted by 3 to 6 percent."For those who don't live in China, they don't understand how vast the implications are if American companies aren't allowed to use it," said Craig Allen, president of the U.S.-China Business Council. "They are going to be held at a severe disadvantage to every competitor," he added.
The Trump administration is aiming to ban all U.S. transactions with ByteDance (which makes TikTok) and Tencent. The ban was announced on August 7 and there are 39 days left before it goes into effect.
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Article Link: 95% of Chinese Users Surveyed Would Rather Give Up Their iPhones Than Lose WeChat