Apple should start developing an exit strategy from China (but it would be gradual and would take years). Eventually, doing business in China will be about as risky as doing business in North Korea.
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China Tells Apple to Remove Ride-Hailing App Didi Chuxing From App Store for Data Violations
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That is multiple incorrect statements in a single short post.
Wrong #1: The Chinese government has been reining in Chinese Tech and Services companies that IPO globally (for what purpose is TBD). When pulling an App it isn’t just for the iPhone. It’s to be shutdown entirely pending review and approval. Android represents around 90% of the Chinese market.
Wrong #2: Apple hasn’t lost anything on their investment. Didi IPO’d at 14 and remains within its day one range. It’s unlikely Apple was given common shares but if they were it’s very unlikely it would be at IPO price. But even if it sees a sell off today, that isn’t in and of itself a problem to an investor like Apple (for active traders it could be a problem but that’s a different subject). If Didi sees that sell off it could be a superb investment of a narrow slice of a portfolio. Overreaction by ‘traders of the news’ can make for optimal entry points.
A word to the, ahem, wise from one of the greatest investors of all time: “The stock market is a transfer of wealth from the impatient to the patient”.
I will say that for now, the Chinese government needs Apple as much as Apple needs them (due to the massive number of people employed to assemble Apple products). But I agree that Apple should look towards exiting the country eventually (assuming they don’t already have a plan ready).
Exit the largest consumer market in the world, one that is seeing significant per capita consumer spending increases, and is the hub of manufacturing for a huge number of large and mid cap global companies because it’s government is heavy handed? That’s a lot of places a lot of companies will have to leave. The heavy handed government red tape is just part of the deal with Chinese market.
FYI: Apple has a small number, 8% ish, of the Chinese smartphone market. That probably roughly translates to 30 million IPhones. I believe it is also the only non Chinese smartphone maker above <1% (Huawei, Oppo, Vivo, Xaomi dominate the market). Leaving a huge market to only domestic names isn’t a good strategy. (Ironically it is that fact that, I believe, solidifies Apple’s share). They’ll be no exit strategy. They’ll only be others refiguring an entry plan (I’m sure Samsung would like to re-emerge one day).
Apple + News and it’s off to the races with staggeringly wrong posts with some being blatant misinformation. Back on planet Reality:
“A unit of China's cybersecurity regulator launched data-security reviews of apps operated by two U.S.-listed Chinese companies, days after announcing a similar probe into ride-hailing giant Didi Global Inc.
The latest action targets two truck-hailing apps operated by Full Truck Alliance Co. and an online recruiting app owned by Kanzhun Ltd. Both companies went public in the U.S. in June. Like Didi, they were ordered to stop adding users while the probes are conducted.”
“A unit of China's cybersecurity regulator launched data-security reviews of apps operated by two U.S.-listed Chinese companies, days after announcing a similar probe into ride-hailing giant Didi Global Inc.
The latest action targets two truck-hailing apps operated by Full Truck Alliance Co. and an online recruiting app owned by Kanzhun Ltd. Both companies went public in the U.S. in June. Like Didi, they were ordered to stop adding users while the probes are conducted.”
At the very least Apple needs to be more “internationally diversified”. Putting most of its eggs into one Chinese basket is a dangerous strategy. The Communist Party is already shaking that basket roughly.
I dunno. So far, it seems more like a case of the CCP making noise every now and then just to show who is in charge, and Apple playing along, because they don’t really have anything to lose by removing the occasional app from the App Store here and there.
If and when Apple does move out of China, I suspect it may be due more to labour getting more expensive in China (as the country progresses), prompting Apple to look for cheaper alternatives elsewhere (Vietnam and India?).
Tim Cook seems to strike me as being more savvy at playing this international relations game better than people seem to give him credit for. Or maybe I am giving him too much credit. ¯\_(ツ)_/¯
Apple is in Shenzhen because of the knowhow and the logistics, not because of cheaper labor. That concentrated know-how doesn't exist in either Vietnam or India, nor in the USA for that matter. That is what decades of outsourcing does.
Having facts is a good idea wether we’re talking Apple or Chinese government.
You may be right. I’ve come to the conclusion I don’t care if that’s the way apple operates. They say the right things by virtue signaling, release
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Your last sentence doesn’t match at all with the one before it - Trump is the head of the party that is trying very hard to get rid of free and fair elections, to turn the United States into a regime led by a single party - is that what you really want?
Im not american, but if asking for government issued ID to vote and wanting to recount the votes when there is suspicious of fraud is "trying to get red of free and fair elections", then Im all in with this party.
Pic looks like Cook and that lady are welcoming me into the car, but I'm going to get the lame middle seat.
For a phone where you can download apps from outside, taking it off the main store would cripple the business anyway, and if not, they can easily go after the websites hosting it to the point where the only users are a few hackers. And they could even force phonemakers to blacklist it if they really needed to. Pretty hard to evade the govt. This app in particular sells a physical service, and I can't imagine drivers and riders risking using a banned app just for ridesharing.
Guess we'll see cause this one is available for Android too.
I think you meant to say “weren’t”, but point made. I also think the $1B investment Apple made in Didi was probably on instruction from China so that Apple could continue to do business in China and make “obscene amounts of $$$”.
"That lady" is Liu Qing, and you will not sit anywhere near her.
Asking for government issued ID but accepting some forms but not others (e.g. they’ll accept a gun permit but not a passport or a student ID from a state university - I wonder which party has more gun owners and which party has more students), and the past election was the most thoroughly audited in US history, and vanishingly little fraud was found (and the half dozen or so people caught were all trying to vote twice for Trump). Still they keep pressuring for more recounts - of election results that were already signed off on by Republican election officials - the plan seems to be to recount until they get the result they want. There was not legit suspicion of fraud, there were a lot of Republican politicians and conservative media trying to drum up suspicions of fraud, where none existed. They don’t want free and fair elections, they want sham elections where Republicans win regardless of what votes were cast, like a banana republic. They’re trying to make it harder for some groups of people (students, minorities, etc.) to vote, because they think most of those people will vote for the “wrong“ party.
Something is a bit odd about this because had Apple known themselves then they themselves would have removed it without China needing to tell them to do so.. 🧐
How does Tencent control DiDi when they only own 6.8% of shares, and the CEO, President, and Vice President of DiDi have 52% of total voting power?
DiDi Global (DIDI) IPO: What You Need To Know
China ride-hailing giant DiDi Global listed on the NYSE with ticker symbol DIDI. Here’s what you need to know about investing in DIDI.www.investopedia.com
DiDi's leadership team CEO Will Wei Cheng, President Jean Qing Liu, and Senior Vice President Stephen Jingshi Zhu cumulatively hold just under 10% of Class B ordinary shares and 52% of total voting power. DiDi's Class B shareholders will be entitled to 10 votes per share. SoftBank and Uber were two of its largest shareholders at the time of its IPO, holding 21.5% and 12.8%, respectively, as well as Tencent with 6.8%. Goldman Sachs, Morgan Stanley, and J.P. Morgan led the IPO as underwriters.
I think they did this on purpose to drop price of DIDI shares. Once this bottoms just buy. No brainer buy on all the dips. A nice 40-50% price drop from IPO listing of $14 will create a great buying and money making opportunity. Just remember what happened to Facebook stock when after listing it dropped roughly 50% before rallying for years to new highs. This will be the same later. Watch and see..
1. Donald Trump is no longer president and no longer has any war powers. 2. His insurrection attempt failed. 3. In spite of all his personal belligerence, moral failings, corruption, overall terrible presidency, and so forth, he was the most anti-war and anti-interventionist president the U.S. has had since Jimmy Carter. There was no button pushing to start wars.
Well stated.
Now I'm beginning to think this is what regulation is after in the USA and EU over Apple, and soon enough Google. Just a thought.