China widens ban on officials using iPhones but isn't enforcing it

Continuing reports about the Chinese government banning its staff from using iPhones say that more officials are being told to swap, but in an inconsistent and not enforced plan.

On Wednesday, China officially mandated that its central government staff could no longer use Apple's iPhone, nor bring iPhones into the build. Said to be because of security concerns, it's believed to be more a retaliation in ongoing US/Chinese relations.

According to Reuters, previous reports that the ban is being extended to state-owned businesses are correct, yet the implementation of the mandate is only half-heartedly being enforced.

While sources in at least three ministries and government bodies confirmed the ban, one source said they had not been given a deadline to comply. Another source in one of the ministries affected reported have had no such order, and that he or she was currently continuing to use an iPhone.

The yet another source, this time from a regulatory body, told Reuters that staff had not been told to cease using iPhones. They were, though, told that they would be held responsible should any issues arise because of their iPhone use.

While that all suggests that the latest moves by the Chinese government are patchy at best, they are also not the only moves to ban the iPhone. A fifth source, from another regulator, told Reuters that senior staff had been required to swap iPhones for locally-made alternatives such a Huawei — two years ago.

Three years ago, China's Foreign Ministry representative Lijian Zhao said that the Chinese would have no reason to keep using iPhones of the then threatened US ban on WeChat went ahead. WeChat then was banned in January 2021, but the ban was lifted six months later.

Reports of a Chinese government ban on iPhones have been enough to make Apple's shares drop almost 3% down in premarket trading on Thursday.

The thinking behind that drop may be that China represents an important market for Apple, with around 19% of its earnings coming from the country. However, the ban solely affects government use, which is a minuscule fraction of that 19%.

Unsurprisingly, the majority of iPhones sold in China are bought by the general public. And sales to the public are only growing.

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9 Comments

mubaili 454 comments · 13 Years

About 1 year ago

All the compromises Apple has made over the years mount to not much. From now on Apple should be strong enough to say no more and prepare to move all its operations out. Apple can’t change a thing by continuing the engagement. The only Apple gets out is the damaged reputation. It’s no longer worth it. As a shareholder I am going to press Apple to pull out just like what Google has done many years ago.

avon b7 8008 comments · 20 Years

mubaili said:

All the compromises Apple has made over the years mount to not much. From now on Apple should be strong enough to say no more and prepare to move all its operations out. Apple can’t change a thing by continuing the engagement. The only Apple gets out is the damaged reputation. It’s no longer worth it. As a shareholder I am going to press Apple to pull out just like what Google has done many years ago.

'A miniscule fraction of that 19%'.

Don't lose sight of context.

This is a tit-for-tat move following on from US actions from six years ago and continued to the present day. They've shown enormous restraint so far.

Moving out would make things worse. Where would they go? How much would it cost? And if they did do that, there really would be little to no reason for China not to do what the US did to Huawei. Prevent it operating in one the largest markets on the planet.

As a shareholder, what do you think about losing that entire 19% of earnings instead of a fraction of it?

radarthekat 3902 comments · 12 Years

mubaili said:

All the compromises Apple has made over the years mount to not much. From now on Apple should be strong enough to say no more and prepare to move all its operations out. Apple can’t change a thing by continuing the engagement. The only Apple gets out is the damaged reputation. It’s no longer worth it. As a shareholder I am going to press Apple to pull out just like what Google has done many years ago.

Just because a minuscule amount of business will be lost that's no reason to walk away from the vast majority of a huge market, ceding it to Apple's competition and therefore strengthening that competition it needs to compete against worldwide?

Did Tesla pull out of China when the CCP banned Teslas, with their eight cameras, from government installations? No, nor should they have.

I lived in Vietnam for six months a few years ago, long enough to learn that drone use is highly restricted, as is taking any video of airports, military installations and even government buildings.

Each country has its own rules and the right to determine what is and isn't allowed. You may have valid issues with China on human rights and how they regulate privacy, and for those reasons you may appropriately feel we shouldn't do business with China. But this issue doesn't, in my view, rise to the same level. It's hurting my 12,000 shares of Apple just like every other shareholder, but this will prove to be not so impactful on Apple's actual business. This too shall pass.

avon b7 said:

mubaili said:

All the compromises Apple has made over the years mount to not much. From now on Apple should be strong enough to say no more and prepare to move all its operations out. Apple can’t change a thing by continuing the engagement. The only Apple gets out is the damaged reputation. It’s no longer worth it. As a shareholder I am going to press Apple to pull out just like what Google has done many years ago.

'A miniscule fraction of that 19%'.

Don't lose sight of context.

This is a tit-for-tat move following on from US actions from six years ago and continued to the present day. They've shown enormous restraint so far.

Moving out would make things worse. Where would they go? How much would it cost? And if they did do that, there really would be little to no reason for China not to do what the US did to Huawei. Prevent it operating in one the largest markets on the planet.

As a shareholder, what do you think about losing that entire 19% of earnings instead of a fraction of it?

Google,FB do well without that market. Apple would be able to. Apple could spend more in other markets to capture more shares. Now it’s Tim Cook’s turn to say no more and be prepared to leave. Anything less than that is a breach of fiduciary duty to the shareholders and to Apple’s ideals.

mubaili said:

avon b7 said:

mubaili said:

All the compromises Apple has made over the years mount to not much. From now on Apple should be strong enough to say no more and prepare to move all its operations out. Apple can’t change a thing by continuing the engagement. The only Apple gets out is the damaged reputation. It’s no longer worth it. As a shareholder I am going to press Apple to pull out just like what Google has done many years ago.

'A miniscule fraction of that 19%'.

Don't lose sight of context.

This is a tit-for-tat move following on from US actions from six years ago and continued to the present day. They've shown enormous restraint so far.

Moving out would make things worse. Where would they go? How much would it cost? And if they did do that, there really would be little to no reason for China not to do what the US did to Huawei. Prevent it operating in one the largest markets on the planet.

As a shareholder, what do you think about losing that entire 19% of earnings instead of a fraction of it?

Google,FB do well without that market. Apple would be able to. Apple could spend more in other markets to capture more shares. Now it’s Tim Cook’s turn to say no more and be prepared to leave. Anything less than that is a breach of fiduciary duty to the shareholders and to Apple’s ideals.

The easy counter to that is Google and Meta could do much better if they had full access to China.

Apple losing China would effectively give direct and powerful competitors a massive boost in hardware, software and services. Things would get amazingly tough for Apple when those companies competed with it outside China using the fruits of that advantage.