One of the biggest concerns for the future performance of Apple is the viability of the Chinese market. As the largest remaining market for its high end products, Apple’s ability to continue operating in China has always been questionable. As Google and other western tech companies have discovered, it is only a matter of time before you draw the attention of at least one government regulator.
From the NYT:
“For years, there has been a limit to the success of American technology companies in China. Capture too much market share or wield too much influence, and Beijing will push back.
Apple has largely been an exception to that trend. Yet the Silicon Valley company is now facing a regulatory push against its services in China that could signal its good relations in the country may be turning.
Last week, Apple’s iBooks Store and iTunes Movies were shut down in China, just six months after they were started there. Initially, Apple apparently had the government’s approval to introduce the services. But then a regulator, the State Administration of Press, Publication, Radio, Film and Television, asserted its authority and demanded the closings, according to two people who spoke on the condition of anonymity.”
The iTunes and iBooks stores are insignificant compared to the revenue from the iPhone. The worry here is that this signals a start to efforts by the Chinese government to curb Apple’s growth and influence in China.