Two Sides to Apple's China Story

(Bloomberg Gadfly) -- Apple Inc.'s decision to remove VPN apps in China is selling out.

   Apple Inc.'s decision to remove VPN apps in China is pragmatic.

By removing the means by which users skirt the Great Firewall, Apple is actually "aiding China's censorship efforts," because it is doing some of the hard work for the government.

   By removing the means by which users skirt the great firewall, Apple is not really "aiding China's censorship efforts," but merely following the law by halting access to unlicensed apps.

Chinese consumers buy iPhones because they're a secure product developed by a company that prides itself on its respect for privacy and putting customers first. This has helped it hold on to an 8.2 percent market share.

   Chinese consumers bought iPhones because they were once a cool product with great specs and design, and don't really care that much about privacy or security. That's why its market share has dropped to 8.2 percent.

Apple's market share in China

8.2%

Now, by actively removing VPNs from its app store, Apple is eliminating a big reason why Chinese people would choose its product over the dozens of other Android alternatives that also have great hardware features.

   Now, by actively removing VPNs from its app store, Apple is eliminating a big reason the government may have had to ban its product, thereby ensuring that it remains available to compete with dozens of Android alternatives.

As it prepares for its 10th anniversary iPhone, China will be crucial to making this latest device a success, so the company is right to ensure a smooth introduction and avoid annoying the government.

   As it prepares for its 10th anniversary iPhone, China will be crucial to making this latest device a success, so the company is right to stand firm and avoid annoying its remaining loyal customer base.

CEO Tim Cook has made it clear that the world's most populous nation is extremely important to Apple, with the Greater China region accounting for almost 30 percent of sales. He's betting a lot on China and can't afford to screw it up now.

   CEO Tim Cook has made it clear that the world's most populous nation is extremely important to Apple, with the Greater China region accounting for almost 30 percent of sales. He's betting a lot on China and can't afford to screw it up now.

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

Tim Culpan is a technology columnist for Bloomberg Gadfly. He previously covered technology for Bloomberg News.

To contact the author of this story: Tim Culpan in Taipei at tculpan1@bloomberg.net.

To contact the editor responsible for this story: Paul Sillitoe at psillitoe@bloomberg.net.