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HughPickens.com [hughpickens.com] writes:

Katie Benner and Paul Mozur write in the NYT that it took six years for Apple to persuade China’s largest wireless carrier to sell the iPhone but Apple's persistence paid off when China relented in 2013, a moment Tim Cook describes as “a watershed day” for Apple. Today China is Apple’s second-largest market after the United States and Chinese consumers spent $59 billion on Apple products - a market Apple is loath to put at risk. "If Apple accedes to American law enforcement demands for opening the iPhone in the San Bernardino case and Beijing asks for a similar tool, it is unlikely Apple would be able to control China’s use of it," [nytimes.com] write Benner and Mozur. "Yet if Apple were to refuse Beijing, it would potentially face a battery of penalties." “People tend to forget the global impact of this,” says Raman Jit Singh Chima, policy director at Access Now, a nonprofit that works for Internet freedoms. “The reality is the damage done when a democratic government does something like this is massive. It’s even more negative in places where there are fewer freedoms.”

Apple is playing the long game with its business. Privacy and security have become part of its brand, especially internationally, where Apple reaps almost two-thirds of its almost $234 billion a year in sales [statista.com]. And if it cooperates with one government, the thinking goes, it will have to cooperate with all of them. “Tim Cook is leveraging his personal brand and Apple’s to stand on the side of consumer privacy in this environment,” says Mark Bartholomew. “He is taking the long view.” But the business advantage Apple may get from privacy has given critics an opening to attack the company. In a court filing, the Justice Department said Apple’s opposition to helping law enforcement appeared “to be based on its concern for its business model and public brand marketing strategy.” [nytimes.com] Apple’s shareholders have so far been quiet. But data privacy may eventually motivate investors — and ultimately more customers — to vote with their wallets because “it’s an issue that speaks directly to the business,” says Michael Cusumano. “Right now people buy phones regardless of encryption issues, but we have to wait and see how bloody this fight gets."

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