The Information: ‘Inside Tim Cook’s Secret $275 Billion Deal with Chinese Authorities’

Wayne Ma, reporting for The Information (free article link for non-subscribers, which requires you to share your email address):

Apple’s iPhone recently became the top-selling smartphone in China, its second-biggest market after the U.S., for the first time in six years. But the company owes much of that success to CEO Tim Cook, who laid the foundation years ago by secretly signing an agreement, estimated to be worth more than $275 billion, with Chinese officials promising Apple would do its part to develop China’s economy and technological prowess through investments, business deals and worker training.

Cook forged the five-year agreement, which hasn’t been previously reported, during the first of a series of in-person visits he made to the country in 2016 to quash a sudden burst of regulatory actions against Apple’s business, according to internal Apple documents viewed by The Information. Before the meetings, Apple executives were scrambling to salvage the company’s relationship with Chinese officials, who believed the company wasn’t contributing enough to the local economy, the documents show. Amid the government crackdown and the bad publicity that accompanied it, iPhone sales plummeted.

This is a deeply-researched and seemingly amazingly well-sourced story. Extraordinary work by Ma — particularly the Apple internal documents he was able to obtain. The backstory on that must be something. Long story short, Apple’s relationship with China is every bit as complicated, and delicate, as you’d think. I was skeptical about the headline — both the staggering $275 billion figure and the word “secret” — but Ma’s reporting backs it up.

The Information is subscriber-only, and costs $400 a year. That’s a lot, no question, but you get what you pay for. Reporting like this makes it worthwhile to me. I try always to be respectful when linking to paywalled material, and not quote so much as to spoil the whole thing. But I feel compelled to share this nugget:

Sometime in 2014 or early 2015, China’s State Bureau of Surveying and Mapping told members of the Apple Maps team to make the Diaoyu Islands, the objects of a long-running territorial dispute between China and Japan, appear large even when users zoomed out from them. Chinese regulators also threatened to withhold approval of the first Apple Watch, scheduled for release in 2015, if Apple didn’t comply with the unusual request, according to internal documents.

Some members of the team back at Apple’s headquarters in Cupertino, Calif., initially balked at the demand. But the Maps app had become a priority for Apple, so eventually the company complied. The Diaoyu Islands, when viewed in Apple Maps in mainland China, continue to appear on a larger scale than surrounding territories.

I would venture to say that all members of Apple’s Maps team balked at this request. It’s absurd and offensive. Asking professional cartographers to misrepresent the size of islands for propaganda purposes — even if only to users in mainland China — is like asking writers to misspell words or misstate facts, or asking mathematicians to generate incorrect results. It’s contrary to the nature of the profession.

★ Wednesday, 8 December 2021