Reed Albergotti: Kinda Smart on Apple and China, Kinda Dumb on Green Bubbles

Reed Albergotti, formerly of The Washington Post, now writing for Semafor, in a piece with the clickbait headline “Apple’s Chinese Dream Is Over”:

China is also no longer cheap. Wages have skyrocketed, with the average factory worker making $6 per hour on average in 2020, up from less than a dollar in 2006. The average wage of a Chinese factory worker will very soon surpass the U.S. federal minimum wage. For comparison, the average rate for a Mexican factory worker has stayed stagnant at $2 per hour.

If that isn’t the most damning thing I’ve read about the U.S. federal minimum wage, I don’t know what is.

If any company can make the monumental shift away from China, it’s Apple. Its robust supply chain is the reason it was able to keep output going after the 2011 flooding in Thailand disrupted component makers. And it’s why Apple saw only minor product shortages during the height of the pandemic. The chip shortage that crippled Detroit automakers was a blip for Apple’s customers.

But it will cost billions and take years.

The biggest question is whether it will be the same Apple when the process is over. Will the new Apple be stronger and even more resilient? Or will it be unable to recreate the magic of China’s boom years?

It’s a good take on Apple’s increasingly more uncomfortable reliance upon China, but I wouldn’t write about it in the past tense yet.

Bonus content: Albergotti’s bottom-of-the-column take on Elon Musk’s griping about the App Store:

Epic Games can probably commiserate. Musk’s complaint is a pivotal factor in the antitrust lawsuit Epic filed against Apple in 2020. A federal appeals court will soon rule on the case’s outcome.

Albergotti’s description omits the fact that last year’s initial ruling in Epic v. Apple was overwhelmingly in Apple’s favor, including ruling that the App Store does not constitute a monopoly. Anything can happen on appeal, of course, but I’m not aware of anyone serious who expects the appeals court to overturn anything significant in the case.

European regulators also aren’t fans. They’ve forced Apple to get rid of the proprietary Lightning charging port on its phones and threatened to force Apple to open up iMessage (goodbye green bubbles).

Again with the past tense for things that haven’t happened yet, like Apple shipping an iPhone without a proprietary charging/data port.

And the EU’s possible mandate for messaging service interoperability is technical nonsense that reminds of Hugo Rifkind impossible-to-beat description of Brexit: “The thing is, the best way to understand Theresa May’s predicament is to imagine that 52 percent of Britain had voted that the government should build a submarine out of cheese.”

But even if it were possible for Apple, WhatsApp, and whatever other services would fall under the EU’s mandate to comply, what would that have to do with the green bubbles Messages renders for SMS messages? SMS is an example of messaging service interop from Apple. If Apple somehow did connect Messages to WhatsApp, surely WhatsApp messages would be rendered in some color other than blue.

★ Wednesday, 30 November 2022