(Reuters) Apple shares fell -0.56% at open on Wednesday following CEO Tim Cook’s speech in Southern China today defending a move to pull a number popular apps from its China App Store this year to comply with government requests.
However, Apple is optimistic that some of those apps will be reinstated Cook said on Wednesday. Speaking at the Fortune Forum in the southern Chinese city of Guangzhou, he also stressed that he believes strongly in freedoms. This followed a US democratic senator’s remarks on Tuesday that Apple had a moral obligation to promote free expression.
Apple is facing criticism from local users and rights groups for bowing to pressure from Beijing cyber regulators after it decided to remove dozens of apps from its Chinese store this year, including messaging apps and virtual private network (VPN) services, which help users subvert China’s Great Firewall.
'Optimism that things pulled, will come back'
“My hope over time is that some of the things, the couple of things that’s been pulled, come back. I have great hope on that and great optimism on that,” Cook said, adding that he always tries to find areas to work together and if he gets criticised for that, so be it.
App stores run by Apple and Alphabet’s Google generate billions of dollars in revenue globally for them and China is a key target market as its users rely heavily on their phones for daily tasks ranging from grocery shopping to booking nail appointments.
Cook said he couldn’t be happier with how the iPhone X is doing in China, Apple’s third-largest region by sales although it has lost market share there in recent years as high-end handsets from local rivals continue to gain traction.
Tencent - 'a great partner'
Tencent Holdings, China’s biggest social network and gaming company, was a great partner, Cook said, adding that he thinks very highly of its founder, Pony Ma.
Apple and Tencent had a spat earlier this year after Tencent launched mini programs on its WeChat app, which created an ecosystem of apps within the app and threatened to become an operating system of its own.
The two companies are seen to have made peace recently, with the Apple China App Store starting to accept WeChat payments from late August.
WeChat starting point for future without apps?
Tencent founder and chairman Ma, who spoke at the same forum immediately after Cook, said WeChat, with its mini-programs, could be the starting point to build a future where there are no more apps.
Many of the top games on Apple’s China App Store are made by Tencent, which creates value for both firms. Cook said Apple welcomes the WeChat ecosystem as it in fact lowers the cost for Android users to switch to the iPhone’s iOS system, which he said has around 15 percent of the smartphone market in China.
“Tencent’s ubiquity in China plays to our advantage. Because WeChat works great on the iPhone, and because you can leave the Android ecosystem and go to iOS without losing all of the things you’ve built,” he said.