U.S. President Donald Trump’s order banning U.S. companies from doing business with Chinese messaging app WeChat could impact Apple’s iPhone sales in China.
The order would block all transactions involving WeChat, which would prohibit Apple from distributing WeChat, an app that’s currently central to digital life in China, to mobile devices through its App Store.
Gerrit De Vynck for Bloomberg News:
It’s the go-to app for a billion people for shopping, payments, email, web browsing and all forms of business and personal communications. Many Chinese don’t use phone numbers or emails. Visitors to the country have to download the app and load it with money or risk not being able to pay for even small purchases.
MacDailyNews Take: Perhaps WeChat is relied upon a bit too much in China?
China accounts for about 20% of Apple’s iPhone sales, so pulling WeChat off the App Store “would be a serious hindrance,” said Anand Srinivasan, an analyst with Bloomberg Intelligence. Trump’s order could also prompt China to retaliate, damaging Apple even further. Much of the Cupertino, California-based company’s manufacturing is done in China, and if the country targets Apple’s exports that would impact its business globally, Srinivasan said. China could also restrict the supply of materials, such as rare earth metals, that are key ingredients of iPhones.
MacDailyNews Take: As De Vynck went on to write, “Trump’s executive order goes into effect in 45 days, but there are many outstanding questions and plenty could happen between now and then.”