Pluralistic: 11 Nov 2022 Apple's business model made Chinese oppression inevitable

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A Chinese revolutionary poster depicting a marching army of peasant soldiers. It has been altered so that a man at the front of the column is carrying an Ipad. The image is surmounted by Apple's 'Think Different' wordmark.

Apple's business model made Chinese oppression inevitable (permalink)

A month ago, a wave of rare political protests swept China, centered on Beijing, where Premier Xi Jinping was consolidating his already-substantial power by claiming an unprecedented third term:

Protest organizers in China struggle with the serious legal and extrajudicial penalties for anti-government activities, backed by a sophisticated digital surveillance grid that monitors and blocks online communications that might challenge government authority.

Though this digital surveillance network is now primarily supplied and serviced by Chinese tech companies, it can't be separated from western tech companies. The first version of the Chinese digital surveillance grid was built by Cisco:

Tech companies like Yahoo went into China knowing that they'd have to censor the internet, and ultimately turned over their users' data to Chinese authorities, who subsequently arrested and tortured some of those users:

Google pulled out of China in 2010, after the Chinese government hacked and arrested Gmail users. But eight years later, Google was secretly working on Project Dragonfly, a censoring, surveilling search product designed for the Chinese market:

Apple plays a key ongoing role in Chinese state surveillance and oppression. Like most tech giants, Apple depends on access to low-waged Chinese factory workers with weak labor protections to hold down the wage bill for its manufacturing.

Apple also relies on selling phones and computers and services to the titanic Chinese middle class, a category that's loose enough that estimates of its size range from 350m to 700m – but even the lower figure is larger than the entire US population.

Apple's dual reliance on poor Chinese workers and rich Chinese consumers gives the Chinese state enormous leverage over the company. The Chinese government can order Apple to participate in its digital surveillance and dissent-suppression efforts and threaten the company with the loss of revenues and manufacturing if it balks.

But that's true of any western company that seeks to hold down costs and generate revenues through Chinese manufacturing and Chinese sales. What makes Apple uniquely vulnerable to Chinese state pressure is its business-model choices – choices that, ironically, are touted as a way to keep its users safe.

Apple's Ios platform is "curated." Ipads and Iphones ship locked to Apple's App Stores. Users aren't supposed to be able to install software unless it is delivered via the App Store. Apple describes this as a safety measure, a bulwark against the tricks that hackers and identity thieves use to lure users into installing malicious software.

But Apple also makes billions of dollars through this arrangement. The App Store is a chokepoint, and any software author who wants to sell an app to an Iphone owner can only do so if Apple approves of the transaction.

Apple can arbitrarily withhold this permission, if, say, it has a competing product and doesn't want to have to win out over a new market entrant in a fair fight.

Apple can also burden its competitors: if you want to sell media that competes with Apple Books, Apple Music or Apple Video, the company will charge you 15-30% on each sale, while its own offerings escape this charge.

That means that media stores that competes with Apple's own retail storefronts have to either charge more than Apple, or make less money, or not sell media via an app at all – instead, they have to implement a clunky two-step whereby customers buy their media on the web and they flip back to an app to download it.

Even when an app maker doesn't compete with Apple, Apple can turn it to its advantage: the company simply appropriates 15-30% of ever dollar that changes hands when Iphone owners buy software and media from app makers.

This is "feudal security." In a lawless realm of roving bandits, Apple offers us a high-walled fortress bristling with fierce infosec mercenaries who promise to defend us from the threats outside the walls. In return, Apple uses its control over the gateway to the outside world to extract a tax from everyone who brings us the things we need.

Apple has every incentive to make this fortress as impregnable as possible. From the lowest levels of its chip designs to its lobbying blitzes to criminalize jailbreaking devices, the company is fully committed to ensuring that Ios device owners can't make choices Apple disapproves of.

This is the source of China's extraordinary leverage over Apple. Apple can't afford to leave China, because that would mean losing manufacturing and customers. Because of this, the Chinese state can order Apple to take any measure that Apple is technically capable of delivering.

Because of its business-model choices, Apple has the technical capability to introduce defects in the apps on its customers' devices. It can order every software vendor in the App Store to break their privacy tools so that the Chinese government can spy on those customers.

If companies don't comply, Apple can simply block them from delivering software to Chinese users altogether. An absolutely foreseeable consequence of this product design is that the Chinese state will order Apple to neuter all the privacy tools available to Chinese Ios users, which is exactly what happened:

Apple offers cloud storage to its Ios users. Because Apple can't afford to anger the Chinese state, the Chinese state can order Apple to introduce defects into the encryption on its cloud servers so that Apple customers can be spied on by the Chinese government. That's also exactly what happened:

Apple's business-model decisions reduce the consequences for betraying its customers. If defects in Apple's cloud product come to light, it can simply order all the other cloud services in the App Store to introduce similar defects, on pain of being kicked out of the store.

Last month's Chinese protests were coordinated in part thanks to a novel technological tactic, one that made use of one of Apple's most innovative technologies: Airdrop. Airdrop is an ad hoc, peer-to-peer file transfer protocol that lets two nearby Ios users exchange files with one another without identifying themselves.

Anti-Xi organizers used Airdrop to exchange forbidden protest literature. Because these files travel directly between Ios devices, they weren't visible to the censors and spies who monitor other digital communications tools in China.

This use of Airdrop is a canonical example of the ways that digital technologies can be part of human rights struggles, giving people new tools that give them leverage over powerful state actors.

Right on schedule, the Chinese government has ordered Apple to break Airdrop so that it can't be used to organize protests, requiring users to opt into receiving files from strangers every ten minutes, rather than letting them set their devices to publicly visible until they are ready to turn it off:

Apple called this a "security update." It updates the security of the Chinese state from democratic accountability.

There's a strain of technology criticism that sees incidents like this as proof that digital tools have no place in human rights struggles, because they will always be turned against their users.

But no one forced Apple to launch its "curated computing" service, nor to design it so that its customers can't override it. Apple built a walled fortress in full knowledge that it might be called upon someday to turn that fortress into a prison.

The feigned outrage of tech companies when the weaknesses in their business models are exploited by third parties is an obvious and shabby trick to deflect blame. Apple put the gun on the mantelpiece in Act I. It can't expect us to forgive it when Xi Jinping fires the gun in Act III.

Of course, this sin isn't unique to Apple. Google has designed a location-harvesting system that is impossible to opt out of, so that it can accumulate and sell access to a database of every movement of every person.

Having assembled this database, Google doesn't get to act surprised when cops show up with "geofenced reverse warrants" that demand the identity of every participant in a Black Lives Matter protest (or the January 6 riot):

Or take the scandal of Adobe customers' files being wrecked by the company's dispute with proprietary color system vendor Pantone. Pantone cancelled Adobe's license to use its technology and wants Adobe customers to spend $21/month to keep Pantone colors.

But this doesn't just affect files created after the Adobe/Pantone split. Due to Adobe's subscription-based business model, which requires customers to pay monthly for software as a service (SaaS), Pantone can demand that Adobe break all the existing files its customers have created.

If you created a Photoshop file with some Pantone colors 20 years ago, they are broken now, and forever, unless you start paying Pantone $21/month, because Adobe has altered its cloud software so that all Pantone-colored pixels are rendered in black.

I've been corresponding with an Adobe PR flack doing damage control after the Pantone scandal broke, and as far as I can tell, she wants me to "correct" my article to blame Pantone for this mess, because it has Adobe over a barrel.

But Adobe built that barrel. This hostage situation was a completely forseeable consequence of redesigning its products to treat its users like hostages. Pantone are greedy scum, but so are Adobe – and it was Adobe's greed that exposed its customers to Pantone's greed.

The point isn't that having your Photoshop files corrupted is the same as being kidnapped and tortured by Chinese police. But both Adobe and Apple – and every other tech giant – has decided that the rise of networked computing is an opportunity to exercise ongoing control over their customers. All of these companies knew that this ongoing control could be hijacked by hostile governments or corporations at any time, and they did it anyway.

They have no business acting surprised now. Apple isn't responsible for Chinese state oppression, but it is knowingly, explicitly complicit in it.

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Colophon (permalink)

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