Does Apple have the courage that Google had to leave China?

In the context of economic globalization, the "trade friction" provoked by the United States has caused huge losses to technology companies in both countries. Huawei has lost the US 5G market and suffered a "supply cut" crisis. A number of American companies are also facing the risk of declining performance and even losing the Chinese market. Obviously, there is no winner in this retrograde farce.

This incident has made technology companies in China and the United States the focus of public opinion, and some American technology giants that have deep roots in China seem to be preparing for the worst. Earlier, there were rumors that Foxconn was "evacuating", but after the rumors were debunked, there was news that Apple was exploring the possibility of moving 15% to 30% of its hardware production out of China, which is very sad.

For a time, the question of whether Apple should stay or go became a hot topic, and the story of Google leaving China in the early years was brought up again. Does Apple have the courage that Google did to leave China? This matter needs to be looked at separately.

First of all, Google really made the decision to leave the Chinese market. When operating in a country, it is necessary to abide by local laws. This is the basis for mutual respect and win-win cooperation. Trump unreasonably suspects that Huawei's communication equipment poses a "spying" risk, so isn't Google, which refuses Chinese content censorship, even worse?

Looking back on this past event today, many netizens even expressed such a feeling, "Fortunately, Google left China." If Google had not left, its huge ecosystem would have made us dependent on it, and it would have mastered a large amount of Chinese Internet data. In this context, strangling and cutting off supply would undoubtedly make our situation even more passive!

However, for any company, the huge and growing Chinese market is a must-win. Google's courage to leave China can only be explained by its profit model.

As we all know, Google started out as a search engine, and then gradually developed YouTube, email, maps, and the Android ecosystem that everyone is very familiar with in the mobile field. On the surface, Google is a very large technology company with services covering many fields, but the root of its profit is still advertising business, which accounts for more than 85%!

Although both Google and Baidu rely on advertising revenue, the difference in reputation between the two is as big as heaven and earth. In other words, Google and Baidu eat the same thing, but Baidu's eating is too ugly, such as various hospital advertisements. In fact, Google is not much better than Baidu, it just proves the old saying that things smell good when they are far away.

In other words, although Google has many business branches, they are basically all based on advertising. For example, ads in search engines, ads on web pages, ads in emails, ads on maps, ads on YouTube, in short, all kinds of ads are everywhere and pervasive...

However, Google's advertising is not the hard ads floating on TV or websites in our traditional consciousness. It is more based on the precise push of big data. For example, if you have searched for a product, it will recommend you the corresponding brand's product ads or content. For example, if you are in different regions, it will also recommend you product ads in different regions. Of course, its algorithm is more sophisticated and complex.

Therefore, it is not difficult for us to understand why Google has expanded its product line so much. The Android system, which was developed at great expense, is also licensed to others for free. Because the larger the ecosystem, the more people it covers, and the more ads it can push. Even if you are not the target of the ads, you can still become a data contributor to Google.

Do you really think Google is a savior and how great it is? In fact, Google is a middleman that supports two parties. On one hand, it has a huge amount of user data, and on the other hand, it has the needs of advertisers from all over the world. There is no free lunch in the world. What Google does is to connect the two in an orderly manner and take what they need. What is the most valuable thing in the Internet age? Data!

Here comes the point: Why did Google dare to leave China?

Because Google has a huge user base around the world, even though its search engine doesn't work well in China, it can still make money in the Chinese market. For example, if Chinese companies want to open up overseas markets, they still have to rely on Google's advertising services. As far as I know, there are currently many agencies in China that are doing Google advertising-related business.

Although Google's search engine does not work well in China, its advertising modules are not uncommon on the Chinese Internet. I believe that many of our netizens have seen corresponding advertising modules on different websites. These advertising modules will be accurately pushed according to your browsing habits, and then charge advertisers according to the number of clicks.

Although many of Google's businesses cannot be carried out in China and will be slightly affected, its core advertising business is still running in an orderly manner, which explains why Google search engine has the courage to leave China. This may also be the main reason why Google search has not been in a hurry to return to China for so many years, after all, it has already made money!

Although both are top American technology giants, Apple's situation is far less optimistic than Google's, because from the perspective of Apple's profit model, it is highly dependent on the Chinese market.

Speaking of Apple, I believe many people think of the iPhone first. Nearly 60% of Apple's revenue comes from the iPhone product line. Although compared with Google's "high-end" profit model, the iPhone business is more like "moving bricks", the iPhone's super high profit margin and sales volume also make Apple a lot of money.

Some people say that Apple's most powerful thing is its iOS ecosystem, but its foundation is hardware sales. Because fundamentally, whether it is a service or software based on the iOS ecosystem, it actually needs hardware as a carrier, that is, there must be enough people to buy Apple's hardware, only then can there be subsequent consumption and the foundation of ecological value.

Google is different. Its seemingly free services are more likely to attract users, thereby monetizing user traffic and user information. As for Apple, they need to do everything they can to sell products that cost thousands or even tens of thousands of yuan to users, so that their iOS ecosystem has real value.

They are both "head-swiping" businesses, but Google is free and Apple's tickets are very expensive.

So from this perspective, there is no doubt that Apple is more dependent on users' purchase of hardware. China is an extremely large emerging market with a huge user base and rising spending power. If Apple loses this huge potential market in China, it is basically tantamount to cutting off its own arm!

Industry insiders have made careful calculations based on Apple's historical revenue data and the current situation of China's mobile phone market. If Chinese people stop buying Apple phones, or Apple withdraws from the Chinese market, Apple's turnover will drop by 25%, and Apple's stock and market value will shrink sharply.

Apple not only relies on the huge consumption capacity of the Chinese market, but also cannot leave the advantages of "Made in China". Not only in the assembly link, Chinese companies also provide Apple with a high-quality and low-cost accessories supply system and trade system. Supplying the world with China as the core has proven to be an effective and highly efficient operation strategy.

In the face of the huge pie of the Chinese market, Google and Apple made completely different choices on the issue of the flow of extremely sensitive data. Google chose to leave China, while Apple chose "Cloud Guizhou". In order to please Chinese users, Apple even launched the latest version of dual-SIM dual-standby. This is enough to show how much Apple relies on the Chinese market.

So when Trump repeatedly asked Apple to move its production back to the United States, Apple repeatedly said that "this is almost impossible"! After the Sino-US trade friction broke out, Apple CEO Cook persuaded Trump: "It is wrong to impose tariffs on China." So does Apple have a "red heart" in the face of major issues?

No! In fact, businessmen only care about profits. Apple recently said that the US's $300 billion tariff list covers all of Apple's major products, which has a huge impact on Apple. Apple also listed a lot of data, stating the company's important contribution to the US economy, and earnestly dissuaded the US from imposing tariffs.

The Wall Street Journal believes that Apple's rise to become one of the world's largest and most profitable companies is closely related to its outsourcing strategy in China. Bloomberg News claims that the U.S. tariff increase poses a huge threat to Apple's profit model, making it one of the largest companies affected.

There is no doubt that Apple will suffer a huge blow if it loses the Chinese market, and the Chinese market will also suffer corresponding losses due to the loss of Apple.

More than half of Foxconn's revenue comes from Apple's OEM business, and nearly 80% of Apple products produced in China are supplied to the global market. Perhaps without the iPhone in the Chinese market, the missing share will soon be filled by other brands, but the global production orders are actually lost, and it is difficult for domestic brands to open up the international market for the time being.

Chinese companies in Apple's supply chain will also become direct victims. Many of these companies have invested a lot of money in special research and development or technology acquisition based on Apple's needs, and bear a certain amount of inventory pressure for Apple. If Apple leaves China rashly, a series of chain reactions will also affect Chinese companies that supply Apple.

Just like Apple cannot leave the Chinese market, the Chinese market actually needs Apple. This is the inevitable result of the development of the global economic integration trend to a certain extent, and it is also a proven and effective win-win cooperation model. The trade friction unilaterally provoked by the United States is not only inconsistent with the trend, but also hurts the vital interests of both sides.

Today's apples can be likened to a tree growing on Chinese soil. It has luxuriant branches and leaves on the top and tangled roots below, but the United States wants to uproot this "apple tree". The tree is gone, and there may be a "hole" left, but it will eventually be filled. We can't help but question whether the tree can bear fruit again without fertile soil.

When Google left, many people expressed regret. But looking back, no one can change our trend of rapid development. On the contrary, the United States has done many unjust things. Don't shoot yourself in the foot!