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(one)

In a word:The world has suffered from the apple tax for a long time!

Now, we need to add four more words.Especially in China。

I believe that people working in the Internet industry have a lot of grievances about the Apple tax. Especially the recent controversy surrounding the Apple tax, which makes people feel like they have a thorn in their throat and they can't help but speak out.

According to recent reports, Apple is increasing pressure on Tencent and ByteDance, demanding that they make fundamental changes to WeChat and TikTok, otherwise it will refuse to update the relevant apps.

The reason is the so-called loophole.

The root cause is the Apple tax.

Because in Apple's view, the loopholes in WeChat and TikTok can be exploited by creators to direct users to external payment systems, thereby circumventing the 30% commission charged by Apple.

30% is what we usually call the Apple tax.

That is, as long as you use an Apple phone or tablet, whether you pay to download the APP or purchaseDigital GoodsOr services, for example, subscribing to a video membership or purchasing a digital prop, 30% of the payment goes into Apple's pocket.

30% is 5 percentage points higher than our statutory corporate income tax rate (25%).

But this is Apple, the strong Apple.

According to statistics, last year, Apple's revenue from Apple taxes alone exceeded 160 billion yuan worldwide.

What is the concept?

Last year, Baidu's total revenue was 134.6 billion yuan, which is more than 20 billion less than the Apple tax. To earn this much Apple tax, NetEase would have to work for 1.6 years without eating or drinking, and Bilibili would have to work for 7.5 years.

I'm not referring to their profits, but their total revenue.

This is indeed huge profit.

Even in the United States, according to an antitrust ruling that came into effect in January this year, the U.S. court determined that the operating profit margin of "Apple tax" revenue was approximately 75% after deducting a series of costs such as operating expenses, sales expenses, administrative expenses, and research and development expenses.

But in order to protect the Apple tax, Apple is going all out.

For example, at the beginning of this year, Apple warned Kuaishou and Douyin that they must rectify the behavior of providing third-party payment links to users in scenarios such as live broadcast rewards, small games, and short dramas, otherwise...

In May this year, Apple again targeted WeChat and demanded that small game developers rectify similar behaviors.

During the 618 promotion this year, Apple forced TikTok, Alipay, Pinduoduo and other apps to remove the memberships of video platforms such as iQiyi, Youku, and Mango TV on iOS, memberships of Internet platforms such as Himalaya and Baidu Netdisk, as well as virtual goods such as knowledge payment and education and training that they were selling on promotion...

In total, the Apple tax contributed by the Chinese market in 2023 alone will be as high as 46.4 billion yuan. If the "tax rate" remains unchanged in the next five years (2024-2028), the Chinese market will have paid a total of about 287.3 billion yuan in taxes.

Apple, you are really ruthless in fleecing China!

(two)

Is there no one who says no to Apple tax?

Yes, yes.

Here, we have to mention the European Union.

In March this year, the EU's Digital Markets Act was implemented, one of the targets of which was the Apple tax. Because of market monopoly, the EU also fined Apple 1.84 billion euros.

Even though Apple was extremely unhappy, it had to bow its head and make corrections.

In the official version of iOS 17.4 released on March 6 this year, Apple made a series of unprecedented adjustments for the European Union region.

Third-party downloads and third-party payments are open; Apple tax is also reduced from the original 30% and 15% (for small developers with annual revenue below US$1 million) to 17% and 10% respectively.

The European Union is not someone that can be easily messed with.

Another country that is not easy to deal with is South Korea.

In September 2021, South Korea revised the Telecommunications Business Act, requiring Apple to open up third-party payments. Apple was forced to seek a settlement and reduced the Apple tax by 4 percentage points in South Korea.

South Korea also became the first country in the world to successfully pass legislation to challenge Apple's tax. In a sense, it was South Korea's pioneering action that pushed the EU to follow suit to a greater extent.

Japan is also taking action.

According to media reports, the Japanese government is planning to introduce a related antitrust bill based on the EU's Digital Markets Act. If things go well, the bill will enter the process this year and take effect within 1-2 years.

The goal is simple: Japan’s Apple tax will eventually be cut in half like in the EU.

South Korea took the lead, the European Union gave a wake-up call, Japan followed closely, and the United States also continued to criticize.

I personally believe that lowering Apple taxes is an inevitable trend on a global scale, and Apple cannot stop it even if it wants to.

Because this time, Apple really angered the public!

(three)

But in many things in this world, if you are soft, they will be hard, and if you are hard, they will be soft. If you don’t work hard to push them, don’t expect others to take the initiative and show goodwill.

Regarding the Apple tax issue, this is purely my personal opinion and we need to take a multi-pronged approach.

First, we really need to learn from South Korea and the European Union.

Faced with the powerful Apple, the power of a single company is limited after all, but Apple has to bow to the power of national legislation.

Because it’s very simple, is the 30% Apple tax reasonable?

Does not allowing third-party downloads and payments constitute monopoly?

Even Apple must ultimately be reasonable and abide by laws and morals.

I saw that a friend has done some calculations. Without canceling the Apple tax, if Apple follows South Korea's standards in China and allows Apple users to use third-party payment, it will reduce the Apple tax by 4 percentage points, from 30% to 26%. In the next five years (2024-2028), it will give up 37.4 billion yuan in profits to the Chinese market.

The extent of the profit concession actually does not exceed 2% of Apple’s revenue in China, but it can leave an online music industry for China.

If we go a step further and implement EU standards in China, for example, allowing Apple users to use third-party payment, Apple tax can be reduced by 13 percentage points, from 30% to 17%. In the next five years, the Chinese market will benefit from 121.7 billion yuan.

The extent of the profit concession will not exceed 5% of Apple’s revenue in China, but it will be able to leave two film industries for the Chinese market.

China is an open economy, and Apple's success today is inseparable from its expansion in the Chinese market. However, we really cannot stand idly by when it comes to practices that are obviously unfair or even discriminatory against Chinese companies.

Second, Chinese companies must also have backbone and unity.

We must have backbone and say no boldly when faced with obviously discriminatory practices.

We also need to unite. Facing the super-powerful Apple, the strength of a single company is limited, but when united, they become an irresistible force.

Now, Apple can be said to be standing on the opposite side of many Chinese companies. It also faces two powerful rivals, one is Tencent and the other is ByteDance.

Behind Apple's latest attack on Tencent and ByteDance is actually its coveting of China's emerging digital industries such as short dramas and small games.

According to forecasts, the market size of short dramas and small games in China will exceed 110 billion yuan in 2024. Apple, with a market share of one-third, naturally hopes to get a piece of the pie. As a result, WeChat mini-games and TikTok short dramas have become the hardest hit areas for Apple's taxation in China.

But the way you eat should not be too ugly.

I always feel that Chinese companies cannot back down and must defend their legitimate interests. Unprincipled compromise and concession will damage the development of the entire industry and make the whole world laugh at us.

This reminds me of the WeChat tipping controversy a few years ago. Even if it was a few dollars of article tipping fee, Apple would take advantage of it. Just because it didn’t get its share of Apple tax, Apple forced WeChat to shut down tipping for a long time.

Finally, after struggle and bargaining, Apple finally gave up.

Third, Apple needs to reflect on itself and think twice.

The Chinese market is huge and there is endless money to be made, but if you love money, you must earn it in a proper way.

This kind of Apple tax, which kills the goose that lays the golden eggs, damages Apple's image and long-term interests.

Yes, Apple is a great company that has launched great products and even rewritten the course of the mobile Internet era. But the 30% Apple tax shows the world an Apple that is profit-driven, an Apple that drains its pond to catch fish, and an Apple that is rich but unkind.

Moreover, Apple has adopted discriminatory policies. South Korea has one Apple tax, the European Union has another Apple tax, but in China, it is the highest Apple tax in the world.

Will Apple really one day force Chinese users to choose: A, WeChat, TikTok; B, iPhone?

Faced with such a choice, is the answer of Chinese consumers really in Apple's interests?

We should always take a broad view of things.

Apple, you really need to think twice.

But it must be said that without sufficient pressure and effective constraints, it is impossible to eliminate the arrogance and prejudice of some people. Even a giant like Apple would find it difficult to think twice.