Transcript:
Conway Gittens: Apple (AAPL) might be getting caught-up in the tit-for-tat trade war between China and the U.S. Chinese regulators are considering a probe into the Apple App Store and how much the tech giant is charging for developers to sell their wares via the platform.
According to Bloomberg, China’s antitrust watchdog is in the early stages of taking a look at the cut Apple takes from developers, which could be as high as 30 percent. Other app store rules, such as prohibiting other payment services are also under review. The App Store has opened many global doors for Chinese developers like Tencent and ByteDance, but it also faced numerous complaints within China and in other parts that Apple controls it with a heavy hand and exacts a heavy toll on the revenues app makers get.
Related: Apple’s AI strategy is looking pretty smart
Complaints about the App Store’s policies were around before Trump Trade War 2.0, but China could use Apple as a pawn in its retaliation against this new round of tariffs. China, after all, is a major market for Apple and its products. Not only is the country a big manufacturing hub for the iPhone, which is Apple’s top-selling product, Apple also gets about 20 percent of its global revenues from there as well.
While the probe is said to be in the pre-consideration phase, sources tell Bloomberg an official full-blown anti-trust investigation may not materialize.
Sticking with technology for our market check this Wednesday, tech stocks are leading the way lower. Cloud revenue at Google parent Alphabet came in weaker than anticipated, sparking concerns Alphabet may not be getting what it paid for when it comes to investments in AI. AMD added to the gloom. Though the chipmaker beat forecasts, investors worry that may not be good enough to catch up with Nvidia in the AI chip race.
That’ll do it for your Daily Briefing. From New York City, I’m Conway Gittens with TheStreet.
Watch ICYMI This Week:
1 million Americans are about to get a surprise tax refundFed’s rate pause could spell trouble for the U.S. economyUPS paid a big price for your Amazon deliveriesTrump EV policy will have unexpected consequences beyond cars
