Apple Officially Allows Users to Tip Content Creators With In-App Purchases

Apple updated its App Store Review Guidelines this week to indicate that developers may now sell virtual currencies in the form of in-app purchases to enable customers to "tip" content creators within apps.


Like all other in-app purchases, Apple will now receive a 30 percent cut from the virtual currencies used for tipping.

Tipping within apps is popular in China, where live-streaming apps like Yinke and Yizhibo have long allowed viewers to tip or give virtual gifts to the stars they watch as a token of gratitude, according to TechCrunch.

Last month, however, Apple reportedly told WeChat and several other Chinese social networking apps to disable their "tip" functions to comply with App Store rules, as many of the virtual currencies sidestepped Apple's 30 percent cut on purchases.

Now that Apple has formally outlined its stance on the matter, developers who previously feared repercussions from the company may be more inclined to begin offering virtual currencies for users to tip content creators with.

Beyond Apple's 30 percent cut, it's up to developers to determine how much of the tips are relayed to the content creators themselves.


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Apple Takes Risk By Telling Chinese Chat Apps to Disable ‘Tip’ Functions

Apple has told several Chinese social networking apps to disable their "tip" functions to comply with App Store rules, according to executives at WeChat and other companies.

The tip functions in Chinese messaging platforms are free to use and allow people to send authors and other content creators monetary tips through transfers to mobile wallet accounts. However, according to The Wall Street Journal, Apple has decided that tips are equivalent to in-app purchases – similar to buying games, music, and videos – therefore Apple is entitled to a 30 percent cut of every transaction.

WeChat on iPhone

The move by Apple appears to be a way to eke out additional revenue from Chinese iPhone users as part of a broader effort to increase its market share in the country. According to research firm IDC, Apple's market share in China dropped from 16 percent in Q1 2015 to 9 percent in Q1 2017, while the iPhone has fallen to fourth place behind Chinese brands Oppo, Huawei, and Vivo.

On the other hand, Apple's App Store revenue in China overtook its U.S. App Store revenue in 2016 and became the biggest App Store market in the world. Making the tip function an in-app purchase in China's wildly popular chat apps would seem to be a sure-fire way to increase Apple's revenue. However, Apple's pressure on messaging platforms like WeChat is a risk and threatens to alienate huge Chinese companies.

Some social-networking apps have likened Apple's tactic to arm-twisting, according to The Wall Street Journal. Apple is said to have told chief executives at two companies that if they refuse to make the change, updated versions of their apps won't be made available and they could be kicked out of the App Store. "We don't charge anything as the platform, but Apple gets 30 percent for doing nothing," one of the executives reportedly fumed.

The annoyance stems from the way the tipping culture is viewed in China. Chinese app developers see tipping as fundamentally different from in-app purchases because users only tip voluntarily as a mark of appreciation when they consume content. But the biggest worry for Apple could be whether the Chinese government decides to intervene and side with the tippers.
One executive says his company is talking to the Ministry of Industry and Information Technology, a regulator, about whether Apple is imposing unfair rules by turning tipping into in-app purchases. MIIT says it isn’t involved. The People’s Bank of China, which regulates electronic payments, didn’t respond to a request for comment.
Apple has suffered at the hands of Chinese state regulators before. But Apple also risks frustrating China's biggest company Tencent Holdings Ltd, the developer of WeChat, which has 938 million active monthly users. The messaging service works almost like an operating system all of its own, boasting multiple mini-apps that allow users to pay bills, book hotels, browse media, and more, without ever having to leave the chat platform. The nature of the system itself could be a threat to Apple's app revenue, while WeChat is arguably more important to Chinese smartphone users than any individual phone brand – iPhone included.

WeChat is in talks with Apple to try to find a new solution to the tipping problem and come to an alternative agreement, according to people familiar with the matter.

Tags: China, WeChat

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China to Get Netflix Originals in Content Deal With Local Streaming Service

Netflix has signed a licensing deal with a Beijing-based video platform in order to avoid regulatory restrictions and get its content into China's huge entertainment market (via The Hollywood Reporter).

The streaming giant announced the news of its content agreement with iQiyi on Tuesday at the APOS industry conference in Bali, Indonesia.

"China is an important market for obvious reasons; it's also a challenging market for obvious reasons," said Robert Roy, Netflix's vice president of content acquisition. "Right now what we will do is look to license content into China. We closed a deal with iQiyi, which is exciting." 

"For us, it does a couple of things," Roy added. "It gets our content distribution into the territory and builds awareness of the Netflix brand and Netflix content."
A subsidiary of Chinese giant Baidu, iQiyi is currently switching from an advertising-supported streaming service to a subscription model in the same vein as Netflix. The subsidiary reportedly commands the largest customer base and content portfolio in China, however it has been looking to broaden its appeal as rivals like Tencent Video and Youku Tudou compete for viewers in the country's market.

It is understood that Netflix will make some of its upcoming original content available on iQiyi at the same time as it appears in other Netflix-serving countries, but further details on which shows would be included in the deal were not forthcoming.

Both Amazon and Netflix have been unable to enter China's market because of regulatory hurdles, although Netflix's House of Cards briefly achieved viral status in China thanks to a deal with local service Sohu. The show was apparently even known to Chinese president Xi Jinping, but it was later withdrawn from local streaming services by regulators.

Last year, Apple faced its own issues with Chinese state regulators regarding a controversial independent movie which led to the shut down of iTunes and iBooks in the country.

Tags: China, Netflix

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Xiaomi Unveils $360 Mi 6 Phone With Dual-Lens Camera, ‘Four-Sided 3D Glass’ Casing, No Headphone Jack

Chinese mobile maker Xiaomi unveiled the Mi 6, its latest flagship smartphone, at a packed-out event in Beijing on Wednesday.

The Mi 5's successor features curved "four-sided 3D glass" and a front that isn't bezel-free like the company's Mi MIX, but the phone does boast a lot of tech for a device that starts at 2499 RMB, or $360 – about half of what a base iPhone 7 goes for in China.


Like the iPhone 7 Plus, the new 5.15-inch Mi 6 includes a 12-megapixel rear dual lens camera combining a wide-angle lens and a telephoto lens. It also matches Apple's latest smartphone with 10x digital zoom, 2x lossless zoom, image stabilization, and depth of field effects.

Similar to the Mi 5s, the Mi 6 features a Qualcomm-based ultrasonic fingerprint reader built under the glass at the bottom of the phone. The "button-less" technology is said to recognize a 3D map of each user's fingerprint through ultrasonic waves, although it only works within the bezel's concave indentation that marks out the home button.


The Mi 6 includes 2x2 Wi-Fi, which is meant to improve connectivity speed, and does away with the headphone jack, settling for a single USB-C port instead. Elsewhere the handset features the latest Snapdragon 835 processor (also found in the S8), 6GB of RAM, 64GB of storage memory on the entry model, dual stereo speakers, a 3,350mAh battery, a new "night display" screen mode, and water resistance.


The Mi 6 with 128 GB option costs 2899 RMB ($420) while a special Ceramic edition goes for 2999 RMB ($435). It's unclear at this time whether the phone will become available in Europe or the U.S.


The announcement of a new flagship phone comes at a particularly important time for Xiaomi, which suffered its first sales slump last year. The company's former VP of Global Efforts Hugo Barra left in February, while CEO Lei Jun recently admitted the firm had grown too fast and was now entering a transitional period, as it focuses on its main markets in China and India.

Related Roundup: iPhone 7
Tags: China, Xiaomi

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iOS Drops to Lowest Share of China Smartphone Market in Nearly Three Years

Apple's iOS has dropped to its lowest share of the smartphone market in urban China since July 2014, according to new data collected and shared by Kantar Worldpanel. Today's report specifically details smartphone shares around the world for the three months ending in February 2017. In total, devices running iOS dropped 8.9 percentage points from the same year-ago quarter, receding from 22.1 percent of the China market to 13.2 percent.

Apple rival Android remains the dominant force in China at 86.4 percent of the smartphone market in the country, growing 9.3 percentage points year-over-year. Although the iPhone 7 and iPhone 7 Plus remained the top selling devices in China, Apple has trouble competing with local vendors -- like Oppo and Vivo -- who produce cheaper smartphones at a massive rate that are far easier to obtain by the Chinese consumer.

"In the three-month period ending February 2017, iOS accounted for 13.2% of smartphone sales in urban China, a decline of 8.9 percentage points from 22.1% a year earlier. This marks iOS’ lowest share since the three-month period ending July 2014," reported Tamsin Timpson, Strategic Insight Director at Kantar Worldpanel ComTech Asia. "That said, iPhone 7 and iPhone 7 Plus remained the top selling devices in the region, accounting for 8% of smartphone sales. By comparison, iPhone 6s and 6s Plus accounted for 14% of smartphone sales in the three months ending February 2016."
Not much has changed for either iOS or Android in the United States since Kantar's last report, although the latter OS has continued to see a decline in market share throughout December, January, and February. Android has dropped three percentage points when compared to the same year-ago quarter, now accounting for 55.9 percent of the U.S. smartphone market, while iOS has grown by 3.7 percentage points year-over-year to take 42 percent of the market in the U.S.

As in China, iPhone 7 and iPhone 7 Plus remained the top-selling smartphones in the U.S., which the devices have been since Kantar's report on the three months ending November 2016. Kantar's analysts cited hope that Google Pixel "might soften the drop in Android sales" that happen annually around every iPhone launch -- and which dropped even more dramatically last year because of the Note7 -- but the Pixel doesn't appear to have picked up the slack for the Android market in the U.S.

In terms of overall growth, iOS saw its biggest percentage point increase in the quarter happen in Great Britain, growing 4.5 percentage points year-over-year. In most of Europe's big five markets -- Great Britain, Germany, France, Italy, and Spain -- Apple has done well to boost sales of iOS devices, with France housing the biggest growth for the Apple operating system over the holidays. Outliers still remain, like Spain's 1.7 percentage point dip in today's report.

Kantar's report also looked forward to the rest of 2017, admitting that the three months ending in February is a "challenging time" to report on due to its awkward middle ground proximity between the holiday season last year, and upcoming announcements at events like WWDC in the summer.
“The February period is always a challenging time to report on consumer behaviour and plans, since many people put purchases on hold following the holidays, waiting for the latest phone announcements from Mobile World Congress,” Guenveur said. “The much-anticipated March 29 announcement of the Samsung Galaxy S8, combined with the somewhat unexpected launch of the (PRODUCT) RED iPhone 7 and iPhone 7 Plus, and the capacity upgrade to iPhone SE a week before that, may mean that the remainder of Q1 and Q2 could yield some interesting, even unpredictable, shifts in the market.”
Apple CEO Tim Cook has remained vocal in his optimism about the company's presence -- and future -- in China, mentioning in an earnings call last year that, "We may not have the wind at our backs that we once did, but it's more stable than the common view of it." More recently, Cook went into even more detail about Apple's China plans, stating that, "We're not just someone who's here to access the market," and that the company intends to bolster its presence in the country through providing jobs and improving people's standard of living.

Related Roundup: iOS 10
Tags: China, Kantar Worldpanel

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Chinese Court Overturns iPhone 6 Patent Ruling in Apple’s Favor

A Beijing court has overturned a 2016 ruling that Apple's iPhone 6 violated a Chinese manufacturer's patent, which saw intellectual property regulators attempt to bar sale of the phone in the country (via South China Morning Post).

Last June we reported that ailing company Shenzhen Baili filed a lawsuit against Apple claiming that the iPhone 6 violated the patent of its 100c smartphone. Shortly after the lawsuit was filed, the Beijing Intellectual Property Office ruled that the iPhone did infringe on Shenzhen's patent rights, accusing Apple of having "copied" the exterior design of the 100c phone.


The Cupertino company was ordered to halt sales in Beijing completely, but an appeal at a regional patent tribunal was granted that allowed both the iPhone 6 and 6 Plus to remain on sale. Today's news finally appears to have put an end to the legal dispute.
The court "quashes the decision of the bureau" and "recognises that Apple ... has not infringed the design patent filed by the company Shenzhen Baili", according to the verdict reported by the People’s Court Daily.
The Beijing court ruled that the features of the iPhone 6 "completely change[d] the effect of the entire product" and made both phones "easily distinguishable in the eyes of consumers".

The decision is likely to be another nail in the coffin for Baili, which was reported to "barely exist" even at the time of its original victory in the intellectual property office. The company, along with its parent Digione, is no longer a competitor in the Chinese smartphone market and has since collapsed, blighted by mismanagement and public criticism of its products, which were seen as poor quality.

Apple's lawyers will be relieved with today's ruling, given that Apple has been on the losing side of Chinese intellectual property lawsuits in the past. In May 2016, an "iPhone" branded leather goods maker won a lawsuit filed by Apple, after the court ruled Xintong Tiandi had registered the word as a trademark in 2007, while Apple's phones didn't go on sale in China until 2009.

Tag: China

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Tim Cook Hails China Investment, Says Apple ‘Here to Stay’

Apple CEO Tim Cook sat down for an interview with Chinese media outlet Caixin on Tuesday, in which he emphasized Apple's ambitions in China and its long-term commitment to investment there.

Despite Apple's need to see off competition in the country from the likes of Chinese mobile makers Oppo and Huawei, Cook took pains to explain that Apple isn't simply in China to grab a piece of the market, but that it is actively working to create jobs and improve people's standard of living in the country.

Tim Cook poses for a photo during his visit to Ofo
"We're not just someone who's here to access the market," Cook told Caixin. "We've created almost 5 million jobs in China. I'm not sure there are too many companies, domestic or foreign, who can say that. … There's deep roots here. I think very highly of the country and the people in it. We're here to stay."
As reported earlier this week, Cook has spent the last few days in China to celebrate the company's announcement that it is building several research and development facilities in the region. On Wednesday he stopped in at Beijing-based bicycle sharing startup Ofo, which counts ride hailing company Didi Chuxing as one of its investors.

Apple surprised analysts last year when it bought a $1 billion stake in Didi, earning it a place on the company's board. Speaking to Caixin, Cook said the investment in Didi was an exceptional case and not a general direction for Apple.
"We've never invested in a developer before, and yet we met Didi, and Didi was so impressive. One, we thought their management was so great, we thought their idea was great," Cook said. "And we liked the holistic view, they were doing everything from taxi to the more-traditional private-car thing. There was a strategic alignment. They needed some funds to continue to grow. We really want them to be successful and be global."
Cook kicked off his China visit with a wide-ranging talk on Saturday at the China Development Forum, where he underlined his support for globalization. When asked by Caixin about the subject, the Apple CEO said there were three groups of people he always kept in mind.
"My view on globalization is that you can think of three groups of people. There's a group of people that globalization has helped tremendously. There's a group that globalization did not help. There's a group of people that globalization hurt," Cook said. "Globalization has lifted hundreds of millions of people out of poverty. But I also recognize is that it did not help everyone."
Commenting further on the recent political steps away from globalized investment, such as the protectionist policies of the Trump administration, Cook admitted it was important for policymakers to address the issues that have led to resentment by some, but said it would be a mistake to roll back the process of globalization.
"You want to keep this going because it's great. But we must fix this," Cook said. "I do think there are ways to address it. I don't think it’s an impossible task. I hope the politicians will put their attention on fixing that problem. … I'm optimistic. We must be. There are so many good things in the world. We just have to make sure we focus on the thing to fix."
Cook is likely to remain in the country until at least Friday, when Apple will launch its special edition red iPhone 7 and 7 Plus globally. Despite the missing (PRODUCT)RED branding in China, Cook told MacRumors that proceeds from sales of the red colorway iPhones will still go to help the fight against HIV/AIDS, which has been called a "looming epidemic" in the country.

Note: Due to the political nature of the discussion regarding this topic, the discussion thread is located in our Politics, Religion, Social Issues forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.

Tags: China, Tim Cook

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Tim Cook Confirms Apple Will Make Global Fund Donations From Sales of Red iPhone 7 in China

With the news earlier today that Apple has ditched the PRODUCT(RED) branding for the red iPhone 7 and 7 Plus in China, MacRumors reached out to CEO Tim Cook to find out if any of the proceeds on sales in the country would still be donated to charity in the fight against HIV/AIDS.
MacRumors' question: We noticed the (PRODUCT)RED branding is missing from the new red iPhone 7 on the China Apple website. Will you be donating any of the proceeds from the phone's China sales to the HIV/AIDs cause anyway?

Tim Cook's response: We donate to the Global Fund on every iPhone 7 and iPhone 7 Plus we sell in every country in the world.
Since the omission of the branding came to light, there's been some speculation that recent changes in Chinese law prevent not-for-profit organizations from being involved in commercial advertising. Whatever the truth of the matter, it appears Apple will be upholding its (PRODUCT)RED charitable donations commitment with or without said branding.

Apple's special edition red iPhone 7 models, due to be launched on Friday in more than 40 countries, are the first iPhones to join Apple's (PRODUCT)RED line-up.

Apple said the new handset color was in recognition of more than 10 years of partnership between Apple and the charity (RED), offering customers a way to contribute to the Global Fund and "bring the world a step closer to an AIDS-free generation".

Other Apple products in the (PRODUCT)RED range that are available all year round include the full iPod line of products, Beats Solo3 Wireless On-Ear Headphones, Beats Pill+ Portable Speaker, the iPhone 7 Smart Battery Case, and a range of accessories for iPhone, iPad, and Apple Watch.

Note: Due to the political nature of the discussion regarding this topic, the discussion thread is located in our Politics, Religion, Social Issues forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.

Related Roundup: iPhone 7
Tags: China, Tim Cook, (PRODUCT)RED

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Tim Cook Visits Beijing-Based Bike Sharing Startup, Ofo

Tim Cook visited Beijing-based bike-sharing company ofo on Tuesday, according to Reuters. The Apple CEO has been in China since at least Saturday, when he gave a wide-ranging talk at the China Development Forum.

During his ofo stop, Cook met with founding members including CEO Dai Wei, and posed for pictures of him riding a yellow ofo bike.


"Thanks for welcoming me today, ofo team! Great energy behind your mission to make commuting greener, more efficient and fun!" Cook said in his official Sina Weibo post, along with pictures of him riding an ofo bike.
The rivalry between China's bike sharing startups has been compared to the battle between Uber and local competitor Didi Chuxing. Last year, Apple poured a $1 billion investment into Didi Chuxing, earning it a seat on the company's board. At the time, Cook described the investment as "a chance to learn more about certain segments of the China market".

Ofo, which counts Didi Chuxing as an investor, confirmed that Cook made the company visit on Tuesday but said no discussions regarding collaboration or investment took place. The company has already raised $450 million this month, which saw its valuation pass the $1 billion mark for the first time.

Founded in 2014, ofo developed the world's first "non-docking" bike sharing platform operated by a mobile application, according to its site. Ofo and main rival Mobike are among a number of rapidly emerging bike-sharing services that allow users to find, unlock, and pay to rent trackable bicycles through smartphone apps, allowing younger consumers to get around congested roads and public transport.

Ofo operates 2.2 million bikes in 43 cities in China, with pilot schemes in Singapore, London, and California.

Tag: China

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Apple CEO Tim Cook Touts Benefits of Globalization in China Speech

Apple CEO Tim Cook gave a talk on Saturday to attendees of the China Development Forum 2017, where he offered commentary on a range of issues including globalization, economics, and data privacy.

The annual forum is a high-profile conference in which senior Chinese government officials, global corporation leaders, institutions, and scholars gather to discuss major issues including Chinese economic reform and the country's relationship with the wider world. Other tech CEOs at this year's event included IBM's Ginni Rometty and Siemens' Joe Kaeser.


According to The Wall Street Journal, Cook chose to focus on the perceived merits of globalization during his speech, calling its impact on the world "great" in general, while noting the currently uneven distribution of its economic and cultural gains. Despite shortcomings – and amid calls from the Trump administration to direct investment inwardly – Cook encouraged other countries to bet on a future of more balanced development by opening themselves to global investment.
"I think the worst thing would be to — because it didn't help everyone — is to say it's bad and do less of that," said Cook. "I think the reality is you can see that countries in the world... that isolate themselves, it's not good for their people."
In general, Cook's comments largely avoided sensitive Chinese political issues. On the subject of data privacy and cybersecurity, for example, Cook reiterated previous statements made about the importance of encryption to protect user information from state hackers and other bad actors. "We think that an individual should own their data and should be able to control their data," said Cook, while avoiding any explicit criticism of Chinese cybersecurity policy, which in its current form only serves to tighten state control over information flows and technology equipment within the country.

In contrast to outspoken political stands taken at home – such as last year's very public encryption battle with the FBI – the tone of Cook's comments reflected Apple's historically mindful approach to Sino relations, with the company having previously fallen foul of China's restrictive internet policies. Given Apple's ongoing efforts to crack China's booming smartphone market, combined with heavy investment in research and development facilities in the country, Cook's cautiousness aligns with Apple's strategy of sidestepping issues that could significantly damage future negotiations.

As part of his China trip, Tim Cook is also scheduled to speak with Xu Lin, director of the Cyberspace Administration of China, in a private meeting on Monday.

Note: Due to the political nature of the discussion regarding this topic, the discussion thread is located in our Politics, Religion, Social Issues forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.

Tag: China

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