According to a new paid report from the Wall Street Journal, Apple staff have met with Chinese officials in recent months to discuss concerns about new rules governing the App Store that would restrict Apple from offering many of the foreign apps currently available in the Chinese App Store.
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China has blocked the websites of many popular Western social media apps, including Instagram, China banned VPN services from the App Store in 2017.
According to SensorTower estimates, the above-mentioned five social media applications have been downloaded more than 170 million times on the Apple App Store in China over the past decade.
According to reports, Chinese officials told Apple staff that Apple must strictly enforce regulations prohibiting unregistered foreign apps to plug the "loopholes" that allow Chinese iPhone users to download these apps.
According to new regulations issued by China's Ministry of Industry and Information Technology in July this year, starting from July next year, Apple will not be able to provide such applications in its Chinese App Store unless the application operator registers with the government department. The new rules affect both domestic and foreign app distributors and are not specific to Apple.
However, overseas app operators are unlikely to register with the Chinese government, as doing so would force them to comply with China's data transfer and censorship requirements. In this case, Apple has no choice but to remove it from the shelves, otherwise the App Store itself will face legal sanctions.
Investors are said to be worried about how the new rules will affect Apple's services bottom line, including transaction activity on the App Store. Apple is also said to be concerned about problems the company may face in enforcing the rules, such as whether Chinese users who access foreign apps through its overseas app stores will be able to continue to do so.
According to the report, Apple was told in recent discussions that new rules are needed to combat online fraud, pornography and the flow of information that violates China's censorship regulations.
China recently banned government officials from using iPhones and other foreign smartphones at work or bringing such devices into government offices, a ban that was extended to multiple state agencies and state-owned enterprises earlier this month, underscoring China's renewed attempts to block foreign technology.
China is an important market for Apple, accounting for about a fifth of its sales. Although Apple has made efforts in recent years to diversify its supply chain to places such as Vietnam and India, most of its production base remains in China.