Three Apple battles to watch in 2021
A handful of battles are hovering just over the horizon for the Cupertino-based company. Dan Moren reports
There’s the thing about being one of the most prominent – and, by some measurements most valuable – companies in the world: it paints a hell of a target on your back. Apple has long found itself on the receiving end of attacks from competitors, smaller challengers, and the government, and that hasn’t changed in recent years.
But as we flip our calendars over to 2021, there are already a handful of battles in progress that could have marked effects on Apple’s business
in both the short and long terms. Of course, a company with as many resources as Apple may be able to weather the occasional squall, but every once in a while you get a perfect storm that’s harder to fend off.
Let’s take a look at these three brewing fights and how they might force Apple to batten down its hatches in the year ahead.
APPLE VS FACEBOOK
If you’ve been paying attention to tech news, you’ve probably seen the recent offensive launched by one of Apple’s rivals in Big Tech. Facebook has taken aim at an upcoming measure Apple is planning to implement: App Tracking Transparency.
As Facebook would have it, this measure would completely destroy advertising on the Internet, especially impacting small businesses that predominantly rely on advertising to get their products out there. The social media giant has taken out full page ads in the WallStreetJournal, casting itself as a defender of those same small businesses in standing up to Apple’s tyranny.
So what is App Tracking Transparency? It’s pretty much what it says on the tin. Many websites and apps track information about you using third-party ad networks – like, say, Facebook’s – thus aggregating data about customers’ activities across the net. That information is then used to build profiles customers, allowing ad networks to make more narrowly targeted ads. If you’ve ever felt like you were just thinking about a product and then suddenly seen an ad for that product appear, this kind of tracking is one way ad companies make that happen.
Apple’s new measure would simply require apps to ask users if they consent to this tracking, making it more of an opt-in situation than the opt-out it is currently. Understandably, Facebook and other ad networks – who profit handsomely by the current situation – aren’t thrilled about this, for the simple reason that most people probably aren’t going to jump at the chance to opt in. But Apple’s stance is that this is about transparency and privacy for consumers, and it’s tough to argue that point. The change is expected to go into effect with an upcoming release of iOS 14.5, but the battle may just be getting started.
APPLE VS EPIC
The App Store became a contentious battleground this year, and of the shots that were fired, more than a few of
them originated in Fortnite. The extremely popular free-to-play game became a major point of contention this year when its developer, Epic Games, decided to take on Apple’s App Store for being anticompetitive and unfair.
At the root of the issue was Epic’s attempt to add the option for direct payments on in-game currency purchases in its iOS app, in order to make an end run around Apple’s 30 per cent cut – a move expressly forbidden by Apple’s rules. But when Epic didn’t back down, Apple removed the app from the store, prompting a cry of foul from the developer.
In other cases, Apple and a developer might come to an agreement and move past the issue, but Epic is a big company in its own right, and even though it’s had some PR missteps in this fight, it’s hitting Apple in the one place that the company is clearly vulnerable: its App Store practices. Apple has long asserted that keeping iOS locked down is a key element in its unparalleled platform security, but it does come with restrictions which many developers have argued are unfair and, at times, arbitrary.
The two companies have already traded legal motions, but the official antitrust trial has now been set for May 2021, and win or lose, the outcome could have significant effects on Apple’s relationships with the developers that power its platform.
APPLE VS GOVERNMENTS
Competitors aren’t the only ones who have Apple in their cross hairs. In a year where Big Tech came under increased government scrutiny – especially in the US – Apple has not escaped the attention of legislators and regulators.
In June of last year, the European Commission opened investigations into the App Store and Apple Pay for anticompetitive practices. The App Store investigation was prompted by accusations from Spotify, among others, who have alleged – similarly to the Epic case – that Apple uses its clout to stifle competition; on the Apple Pay side, the suggestion is that Apple plays unfairly with other payment apps by reserving use of its NFC chips for its own built-in software. No deadline has been set for the investigations’ conclusions, but there is certainly a good chance we’ll have further developments in 2021.
Meanwhile, in the US, Apple has found itself questioned by lawmakers over issues related to privacy and competition in the App Store. Apple CEO Tim Cook was summoned before Congress in the summer, along with the leaders of several other tech firms, though Apple received somewhat less probing than the likes of Facebook and Google. But that doesn’t mean that there won’t be more to come: with a new administration poised to take office, Apple may find itself lumped together with many of its counterparts in Big Tech in an environment where the government is far more interested in regulating and legislating behaviour.