Apple tells Chinese app makers to cut tips or pay up

Apple Money 2 Apple wants to take
its cut of the money Chinese app users send as tips to content
Photo: Ste Smith/Cult of Mac

Apple has risked upsetting customers in China by revealing
plans to take a percentage of donations that are sent to
content creators on social media, via the “tip” function of
local apps like WeChat.

Apple previously
told developers to disable the feature, but it has since
reconsidered and decided that this represents an opportunity to
make some money. Since they are considered in-app purchases,
Apple wants to take its usual 30 percent cut of payments.

The move
has a chance of backfiring, however. Culturally, tipping is
viewed as being separate from purchases. This means that
customers are unlikely to be happy knowing that money they have
handed over to a creator is subject to what amounts to a fine
from Apple.

This wouldn’t be the first time Apple
has run into problems in China. Previously Apple
was ordered to shut
down the iBookstore and iTunes Movies
 in the country,
while Apple has also been forced
to accept
 the Chinese government’s demands that
it run network safety evaluations on all Apple products before
they can be imported into the country.

In addition, Apple’s products were booted
off the list of approved state purchases
, along with
other Western companies such as Cisco and Intel — in favor of
thousands of Chinese-made products. Most recently, Apple

ran into another hurdle in China
, with internet
regulators in the country reportedly calling on Apple to
“tighten its checks” on live streaming apps which appear in
the App Store.

The amount of money that Apple takes as a cut for offering
services has frequently been a bone of contention. For
in Australia
the rise of Apple Pay has been thwarted due
to banks quibbling with Apple about the percentage of
payments that it takes.

That’s one thing in a market like Australia, which represents
a relatively small business opportunity for Apple. In China —
which has overtaken the U.S. as
Apple’s biggest app market
, and for whose audience Tim
Cook says
Apple designs its products for
— there’s a much higher
probability things could blow up in Apple’s face.



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