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Opinion
Adam Minter

Apple Gets Greedy in China

It is taking a bigger gamble than it seems to realize.
Fuzzy thinking.

Fuzzy thinking.

Photographer: Brent Lewin/Bloomberg

Apple Inc. has long proved adept at negotiating China's notoriously challenging market, responding to fickle consumer tastes and unpredictable regulation far more adeptly than its competitors. But a recent decision to start taking a 30 percent commission on "tips" paid to artists and entertainers online threatens to undermine that savvy reputation -- and quite possibly Apple's long-term prospects in China.

Apple has been taking a cut from developers since it opened the App Store, of course. But this is something different. Tipping has become an essential part of China's digital economy, and Tencent Holdings Ltd. -- China's most valuable company and owner of WeChat, its most popular social media service -- has so far refused to give Apple a piece of it. The intensifying rivalry between two of the world's most powerful tech companies probably won't turn out well for Apple.