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Wall Street Breakfast: First U.S.-China Trade Talks Since July Seeking Alpha
A protester in Hong Kong checks his phone for police activity during a protest against the government in Hong Kong's New Territories, in August. Aidan Marzo/SOPA Images/LightRocket via Getty Images hide caption
Apple has removed from its App Store a smartphone app used by Hong Kong pro-democracy activists to crowdsource the location of protesters and police, after Chinese state media suggested the tech giant was aiding "rioters."
Apple initially rejected the app last week, saying that it "encourages an activity that is not legal," and allows users to "evade law enforcement," according to its developers.
"Your app contains content - or facilitates, enables, and encourages an activity - that is not legal ... Specifically, the app allowed users to evade law enforcement."@Apple assume our user are lawbreakers and therefore evading law enforcement, which is clearly not the case.
— HKmap.live 全港抗爭即時地圖 (@hkmaplive) October 1, 2019
Nonetheless, HKmap.live did briefly become available in the App Store before Apple announced Wednesday that it was being removed.
"We have learned that an app, HKmap.live, has been used in ways that endanger law enforcement and residents in Hong Kong," Apple said in a statement. "Many concerned customers in Hong Kong have contacted us about this app and we immediately began investigating it."
The app, it said, "has been used to target and ambush police, threaten public safety, and criminals have used it to victimize residents in areas where they know there is no law enforcement."
HKmap.live reportedly consolidates reports from social media and then uses the information to plot the locations of protests and such information as where police are using tear gas.
The protesters have staged months of protests in the former British colony, demanding universal suffrage and the right to choose Hong Kong's leadership. The level of violence has grown in recent weeks, with protesters wrecking store fronts and hurling gasoline bombs. Police have responded with tear gas, batons and, in some cases, live ammunition.
On Wednesday, an editorial that appeared in China's official People's Daily called out developers of HKmap.live for providing a "'navigation service' for the rioters."
"Apple chose to approve the app in the App Store in Hong Kong at this point," the editorial said. "Does this mean Apple intended to be an accomplice to the rioters?"
"[P]eople have reason to assume that Apple is mixing business with politics, and even illegal acts," it said. "Apple has to think about the consequences of its unwise and reckless decision."
Responding to Apple's decision to withdraw the app, its developers, who have not identified themselves because of security concerns, responded in a series of tweets on Thursday, reports The South China Morning Post, a Hong Kong-based English-language daily.
"We once believed the App rejection [was] simply a bureaucratic f up but now it is clearly a political decision to suppress freedom and human rights in Hong Kong," the developers said, according to the Post.
Although HKmap.live has been removed from Apple's App Store, it remains available on an independent website.
The Hong Kong unrest is a sensitive issue in Beijing and anyone seen as showing sympathy or support for the protesters has come in for sharp criticism.
Earlier this week, Houston Rockets General Manager Daryl Morey touched off a heated controversy by tweeting support for the Hong Kong protesters.
Although he quickly deleted the tweet and expressed contrition, that didn't stop the Chinese Basketball Association from suspending its business dealings with the Rockets. Tencent, a Chinese media partner with the NBA in China, also ended a streaming deal worth $1.5 billion and China's state television said it would stop airing Rockets games.
Apple's complex relationship with China has made the headlines again. Just a day after Chinese state media criticized the company for allowing HKmap in its App Store -- and a week after Apple flip flopped on its initial decision to delist the app -- the crowdsourced map app has been removed, again sparking concerns that Apple is pandering to China's political regime.
The app, which shares information on the location of pro-democracy protests and police activity in Hong Kong, was slammed by China Daily -- owned by the Communist Party of China -- for enabling "rioters in Hong Kong to go on violent acts," adding that Apple has to "think about the consequences of its unwise and reckless decision."
HKmap's creators, however, say that there is no evidence that the app has been used to target police or threaten public safety. They added that apps such as Waze, which use crowdsourced information to help users avoid traffic cameras and police, are still permitted on the App Store, and noted that they are sure there have been occasions where criminal activity has been discussed and encouraged on platforms such as Facebook, Instagram and Twitter. HKmap is still available on desktop.
Critics say that Apple's decision to remove the app is just another example of the company kowtowing to the economically influential country. Two years ago Apple pulled all the VPN apps from its App Store in China, while more recently it removed the Taiwan flag emoji from the iOS keyboards of users in Hong Kong, in a move many claim was designed to appease Apple's third biggest market.
With trade talks between the United States and China resuming this week, the US appears to have made some concessions that could help reduce tensions between the world's top two economies.
The New York Times newspaper reported that the US was considering issuing licences to American companies allowing them to supply non-sensitive components to Chinese telecoms giant Huawei. In May, US President Donald Trump had proposed to ban Huawei from buying parts and technology from US suppliers citing national security concerns.
But the paper, citing unidentified sources, says Trump gave the green light in early October for the issuance of licences to US companies to supply Huawei with some equipment.
The top negotiators from the two sides are set to meet on Thursday for the first time since late July to try to find a way out of a 15-month trade war that has forced companies to alter supply chains and been a drag on the global economy.
China is urging the US to stop what it described as unreasonable pressure on Chinese companies, including Huawei, foreign ministry spokesperson Geng Shuang said at a news briefing in Beijing ahead of the talks.
Separately, the US is also considering a currency pact with China as part of a partial trade deal, the Bloomberg news agency reported, also quoting unidentified sources.
Tariffs that are due to increase next week could also be suspended as part of this deal, it reported.
The currency accord was something the US said had been agreed to earlier in the year before trade talks broke down. It is meant to be followed by further negotiations on core issues such as intellectual property and forced technology transfers, Bloomberg reported.
Chinese Vice Premier Liu He is scheduled to lead the Chinese delegation in trade talks with US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin on Thursday and Friday in Washington, DC.
But just hours earlier, the upcoming talks were reportedly cut short by a day as lower-level discussions had failed to come to an agreement on key issues, unnamed sources told the South China Morning Post (SCMP).
One of the stumbling blocks was the issue of forced technology transfers, which the Chinese delegation refused to broach, SCMP reported.
The discussions concerning an interim deal come after the Trump administration this week further ramped up pressure on Beijing by blacklisting Chinese technology firms over their alleged role in oppression in the far west region of Xinjiang. The US also placed visa bans on officials linked to the mass detention of Muslims from the region.
At the same time, a fight over free speech between China and the US National Basketball Association (NBA), triggered by a tweet by the Houston Rockets general manager backing Hong Kong’s protesters, has underscored the tensions.
Meanwhile, US Secretary of Commerce Wilbur Ross said on Thursday that tariffs on Chinese goods and services are working as they are forcing China to pay attention to US concerns.
Ross said the US would have preferred not to implement tariffs against Chinese goods more than a year ago, which ignited a trade war that slowed global commerce and threatened decades-old systems, but added that it has forced Beijing into action.
"We do not love tariffs, in fact, we would prefer not to use them, but after years of discussions and no action, tariffs are finally forcing China to pay attention to our concerns," Ross said in a speech while on an official visit to Australia.
Without a significant breakthrough, Trump is set to raise the tariff rate on $250bn worth of Chinese goods by an extra five percent to 30 percent next Tuesday.
Further tariffs are scheduled to come into effect on December 15.
On Wednesday, a Chinese official said that the country was still open to reaching a partial trade deal with the US that may include large purchases of US commodities, but added that success was contingent on Trump halting further tariffs.
Ross added that the US was "not opposed" to trade with China but said that China's trade practices have "gotten worse" and that the country needed to abide by global trade regulations.
Less than a day after Apple was criticized by Chinese state media for allowing HKmap in the App Store, the crowdsourced map app said it had been delisted. Its removal comes less than a week after Apple reversed its initial decision to reject the app, which provides information about the location of pro-democracy demonstrations, street closures and police activity (its website is still available).
After Apple allowed HKmap into the App Store, an article in the China Daily, a newspaper owned by the Communist Party of China, criticized the company, claiming that it enabled “rioters in Hong Kong to go on violent acts,” and adding that “Business is business, and politics is politics…Apple has to think about the consequences of its unwise and reckless decision.”
While the Chinese government has labeled protestors as violent, including through coordinated campaigns on social media, human rights groups like Amnesty International have documented multiple instances of police abuse against protestors.
HKmap’s creators tweeted that Apple claimed it endangered law enforcement and residents, and said they disagreed.
1. We disagree @Apple and @hkpoliceforce ‘s claim that HKmap App endanger law enforcement and residents in Hong Kong.#HKmap #HKmaplive #HK #Censorship
— HKmap.live 全港抗爭即時地圖 (@hkmaplive) October 10, 2019
Update: Since publishing this article, Apple has provided a statement directly to TechCrunch confirming endangerment of police and residents of Hong Kong as two reasons for removing the app:
“We created the App Store to be a safe and trusted place to discover apps. We have learned that an app, HKmap.live, has been used in ways that endanger law enforcement and residents in Hong Kong. Many concerned customers in Hong Kong have contacted us about this app and we immediately began investigating it,” a spokesperson said in a written statement. “The app displays police locations and we have verified with the Hong Kong Cybersecurity and Technology Crime Bureau that the app has been used to target and ambush police, threaten public safety, and criminals have used it to victimize residents in areas where they know there is no law enforcement. This app violates our guidelines and local laws, and we have removed it from the App Store.”
The app’s developers question this reasoning, however, in their response: “There is 0 evidence to support CSTCB’s [the Hong Kong Police Force’s Cyber Security and Technology Crime Bureau] accusation that HKmap App has been used to target and ambush police, threaten public safety, and criminals have used it to victimize residents in areas where they know there is no law enforcement,” it said, adding that other apps containing crowdsourced information and public postings, including Waze, which is used by commuters to avoid traffic cameras and police, are still allowed on the App Store.
“The quoted Apple’s App Store Review Guideline is vague, does that include user-generated contents? We are sure there are contents ‘solicit, promote, or encourage criminal activity in Facebook, Instagram, Safari, Telegram, Twitter, Waze, Whatsapp, etc. at some point in time,” wrote HKmap’s developers.
Pro-democracy demonstrations began in March to protest a now-withdrawn bill that would have allowed extradition to mainland China, but have grown to encompass additional demands that center on Hong Kong’s ability to safeguard rights, including freedom of press and speech, under the “one country, two systems” policy that has been in place since it was returned from British rule to China in 1997.
This is the latest in several decisions made by Apple that have concerned pro-democracy observers and appear designed to appease the government of China, its third-biggest market by sales. Two years ago, it removed VPN apps from its App Store in China and within the last week has removed the Taiwan flag emoji from the iOS keyboard in Hong Kong and the app version of Quartz from the Hong Kong App Store, reportedly because of its protest coverage.
Updated with response from Apple.
BEIJING (AP) — Apple removed a smartphone app that allows Hong Kong activists to report police movements from its online store Thursday after an official Chinese newspaper accused the company of facilitating illegal behavior.
Apple Inc. became the latest company to come under pressure to take Beijing’s side against anti-government protesters when the Communist Party newspaper People’s Daily said Wednesday the HKmap.live app “facilitates illegal behavior.” The newspaper asked, “Is Apple guiding Hong Kong thugs?”
Apple said in a statement that HKmap.live was removed because it “has been used to target and ambush police” and “threaten public safety.” It said that violated local law and Apple guidelines.
HKmap.live allows users to report police locations, use of tear gas and other details that are added to a regularly updated map. Another version is available for smartphones that use the Android operating system.
“We have verified with the Hong Kong Cybersecurity and Technology Crime Bureau that the app has been used to target and ambush police, threaten public safety, and criminals have used it to victimize residents in areas where they know there is no law enforcement,” said the Apple statement. “This app violates our guidelines and local laws, and we have removed it from the App Store.”
The Hong Kong demonstrations began over a proposed extradition law and expanded to include other grievances and demands for greater democracy.
Activists complain Beijing and Hong Kong leaders are eroding the autonomy and Western-style civil liberties promised to the former British colony when it returned to China in 1997.
Criticism of Apple followed government attacks starting last weekend on the National Basketball Association over a comment by the general manager of the Houston Rockets in support of the protesters. China’s state TV has canceled broadcasts of NBA games.
People’s Daily warned Apple might hurt its reputation with Chinese consumers.
“Apple needs to think deeply,” the newspaper said.
Brands targeted in the past by Beijing have been subjected to campaigns by the entirely state-controlled press to drive away consumers or disrupt investigations by tax authorities and other regulators.
China has long been critical to Apple’s business.
The mainland is Apple’s second-biggest market after the United States but CEO Tim Cook says it eventually will become No. 1.
Apple, headquartered in Cupertino, California, also is an important asset for China.
Most of its iPhones and tablet computers are assembled in Chinese factories that employ hundreds of thousands of people. Chinese vendors supply components for Mac Pro computers that are assembled in Texas.
AT&T Inc. has agreed to sell its Puerto Rican and U.S. Virgin Islands businesses to Liberty Latin America Ltd. for $1.95 billion in cash, allowing the telecommunications giant to shave its debt load and move closer to repurchasing shares.
AT&T’s operation in Puerto Rico provides cellular, landline and internet connections. It had 1.1 million wireless subscribers. As part of the deal, about 1,300 AT&T employees will be transferred to Liberty Latin America.
The two companies said they expect the deal to close within six to nine months. The Wall Street Journal earlier Wednesday reported the companies had agreed to a deal.
Puerto Rico accounts for a small sliver of AT&T’s domestic operations, but shedding the unit will help it work down a large debt load accumulated through its $80 billion-plus acquisition of Time Warner last year.
The deal signals progress on AT&T’s goal of selling noncore assets, something activist investor Elliott Management Corp., which recently disclosed a stake in the company, is also pushing. AT&T has also sold its stake in streaming service Hulu.
On Wednesday, AT&T said the deal brings to more than $11 billion the amount of money it will have raised from asset sales this year. The company said its expects to return to repurchasing shares in the fourth quarter, along with debt reduction.
Liberty is already the biggest pay-TV and broadband provider on the island. Cable tycoon John Malone, who holds a 25.5% voting stake in Liberty Latin America, and Liberty Latin America CEO Balan Nair have told investors they would like to expand in the region through disciplined mergers and acquisitions.
Liberty plans to finance the cash deal in large part by raising debt against the combined Puerto Rican operation, one person familiar with the matter said.
AT&T originally entered Puerto Rico in 2009 after it acquired Centennial Communications Corp., a rural telecom company with a large share of revenue from the island, for under $1 billion.
The complexity of the Puerto Rican unit slowed negotiations. Thousands of residents of the commonwealth spend several months out of the year on the U.S. mainland, for example, which made difficult the job of counting subscribers, according to another person familiar with the matter. The island also was heavily damaged in 2017 by Hurricane Maria.
Liberty Latin America is a publicly traded telecom and cable provider that operates in Chile, Puerto Rico, the Caribbean and other countries in Latin America. The company spun out last year from Liberty Global, the international cable operator headed by Mr. Malone. The Latin America operator currently has a market value of about $3 billion.
Write to Shalini Ramachandran at shalini.ramachandran@wsj.com and Drew FitzGerald at andrew.fitzgerald@wsj.com
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