By Eva Dou
BEIJING--China's influential state broadcaster on Friday called
a location-tracking function offered by Apple Inc.'s iPhone a
"national security concern," in the latest sign of a backlash in
the country against U.S. technology firms.
In its national noon broadcast, state-run China Central
Television criticized the "frequent locations" function in Apple's
iOS 7 mobile operating system, which tracks and records the time
and location of the owner's movements. The report quoted
researchers who said that those with access to that data could gain
knowledge of the broader situation in China or "even state
secrets."
Apple didn't respond to requests for comment.
The broadcast represents a potential challenge for the
Cupertino, Calif., company in an increasingly competitive market.
Apple holds a 6% share of China's smartphone market, according to
research firm Analysys, while models made by Samsung Electronics
Co. and others running Google Inc.'s Android mobile operating
system hold a greater share.
Still, Apple dominates the higher end of the market. About 80%
of smartphones priced at more than $500 in China are iPhones,
research firm Umeng said. IPhone users include Chinese government
officials and executives. Last year China's first lady, Peng
Liyuan, was photographed using an iPhone, though she has since been
seen sporting a smartphone made by China's ZTE Corp.
While CCTV's broadcasts don't necessarily reflect the views of
China's top leaders, they are influential in China. Some companies
have shifted policies or recalled products after critical CCTV
reports.
It isn't clear whether the CCTV report will be followed by new
rules or limits on Apple. But its reports have had an impact on the
company in the past. Last year Chief Executive Tim Cook publicly
apologized after the broadcaster accused the company of
discriminating against Chinese consumers in its warranty
policies.
U.S. technology companies have felt a chill in China since last
year, when former U.S. contractor Edward Snowden alleged the
National Security Agency was spying on Chinese leaders and that
U.S. tech firms were providing data to the government. Apple has
said it doesn't provide government agencies with direct access to
its servers.
The broadcast on Friday cited the Snowden disclosures and called
U.S. technology firms' databases a "gold mine." It also quoted
officials who said that China needed stronger data protection laws,
and that Apple would need to "take on any legal responsibilities"
if any data leaks cause harm.
The cybersecurity debate between Beijing and Washington has
heated up since May, after the U.S. charged five Chinese military
officers with spying.
Chinese state television raised security questions about
Microsoft Corp.'s Windows 8 operating system last month, after the
government procurement center said in May that it wouldn't allow
the purchase of new government computers if they ran Windows 8.
China, long Apple's manufacturing base, is an increasingly
important consumer market. In the most recent quarter, 24.8% of
Apple's global revenue came from greater China, which includes Hong
Kong and Taiwan, and sales have grown 13% in the region during the
past year.
China has long been uneasy about its heavy dependence on U.S.
technology in crucial sectors and has poured billions of dollars
into the development of its own technologies. Last year, the
state-run China Economic Weekly magazine, with the English headline
"He's Watching You," named eight U.S. companies--including
Apple--that it said pose a danger to China's computing
networks.
China's government has mentioned software, servers and high-end
chips as areas where it is trying to develop homegrown
alternatives. The China Academy of Sciences unveiled its own mobile
operating system, the China Operating System, in January, but
analysts say it stands little chance of becoming widely used in the
competitive mobile market.
Write to Eva Dou at eva.dou@wsj.com
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