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Chinese regulators call for stricter supervision of Apple
Friday, March 29, 2013 @ 4:00am

Following a coordinated attack on trumped-up aspects of Apple's warranty policy in the country, China's State Administration for Industry and Commerce has called for tougher supervision of Apple's warranty service in the country, but was unable to specify any area or policy that the iPhone maker needs to change, nor explained what specifically needs to be done. For its part, Apple has repeatedly insisted that its policies meet or exceed Chinese law, and any adjustments to warranties in China are a result of local regulations.



The attack on Apple began on March 15 after a state-run TV channel claimed that Apple products in the US included a two-year warranty (which is not true) compared to one year in China. The show also charged that Apple was making repairs on damaged iPhones rather than than replacing them with new ones as it does in the US (replacement iPhones in the US are generally refurbished units, not "new") and finally that the company was fixing iPhones with used parts (denied by Apple, though per Chinese law it does keep the original backplate of the repaired iPhone on the unit unless that is the part that has been damaged, a practice it does not do in the US unless the backplate has been personalized). A celebrity attack that echoed the state-run station's charges that appear on the country's largest social network (Sina Weibo) backfired when it was discovered that the personalities had participated in an orchestrated attack and likely been paid to make disparaging remarks about Apple. The service was forced to scrub thousands of disparaging remarks attacking the state-run station over the affair. An independent business journal that posted a link to a newspaper report that called Apple "arrogant" in its warranty policies was also inundated with complaints about state-run industries and media rather than Apple. The iPhone maker, which has seen surging popularity in recent years and which now considers China its largest single-country customer, posted a statement on its website noting that its warranty policies are roughly the same worldwide, that its products are of much higher quality than local competitors, and that it actually exceeds Chinese requirements on warranties for repair work (Apple guarantees repairs for 90 days rather than the 30-day legal standard most other companies abide by). It said it takes charges of poor customer service "very seriously" but has otherwise not commented on the charges levelled by state-run media outlets and publications. The reasoning behind the attack is unclear, though the Chinese government has engaged in such campaigns before -- usually either to coerce a foreign corporation to spend more of its profits in China or due to a political desire to boost local industries (such as smartphone makers Huawei and ZTE, currently under investigation in the US) at the expense of foreign companies. It is also possible that the attacks are the result of state corruption and are influenced by Apple's rivals (either domestic or foreign) that wish to see its surging popularity watered down, or that the attacks are a bizarre form of retaliation for the suspicion by many in the US government that China's authorities are creating security risks in Huawei and ZTE's products. Thus far, the campaign does not appear to be working. The effect of the charges in the longer term, and their effect on Apple's relationship with China, remains to be seen.

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