"Listen, strange women lying in ponds distributing swords is no basis for a system of government. Supreme executive power derives from a mandate from the masses, not from some farcical aquatic ceremony. You can't expect to wield supreme executive power just because some watery tart threw a sword at you. If I went round saying I was an emperor just because some moistened bint had lobbed a scimitar at me, they'd put me away" :D
Sure, companies have to adapt to markets. But inserting code like this, buggy or not, is a cowardly act by Apple. They should be ashamed, and apologize.
I'm having a hard time understanding what is cowardly about complying with Chinese law when selling products inside China. There are many laws in the US I don't agree with, but I'm obligated to comply with them for as long as I choose to live here and remain a citizen. For example, its essentially US law that Apple's officers have a fiduciary responsibility to shareholder's best interests. Not participating in the Chinese cellular market over principle violates that principal of law. If you want Apple to be "brave" then persuade the US Congress to require that Apple not comply with repressive Chinese law; or convince Apple's shareholders to prohibit the same. Short of those outcomes Apple is doing precisely what its supposed to be doing.
> For example, its essentially US law that Apple's officers have a fiduciary responsibility to shareholder's best interests. Not participating in the Chinese cellular market over principle violates that principal of law.
Lynn Stout, the distinguished professor of corporate and business law at Cornell Law School, is the author of "The Shareholder Value Myth: How Putting Shareholders First Harms Investors, Corporations, and the Public."
Except that it is true that directors face lawsuits about breaches of fiduciary duty frequently enough for it to be not uncommon.
A suit was filed recently naming Eddy Cue for violating anti-trust law relating to the settlement for the e-books case brought by the federal government.
The problem is getting sued in itself is meaningless. PETA could sue Tyson Foods by arguing that selling meat is a longterm liability. They would lose badly and quickly.
> Apple is doing precisely what its supposed to be doing.
Such as aidding and abetting authoritarian foreign governments to suppress freedom of speech.
I'm having a hard time understanding why you are having a hard time understanding why this is cowardly, given that Apple is not particularly cowardly when it decided to stand up to US government surveillance.
That is such a simplistic view of things. Do you think they'd do it if there was another way? At that scale things are not that easy and you can't just break the law even if it feels "right" to you.
Most users are probably never subject to government intervention and they are still protected by the encryption from thiefs, evil ISPs and other bad actors. If Apple would pull out completely and get banned in the country they'd maybe have to switch to other companies that are not that privacy minded.
Well traditionally tech companies leave open gaps for the average Joe to do the law breaking themselves. If the concept of Taiwan is illegal then it would be a add-on available from other sources. Given how closed source and how rudimentary text input is to an OS I do not know how feasible this is for an IPhone.
A multinational corporation is not actually one thing. It's a distinct entity per country, that all pretends to be one global entity, but isn't.
Are you saying that Apple China—a Chinese corporation, Apple Corp.'s subsidiary—shouldn't be aiding and abetting its own (authoritarian) government?
Or are you saying that Apple Corp (a US company) should be attempting to compel Apple China to break Chinese law? (What do you think Apple China's response to this must, necessarily, be?)
Or are you saying that Apple China shouldn't exist?
I'm not sure there are any other alternatives than these, and none of them sound very sensible.
First of all, read your history and news. You don't have to go far, just go back a few years when the Chinese government were blocking the App Store. This isn't a law, this is literally just some arbitrary decision passed down in a piece of paper from the top.
Second of all, even if it is a statute, you don't respect the law in China, you respect the MAN. What's legal and what's not depends on not the independent judiciary, as there isn't one, but how well your relationship is with key government officials.
Thirdly, all these world-wide subsidiary are there mainly for tax and payroll. Apple China does not operate independently as it's wholely owned by Apple US. Also, I don't know if you are aware, this is likely the decision made directly by Tim Cook if you've seen his activity in China recently.
The solution is very easy, appeal to Trump and I'm sure his ilks will go to work. You may not like Trump, but the outcome surely will be infinitely better than compromising your own core values and customer's trust.
> What's legal and what's not depends on not the independent judiciary, as there isn't one, but how well your relationship is with key government officials.
Yes, so your first two paragraphs reduce to an argument over semantics. When I say "law in China", I mean "what you will be punished by the Chinese government for doing [whether for cronyist reasons or not]." It's "the law" in the Libertarian sense of "the whims of the people who can command people with guns to come shoot you without reproach."
> Thirdly, all these world-wide subsidiary are there mainly for tax and payroll. Apple China does not operate independently as it's wholely owned by Apple US.
Yes, that is how multinational corporations work in every other sense. That is not how multinational corporations work when it comes to interactions between the subsidiary and the subsidiary's government, because—and consider this carefully for a moment: the employees of the subsidiary corporation—including those operating its distribution logistics pipeline within China—are Chinese citizens.
Tim Cook can try telling these employees what to do, and in all other ways he'll succeed, but the Chinese government can override Tim Cook in this one way, because the people he's giving orders to here are Chinese, and are beholden to the Chinese government. They're not going to do something that's illegal for them personally to do, just because their boss tells them to. They'd just end up quitting, and the people who'd replace them would end up quitting, and so forth. And Tim Cook knows that, which is why he doesn't tell them to do things that the Chinese government would consider illegal.
Which includes, for those distribution-pipeline employees, distributing iOS devices that don't have Chinese-government-mandated modifications to the firmware. Those employees would be arrested for that. So Tim Cook orders his US employees to make the modifications to the firmware, such that those Chinese employees can then comply with the "law in China" when they distribute the phones. (Which is really to say, such that Apple retains Chinese employees at all.)
The only other choice he has (since "force your Chinese employees to get arrested" is not actually a workable strategy) is not distributing the phones in China in the first place.
Sure, he can try to get the "law in China" changed. Every corporation is always lobbying in every market they're in. But it doesn't usually work; if it did, we'd be living in a far more dystopian-corporatist world than we already do. ;)
Apple is in a position of strength in the USA and a position of weakness in China. Apple could choose to die on this hill, and all it would accomplish would be to deprive Chinese consumers of the strongest privacy-protecting mobile phone choice.
Things would be different if Apple were found to be shipping firmware-level spyware like Huawei and ZTE phones. But for flag emoji? Who cares? That's an easy trade.
> Apple could choose to die on this hill, and all it would accomplish would be to deprive Chinese consumers of the strongest privacy-protecting mobile phone choice
You are clearly drugged out of your mind by Apple's marketing machine. Who exactly uses iMessage in China? Everybody uses Wechat. Are you telling me iOS can protect Chinese users' privacy when the traffic go through their servers?
Also, Apple wouldn't die, no alone anyway. Foxconn and Apple would likely both die together. There's nothing scarier than 1000s of 1000s of laid off workers for the CCP.
> But for flag emoji? Who cares? That's an easy trade.
This is an extremely dangerous line of thought. Today you give them an inch, tomorrow they'll ask for a foot. It is exactly this kind of kautouing the West has given China in the past 20 years that led to its progressive erosion of universal values and leverage to safeguard those values across the world. When it comes to principles, espcially core values of a company, you don't compromise.
You're essentially asking Apple to adjust how they deal in China, potentially losing a market and manufacturing center, because in your opinion, China should acknowledge Taiwan's sovereignty. Not everyone agrees with that.
> Today you give them an inch, tomorrow they'll ask for a foot. It is exactly this kind of kautouing the West has given China in the past 20 years that led to its progressive erosion of universal values and leverage to safeguard those values across the world. When it comes to principles, espcially core values of a company, you
This is just absurd. It is not Apple's responsibility to represent the West nor do they actually represent the west. And I do not want them to represent the west.
They spoke out because legally they were allowed to do so. Our government is founded on things like this. We have courts and representatives that we ultimately control.
It had nothing to do with "power" or positions of strength. They simply acted in the political environment they were in. Surprise surprise it's different in China.
> Such as aidding and abetting authoritarian foreign governments to suppress freedom of speech.
Over half of all countries have few to no protections on freedom of speech. Is your premise that Apple should only sell its products in about four dozen countries? If we wanted to be really strict about it, only a few nations have strong protections on freedom of speech.
You are aware of just how bad the individual liberty protections are in the bottom 100+ countries, right? Freedom of speech protections are rare, and it's even more rare for them to be regularly enforced.
Major countries as diverse as Turkey, Singapore, Thailand, China, Russia, Venezuela, Sudan, Libya, Iran, Iraq, Saudi Arabia - have no or very little freedom of speech. The bottom 40-50 nations on human rights barely have any actively enforced rights protections at all.
Speaking of naivety, if selling to Chinese customers is the most important thing Apple has to worry about, banning Apple products would incense Chinese users. It's the lost of their manufacturing capabilities that's of concern.
And no, I think Apple should sell to as many countries as possible, but not at a cost of compromising integrity and universal value. Apple should sell their products INTACT across the world.
As a regular Chinese citizen, freedom of speech is at the bottom of list of things I care about, and I would happily sell that for profit if it is sell-able.
I lived in US for quite some time and travel to US regularly. But seriously, I feel much less safe or comfortable when I am in US, and a lot of things Americans care so much about doesn't mean anything
Wow, I would've never thought that being raised in a decades-old dictatorship could effect one's world view...
Also, makes you wonder if China's censorship might play any role in this lack of interest in discussing things...
Heck, maybe they're not so stupid these Chinese rulers! But of course that's only for the best interest of the Chinese citizens, right, dear Chinese citizen?
Those countries might be diverse, but they accidentally happen to be all authoritarian or authoritarian-leaning countries...
And yes it would be right in general to avoid doing business with authoritarian countries.
Of course it ought to be a country-wide policy, but even if it's not it's still more ethical for a company to do so.
The "theory" that trade fosters democracy has been tested for long enough.
> Is your premise that Apple should only sell its products in about four dozen countries?
I think that public disagreement consistent with their principles regardless of region would be appropriate. I don't think many are asking them to not sell or not abide by the law, just that their pinciples ring hollow if they only voice them against certain governments.
The courts don't review normal business judgements. Even when there is a fiduciary duty. If that wasn't true then no one would want to risk being a officer because they would be constantly getting sued by upset shareholders.
> The courts will defer to erroneous business judgments, provided that the officers or directors did not show gross negligence in their review and decision-making process. Without this rule in place, many individuals would be unwilling to serve as officers and directors and business people might be reluctant to take commercial risks that could benefit a corporation in the long run.
> I'm having a hard time understanding what is cowardly about complying with Chinese law when selling products inside China. There are many laws in the US I don't agree with, but I'm obligated to comply with them for as long as I choose to live here and remain a citizen.
That you draw such equivalence may be why you have a hard time understanding.
Not quietly and without disagreement, no. And not a ban on an image of a flag or name of a disputed country, no. These equivalences are getting ridiculous and I'm beginning to believe the only justification for constantly bringing them up is to distract from the issue at hand.
but they are champion of privacy or something like that. And google who walked out of China because they refused to bend to their rules are the bad guys.
Just having a point is not good enough. It needs to make some sense.
China Hing Kong and China Mainland was always a separate entity.
China Hong Kong Google site still remains blocked in China mainland (last I checked), because Google refuses to comply with China laws regarding privacy.
Google has other business interest that doesn't require direct access to customer data and products that can be only developed for Chinese consumers.
Google remains the only major company in the world that I know of that refused to do business with China over privacy concern.
So your argument is that Google values privacy, so it doesn’t operate in China. But if it were to operate in China, it has to obey Chinese laws. Agree or disagree?
As for the first part, explain to me how Google values privacy when it circumvented Safari’s built in privacy protection and was fined for it. So how does your argument make sense?
Edit: You completely changed your original comment I replied to. That put my comment out of context. That's a very douchy move, esp you didn't mention that you changed your comment.
BTW, here’s a bonus question. Explain how the “champion of privacy that doesn’t operate in China” collects Android users’ locations even when location services are disabled. The practice was stopped only when they got caught, and this only happened last year.
I copy-pasted the wrong reply to the window, and corrected it while you were formulating your reply. There’s no way to edit a comment once it has been replied to, so there’s no way for me to put an edit reason. But thanks for the ad hominen attack.
It's not exclusively defined as living in California, but if you live in California and have an LLC, it almost certainly requires registration in the state:
For taxable years beginning on or after 1/1/2011, a taxpayer is doing business in California if it actively engages in any transaction for the purpose of financial or pecuniary gain or profit in California or if any of the following conditions are satisfied:
> The taxpayer is organized or commercially domiciled in California.
> Sales, as defined in subdivision (e) or (f) of R&TC 25120, of the taxpayer in California, including sales by the taxpayer’s agents and independent contractors, exceed the lesser of $500,000 [1] or 25 percent of the taxpayer's total sales.
> Real and tangible personal property of the taxpayer in California exceed the lesser of $50,000[1] or 25 percent of the taxpayer's total real and tangible personal property.
> The amount paid in California by the taxpayer for compensation, as defined in subdivision (c) of R&TC 25120, exceeds the lesser of $50,000[1] or 25 percent of the total compensation paid by the taxpayer.
> For the conditions above, the sales, property, and payroll of the taxpayer include the taxpayer's pro rata or distributive share of pass-through entities. "Pass-through entities" means partnerships, LLCs treated as partnerships, or S corporations.
So if your 'HQ' is in California, if 25% of your sales are in California, if more than 25% of your property is in California, or if more than 25% of the total compensation you pay is in California, you need a California LLC.
Normally I’m pro simple answers but I think this answer over simplifies a bit too far. When it comes to allocating state revenue just having a presence in a state doesn’t mean as much as “where services are performed” or products sold. It’s a heck of a dance dealing with these issues some tax time.
First, this kind of post will get you banned from HN if you do it repeatedly, so please don't.
Second, would you please not use HN for political or ideological battle? You appear to have been doing that repeatedly and it's not what this site is for.
The top level comment I replied to went on the political discourse and I just carried on from there. Did he get a warning as well?
Personally I'd be happy to have less political HN. But as long as there're top level political comments.. It's too hard to resist :) I believe mods could easily mega-downvote such comments. Yet particular comment I replied to seem to be upvoted?
As for my later comment, are jokes not allowed on HN anymore? I got grammar-nazi'd, I replied back with a matching joke.
This stood out to me, too. On the one hand, hearing him say it is a little unnerving. On the other, it's oddly comforting to know that he truly believes we're in a race against the clock to save civilization, and that someone like him is doing everything they can to prevent the end of it (at least on the environmental front; he's probably nervous about other dangers, too, that he'd have less control over, e.g. geopolitics).
Seeing that reaction from him helps explain in my mind how he's been able to accomplish as much as he has. It really feels like he's a man on a mission and that he's going to run through walls to accomplish it.
Other comments have compared him to a politician. I think that's laughable. He has a consistent track record of 'doing.' Politicians have not earned that reputation.
$10B? That's awfully large, and closing the door on a lot of ideas. What if you just want to solve an important problem by selling a product profitably and don't want to grow to enormous size? I guess you look somewhere other than Y Combinator to get started.
The point of the lower limit on the value of the company is not based on what might turn out to be a 1 billion dollar company. There are many more ideas in hardware than there are in software, purely based upon how accessible it seems. If you are solving anything close to an important problem, you will eventually reach a $10B valuation. A software company can grow to a reasonable size that is nowhere close, but hardware companies don't follow the same path.
Solving a problem with hardware either solves a problem or replaces the thing that fixed the problem before. Solving a problem with software is usually (if not always) making computers better or easier to use. The underlying difference is how clear the change is in the user's life.
The much larger cost to develop and produce hardware like some in the comments have been discussing leads us to value hardware much more significantly than software. It might be due to iTunes, Java, and Windows update making people mad when they waste their time, or have their computer shut down on them in the middle of their work, but there is a significant bias.
it doesn't really close the door on most ideas in the sense that everybody realizes that the likelihood of being a $10B is quite small. But if it is literally zero, then this company may not be the right fit for YC. I would say if you think the likelihood of your company being worth $10b is zero, you should carefully think about why you think you need venture money in the first place.
Plenty of funds would be happy with exits in the $100M range. The billion dollar exits or IPOs are the exception, not the rule and a $50M exit is a damn sight better than a failure. Of course it all depends on when they joined that particular party, the later in the game the higher the exit would have to be to make those investors happy.
Certainly they would pop a bottle for that 100m exit when it happens, but at the funding stage there is a case to be made for chasing deals in markets large enough that a 10B exit is at least possible. Because 10B might happen and that does a lot to the EV calculations. Even if it doesn't, some might think that startup has a better chance for reaching the 100M mark sooner.
Of course is $50M exit a lot better than a failure.
My point was: if $50M is your maximum potential - if everything goes perfect - it'd be pretty hard to get some interest from VCs.
For their math to work out, they need at least the potential for an exit a few orders of magnitude more than their investment. If VC rounds start at $1M, a max potential of $50M will not be taken into consideration so easily ?
