Apple loves to hold a grudge


Gather ‘round while I put Apple Inc on the psychiatrist sofa. This company appears to constantly need a villain — some company to look down on from Apple’s moral high ground. What would Freud say about that?

In the early days of Apple, of course, the company’s Evil Empires were International Business Machines Corp (IBM) and Microsoft Corp, as encapsulated by two famous market- ing campaigns. (Yes, children, IBM did make personal computers once upon a time.) IBM and Microsoft were convenient foils. They were lumbering, vicious and uncool — the opposite of what Apple wanted to be.

Then early in this decade, Google became Apple’s villain. The two companies had collaborated closely on the Safari web browser and the original iPhone, but the good times ended when Steve Jobs believed Google’s Android operating system for smartphones ripped off the iPhone.

As my Bloomberg News colleague Brad Stone helped chronicle in 2010, Jobs told Apple employees during a meeting early that year: “Make no mistake: Google wants to kill the iPhone. We won’t let them.”

King of the Hill

Apple isn’t an underdog anymore; It’s the world’s most valuable public corporation.

As in Apple’s early history, the Google feud was about business, bruised feelings and pragmatism. Having an enemy helped energise Apple employees to keep slogging away in service of the Good Fight.

It was clear this week that Face- book Inc has become Apple’s new supervillain.

During its developer conference last Monday, Apple unveiled changes to its Safari web browser, which will now ask people for permission for the kind of tracking that Facebook does.

An Apple executive showed an image of the new feature with Face- book as the example of the digital-privacy compromises that Apple is trying to root out. (A Facebook executive countered that the Safari feature seems to hurt Google more than it might hurt his company.)

And in showing Apple’s new features to help people monitor and limit the time they spend on smartphones, Apple opted to show Facebook’s Instagram as the example of an app people might want to limit.

It all felt incredibly targeted at Facebook. Apple executives have been consistent over the years in bashing digital advertising companies including Google and Facebook, but the criticism feels even harsher now.

Apple’s beef with Facebook is odd. Unlike Apple’s past antagonists, Facebook is not a competitor.

Apple has little to gain financially or strategically if Facebook falls. If anything, the popularity of Face- book’s products has been a boon to Apple because the social network and the company’s other apps make iPhones more appealing.

Apple may truly believe that Facebook is bad for the world and that its quibble with the social network is philosophical rather than financial.

But Apple needs to be careful. It’s cool to bash other companies when you’re an underdog.

It’s not cool to punch down when you’re the most valuable public company in the world — on your way to the US$1 trillion (RM3.99 trillion) market cap milestone.

To be fair, it’s easy to claim the moral high ground against Facebook right now. But again, there’s a risk. When Apple said Facebook’s ad-dependent business model makes the company inherently hostile to consumers, I wonder about Apple’s own advertising-dependent riches.

Biting the Hand That Feeds You

Apple has criticised digital-advertising companies, but it generates billions of dollars each year from a deal that helps Google’s ad operation.

Apple collects an estimated US$3 billion to US$4 billion or more each year from Google in exchange for making its web-search tool the default option on Safari browsers. If Apple wants to be the moral authority on digital privacy, that position is under- mined by taking all those high-profit dollars to bolster Google’s ad machine.

The Wall Street Journal also reported recently that Apple hopes to expand its own digital-advertising business. Again, it will be a relative drop in the bucket compared to Apple’s revenue from selling hardware, and I’m sure Apple will say that it won’t do the aggressive personal-data collection and ad-targeting that Facebook and Google do.

Still, it’s tough for Apple to both bash digital-advertising companies and increasingly borrow from their business models.

I get why Apple likes to have a Lex Luthor to its Superman. Feeling superior is excellent motivation. But Apple’s creation of technology enemies is wearing thin with time and its growing riches. — Bloomberg

  • This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.