The evolution and success of Apple products in the future will likely hinge on how deep their commitment to privacy is, and whether they’ll have the ability to meet features and levels of personalization their competition is slinging. As such, two recent articles from The Wall Street Journal highlight both these challenges.
First up is Robert McMillan’s piece on Apple’s expansion of “cutting edge” privacy methodologies. We first heard about this shift at last year’s World Wide Developers Conference (WWDC), the annual development get-together Apple hosts on the west coast. Essentially, Apple is investing serious resources into, and anchoring product integrity around what the industry calls differential privacy.
Two years ago, researchers at the Massachusetts Institute of Technology discovered shoppers could be identified by linking social-media accounts to anonymous credit-card records and bits of secondary information, such as the location or timing of purchases.
”I don’t think people are aware of how easy it is getting to de-anonymize data,” said Ishaan Nerurkar, whose startup LeapYear Technologies Inc. sells software for leveraging machine learning while using differential privacy to keep user data anonymous.
Differentially private algorithms blur the data being analyzed by adding a measurable amount of statistical noise. This could be done, for example, by swapping out one question (have you ever committed a violent crime?) with a question that has a statistically known response rate (were you born in February?). Someone trying to find links in the data would never be sure which question a particular person was asked. That lets researchers analyze sensitive data such as medical records without being able to tie the data back to specific people.
Whether the expansion of this methodology will be successful, or prove a hindrance for Apple, is yet to be seen. The establishment media is casting it as a do-or-die juncture in Apple’s commitment to artificial intelligence and machine-learning initiatives. And while other companies are starting to pursue differential privacy, it is a hindrance to core products many of them have, so it’s really only being applied to photo applications and not advertising platforms, for instance.
But no matter how much Apple invests in ways to further its hardware and software services while ringing the privacy bell, it still is beholden to governments. And so: enter China.
Apple has been pressing hard into China over the last several years. As of 2017, it is Apple’s third largest market behind the US and Europe, but has started to slide due (likely) to the increasing competition in the country. According to The Wall Street Journal (again!), Apple has recently buckled under governmental pressure, and will be complying with China to store all cloud data for Chinese customers with a government-owned company.
Apple said it made the latest change to comply with China’s new rules on data storage and cloud-services operation that went into effect June 1 as part of sweeping new regulations aimed at improving cybersecurity. It also said the new data center would improve speed and reliability for customers in China.
The Silicon Valley company has been one of the technology industry’s strongest advocates for fending off government incursions into user data. In a statement, Apple said it has “strong data privacy and security protections in place and no backdoors will be created into any of our systems.”
The latest move comes as Apple has been facing increasing regulatory headwinds in China. Last year, for example, its online book and movie services was shut down by authorities, who didn’t give specific reasons for the closing.
These kinds of things are bound to happen. Apple has also had to recently navigate opening retail stores in India, as the government there had restricted companies with “cutting edge technology” to perform sales without first sourcing some percentage of components locally. This Indian law has apparently pushed sales in that country further back still.
As we see Apple continue to press forward on its hardware, software, and integration fronts, the challenge of maintaining privacy will be tested. They are one of the few, if only, major technology companies left with such goals — time will tell if they can pull it off, or if customer interest cares at all.
Update: Aug 13, 2017.
Thoughtful piece by economist Tyler Cowen on this ordeal over at Bloomberg: Don't Be Too Hard on Apple for Bending to China.
Apple is still doing plenty to help Chinese citizens counter their censors. It sells chat and messenging apps in China that allow for encryption. Apple iPhones and iPads, bought in the U.S., bypass Chinese censorship altogether when they use the 4G network (not Wi-Fi); presumably some Chinese citizens have bought these products and use them. Perhaps most important, VPN apps are still available in China through other means, or overseas, and Chinese citizens can download them and combine them with Apple products to help bypass censorship. Apple has hardly backed away from its mission of tying the world together.