Overview
Apple recently opened a new megastore in Sanlitun, an upscale shopping district in Beijing, China. The store replaces the existing Apple flagship in that same location and is significantly larger, more than doubling its size compared to the previous one (opened in 2008). TechCrunch
The opening came at a time when the company was being publicly criticized by U.S. Attorney General William Barr for what he claimed was Apple’s compliance with Chinese government demands—specifically, Barr accused Apple of being “acquiescent to the Chinese Communists,” citing issues like removing apps under Chinese regulation. TechCrunch
Key Details & Implications
- Why Sanlitun?
- It’s one of the most fashionable and visible retail districts in Beijing. The remake of a flagship in such a location signals Apple’s continued confidence in its premium branding among Chinese consumers. TechCrunch+1
- The new store includes Apple’s first integrated solar array in a retail store in China, aligning with Apple’s global push for renewable energy usage. TechCrunch
- The Criticism from Barr
- Barr’s speech noted that Apple and other tech companies often pull apps or comply with censorious demands from the Chinese government. He implied that Apple’s behavior was compromising U.S. values or standards to maintain its operations in China. TechCrunch
- The criticism comes amid increasing tensions between the U.S. and China over trade, data privacy, sovereignty, and influence in tech, making Apple’s China strategy more politically visible.
- Business Context in China
- Despite the scrutiny, China remains a major market for Apple: both for manufacturing (supply chain) and for sales/services (App Store, iPhone, etc.). TechCrunch+1
- However, Apple’s market share in China has faced challenges from local competitors like Huawei and others. According to Counterpoint Research, Apple was around 5th in total smartphone shipments in China at some point, with about 10% of the market. TechCrunch
- Strategy & Messaging
- Building a larger flagship store in a high-footprint location sends a message: of resilience, of scale, and of commitment to customers in China, even as regulatory or geopolitical pressures grow.
- The solar array is also symbolic—it strengthens Apple’s environmental credentials, which may matter both for Chinese regulatory scrutiny and public perception.
Potential Risks & Trade-offs
- Apple’s visibility in China also means more exposure to regulatory risk: demands from the Chinese government about content, privacy, app availability, or data storage could conflict with U.S. expectations or its own corporate policies.
- Being called out by U.S. political leaders (like Barr) could also create liability or reputational damage, especially among consumers or governments concerned about human rights, censorship, or free expression.
- The cost of a megastore (real estate, construction, staffing, operations) is large; such investments pay off only if sales and foot traffic are strong, and if the store helps bolster broader brand loyalty / services revenue.
Conclusion
The opening of Apple’s mega-flagship in Sanlitun is more than just a retail expansion—it’s a strategic, political, and symbolic move. It demonstrates Apple balancing profitability, brand presence, and regulatory risk. While Apple faces criticism from the U.S. side (Barr’s comments), it appears to be doubling down in China—not withdrawing. Whether this strategy will pay off long-term depends on how well Apple manages the regulatory, political, and market headwinds on both sides.
References
- Liao, Rita. “Apple opens another megastore in China amid William Barr criticism.” TechCrunch, July 17, 2020. TechCrunch
- “Apple opens another megastore in China amid William Barr criticism.” TECHx Media. TECHx Media
- “Apple has long relied on China … generating revenues … local smartphone makers such as Huawei … chipping away …” Counterpoint Research details via TechCrunch. TechCrunch+1
