On August 6, 2020, Donald Trump signed a presidential executive order banning U.S. “transactions” with WeChat with an execution countdown of 45 days. Apple is the USA-based company that sells the iPhone. It is possible that a ban on WeChat dealings with America-based companies could result in an iPhone that cannot use the WeChat app worldwide. This could be a disaster for Apple.
WeChat is the latest major indicator of the power of services in our modern always-connected society. WeChat was developed and released by Tencent in the year 2011, and has since become one of the most downloaded, most used apps in the world. In China, WeChat (Weixin) is the most popular app, used by millions of Chinese citizens. It is possible that these millions of Chinese citizens will opt for Android devices if Apple is no longer allowed to include WeChat (Weixin) on the iPhone.
As of Tencent’s Q2, 2020 financial results report, WeChat had 1.2 billion active users worldwide. Per a report published to Bloomberg, an online survey run on Weibo asked whether users would rather keep WeChat or their iPhone. Of the roughly 1.2 million responses collected, 95% voted that they’d rather keep WeChat (and get a non-iPhone smartphone).
It’s difficult to overstate the importance of WeChat to the average Chinese citizen at the moment. Imagine if you had a smartphone that was not allowed to access Facebook, or Instagram, or Twitter, or any form of text or SMS messaging. That’s getting close to how large this impact would be on an iPhone in China.
As noted by analyst Ming-Chi Kuo, Apple could potentially see global iPhone shipments fall by 25-30% if WeChat is, indeed, banned from the iPhone altogether. The cut-off date for the executive order from Trump is September 20, 2020, that’d be several weeks before the next US Presidential election day, November 3, 2020.