The Prof G Pod with Scott Galloway
China Decode: Apple Doubles Down on China as Trump Blinks
24 Mar 2026
Transcript generated automatically by AI and may contain errors.
Chapter 1: What is the main topic discussed in this episode?
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Tim Cook is in China at the moment. He's been opening a big store. And previous to that, he was at the China Development Forum in Beijing. And there he was using some mollifying language. He said, we are committed to collaborating with our partners across China and with all of you to make this vision of progress at Apple a reality.
It didn't really seem to address the issue head on, but I think it was supposed to mollify opinion in China that is turning against Apple to some degree. So to me, what is happening to Apple in China is that it's being pressured by the Chinese government to make commercial concessions. And it's already made one, but China wants more.
Welcome to China Decode. I'm Alice Han.
And I'm James King.
In today's episode of China Decode, we're discussing how Tim Cook's China visit highlights Apple's reliance on iPhone sales in the mainland, why Trump's Beijing summit delay exposes the broader context of US-China competition in the Iran conflict, and how China's museum boom is reshaping its culture.
Now, that's all coming up, but first, let's do a quick check-in with how the Chinese markets are starting the week. On Monday, both the Shanghai A share index and the Hang Seng H share index closed down nearly 4% as investors scrambled to adapt to the possibility of tighter monetary policy.
This was the worst day for the Hang Seng since the Liberation Day tariff announcement, no doubt affected by the Iran crisis. Precious metals company Laopu Gold and Zijin Mining Group fell more than 5% after the price of gold tumbled.
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Chapter 2: Why is Apple increasing its commitment to China?
And tech giants Alibaba and Tencent both ended the day in the red. Before we go to the episode, a quick announcement. China Decode now has a weekly newsletter. We go beyond the topics we cover here on the podcast and give you even more data and analysis on the most important stories coming out of China this week. Subscribe at chinadecode.profgmedia.com.
It's free for now, so be sure you get subscribed soon. That's chinadecode.profgmedia.com. All right, let's get into it. Last week, Tim Cook was in Chengdu, China for a high-profile Apple Store event marking the company's 50th anniversary. His visit underscored how crucial China remains for Apple, even as the US-China tensions rise and regulators in China push for a more open app store ecosystem.
iPhone sales are booming in the mainland, up 23% so far in 2026, while the broader smartphone market shrinks. Meanwhile, Apple has cut its App Store fees in China from 30% to 25%, though Beijing is signaling it wants more concessions. Despite Apple leaning on the iPhone for growth, Apple is still struggling to find traction in AI.
James, this is an exciting topic because we did have, as you recall, Patrick McGee, who wrote Apple in China. So this is a topic that we've discussed previously. But what has been interesting to me relative to, I would say, the discussion a year or two ago is that Apple is not quite dead in China.
You know, even though we have heard stories and seen data of manufacturing moving further south to India, for instance, or Southeast Asia, And that the market within China is shifting more strongly to the local variants, whether it's Huawei or Oppo. It seems that the strong performance this year and Tim Cook's trip to China suggests that there still is a market for Apple.
I'm just not really sure how sustainable it is. But certainly I've seen from Chinese social media that this, especially the orange-cased iPhone that came out, iPhone 17, has been viral because it's known as the Hermes orange, like the Hermes designer brand. But what's your take on this, James?
Yes, I think China remains highly important to Apple. And to me, this story is really bigger than just Apple in China. This is a story that says, in this case, when China says jump, Apple will jump, at least to some degree. That's because Apple has invested so much in the China market and because Apple gets such a large proportion of its global revenues from China.
And the reason why I think this is such a big issue is because Apple is not the only company experiencing these types of dynamics in the China market. In fact, there are lots of US companies and lots of European companies that are in the same boat.
that China is so important to them that when the government of China says you've got to do this or you've got to do that, they would be rash to ignore such instructions completely. And as you mentioned, we had Patrick McGee on the podcast and he said that basically China has captured America's most famous company.
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Chapter 3: What impact does Tim Cook's visit have on Apple's strategy?
is using the conflict to pull China into policing the Strait of Hormuz. Meanwhile, behind the scenes, Beijing sees the Iran crisis as a chance to make political capital at the expense of the U.S. James, it's been sleepless nights for a lot of my friends who are oil traders or just traders in general. I'm curious how you've been faring in the last few weeks.
But I have been struck by the lack of real Chinese media coverage on Iran, I think even relative to Venezuela. There's been a lot of focus, obviously, on the new five-year plan that's come out, on some of the domestic data that have come out.
But I've been struck how there hasn't been a lot of talk within Chinese media about Iran and how China actually hasn't been that vocally critical of the U.S. 's campaign. Now, that may change if we, in the coming days, see Trump escalate in terms of boots on the ground to try to stabilize the straight or even decapitate the leadership in Tehran.
But right now, I sense that the Chinese are playing a wait-and-see game to see what pans out. They've just sent a special envoy to the Middle East to the region to talk to the Gulf states, to the Iranians. I sense that maybe there are moves early on to see if they can be involved in a longer-term diplomatic peace process. But right now, it seems like Beijing is playing a wait-and-see game.
What's your view?
Absolutely. I think China's strategy for the moment is to make rhetorical capital out of the U.S. actions. I thought in particular recently Li Qiang, the premier, made a speech at the China Development Forum, which is China's version of Davos. It's a place where CEOs of companies from the West who can be relied upon to praise China collect with Chinese officials and academics from the West
who can also be relied upon to lavish praise on China. And this took place over the weekend in Beijing. And if you look at what Premier Li Qiang said in front of all of these assembled dignitaries in the Diaoyutai State Guesthouse, he said that China was committed to being a cornerstone of certainty.
and, quote, a harbor of stability in a world that is dominated by rising trade protectionism and upheavals in the rules-based international order. He did not mention the US by name at any point, but it was very clear that he was making a contrast between China's role and the role of the US.
He also said, talking about trade, that he wanted to optimize and balance the development of trade and expand global economic and trade ties with the rest of the world. And to me, you know, although this was an oblique reference to the U.S., it really struck a very strong point against Washington.
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