Russia’s push back against big tech has major consequences for Apple

Last month, Donald Trump took to Twitter to criticize Apple for not unlocking two iPhones belonging to the Pensacola shooter, another volley in the struggle between big tech and the world’s governing bodies. But even the White House’s censure pales in comparison to the Kremlin’s ongoing plans. Apple, as the timing would have it, also happens to be in Vladimir Putin’s sights.

The company’s long-running policy of not preloading third-party software onto its devices is coming up against a new piece of Russian legislation requiring every smart device to be sold with certain applications already installed, many of which are produced by the government. Inside the country, the policy has even been called the zakon protiv Apple, or the “law against Apple,” for how it disproportionately affects the tech giant. While the law was passed last November, the Russian Federal Antimonopoly Service released the full list of apps only last week.

These regulations form the latest move in what’s turning out to be one of the largest national campaigns for digital control outside of Asia. These laws have been steadily accumulating since 2014 and are described as a way of consolidating sovereignty over the digital space — threatening to push companies out of the country if they fail to comply. Apple, for instance, will have to choose by July 1 whether maintaining access to the Russian market is worth making a revolutionary change in their policy. The same choice is given to any company wishing to do business in the country.

The battle for digital sovereignty

Russia’s approach to digital control began changing after its widely criticized annexation of the Crimean peninsula in 2014. The new laws started locally, expanding terrorism statutes to include criticism of the annexation on social media (as a challenge to Russia’s territorial integrity). Soon afterward, however, Moscow demanded that large tech companies begin storing Russian user data on servers located within the country — attempting to bring online activity under Russian jurisdiction. Companies like LinkedIn and PornHub were banned in 2016 for refusing to comply.

Only a limited number of companies were able to find ways around being banned. The messenger app Telegram, founded by Russian tech icon Pavel Durov, became infamous in 2017 for its refusal to unlock encrypted user messages for the Kremlin — and for its resilience to attempts to block it inside the country. But for the most part, the new regulations have proved effective.

The law that perhaps best embodies Putin’s ambition for digital dominance is the legislation allowing for the creation of a “sovereign internet.” It would allow the president, at least in theory, to cut off from the rest of the planet the Russian internet in case of crisis or war. While some experts have expressed doubts as to whether this is technically possible, it would allow the nation to protect itself from hybrid propaganda campaigns or interference in internal affairs (like elections), two charges that have been leveled against Russia itself in recent years.

The “law against Apple” was passed at the same time as the motion in favor of a “sovereign internet” and is just as conducive to consolidating control over digital space. The apps required by the law include programs for communication, navigation and banking, most of which have connections to official governing bodies. These have the potential to record and send data pertaining to location, finances, messages and all sorts of preferences.

Problematic compromises and minor geopolitical crises

Tech companies wishing to do business in Russia have taken different approaches to working with the local government. Google, for instance, has largely acquiesced to major demands, including censoring controversial content at Moscow’s request.

Apple, however, has attempted to mix resistance with selective compromise. Sources inside the company report that while the company opposes the “law against Apple,” it still proved willing to give in with regards to the territorial status of the Crimean peninsula.

Soon after the “law against Apple” was passed, weather and mapping apps on Apple devices began displaying Crimea, considered by the international community to be part of Ukraine, as Russian territory. This was only the case for devices inside Russia (as it is with Google devices), but it still caused uproar in nearby Ukraine, where social media users called for a boycott and even Vadym Prystaiko, the country’s foreign minister, called out the company on Twitter, telling Apple that “global politics are not your strong side.” The tech giant spent much of its time last week at Davos with Prystaiko in an attempt to address his concerns.

If Apple conceded the Crimean issue in hopes for a favorable compromise in July, the end result was a PR disaster with geopolitical implications. The border policy change came at a sensitive time for Ukraine, just ahead of the first official meeting between the country’s newly elected president, Volodymyr Zelensky, and Vladimir Putin in Paris. Experts claimed that Zelensky was already “hobbled” by Ukraine’s awkward role in the White House impeachment hearings, which limited the ability for America to support its ally in Paris. Apple’s gamble for market access ended up adding to Ukraine’s feeling of isolation at a critical moment.

A new great game

Tech companies are entering a new phase of dominance and monopoly, where attempts at appeasing one side of a geopolitical struggle can have major consequences. With the Ukraine debacle, Apple learned that neutrality is becoming difficult to maintain. In effect, laws like those passed in Russia force companies large and small to take sides.

But while Apple may be trying to avoid being politicized, companies like Google are embracing their influence, even using it to pressure states into changing local laws or policies. This was the case last December when the company stopped service to Android phones in Turkey. This was previously done only at the request of the White House, as when Trump asked Google last year to halt Android updates to Chinese company Huawei’s devices, which largely use Google’s operating system.

Google has created a precedent of unilaterally placing pressure on a country’s internal affairs, which some critics compare to a de facto sanctions regime. In this light, Russia’s new laws may in fact be a move in what could turn into an arms race with increasingly monopolistic big tech companies for digital influence across the globe — the victor of which would occupy a better position to impose their vision of data rights, privacy policies and digital sovereignty worldwide.

While Google may be taking advantage of this brave new world, companies like Apple struggle to find their footing. Despite Apple’s attempts to play ball with the Kremlin, Putin may nevertheless force Tim Cook into a zero-sum game come July. The stakes couldn’t be higher — and tech companies looking to work with the rapidly changing Russian market would be wise to pay attention to Apple’s fate.