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Eurasia Group: 'Very Possible' Apple Gets Shut Out Of China

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China may shut Apple Inc. (NASDAQ: AAPL) out of its country, Ian Bremmer, founder and president of the Eurasia Group, told CNBC's Squawk Box.

"It's very possible. I'd be very surprised in five years' time if we see Apple having the kind of access to the Chinese consumer that they presently enjoy," Bremmer told CNBC.

The comments come a day before Apple's second quarter earnings release.

A recent Wall Street Journal report said China shut down Apple's online book (iBooks) and movie services (iTunes Movies) in the country, a move to bring web content in line with Beijing's stringent guidelines for traditional media.

Related Link: 3 Apple Stories Circulating Before Earnings

Bremmer said he expects Apple may face the same challenges as Facebook Inc (NASDAQ: FB), which is banned in China.

"I think people misunderstand the nature of the Chinese tech involvement," Bremmer said.

Bremmer also noted that Apple's overall privacy strategy also act as a roadblock in China.

"We're [Apple] going to create it so nobody can have access to your data. It's just in the cloud. That's antithetical to everywhere the Chinese want to go," Bremmer said.

"Either Apple has to change their model, which I don't think they're going to do. Or they're going to have a big problem gaining access to the Chinese consumer," Bremmer added.

However, Piper Jaffray analyst Gene Munster played down Bremmer's concerns and said the iPhone maker would have a booming business in China.

"The [Chinese] government has been pushing back on using [the] iPhone for the last couple of years. And the China growth [for Apple] has still been 15 to 100 percent," Munster told on CNBC's "Squawk Box."

Shares of Apple were down 0.65 percent to $104.99.

Latest Ratings for AAPL

DateFirmActionFromTo
Feb 2020Canaccord GenuityMaintainsBuy
Feb 2020BarclaysMaintainsEqual-Weight
Jan 2020B of A SecuritiesUpgradesHoldBuy

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Posted-In: China CNBC Eurasia Group Ian BremmerAnalyst Color Analyst Ratings Tech Media

 

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