Apple and Yalta

Cupertino's cold warriors
May 6th 2010
From Economist.com


What has Apple got against eastern Europe?

WHAT have the following places got in common?

America, Australia, Austria, Belgium, Brazil, Britain, Canada, Denmark, Finland, Germany, France, Hong Kong, Indonesia, Ireland, Italy, Japan, Luxembourg, Malaysia, Mexico, the Netherlands, Norway, the Philippines, Portugal, Singapore, South Korea, Spain, Sweden, Switzerland, Thailand, Vietnam.

Clearly the size of the market is not the determinant. China and Russia don’t appear, but Luxembourg does. It is not about prosperity: Iceland—which, believe it or not, is still one of the richer countries in the world—is out, whereas Vietnam is in. Political freedom or the rule of law are not the binding factors. The Philippines and Thailand are on the list, whereas impeccable democracies such as Slovenia are not.

Perhaps the list comprises the target markets of some tiresome company from “old Europe” that has not noticed that the Berlin Wall has come down and that the division of Europe at Yalta into consumer-citizens in a rich, free west and captive east is long out of date.

But no, the list comes from a company that prides itself on being an icon of über-cool internationalism, with a post-modern disdain for clunky convention and tiresome rules. It is from the Apple Store, where eager customers from all over the world end up in the hope of buying an iPad, or a humble $25 gift card.

First-time visitors are assumed to be from America. If you come from one of the countries listed above, you can switch. But if not, you are out of luck. No matter if your country is in the European Union, NATO and the OECD. For Apple, the eastern half of Europe is still both terra incognita and non desiderata.

Still, you can always buy your Apple hardware from an authorised reseller. The real irritation comes when you want to buy electrons, not atoms. Sign up for an iTunes account, and the opening windows offer a glimmer of hope.  It offers not just two kinds of Portuguese, but Polish and Russian too, as well as the mysterious “Spanish (International Sort)”. It looks fine. So—at first sight—does the iTunes store, which offers a tempting array of countries.

But some are more equal than others. Visitors from Finland, for example, are presented with a full array of music. But register with an address in Estonia, just half an hour away by plane, and you get only a list, admittedly rich, of games, gimmicks and lectures. Films and music are out of bounds.

This approach annoys a lot of people. One organisation in Poland has been berating Apple for its approach to the biggest and most advanced market in eastern Europe. It is now celebrating a partial victory (Apple has agreed to open up its distribution market). But even in Poland, the company’s offering is nothing like what you get across the border in Germany. Other countries in the region have yet to see any improvement at all.

One of those most irked by the company's approach is the iPhone-toting president of Estonia, Toomas Hendrik Ilves, a loyal customer since 1982, when he bought an Apple IIe. Estonia, he notes, is one of the most wired countries on earth. Tallinn is the centre of NATO’s cyber-warfare research, and Estonians invented another icon of internet cool: Skype. Skype’s director of new products, Sten Tamkivi, has an iPhone, an iPad and a Mac at home. He describes the Apple rule as “a weird relic of commercial east-west segregation inside what is otherwise known as the European Union".

Why doesn’t Apple, a company so irritatingly up to date in its products and marketing, update its worldview when it comes to sales? Apple’s global headquarters did not respond to a request for comment. A spokeswoman in Britain promised to investigate. When we get an answer, we’ll post it here.