Vidostream | News, sport and opinion from the Vidostream's US edition

https://vidostream.com

The Latest Twists in the Tensions Between Elon Musk and Tim Cook

Billionaire’s ambitions for his social-media company run up against Apple
Elon Musk and Tim Cook PHOTO ILLUSTRATION BY EMIL LENDOF/THE WALL STREET JOURNAL; BLOOMBERG NEWS (2)

Elon Musk and Tim Cook PHOTO ILLUSTRATION BY EMIL LENDOF/THE WALL STREET JOURNAL; BLOOMBERG NEWS (2)

Tim Cook was in an awkward position this past week as he launched the latest iPhones. 

He had Elon Musk to thank. 

The Apple AAPL 0.49%increase; green up pointing triangle chief executive was asked on CBS News’s “Sunday Morning” why the iPhone maker continues to advertise on Musk’s Twitter-turned-X, even as a Jewish civil-rights organization raises concerns about hateful speech on the social-media platform. 

“It’s something that we ask ourselves,” said Cook, who several years ago won the Anti-Defamation League’s first Courage Against Hate award. “Generally, my view is Twitter’s an important property. I liked the concept that it’s there for discourse. And there is a town square. There’s also some things I don’t like.”

Musk has denied promoting antisemitism on X, has criticized the ADL—and has separately been unrelenting about his problems with Apple’s business, even after he and Cook reached a detente following some barbs from Musk last November. 

In a tweet last month, he said the tech giant’s power as wielded through its App Store “will have to be taken from them by force.” It’s a sentiment he echoes in the biography of him published this month. 
 


In a new biography about Elon Musk, Walter Isaacson shares what he learned during his two years shadowing the billionaire entrepreneur, including how Musk’s childhood influenced his leadership and instilled in him an aversion to contentment. Photo: Ariel Zambelich/The Wall Street Journal

Apple controls access to more than one billion iPhone users through its App Store, making it hugely important to X, which Musk bought last year; many X users access the social-media platform by downloading it through the App Store. Musk’s company is subject to Apple’s rules, including a commission of as much as 30% on revenue generated through the app. 

While Cook’s style is to engage people he disagrees with, Musk, who also leads Tesla and SpaceX, is prone to put his beefs into tweets. He doesn’t like a lot of rules. And defiance is his calling card. 

That was evident soon after he acquired X in late October and began lashing out at Cook, declaring all-out war against the tech giant.  

“Apple has mostly stopped advertising on Twitter. Do they hate free speech in America?” Musk tweeted in November. “What’s going on here @tim_cook?”

The ruckus placed even greater attention on the iPhone maker’s powerful role as gatekeeper to a large part of the App Economy, as regulators and lawmakers around the world consider curbing its reach. In short order, Washington politicians were amping up their rhetoric against Apple in a political climate that has put big tech under scrutiny. 

But Cook’s diplomacy—an invitation for Musk to meet in person at Apple headquarters and peek at its pretty campus pond—helped cool things off just as quickly as they erupted. 

A detente was reached. Apple continued to advertise on the platform, giving Musk a needed win when many other brands fled amid his dramas and their concerns about content. 

In April, at a brand conference, Musk pointed to Apple’s continued business with the platform to suggest it is safe for others. “It’s worth noting that…Apple has remained a major advertiser,” Musk said at the event near Miami. “

Disney has remained a major advertiser—they literally advertise children’s shows on Twitter—and they wouldn’t do that if it was filled with hate speech.”

Still, a question has lingered: How long will the peace last between the world’s richest man and the world’s most valuable company? 

In the book “Elon Musk,” released earlier this month, biographer Walter Isaacson writes that the fateful meeting between Musk and Cook last November didn’t result in much for X beyond the ad-spending commitment by Apple. 

Musk wanted much more. His complaints about Apple taking as much as 30% of in-app revenue through the App Store didn’t go far with Cook, who has long heard similar gripes and not bent. 
 

Elon Musk, CEO of X, has been unrelenting with complaints about Apple, especially the commission it takes on in-app revenue through the App Store.    PHOTO: NATHAN HOWARD/GETTY IMAGES
Elon Musk, CEO of X, has been unrelenting with complaints about Apple, especially the commission it takes on in-app revenue through the App Store.    PHOTO: NATHAN HOWARD/GETTY IMAGES

 

And, according to the book, the men didn’t discuss Musk’s desire for Apple to grant special access to App Store user data—which Cook’s company prides itself on not handing out or using itself—to make it easier for X to pursue its broader ambitions. 

“That’s a future battle that we will have to fight,” Musk is quoted as saying, “or at least a conversation that Tim and I will have to have.” 

Musk wants to transform X beyond social media into a so-called super app, such as China’s WeChat, with a host of services including digital commerce. He wants to bolster subscription revenue, too, and has begun offering greater revenue-sharing with creators as he aims to make the site appealing for the kinds of content likely to keep users coming back for more. 

A business built more on subscriptions would mean Apple would get more of X’s revenue. 

Musk’s agitation against Apple’s control over the iPhone user base comes as other companies are trying to chip away at the power around the world. 

“Fortnite” maker Epic Games is locked in a legal battle over Apple’s ability to block alternative app stores and force apps to use its payment system. 

Apple has defended itself, saying its fees are fair for the technology it is providing and are in line with industry norms and that its App Store’s rules protect users. While Apple has been mostly victorious in court, each side faces a deadline later this month to appeal various rulings to the U.S. Supreme Court.

A bigger challenge to Apple’s power has come from overseas, after the European Union passed legislation last year that intends to create more competition for big tech, including requiring companies like Apple to allow alternative app stores. 

It isn’t yet clear what the full ramifications to Apple would be of the law, which is expected to go into effect next year—including whether the company would extend any changes it makes for that market to the U.S. 

In the meantime, Musk has begun poking at the truce. 

“If Apple competes against the whole world, Apple will have the whole world against it. This is not a winning scenario,” Musk tweeted in June about its App Store power. Then last month, he tweeted about Apple’s 30% commission affecting X’s content creators, promising to look into what could be changed. 

“I will speak with @tim_cook and see if that can be adjusted to be just 30% of what X keeps in order to maximize what creators receive,” he posted. 

About two weeks later, however, Musk suggested Apple would give up control only by force. “Phone demand is flattening out, as there just isn’t much more you can do with a black rectangle,” Musk tweeted. “That means most of Apple’s market cap will be in that 30% fee…Even though 30% is obviously too high, it will have to be taken from them by force. It is basically illegal for the Apple board to reduce that number voluntarily.”

Late Friday (hours after we sought comment for this article), he struck a different tone. Responding to tweets from Cook about the new iPhone lineup, Musk wrote: “I’m buying one!”

Write to Tim Higgins at tim.higgins@wsj.com

 

 

 

Author: Editors Desk

Source: WSJ:

We are using cookies to give you the best experience on our website. By continuing to browse, you are agreeing to our Cookie Policy.
You did not use the site, Click here to remain logged. Timeout: 60 second