iPhone sales could plummet in Iran: OpEd

Financial Tribune | Amir Nazemi: Apple Inc. banning Iranian iOS apps has hit headlines once again. Multiple factors are behind the recent ban which has rendered Apple smartphones almost useless in the country and can lead to a sharp fall in local demand for iPhones.

Three factors have caused the recent banishment of Iranian iOS apps: US-imposed sanctions against Iran, a change in Apple’s policy in regards to enterprise developer certificates, and a recently published report listing Iranian startups that circumvented US sanctions by using enterprise developer certificates which called on the US firm to take action.

Following the re-imposition of the US sanctions against Tehran, deciding to err on the side of caution, Apple removed mobile applications developed by Iranian firms from its App Store service.

Despite broad prohibitions, according to General License D-1 issued by Office of Foreign Assets Control, the US Treasury Department’s financial intelligence department, there are services that American firms are not barred to offer to Iranian companies and individuals.

As per official literature, Apple is seemingly not prohibited from distributing software products developed by Iranians.

However, to curb the risk of facing possible penalties, Apple decided to impose an outright ban against Iranian developers.

To circumvent the sanctions, Iranian developers started employing Apple’s Developer Enterprise Certificates for publishing their iOS apps through their own websites.

The certificates are designed to let companies distribute iOS apps to their employees without going through the App Store.

Furthermore, using the same technology several local app markets were developed by Iranian tech firms to cater to the needs of Iranian iDevice users.

Note that, US sanctions have forced Iranian tech companies to use this workaround for publishing their products.

Policy Change

In order to protect users’ privacy and curb intellectual property infringement, Apple audits apps before publishing them on the App Store.

However, illicit software distributors and digital pirates employed Developer Enterprise Certificates to put hacked apps on iPhones.

As of last Tuesday, mobile apps developed by Iranian firms that were already barred from distribution on the App Store could not be published on local websites and app markets

A few months ago Apple announced that it was reviewing its policy in regard to applications of Developer Enterprise Certificates.

The crackdown on misuse of the certificates was essential for safeguarding users’ data and developers’ intellectual property. Nevertheless, the change in Apple policy has taken a toll on Iranian iOS smartphone users.

As of Tuesday, mobile apps developed by Iranian firms that were already barred from distribution on the App Store could not be published on local websites and app markets.

Complex Issue

We are living in a complex world where issues are complicated and there is no easy answer to them.

For instance, in this case, the change in Apple policy that by itself could have been a step in the right direction for data protection, has had a negative impact on the free flow of information and online services in Iran.

Furthermore, while it cannot be said that US sanctions have led to the recent banishment of Iranian iOS apps, the embargo plus other factors have created the current situation.

A combination of all the above factors has created the current untenable situation that has rendered Apple smartphones almost dysfunctional in Iran.

Iranian smartphone users use various online services regularly for such purposes as payment, package delivery, video/music streaming, and ride-hailing which are offered by local startups.

Banning iOS apps of these startups can push many Iranians towards ditching their iPhones.

It is estimated that there are close to 5.2 million iPhone users in the country and Apple has a 12% share of Iran’s smartphone market. The local cellphone market is worth $438 million.

Apple has two options. It can tap unused potentials of OFAC’s General License D-1 and publish apps developed by Iranian firms on App Store or stay on its current track. If Apple goes with the latter strategy, many Iranians will be forced to think twice before buying an iPhone.