by John Reiners
It seems like everyone is talking about the fallout from the dispute over whether Apple should have been compelled to provide a backdoor to allow FBI access to the iPhone of the San Bernardino gunman. As The Observer reports, having a reasoned public debate about encryption is like trying to discuss philosophy with smoke signals. You could say the same about getting the unvarnished truth behind the public pronouncements from the World’s largest corporation and the notorious law enforcement agency. But beyond the fascinating technical details, it’s a very modern dispute, that sheds light on many important challenges – like how our legislators, regulators and law enforcement agencies keep up to date with rapid advances in technology. It has also been an opportunity for politicians, tech firms and the commentariat to set out their positions – on whether tech firms are acting as if they are above the law, or whether Apple was standing up for citizens’ rights in the face of disturbing legislative overreach. It has also provided Apple with an opportunity to set out where it stands on security and personal data, through a number of public statements.
Apple’s CEO, Tim Cook set out their position most clearly in a speech to EPIC in June last year, as reported by Techcrunch: “We believe that people have a fundamental right to privacy. The American people demand it, the constitution demands it, morality demands it.” This was a clear attempt to differentiate Apple from many of their Silicon Valley competitors: “They’re gobbling up everything they can learn about you and trying to monetize it. We think that’s wrong”. He continued, “We shouldn’t ask our customers to make a tradeoff between privacy and security. We need to offer them the best of both….ultimately, protecting someone else’s data protects all of us.”
So perhaps this is what will be remembered most from this particular case – the positioning of tech companies on the security of their customers’ personal data. As more and more sensitive data, in particular financial and health records are held on phones and in the cloud, this issue is becoming increasingly important. Apple is setting out an increasingly moral, ethical public position. If Immanuel Kant, the 18th Century philosopher, was around today I’m pretty certain he would have sided with Apple over the FBI.
More generally, I am hearing more and more that ethics and business are seen as compatible, even a competitive differentiator. Consumers are making use of their growing market power and influence by selecting products and services from companies reflecting their ethical values – on issues like control over their data, the environment and whether the company is contributing to society by paying taxes and treating its employees fairly. Companies getting this wrong can pay a heavy price (think Volkswagen).
For tech companies, battling for platform dominance and increasingly under the scrutiny of regulators you could argue that it is particularly important they get this right. This means more than a mission statement (as recently revised by Alphabet), a marketing, advertising or PR campaign. It must be seen to be authentic, to run through the company – its products, services and its corporate culture, as demonstrated by what its managers say and do and how it treats its employees.
And perhaps as the NY times report, there are inconsistencies in Apple’s position. Using personal data undoubtedly helps to improve the customer experience and delivers commercial returns. The freemium business model is widely accepted – it seems most consumers don’t mind that much if their personal data is used, as long as there are some reassurances on data use (and they don’t suffer personally). Unlike Mr Kant, I don’t have a tendency to jump quickly to moral judgement, but will observe with interest as the tech titans further refine their positions in their ongoing battle to win over consumers and regulators.
John Reiners is Oxford Economics Managing Editor, EMEA. He manages research programs on a wide range of topics, including digital economy and international trade. He also follows emerging trends, like the emerging platform economy. He can be contacted at firstname.lastname@example.org