In the wake of the December 2015 terrorist attack in San Bernardino, attention turned to the

perpetrator’s iPhone. A federal judge asked Apple, maker of the iPhone, to provide
“reasonable technical assistance” to the FBI in accessing the information on the phone with
that hope of discovering additional threats to national security.

Apple provided the FBI with data it had in their possession and sent Apple engineers to
advise the FBI, but refused to comply with the court order to bypass the phone’s security
measures: specifically the 4-digit login code and a feature that erases all data after ten
incorrect attempts. The FBI argued that the bypass could only be used for this phone, this
one time. The agency also cited national security concerns, given the phone may lead to
better understanding the attack and preventing further incidents.

Apple CEO Tim Cook issued a public letter reiterating Apple’s refusal to cooperate. Cook
advocated for the benefits of encryption in society to keep personal information safe. He
stated that creating the backdoor entry into the iPhone would be akin to creating a master key
capable of accessing the tens of millions of iPhones in the U.S. alone. Cook also had
concerns that the FBI was outstepping its bounds - by using the court system to expand its
authority - and believed the case should be settled after public debate and legislative action
through Congress instead.

Public opinion polls on the issue were split. A number of major tech firms filed amicus briefs
in support of Apple. The White House and Bill Gates stood behind the FBI. In anticlimactic
fashion, the FBI withdrew its request a day before the hearing, claiming it no longer needed
Apple’s help to assess the phone. It is speculated that an Israeli tech firm, Cellebrite, helped
the FBI gain assess. Questions based on International Business.

Q How did Apple's refusal to comply with the court order impact its organizational
competitive advantage in international business?

A. Apple's refusal to comply with the court order had both positive and negative implications
for its organizational competitive advantage in international business. On the positive side,
Apple's steadfast commitment to user privacy and data security reinforced its brand image as
a trusted technology provider. This stance resonated with customers who value privacy,
thereby solidifying Apple's competitive advantage and fostering customer loyalty.
Additionally, by advocating for encryption and highlighting the potential risks of creating a
backdoor, Apple showcased its commitment to technological innovation and user-centric
design, further distinguishing itself from competitors.

However, on the negative side, Apple's refusal to comply with the court order created some
uncertainties and potential risks for its international business. The incident highlighted
tensions between the tech industry and law enforcement agencies regarding encryption and
access to user data. This could have led to potential legal and regulatory challenges in
different countries, impacting Apple's operations and market access. It also drew public
attention to Apple's security measures, making the company a target for hackers and
potentially impacting customer trust if any security breaches were to occur.
Q. How did public opinion and support from other tech firms impact Apple's
competitive advantage?

A. Public opinion and support from other tech firms played a significant role in bolstering
Apple's competitive advantage during the incident. By advocating for strong encryption and
user privacy, Apple aligned itself with the growing concerns of consumers and industry
peers. The public's perception of Apple as a defender of privacy and data security enhanced
its brand image and solidified its competitive advantage in the global marketplace.

Support from other major tech firms, as evidenced by the filing of amicus briefs, further
strengthened Apple's position. This collective support showcased industry solidarity and
highlighted the importance of encryption and user privacy across the tech sector. The backing
from other tech firms bolstered Apple's credibility and reinforced its competitive advantage
as a leader in the industry.

Q. How did the incident impact Apple's international business relationships and
operations?

A. The incident had implications for Apple's international business relationships and
operations. While Apple received support from other tech firms, it faced opposition from the
U.S. government, with the FBI advocating for access to the iPhone in question. This tension
between Apple and the government may have created uncertainties in international markets,
potentially impacting relationships with government authorities, regulatory bodies, and
business partners in different countries.

Moreover, the incident brought attention to Apple's security measures, making the company a
focal point for discussions on encryption and user privacy. This increased scrutiny could have
led to more stringent regulations or requirements from international governments, potentially
impacting Apple's operations and market access in certain regions.

However, it is important to note that the incident also showcased Apple's commitment to user
privacy and data security, which could have resonated positively with international
customers, particularly in regions where privacy concerns are valued. This could have
solidified Apple's competitive advantage and strengthened its market position in those
regions.

Overall, the incident had a mixed impact on Apple's international business relationships and
operations, with potential challenges and opportunities arising from the heightened attention
on privacy and security issues.