Government intervention

In some countries, there is some government intervention which involved in the Apple Inc. which included taxes, subsidies, laws and regulatory bodies. There are a few purpose for government to implant an intervention which is to correct the market failure, to achieve a more equitable distribution of income and wealth, to improve the performance of economy. For instance, on 16 Sept 2013 China Telecom Corporation Limited announced that there will be a subsidies on Apple Inc.’ iPhone 5c and iPhone 5s which will 15% cheaper than the previous model of iPhone. The purpose of this action is to ensure that the price competition is more rational, balancing between quantity and quality of new 3g subscriber development (Jain, 2013).

Moreover, Apple Inc. also did very well in their Tax practicing by creating subsidiaries in some low-taxes countries such as Ireland, Netherlands and Luxembourg. Apple was a pioneer of an accounting technique which known as "Double Irish With A Dutch Sandwich" which reduces the taxes by routing their company profits to Ireland's subsidiaries and Netherlands and then to the Carribean (Outsidethebeltway.com, 2013).