Apple Gets Greedy in China

Apple Inc. has long proved adept at negotiating China's notoriously challenging market, responding to fickle consumer tastes and unpredictable regulation far more adeptly than its competitors. But a recent decision to start taking a 30 percent commission on "tips" paid to artists and entertainers online threatens to undermine that savvy reputation -- and quite possibly Apple's long-term prospects in China.

Apple has been taking a cut from developers since it opened the App Store, of course. But this is something different. Tipping has become an essential part of China's digital economy, and Tencent Holdings Ltd. -- China's most valuable company and owner of WeChat, its most popular social media service -- has so far refused to give Apple a piece of it. The intensifying rivalry between two of the world's most powerful tech companies probably won't turn out well for Apple.