There is one question missing: if China asks Apple to flag users having Winnie-the-Pooh images on their devices, or leave the chinese market, what will Apple choose?
I mean, that same situation already applies right now without this system being deployed. China already can mandate Apple to scan all iCloud or on-device photos for certain images etc. if they wanted to.
They answer that question. The answer they provide is that they would leave the Chinese market.
You might not believe them but they are pretty clear on that point: “we will not accede to any government’s request”
This is the standard you have to hold Apple to. As I said, you might not believe them – but if you don’t trust their statements on some level then it’s game over anyway.
There are about 69 countries where it is illegal to be gay, what if these countries want to know if you have a rainbow flag or two men kissing photo on your phone?