The top news of the week has, of course, been political scandals of all stripes, but at this point, cataloging it all would actually require an entirely separate Data Dive. We somehow imagine that everyone has had enough already, so we’ll skip happily to the sanguine world of payments and commerce where we had lots of stuff happen last week.
The CFPB dropped its latest set of regulations for prepaid payments cards, to some cheers (for offering clarity on fees) and some jeers (for thinking that prepaid cards are credit products and require underwriting for $25, 24-hour overdrafts). Kohl’s rolled out its own payments app — inventively named Kohl’s Pay — that accepts only one card: its own. And across the pond in Europe, Mastercard is test driving the newest generation of authentication techniques: selfie pay.
And that’s just the first course.
The second week of October also saw JPMC betting big on the blockchain, Google getting into hardware in a big way and Samsung having yet another explosive week — but not the good kind.
So, want to take a second look?
Google Jumps Hard Into Hardware
Google has decided that it can do better than the age-old choice between going big or going home.
Google is doing both. It’s going big on hardware, and it’s going home — specifically to your home, with a product called Google Home.
Google Home — the Echo competitor with the Google personal assistant AI — was not the day’s headliner. That honor certainly went to the Pixel phone (and the associated Daydream VR hardware). Every story on the Google hardware event last week led with the phone.
But the most consistently positively reviewed part of the day was the pre-launch of the Google Home product. Whether the Pixel could realistically compete with the iPhone at the iPhone’s price point remains very much up in the air, but the Google Home was nearly universally touted as the potentially very effective competitor for Amazon’s Echo.
To start, the device is priced at $129 — about $50 cheaper than the Amazon Echo (though more than the recently released Echo Dot). Google Home is also said to perform as a slightly more impressive data receptacle than Alexa, as it is able to call upon the 70 billion facts the company has logged throughout the years.
It also comes loaded with Google Assistant, which means it can search for answers, schedule meetings, adjust your calendar, control smart home devices (as long as they are partnered) and play fairly seamlessly with Android-operated devices.
Which isn’t to say that the reviewers didn’t also like the phone — they did — though Home was praised in its own right. Whereas “it looks a lot like an iPhone” was the Pixel’s most common review.
The phone did net a fair amount of praise — particularly for its screen display, which many reviewers noted is, as advertised, capable of actually being a screen display for the Daydream View VR headset. Also netting praise was the quick-charging technology that allows the phones to run for over seven hours on 15 minutes of charge (though the loss of wireless charging was bemoaned) and the 12.3-megapixel camera.
The most lauded upgrade, however, was Google Assistant, available with a long press of the on-screen home button.
Like Siri, when asked questions, it provides answers (somewhat more reliably than Siri does, according to some reviews) and also will automatically complete actions when asked (“open Kim Kardashian’s Instagram account” will take a user directly there). And because it is baked directly into the Android core, it is also capable of “reading” the current open screen to predict what action the user might like to take next.
Also, every photo and video shot on a Pixel phone is automatically uploaded to the cloud via the Google Photos app, in full resolution.
But will customers want to pay an iPhone price for the flagship Android phone? Well, it probably shouldn’t quit its day job in software and search.
JPMC’s Blockchain Embrace
Big banks have a somewhat ambiguous relationship with the blockchain. They like the prospect of the speed and the transparency of the public ledger and the near impossibility of hacking the transactions involved. They don’t so much like the difficulty in securing bitcoin vaults (as evidenced by the numerous and expensive hacks that seem to be endemic to bitcoin storage) and the simple fact that it is hard to incorporate digital currency systems into the highly regulated and compliance-focused environments that all large international banks exist in.
But this week, JPMC has offered its attempt to square the blockchain circle — a way to leverage blockchain to allow the bank to design a publicly available system to complete confidential transactions.
Quorum — the in-house name of the project — has dumped blockchain and bitcoin for a distributed ledger concept that runs via the Ethereum network. Quorum is also run directly by Chief Executive James Dimon. The system is designed to limit access to transactions shared via a network to people who need to know the details (those making the trade, for example — or regulators).
JPMC plans to share its new code for its system with outside developers, a move designed to hopefully entice top developers looking to build the next generation of distributed ledger tech.
Ethereum is a publicly available network — and not one without some troubles in its past. A separate app for the network created by venture capital firm DAO was hacked, leading to the theft of $55 million worth of digital currency.
JPMorgan’s main focus with Ethereum now is to solve the central problem banks and blockchains have — building transactions that are private enough for traders but public enough for regulators that don’t rely on bitcoin.
Skeptics are far from convinced this is possible — or that this use would even be much of an improvement for banks.
Much of this situation is additionally muddied by the fact that regulators in the U.S. have no clear position to point to on the blockchain.
Many regulators have lauded the blockchain technology’s potential to give them a detailed, real-time view of what is going on in opaque markets while keeping data secure from the wrong parties who might want to access it, though many have derided its usefulness given the “wild west” nature of digital currency in its current phase of development.
JPMC — unsurprisingly — remains pretty confident.
“We have people building the most stress-tested financial systems in the world,” said Amber Baldet, program lead for JPMorgan on Quorum and other blockchain projects. “Bringing that enterprise expertise [to blockchain] is one of our strengths.”
What could possibly go wrong?
Speaking of going wrong…
More Phones On Fire For Samsung
More bad news for Samsung. Reports are emerging that a Southwest flight scheduled to leave Louisville, Kentucky, was delayed after a Samsung phone caught fire. Samsung phones have been combusting for the last few weeks, of course, but according to reporting by The Verge, the phone in question was “a replacement Galaxy Note 7.”
A Samsung spokeswoman said in a statement on Wednesday (Oct. 5) that the company was unable to immediately confirm which device was involved in the episode.
“We are working with the authorities and Southwest now to recover the device and confirm the cause,” the statement said. “Once we have examined the device, we will have more information to share.”
Just when Samsung thought it couldn’t get worse than recalling and replacing 2.5 million of the Galaxy Note 7s because of a flaw in the battery’s cell that could result in the devices bursting into flames or exploding, it seems to have.
According to The Verge, the phone’s owner had picked up his replacement Note on Sept. 21, after the recall. The new models had been approved by the United States Consumer Product Safety Commission (CPSC). The CPSC has confirmed it will be investigating the incident.
According to eyewitness reports from within the flight, the phone in question caught fire while in the process of powering down. The phone was stomped out as it caught fire.
“This could have happened moments after we took off, or in the air,” one witness noted. “It could have been catastrophic.”
And no, it wasn’t just the one replacement. By the end of the week, reports indicated three Samsung replacement phones had gone up in smoke. And the news gets more damning than that. It also appears (due to an accidentally sent text to one of the complaining customers with a flaming phone) that the company was aware its replacements were catching fire and chose not to say anything about it.
We suspect that Samsung is in for a rough week.
So, what did we learn?
It’s important to try new things.
Google is trying hardware out, with high hopes and decent reviews. JPMC is taking the blockchain for a spin, though the jury is out over whether it is going to be an improvement.
But only if they don’t blow up.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
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