Start Up: Facebook v China, foldable smartphones?, the too-smart cryptocontract, Android fine for Google?, and more

Toshiba’s days as a PC maker are effectively over. Photo by The Shared Experience on Flickr.

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A selection of 11 links for you. They’re all Eagles supporters, honest. I’m @charlesarthur on Twitter. Observations and links welcome.

Facebook confirms data-sharing deals with Chinese tech firms • WSJ

Deepa Seetharaman:


The social-media company said it plans to wind down its data-sharing partnership with Huawei by the end of the week. It isn’t clear when Facebook will end partnerships with the three other companies: Lenovo Group Ltd., the world’s largest personal-computer maker; Oppo Electronics Corp., a smartphone maker; and Chinese electronics conglomerate TCL .

Facebook officials defended the decision to work with Huawei and said that no data belonging to Facebook users was saved on Huawei servers. Facebook had a manager and an engineer review the apps before they were deployed to ensure the data wasn’t saved on company servers, the Facebook spokeswoman said.

“Huawei is the third-largest mobile manufacturer globally and its devices are used by people all around the world, including in the United States,” Francisco Varela, vice president of mobile partnerships, said in a statement. “Facebook along with many other US tech companies have worked with them and other Chinese manufacturers to integrate their services onto these phones.”

The New York Times earlier reported on Facebook’s device partnerships with companies like Apple Inc., Inc. and Microsoft Corp. After the Times article, several lawmakers said they felt they had been misled by chief executive Mark Zuckerberg, who testified in April that Facebook restricted data access to outsiders in 2015.

“Facebook’s integrations with Huawei, Lenovo, OPPO and TCL were controlled from the get go—and we approved the Facebook experiences these companies built,” Mr. Varela said. “Given the interest from Congress, we wanted to make clear that all the information from these integrations with Huawei was stored on the device, not on Huawei’s servers.”


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Exclusive: Aussie firm loses $6.6m to backdoored cryptocurrency • Bank Info Security


One disadvantage of using virtual currencies is that transactions are irreversible. If a bitcoin is sent from one address to another, it can’t be recovered unless the recipient chooses to return it.

So how did Soar Labs reclaim its coins? Queensland Police described the problem as a backdoor within the coin’s code, which was confirmed during a forensic analysis by a German company.

A Byte Power Group representative said on Tuesday that the company could not provide details beyond the information it provided to the ASX.

But the representative did say that “the way in which the smart contracts were written allowed them [Soar Labs] to remove the coins, which the company itself wasn’t aware of at the time until the coins were actually taken.”

The zero-fee transaction function in Soarcoin

On Tuesday, ISMG contacted Nicholas Weaver, a researcher with the International Computer Science Institute and a lecturer at the University of California at Berkeley. Weaver has studied virtual currencies and their surrounding ecosystems since 2013.

While on the phone with ISMG, Weaver browsed Soarcoin’s code. Within about two minutes, he found a zero-fee transaction function that can only be called by the owner of the Ethereum smart contract, which in this case would be Soar Labs.

“If I’m the account owner, I can call that function and transfer a balance from anybody to anybody,” Weaver says. “It’s best described as a backdoor hiding in plain sight.”


Well that’s certainly a smart contract for one counterparty.

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Ersatz free trials •

Daniel Jalkut of Red Sweater software (maker of MarsEdit, which I use) points out the advantages and problems of how Apple allows “free” trials on the iOS and Mac App Stores:


let’s talk a little bit about what real support in the App Store might look like, and how it would alleviate the problems I’ve described.

For starters, real free trials would allow developers who currently list their apps as “free” in the App Store to list them by their actual price. The App Store could convey that information both more honestly and more informatively to users. Instead of “Free with in-app purchases,” MarsEdit could be identified succinctly as “$49.95 with 14-day free trial.” These apps would no longer be erroneously featured among free apps, but would rank alongside other paid apps, where they belong.

Having a bona fide price associated with the main App Store SKU would re-open access to the bulk purchase programs and family sharing. You know you want 500 copies of MarsEdit for your company? Go ahead and purchase 500 copies. The fact that the App Store happens to support free trials would be irrelevant to your conducting this transaction with Apple.

Real free trials would open the functionality up to any developer who chooses to participate, regardless of their app’s functionality. Instead of forcing developers to come up with arbitrary lock-downs on functionality in the app, they would simply flip a switch in App Store Connect, ideally specifying a trial duration. When free trials are downloaded from the store, the receipt would have the trial information baked right in.

Putting the logic in the store itself would also empower developers to start or stop offering free trials whenever they like, and to reset free trials across the board with major updates, in the same way they can choose to reset star ratings today. And all the tedious mechanics of offering, transacting, and enforcing free trial limitations would obviously be back in Apple’s court, where they can efficiently support such functionality in one place instead of requiring every developer to re-implement the same kind of support in every app.


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Google braced for Brussels penalty over abuse of market dominance • FT

Rochelle Toplensky:


Brussels is preparing to hit Google next month for abusing its dominance through the Android mobile operating system, concluding the most important of a trio of EU antitrust investigations into the company.

Margrethe Vestager, the EU’s competition commissioner, is poised to announce the negative finding within weeks, according to people familiar with the case, marking the most significant regulatory intervention made against Google’s business model.

A penalty is expected in the Android case, but its size is unclear. The commission is empowered to impose fines of up to $11bn — which is 10% of the global turnover of Google’s parent company Alphabet — but typically decisions are at the lower end of the range.

The decision will mark an escalation of the commission’s battle with Google, which began eight years ago with an investigation into comparison shopping, then only a narrow part of online commerce. Though that case concluded with a €2.4bn fine, it has not led to significant changes to Google’s business.


And that’s the problem. A one-time fine doesn’t get anything done. Vestager hasn’t altered the competitive landscape; she hasn’t had an impact. If you’re the competition commissioner, you have to make competition happen.
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Why it’s so hard for innovative smartphone makers to succeed • Fortune

Aaron Pressman:


Most [US] smartphone sales still occur in physical retail stores, about 88% as of the first quarter, Counterpoint Research says. And, as the carriers have thousands of stores spread across the country, they capture three-quarters of the offline market, with Apple [retail stores] — not a venue that will be selling any startup’s phones ever — grabbing much of the remainder.

That has left the startups trying to sell directly to consumers, both from their own websites and those of big e-commerce retailers like Amazon and Best Buy. But, that slender 12% segment of the market is highly fragmented. Here, the carriers plus Apple combine for only about two out of every five phones sold online, Counterpoint says. Amazon sells slightly more than one out of every five phones sold online, many through its “Prime Exclusive” line up. The remainder of online sales mostly go through the websites of retailers like Best Buy, Walmart, and Target.

A lot of smartphone buyers want either some handholding from a human sales associate or some hands-on time with the device, Counterpoint analyst Maurice Klaehne explains.

“It is a complicated purchase, as these devices are frequently sold bundled with a plan, service upgrade, or accessories,” Klaehne notes. “People often need help in these situations to get their phone set up, data transferred to the new device, and have new features explained.”


I honestly don’t see why anyone would start a smartphone business now. There are too many incumbents who have the top end sewn up; and the bottom end is a piranha tank with zero profits.
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The first foldable AMOLED smartphone displays are expected to hit the market this year • IHS Markit

Jerry Kang:


While the flexible AMOLED display market included equal volumes of flat and curved displays in 2017, most flexible AMOLED panel suppliers are planning to put foldable AMOLED into mass production in a few years.

Flexible AMOLED displays have made rapid inroads into the flagship smartphone display market, with panel makers willing to supply differentiated products with innovative form factors, which increases the profit margin from sales of premium products. The first smartphones with foldable AMOLED displays are expected to be introduced before the end of the year.

Samsung Display has demonstrated single- and dual-foldable AMOLED displays since 2013. The company is expected to mass produce its first foldable AMOLED displays for Samsung Electronics in 2018.

BOE has developed a prototype of a 7.56-inch 2048×1536 foldable AMOLED display with a 5-millimeter bending radius, which reliably bends 100,000 times without breaking. BOE is looking to supply this foldable AMOLED display to Huawei this year.

AUO has developed a 5-inch 1280×720 AMOLED display, with a 4-millimeter bi-directional bending radius. The company says it will bend more than 1.5 million times without breaking. It includes an integrated touch sensor and 4H cover film.


OK, but what about these “rollable” screens allegedly heading our way in 2021? Are these going to be like roll-up papers?
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Investors in Sugru lose up to 90% of their money • Irish Times

Ciara O’Brien:


Sugru maker FormFormForm is being sold for about £7.6m, in a deal that will see investors lose up to 90% of their initial investment.

The London-based company, which was founded by Irish inventor Jane Ní Dhulchaointigh, James Carrigan and Roger Ashby in 2004, will be bought by adhesives specialist Tesa in a deal that will save the firm but values shares at 9p each. The German-based firm made a formal offer for FormFormForm in March. The offer has been accepted by 51% of the company’s shareholders. The sale is set to complete next week, and Sugru staff, along with Ms Ní Dhulchaointigh, are expected to stay on with the company.

The move comes despite sales of Sugru recording double-digit growth in the past few years, with the company last December recording a sales increase of 20% year on year.

The company said an expected second tranche of funding from a £4m debt financing facility with Clydesdale and Yorkshire Bank (CYBG) was pulled back last November, causing financial difficulties for the company.

Sugru is a mouldable glue that works as a flexible, adhesive repair putty that turns into a durable silicone rubber. The glue was named as one of Time magazine’s top 50 inventions in 2010, and has built up a community of users online.


If Sugru keeps going, that’s great – it is terrific stuff. (I honestly thought it was Japanese…) Robin Klein, one of the investors, says that Sugru still has its best times ahead of it, as part of a company with 100 years’ experience selling consumer adhesives. Hard to disagree.
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AirPods to add support for ‘Live Listen’ feature with iOS 12 • 9to5Mac

Chance Miller:


With Live Listen, iPhone owners will be able to use their iPhone essentially as a directional microphone. For instance, you can put your iPhone somewhere and walk away, with the audio being recorded by your iPhone played back live to your AirPods.


After enabling the feature in the iPhone’s settings, users will be able to use their phones effectively as a directional mic. This means you can have AirPods in at a noisy restaurant with your iPhone on the table, for example, and the voice of whomever is speaking will be routed to your AirPods.


Now, with support for AirPods, Live Listen has an entirely new reach. The feature turns the AirPods into a viable product for those with hearing problems, Furthermore, support on AirPods gives Live Listen more publicity that could lead to broader adoption down the road form more.

Here’s how Apple describes its Live Listen feature:


With Live Listen, your iPhone, iPad, or iPod touch becomes a remote microphone that sends sound to your Made for iPhone hearing aid. Live Listen can help you hear a conversation in a noisy room or hear someone speaking across the room.


Of course, this is not to say that AirPods can now serve as a fully functioning hearing aid replacement, but it does give the wireless earbuds a new accessibility focus like we called for last year.


You’d need the volume turned miles up, with great amplification, if you had anything more than a mild hearing impairment. Though imagine the scene for the ordinary person: in the restaurant you leave your phone on the table, go away and hear what people are saying about you…
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Judge orders EPA to disclose any science backing up Pruitt’s climate claims • Ars Technica


In March 2017, Scott Pruitt, the new administrator of Donald Trump’s Environmental Protection Agency, appeared on CNBC and said that carbon dioxide was not known to be a major factor in climate change. “I would not agree that it’s a primary contributor to the global warming that we see,” Pruitt said, adding, “there’s a tremendous disagreement about the degree of the impact” of “human activity on the climate.”

Based on what?

The next day, a group called Public Employees for Environmental Responsibility (PEER) filed a Freedom of Information Act (FOIA) request with the EPA, asking for any agency documents that Administrator Pruitt may have relied on to come to his conclusions. Since Pruitt’s words contradicted scientific evidence shared by the EPA before the administrator took office, PEER’s request might turn up some recent document that indicated Pruitt had new information.

Instead, the EPA stalled and refused to provide any information to PEER. The employee group then sued the agency.

On Tuesday, a US District Court Judge for the District of Columbia issued a memo (PDF) saying that the EPA must comply with PEER’s request by July 2, offering any EPA documents that helped Pruitt come to the conclusion that he shared on CNBC last year. If certain documents can not be provided, an explanation for their absence must be provided by July 11.


A long process to get Pruitt to admit that he was wrong. But, in its own way, elegant.
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Toshiba to close the book on its laptop unit • WSJ

Takashi Mochizuki:


Sharp is paying just ¥4 billion ($36m) for an 80.1% stake in a business that once was at the forefront of the global move toward mobile computing. Osaka-based Sharp, controlled by Taiwan-based iPhone assembler Foxconn Technology Group, has been expanding its consumer goods lineup because Foxconn wants to establish itself in branded electronic products.

The deal, disclosed by the companies Tuesday, highlights a contrast between the two electronics makers, both of which faced multibillion-dollar losses and management turmoil several years ago. Sharp has managed to turn itself around quickly under foreign management while Toshiba, which received more support from the Japanese government during its restructuring, is still trying to streamline its unprofitable portfolio.

Toshiba’s laptop PCs, sold under the Dynabook name, helped make the conglomerate famous among consumers outside Japan, but the business has lost money for the past five years and was at the center of a profit-padding scandal that the company disclosed in 2015.

That scandal and the bankruptcy last year of Toshiba’s U.S. nuclear subsidiary, Westinghouse Electric Co., have pushed Toshiba to shed many of its money-losing consumer businesses as well as more profitable units to raise funds. It has sold its television and appliance businesses to Chinese companies and its medical-equipment business to Canon Inc.

Last week, Toshiba completed the sale of its main profit center, its flash-memory semiconductor business, to a consortium led by U.S. private-equity firm Bain Capital, although Toshiba will retain a 40% stake…

…The Toshiba PC business had revenue of ¥167 billion ($1.52bn) in the year ended March 2018 and posted an operating loss of ¥9.6 billion ($87m).


And so another now-tiny player exits the PC market.
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Apple’s software chief details how iOS apps will run on Macs • Wired

Lauren Goode:


When addressing my question about whether iOS apps moving to macOS is a natural precursor to touchscreen Macs, Federighi told me he’s “not into touchscreens” on PCs and doesn’t anticipate he ever will be. “We really feel that the ergonomics of using a Mac are that your hands are rested on a surface, and that lifting your arm up to poke a screen is a pretty fatiguing thing to do,” he said.

Federighi added that he doesn’t think the touchscreen laptops out there today—which he referred to as “experiments”—have been compelling. “I don’t think we’ve looked at any of the other guys to date and said, how fast can we get there?” (It’s worth noting that Microsoft’s Surface laptop, which has a touchscreen and is considered a top MacBook rival, has received largely positive reviews.)

Speaking of competition, Apple’s biggest competitors in mobile and desktop software are both already offering some version of mobile apps that can run on laptops and desktops. Microsoft’s Universal Windows Platform, introduced back in 2016, lets developers write just one app and have it run across PCs, tablets, mobile phones, and the XBox One. That same year, Google said it was bringing the Google Play app store to Chromebooks, which meant people could download and use Android apps on their ChromeOS computers.

Microsoft and Google have different technical approaches to running similar or the same versions of apps across different devices. But both systems are an acknowledgement of a basic truth: While people really love mobile apps, it can be inefficient and costly for developers to have to build entirely separate apps for multiple platforms.


Federighi is being a little disingenuous about the “fatiguing” thing there. I’m writing this on an iPad Pro – lots of screen touching goes on. The interaction paradigm of a mouse, though, allows for much more precision, and a native desktop/laptop allows for far more information density. This is what advocates of touchscreen laptops overlook: a mouse is a pixel-precise device. A finger isn’t.

This looks to me more like an effort to keep the Mac platform alive, by making it easier to write for, than any convergence. I could be miles wrong – Apple has made sweeping architecture changes in the past – but the need for precision is too big to ignore in desktop work.
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Errata, corrigenda and ai no corrida: none notified

4 thoughts on “Start Up: Facebook v China, foldable smartphones?, the too-smart cryptocontract, Android fine for Google?, and more

  1. Re iOS apps on MacOS… so it’s toaster-fridge time of a kind ? It’s weird how Apple seems to now be saying that apps can support Touch and kbms, but the OS can’t.
    I keep thinking there’s a huge market for desktopified Mobile devices (ie laptops, desktops, convertibles running iOS or Android) and it would take almost no work to bake that. Maybe I’m not a good analyst ;-p

  2. Re Google: there are so many intertwined moving parts. It’s hard to imagine a competitor emerging in a single segment (search, ads, cloud services, IA, Mobile ecosystems,…) because it’s all cross-polinized and cross-subsidized; and a full-range competitor emerging fully formed is impossible. Plus until recently lost everyone (users and suppliers) was happy to be searchable and monetized, so that’s still evolving.

    What could the Commission do ? Try to open up Google’s money flux the same way telephony’s backbone was open to competitors ? What bout the data ?

  3. I think it goes back to elegance again. Apple seems to be converting touch gestures into trackpad mouse gestures in putting iOS apps on MacOS, and that might work well. If we’re completely honest 99% of the time my laptop is closed and its my massive monitor that I’m looking at so touch gestures would be useless in that scenario.

    • There are separate touchpads, and mice with an integrated touchpad on their back, so it doesn’t need to be useless

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