Tag Archives: SOCMED

PayPal heats up buy now, pay later race with $2.7 bln Japan deal

Sept 7 (Reuters) – U.S. payments giant PayPal Holdings Inc (PYPL.O) said it would acquire Japanese buy now, pay later (BNPL) firm Paidy in a $2.7 billion largely cash deal, taking another step to claim the top spot in an industry experiencing a pandemic-led boom.

The deal tracks rival Square Inc’s (SQ.N) agreement last month to buy Australian BNPL success story Afterpay Ltd(APT.AX) for $29 billion, which experts said was likely the beginning of a consolidation in the sector. read more

“The acquisition will expand PayPal’s capabilities, distribution and relevance in the domestic payments market in Japan, the third largest ecommerce market in the world, complementing the company’s existing cross-border ecommerce business in the country,” PayPal said in a statement on Tuesday.

Fuelled by federal stimulus checks, the BNPL business model has been hugely successful during the pandemic and has upended consumer credit markets. These firms make money by charging merchants a fee to offer small point-of-sale loans which shoppers repay in interest-free instalments, bypassing credit checks.

Apple Inc (AAPL.O) and Goldman Sachs (GS.N) are the latest heavyweights that have been reported to be readying their own version of the service. read more

Paypal, already considered a leader in the BNPL market, also entered Australia last year, raising the stakes for smaller companies such as Sezzle Inc and Z1P.AX Co Ltd (Z1P.AX), stocks of which were down in midday trading on Wednesday.

The U.S. payments firm has been among the big winners of the COVID-19 pandemic as more people used its services to shop online and pay bills to avoid stepping out. Businesses, forced to move their stores online, also flocked to PayPal boosting its customer base of active accounts to more than 400 million worldwide.

Buying Paidy will help PayPal expand in Japan, where online shopping volume has more than tripled over the last 10 years to some $200 billion, but more than two-thirds of all purchases are still paid for in cash, PayPal said in an investor presentation.

Paidy, with more than 6 million registered users, offers payment services that allow Japanese shoppers to make purchases online, and then pay for them each month at a convenience store or via bank transfer.

The Financial Times had reported last month that Paidy was considering becoming a publicly listed company.

Paidy, whose backers include Soros Capital Management, Visa Inc (V.N) and Japanese trading house Itochu Corp (8001.T), will continue to operate its existing business and maintain its brand after the acquisition.

Founder and Chairman Russell Cummer and CEO Riku Sugie will continue to hold their roles in the company, PayPal said.

The transaction is expected to close in the fourth quarter of 2021, and will be minimally dilutive to PayPal’s adjusted earnings per share in 2022.

BofA was the sole financial adviser to PayPal on the deal, and White & Case was lead legal adviser. Goldman Sachs advised Paidy, and Cooley LLP and Mori Hamada & Matsumoto provided it legal counsel.

Reporting by Anirudh Saligrama in Bengaluru and Sayantani Ghosh in Singapore; Editing by Ramakrishnan M., Kim Coghill and Lincoln Feast.

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S.Korea parliament committee votes to curb Google, Apple commission dominance

A 3D printed Google logo is placed on the Apple Macbook in this illustration taken April 12, 2020. REUTERS/Dado Ruvic/Illustration/File Photo

SEOUL, Aug 25 (Reuters) – A South Korean parliamentary committee voted early on Wednesday to recommend amending a law, a key step toward banning Google and Apple from forcibly charging software developers commissions on in-app purchases, the first such curb by a major economy.

After the vote from the legislation and judiciary committee to amend the Telecommunications Business Act, dubbed the “Anti-Google law,” the amendment will come to a final vote in parliament.

That vote could come on Wednesday, although South Korean news agency Yonhap reported that parliament would act at a later date. read more

A parliament official told Reuters the office had not yet received an official request not to hold the meeting on Wednesday.

Apple Inc (AAPL.O) and Alphabet Inc’s (GOOGL.O) Google have both faced global criticism because they require software developers using their app stores to use proprietary payment systems that charge commissions of up to 30%.

In a statement on Tuesday, Apple said the bill “will put users who purchase digital goods from other sources at risk of fraud, undermine their privacy protections”, hurt user trust in App Store purchases and lead to fewer opportunities for South Korean developers.

Wilson White, senior director of public policy at Google, said “the rushed process hasn’t allowed for enough analysis of the negative impact of this legislation on Korean consumers and app developers”.

Legal experts said app store operators could work with developers and other companies to create secure payment methods other than the ones they provide.

“Google and Apple aren’t the only ones that can create a secure payment system,” said Lee Hwang, a Korea University School of Law professor specialising in competition law. “I think it’s a problem to try to inspire excessive fear by talking about safety or security about using different payment methods.”

Based on South Korean parliament records, the amendment bans app store operators with dominant market positions from forcing payment systems on content providers and “inappropriately” delaying the review of, or deleting, mobile contents from app markets.

It also allows the South Korean government to require an app market operator to “prevent damage to users and protect the rights and interests of users”, probe app market operators, and mediate disputes regarding payment, cancellations or refunds in the app market.

This month in the United States, a bipartisan group of senators introduced a bill that would rein in app stores of companies that they said exert too much market control, including Apple and Google. read more

Reporting by Heekyong Yang and Joyce Lee. Editing by Gerry Doyle

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S.Korea set to curb Google, Apple commission dominance

SEOUL, Aug 24 (Reuters) – South Korea is likely to bar Google and Apple from requiring software developers to use their payment systems, effectively stopping them from charging commissions on in-app purchases, the first such curbs on the tech giants by a major economy.

The parliament’s legislation and judiciary committee is expected on Tuesday to approve the amendment of the Telecommunications Business Act, dubbed the “Anti-Google law,” that takes aim at app store operators with dominant market positions.

If the bill gets the committee’s approval, it will be put to a final vote on Wednesday. Lawmakers in South Korea have pushed the issue of the commission structure since mid last year.

Alphabet Inc’s (GOOGL.O) Google and Apple Inc (AAPL.O) were not immediately available for comment.

Both companies have faced global criticism because they require software developers using their app stores to use proprietary in-app payment systems that charge commissions of up to 30% on in-app purchases.

“For gaming apps, Google has been forcing app developers to use its own payment system … and it wants to expand its policy to other apps like music or webtoon,” said Kwon Se-hwa, a general manager at the Korea Internet Corporations Association, a nonprofit group representing Korean IT firms.

“If the new bill becomes the law, developers will have options to use other independent payment systems,” Kwon said.

The European Union last year proposed the Digital Markets Act, taking aim at app store commissions. The rules are designed to affect large companies, but some European lawmakers are in favour of tightening them to specifically target American technology giants, Reuters reported in June. read more

Earlier this month in the United States, a bipartisan trio of senators introduced a bill that would rein in app stores of companies that they said exert too much market control, including Apple and Google. read more

In South Korea, the home market of Android phone maker Samsung Electronics Co Ltd (005930.KS), Google Play Store earned revenue of nearly 6 trillion won ($5.29 billion) in 2019, according to a government report published last year.

Earlier this year, Google said it will lower the service fee it charges developers on its app store from 30% to 15% on the first $1 million they earn in revenue in a year. Apple has made similar moves. read more

For Apple too, commissions from in-app purchases are a key part of its $53.8 billion services business, and are a major expense for some app developers.

In May, an antitrust lawsuit filed by the maker of the popular game “Fortnite” against Apple revealed that the game maker paid $100 million in commissions to Apple over two years. read more

Reporting by Heekyong Yang in Seoul, Additional reporting by Stephen Nellis in San Francisco
Editing by Shri Navaratnam

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Policy groups ask Apple to drop plans to inspect iMessages, scan for abuse images

Aug 19 (Reuters) – More than 90 policy and rights groups around the world published an open letter on Thursday urging Apple (AAPL.O) to abandon plans for scanning children’s messages for nudity and the phones of adults for images of child sex abuse.

“Though these capabilities are intended to protect children and to reduce the spread of child sexual abuse material, we are concerned that they will be used to censor protected speech, threaten the privacy and security of people around the world, and have disastrous consequences for many children,” the groups wrote in the letter, which was first reported by Reuters.

The largest campaign to date over an encryption issue at a single company was organized by the U.S.-based nonprofit Center for Democracy & Technology (CDT).

Some overseas signatories in particular are worried about the impact of the changes in nations with different legal systems, including some already hosting heated fights over encryption and privacy.

“It’s so disappointing and upsetting that Apple is doing this, because they have been a staunch ally in defending encryption in the past,” said Sharon Bradford Franklin, co-director of CDT’s Security & Surveillance Project.

An Apple spokesman said the company had addressed privacy and security concerns in a document Friday outlining why the complex architecture of the scanning software should resist attempts to subvert it.

Those signing included multiple groups in Brazil, where courts have repeatedly blocked Facebook’s (FB.O) WhatsApp for failing to decrypt messages in criminal probes, and the senate has passed a bill that would require traceability of messages, which would require somehow marking their content. A similar law was passed in India this year.

“Our main concern is the consequence of this mechanism, how this could be extended to other situations and other companies,” said Flavio Wagner, president of the independent Brazil chapter of the Internet Society, which signed. “This represents a serious weakening of encryption.”

Other signers were in India, Mexico, Germany, Argentina, Ghana and Tanzania.

Surprised by the earlier outcry following its announcement two weeks ago, Apple has offered a series of explanations and documents to argue that the risks of false detections are low.

Apple said it would refuse demands to expand the image-detection system beyond pictures of children flagged by clearinghouses in multiple jurisdictions, though it has not said it would pull out of a market rather than obeying a court order.

Though most of the objections so far have been over device-scanning, the coalition’s letter also faults a change to iMessage in family accounts, which would try to identify and blur nudity in children’s messages, letting them view it only if parents are notified.

The signers said the step could endanger children in intolerant homes or those seeking educational material. More broadly, they said the change will break end-to-end encryption for iMessage, which Apple has staunchly defended in other contexts.

“Once this backdoor feature is built in, governments could compel Apple to extend notification to other accounts, and to detect images that are objectionable for reasons other than being sexually explicit,” the letter says.

Other groups that signed include the American Civil Liberties Union, Electronic Frontier Foundation, Access Now, Privacy International, and the Tor Project.

Reporting by Joseph Menn; Editing by Edwina Gibbs

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Zoom reaches $85 mln settlement of lawsuit over user privacy, ‘Zoombombing’

Small toy figures are seen in front of Zoom logo in this illustration picture taken March 15, 2021. REUTERS/Dado Ruvic/Illustration/File Photo

Aug 1 (Reuters) – Zoom Video Communications Inc (ZM.O) agreed to pay $85 million and bolster its security practices to settle a lawsuit claiming it violated users’ privacy rights by sharing personal data with Facebook, Google and LinkedIn, and letting hackers disrupt Zoom meetings in a practice called Zoombombing.

A preliminary settlement filed on Saturday afternoon requires approval by U.S. District Judge Lucy Koh in San Jose, California.

Subscribers in the proposed class action would be eligible for 15% refunds on their core subscriptions or $25, whichever is larger, while others could receive up to $15.

Zoom agreed to security measures including alerting users when meeting hosts or other participants use third-party apps in meetings, and to provide specialized training to employees on privacy and data handling.

The San Jose-based company denied wrongdoing in agreeing to settle. It did not immediately respond on Sunday to a request for comment.

Saturday’s settlement came after Koh on March 11 let the plaintiffs pursue some contract-based claims. read more

Though Zoom collected about $1.3 billion in Zoom Meetings subscriptions from class members, the plaintiffs’ lawyers called the $85 million settlement reasonable given the litigation risks. They intend to seek up to $21.25 million for legal fees.

Zoombombing is where outsiders hijack Zoom meetings and display pornography, use racist language or post other disturbing content.

Koh said Zoom was “mostly” immune for Zoombombing under Section 230 of the federal Communications Decency Act, which shields online platforms from liability over user content.

Zoom’s customer base has grown sixfold since the COVID-19 pandemic forced more people to work from home.

The company had 497,000 customers with more than 10 employees in April 2021, up from 81,900 in January 2020. It has said user growth could slow or decline as more people get vaccines and return to work or school in-person.

The case is In re: Zoom Video Communications Inc Privacy Litigation, U.S. District Court, Northern District of California, No. 20-02155.

Reporting by Jonathan Stempel in New York; Editing by Andrea Ricci

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