A feature I wish iBooks had

I read books on my iPhone nowadays. There are two main reasons for that

  • I love taking notes while reading. It helps build a note system which refreshes my memory quickly all the points that I deemed worth remembering. With physical books, I can’t do the same
  • Admittedly, I pay for books once in a while, but mostly I use gen.lib; which is a website that offers free ebooks in various genres. After I download books to my Mac, it usually doesn’t take long for iBooks on my phone to sync and have those books ready in the app

Much as I like the experience of reading on iBooks, I wish it had a feature that’d allow readers to quickly store or buy books referenced by authors. Take a look at the example below

With the current iBooks, I have to highlight the name of the “The Tao of Warren Buffett” book and save it in my notes section. Later on, if I want to buy the book, I’ll have to exit what I am reading, go to the Search function, type in the name from my memory and buy it. There is so much friction and the experience is anything, but ideal. What I’d love to have is that once I press on the name of the book, a pop-up will show on the screen that has the book information from Apple’s bookstore and I can just tap on my phone screen to add it to my to-read list. The list should be able to sort books by added date or alphabet.

In fact, links on iBooks are clickable as you can see below. So, I wonder why there isn’t such a feature for iBooks. If friction is removed, I think readers are more likely to buy more books; which means more revenue for Apple and publishers.

Apple’s fall-out with Hey and the “Apple Tax”

If you follow tech Twitter, you likely won’t miss one of the big stories today: Hey’s fight with Apple. Hey is a new email service developed by Basecamp and was launched a couple of days ago. Right now, the only way to use Hey is to get invited on its website and pay for a subscription. The app was rejected by Apple twice because there is no in-app purchase option through which users could pay to use the service and through which Apple could financially benefit by taking its standard 30% cut. Apple issued an ultimatum: comply with our rules or get removed from App Store, along with access to millions of people who own Apple device. There are a few issues at hand here, so I’ll go through it one by one.

Before we begin, a bit of disclaimer right upfront: I own Apple’s stock in my portfolio, but I don’t think I am too partial to the company here. You’ll be the judge.

So, what are the rules?

Here is what Apple says in their guidelines

3.1.1 In-App Purchase:

If you want to unlock features or functionality within your app, (by way of example: subscriptions, in-game currencies, game levels, access to premium content, or unlocking a full version), you must use in-app purchase. Apps may not use their own mechanisms to unlock content or functionality, such as license keys, augmented reality markers, QR codes, etc. Apps and their metadata may not include buttons, external links, or other calls to action that direct customers to purchasing mechanisms other than in-app purchase.

Source: Apple

And

3.1.3(a) “Reader” Apps: Apps may allow a user to access previously purchased content or content subscriptions (specifically: magazines, newspapers, books, audio, music, video, access to professional databases, VoIP, cloud storage, and approved services such as classroom management apps), provided that you agree not to directly or indirectly target iOS users to use a purchasing method other than in-app purchase, and your general communications about other purchasing methods are not designed to discourage use of in-app purchase.

3.1.3(b) Multiplatform Services: Apps that operate across multiple platforms may allow users to access content, subscriptions, or features they have acquired in your app on other platforms or your web site, including consumable items in multiplatform games, provided those items are also available as in-app purchases within the app. You must not directly or indirectly target iOS users to use a purchasing method other than in-app purchase, and your general communications about other purchasing methods must not discourage use of in-app purchase.

Source: Apple

I am not a lawyer, but based on the text above which was referred to by Apple in correspondence to Hey indicates that consumers can still use services from apps like Hey, even though they are not acquired in-app, provided that in-app purchase is an option and not discriminated by app creators. My understanding of the issue here is that, barring any unpublished behind-the-scene details, Apple wanted Hey to add in-app purchase, but the email service refused to.

Here is the communication between the two

Clearly, when a consumer is presented with an option to buy goods or services in app, he or she will jump at it. Apple prohibits languages that discourage the use of in-app purchases. As a consequence, text such as “you can subscribe here, but it will help us more if you do on our website” will likely be banned. Because of those two factors, it’s understandable that Hey doesn’t want to have an in-app purchase. Most of the time, consumers will choose that option and Hey will have no choice, but to give Apple the commission. From Apple’s point of view, without forcing apps to include in-app purchase as an option, what app would voluntarily shoot itself in the foot and lose 30% of revenue? Also, it’s certainly not a good user experience to juggle back and forth between a website and an app, especially for new users that don’t subscribe yet to an app.

What I think is problematic are

  • The inconsistency in their handling that makes the rules look arbitrary and their enforcement look like an abuse of power
  • By making users, after downloading an app, go to a website to subscribe and then come back to use the app, Apple creates friction; which becomes problematic in the context of an app competing with Apple’s own service such as Spotify (which I will talk about later).

“Why do we have to pay while some others get a special treatment?”

One of the main arguments from the CTO of Basecamp is that there are other apps that get a special treatment from Apple and can bypass the rules on in-app purchases. Why is there such an inconsistent enforcement of the rules?

This is indeed frustrating. I tried Fastmail and Spark on my phone. You have to pay for Fastmail on a browser first before you can log in on its mobile version. Spark app is available to use, but there is no in-app purchase option that I can find. The same applies to Netflix. While it’s not a fair comparison between Hey and a household name with bargaining power like Netflix, being treated differently than your peer email services is unfair and I can see why Hey folks are frustrated.

In fact, I think Hey did the exact same thing as those two email apps did. The app only has these screens

Source: Macrumors

How is that different from the likes of Fastmail, Netflix or Spotify (I’ll talk about it later)? Yes, by not having an in-app purchase, Hey violated Apple’s verbatim guidelines, but since other apps and especially some offering the same service get exempted, you can’t help but feel for Hey for being singled out. Worse, Apple threatened to delete Hey app from the App Store

Apple told me that its actual mistake was approving the app in the first place, when it didn’t conform to its guidelines. Apple allows these kinds of client apps — where you can’t sign up, only sign in — for business services but not consumer products. That’s why Basecamp, which companies typically pay for, is allowed on the ‌App Store‌ when Hey, which users pay for, isn’t. Anyone who purchased Hey from elsewhere could access it on iOS as usual, the company said, but the app must have a way for users to sign up and pay through Apple’s infrastructure. That’s how Apple supports and pays for its work on the platform.

Source: Macrumors

I still don’t see why Hey isn’t allowed on the App Store when Netflix and Spotify should have most of their users as consumers. The inconsistency in enforcement of its own rules makes the rules arbitrary and the double down makes the company look like an outrageous bully.

Does Apple deserve to earn the 15-30% commission?

A lot of folks argue that there is no reason for Apple to generally take 15-30% commission from subscriptions and digital services sold through App Store. I tend to disagree on this. Without knowing the exact details, I still think there are expenses that go into maintaining and building the App Store. Somebody will have to review apps, keep the servers up, police content, fix bugs, authenticate payments and keep the marketplace secure. You don’t want an app that uses your data for reasons unknown to you without your consent, do you? You also want to feel that your credit cards are secured when making a payment on App Store, don’t you? None of those is born out of thin air. If Apple already invests in the App Store and makes it work well with Apple devices, why can’t they reap the fruits of their labor? While 30% commission may be too high; which is a legitimate argument, saying that Apple shouldn’t take commission at all is a bridge too far for me. Why shouldn’t they profit from their own investment? Wouldn’t you feel the same way if you were in their shoes?

Some may say that the App Store increases the value of Apple devices from which Apple already profit handsomely. Hence, the company shouldn’t be too greedy by profiting on developers. Well, maybe. But another argument is that Apple also invests a lot in designing and manufacturing their hardware. They deserve to profit from their own investment, whether it’s hardware or software. To answer the question whether Apple deserves the commission, my answer will be yes. How big that commission should be is another discussion.

In fact, Apple argued, in its response to Spotify, that the majority of apps on App Store don’t pay to Apple

Source: Apple

If you look at this point objectively, you can see from Apple’s perspective, it makes sense to “ask” apps that use their secure payment method to contribute to the ecosystem. The problem stems in part from how Apple “asks”, as I mentioned above, and how their policy can be argued to favor its own services at the expense of others. Like Spotify…

Source: Apple

What about Spotify?

There is a lot of bad blood between Apple and Spotify. The music streamer even created a website detailing their complaint on Apple’s unfair practices. One of the main complaints is that by forcing Spotify to have an in-app purchase option and, as a result, handing over 30% commission to Apple, Apple is abusing its power to make Spotify’s service uncompetitive compared to Apple Music.

There are two contrasting views through which you can look at this issue. On the one hand, if Apple gave Spotify a pass because one of Apple’s services competes with the Swedish company’s, 1) the argument seems arbitrary and weak, and 2) we’d go back to the point of inconsistent application of the rules.

On the other hand, does Apple commit anti-trust practice on Spotify? Well it depends. On Spotify iOS app, users can still log in with an existing account without having to pay anything, meaning that Apple will receive no revenue from Spotify

I logged in successfully, and when I tried to upgrade my plan, here was the screen

There is no option to upgrade in-app. The only instruction is to go to Spotify website. I am not sure if the change took place recently to placate regulators, but if this has been the case, existing users can still access Spotify and new users can choose to either go to pay for subscriptions on Spotify’s website or leave. Also, while the approved language (“please go to Spotify’s official website to learn more”) here doesn’t discourage any possible in-app purchase, normal users may not understand what is the issue here. They may as well just feel discouraged to have to go to a website, subscribe and go back to the mobile app. One can argue that this extra step creates friction for potential users to sign up and subscribe for Spotify, in contrast to the virtually frictionless experience with Apple Music, which is Spotify’s competitor. Another argument is that if Spotify wants to eliminate friction, it has to pay up; which hurts margin; or it has to increase prices; which hurts its competitiveness.

You can see both sides’ points in this argument.

Summary

With regard to Hey, Apple can technically enforce the rules which clearly state that there needs to be an in-app purchase option. It gets murky because they have applied their own rules so inconsistently that Hey can’t help but feel singled out for following the exact same companies that got an exemption from Apple. The double down feels like either Hey is unfairly targeted or Apple wants a payback for the PR attack that Hey caused on them. There is a sentiment that Hey knew the rules of the platform beforehand, and likely a possibility that things would come to this point. Yet, they chose to do this and piggyback on the current public narrative against tech giants’ anti-competition behavior for publicity gain and to strong-arm Apple. I don’t know for sure, but I can certainly see where such a sentiment comes from.

The price of taking advantage of a platform is that you have to follow the platform’s rules and be at its mercy. But if Apple decides to use its power in this case, it should give a better explanation as to the inconsistent application of its own rules and start being more consistent. Otherwise, it will create bad blood between itself and a key party that contributes so much to the ecosystem. Plus, well, that’s exactly the behavior of a bully. Exert power just because it can.

Regarding the “Apple Tax” on services that compete with Apple’s, I think it will be debated and decided in court. We can have many folks argue on each side’s behalf, but like other controversial issues, we likely won’t have a solution unless a court renders a decision.

Cobranded Credit Cards and Apple Card

In this post, I’ll try to deduce the reasons why Apple and Goldman Sachs decided to collaborate on Apple Card. What follows in this entry is my deduction from available information and based on my experience working in the credit card industry. First, I’ll touch on the concept of cobranded credit cards and what brands and issuers often get out of a partnership. Second, I’ll talk a bit about Apple Card. Last, I’ll give my thoughts on why Apple and Goldman Sachs may benefit from their relationship. These are my own thoughts only and if you have any thought or material that can contribute to the topic, I’ll appreciate it that you share with me.

Cobranded Credit Cards

You probably have seen a few cobranded credit cards before at popular stores or when you fly with domestic airlines

Source: Google Images

So, what exactly do brands and issuers get for working on cobranded credit cards?

Every brand wants to establish as close a relationship with consumers as possible. One of the popular methods is through a credit card with exclusive benefits. However, brands would be subject to a lot of regulations if they issued credit cards on their own. There would be also a lot of expenses that’d go into servicing accounts. No brand wants that extra burden in addition to running their own business. That’s why they need financial partners.

To compensate an issuer for bearing the risks and operational expenses, a brand usually takes care of the cost of exclusive brand-related benefits. For instance, shoppers receive 5% cash back at Target when they use Target credit cards. I don’t know the exact detail, but my guess is that Target will be responsible for most of the cash back, if not all. Additionally, brands can assist issuers with acquisition costs. Issuers spend thousands of dollars, if not much more, every year to acquire new customers. Brands have an already established relationship with their customers, brand awareness and financial resources that can help issuers in this regard.

On the other hand, issuers are responsible for dealing with financial regulations and servicing accounts. That’s why issuers try to sign as many partners as possible to leverage economies of scale. A small number of partners wouldn’t make operational expenses justified.

Issuers also have to compensate partners for leveraging their brand names. Agreements between issuers and partners vary on a case-by-case basis, but I wouldn’t be surprised if an agreement featured:

  • An issuer pays a partner for each new acquired account and a smaller fee for a renewal
  • An issuer pays a partner a fixed percentage on total purchase volume
  • An issuer pays a partner a fee when accounts make the first purchase outside partners’ locations

What do issuers get in return?

Issuers, of course, keep all financial charges and fees such as annual fees, cash advance fees or late fees. Besides, issuers can generate revenue from interchange fees. In every transaction, a merchant bank which works with a merchant has to pay an issuing bank which issues a credit card to the consumer who shops at the merchant a small fee for accepting credit cards as payment. Payment networks like Visa or Mastercard act as a middle man between a merchant bank and an issuing bank, and decide how big the fee, which is called interchange, should be. What I just describe is a gross simplification of what transpires behind the scenes in a couple of seconds or less in a transaction. There is a lot more to it. Essentially, for the sake of simplicity, just imagine that for every transaction, an issue bank receives 2% of the transaction volume in interchange fees. So if an issuing bank handles $1bn in transaction a month, that bank will get $20 million in interchange fees. Lastly, as mentioned above, issuers can also leverage partners in terms of acquisition costs.

IssuersPartner Brands
Responsibilities– Service accounts and handle regulatory compliance
– Bear risks of charge-off
– Compensation to partners 
– Additional rewards expenses as selling points to consumers
– Assistance in acquiring new accounts
Benefits– Financial charges and fees
– Interchange fees
– Marketing leverage from partners’ outreach
– Deepen relationships with customers
– Compensation from issuers
Table 1

Apple Card

Apple Card is an Apple-branded credit card issued by Goldman Sachs. You can only apply for an Apple Card via your wallet app on Apple-produced devices such as iPhone or iPads. The Card is so synonymous with Apple that you can barely hear about Goldman Sachs.

Apple reportedly will offer monthly payment plans for iPads and ...
Source: The Verge

Apple Pay’s selling points include:

  • No fees
  • Simple application process
  • Premium look and feel
  • Unlimited 2% cash back when you pay with Apple Card using your Apple Watch or iPhone
  • 3% cash back from select merchants such as Uber, T-Mobile, Nike, Walgreens, Duanereade and of course, Apple itself
  • Security as each transaction must be verified either by Touch or Face ID
  • Apple and Goldman Sachs promise not to sell consumer data with a 3rd party for marketing purposes

What’s in it for Apple and Goldman Sachs in launching this Apple Card?

Goldman Sachs isn’t know for consumer banking. It’s known for its investment banking business. Apple Card is the first attempt at consumer banking from the renowned company. As the issuer, Goldman Sachs (GS) will have to deal with all regulatory and security challenges while bearing the risk of charge-off. They will also take part in servicing accounts, but the work is shared with Apple as Apple Customer Service agents handle upfront communication with users. Since Apple Card has no fees whatsoever, what GS can benefit from this collaboration, I allege, include

  • Interchange fees
  • Insane marketing power from Apple and its global footprint in the form of millions of installed iphones
  • I imagine that if this collaboration succeeds, GS will want to sign more partners to achieve economies of scale, leveraging what they learn from operating Apple Card

Apple allegedly wants to launch Apple Card for two reasons: 1) to deepen relationship with users, to motivate them to buy their hardware more 2) to generate more service revenue. As a technology partner, I don’t imagine Apple will have to deal with fraud, regulatory or security concern. In exchange, Apple provides marketing outreach and technical assistance in incorporating Apple Card into its ecosystem. Additionally, from what I read, customers who need technical assistance will reach out to Apple Customer Service agents. Hence, that’s also what Apple brings to the table. Also, the company may allegedly be responsible for Apple-only rewards and interest free payment plans when customers buy Apple products. In terms of rewards with 3rd parties such as Nike or Uber, I can’t find any relevant information. If I have to guess, my money will be on Apple taking the bill for extra rewards as well.

Goldman SachsApple
Responsibilities– Service accounts and handle regulatory compliance
– Bear risks of charge-off
– Compensation to partners 
– Market Apple Card to users 
– Offer technology to make the card work with Apple Pay and its devices
– Help service accounts 3% cash back on Apple products and services
– Interest-free payment plan for customers when buying Apple products
Benefits– Interchange fees
– Leverage marketing power from Apple and its footprint
– Deepen relationships with customers
– Compensation from Goldman Sachs
Table 2

According to Apple, the number of transaction through Apple Pay has grown substantially since it was launched. As of Jan 2020, the annual run rate for Apple Pay reached 15 billion transactions. Not all Apple Pay transactions are through Apple Card. The card debuted only in August 2019. Since Apple doesn’t offer details on Apple Card transactions, let’s run some scenarios by assuming that the annualized transaction count for Apple Card is 500 million to 2 billion. If average ticket size (dollar amount per transaction) ranges from $20 to $60, the transaction volume will be as follows

 Annualized Apple Card Transactions
             500,000,000                         1,000,000,000                2,000,000,000 
$20$10,000,000,000$20,000,000,000$40,000,000,000
$40$20,000,000,000$40,000,000,000$80,000,000,000
$60$30,000,000,000$60,000,000,000$120,000,000,000
Table 3

Interchange fee rate varies depending on numerous factors. However, if we assume that the rate is 2% of purchase volume, based on the scenarios above in Table 3, GS would receive the following as interchange fees

Annualized Apple Card Transactions
             500,000,000                         1,000,000,000                2,000,000,000 
$20$200,000,000$400,000,000$800,000,000
$40$400,000,000$800,000,000$1,600,000,000
$60$600,000,000$1,200,000,000$2,400,000,000
Table 4

As you can see, the more Apple Card transactions, the bigger the interchange fees for GS. Given that Apple has legendary marketing prowess, an installed base of millions of devices and rising demand for contactless payments, the numbers may even grow bigger in the near future.

On Apple’s side, it is reported that Apple takes 0.17% cut on each Apple Pay transaction. In terms of Apple Card transactions, I think the cut will be even bigger, but won’t be bigger than GS’ interchange fee rate. Since we assume that GS receives 2% in interchange fee rate, let’s say Apple receives somewhere from 0.2% to 1% on purchase volume. How much would Apple receive, using the lowest purchase volume for each scenario of transaction count (first row respectively in Table 3)?

 Annualized Apple Card Transactions
             500,000,000                         1,000,000,000                2,000,000,000 
0.20%$20,000,000$40,000,000$80,000,000
0.50%$50,000,000$100,000,000$200,000,000
1%$100,000,000$200,000,000$400,000,000
Table 5

A few days ago, Apple and Walgreens announced that new Apple Card customers would receive $50 bonus in Apple Cash after spending at least $50 at Walgreens using the card. The promotion is valid till the end of June. It signals to me that 1) Apple wants to acquire more customers for Apple Card and 2) Apple may also receive a fee whenever a new customer comes on board. I don’t imagine $50 bonus would be paid for Walgreens or GS. Why would they do so when there is no sustainable benefit? If Apple shoulders the cost of the acquisition bonus, or at least most of it, it will likely not make financial sense to just rely on fees from card purchases to recoup the investment.

In sum, I hope that the information I shared and my thoughts are useful in helping you understand more about the credit card world that is complex yet fascinating. I spent quite some time thinking about the collaboration between Apple and Goldman Sachs as the presence of a tech giant and an investment bank in the consumer banking area is quite interesting. There isn’t much information out there so I would love to learn from whoever has useful information to contribute to the topic at hand.

Disclaimer: I own Apple stocks in my personal portfolio

A few notable graphs from Amazon and Apple earnings

Tech giants reported their earnings this week and proved how resilient their businesses are amid arguably the most challenging environment ever. In this post, I’d like to demonstrate with visuals how important AWS is to Amazon, and how China, Wearables and Services are to Apple while it has become less of an iPhone company.

Amazon

Apple

Teams vs Zoom and the art of reporting confusing numbers

Since the stay-at-home order started around the globe, demand for videoconferencing has skyrocketed. Facebook even introduced a new video service for its users. What has caught my interest, though, is the battle between Zoom and Teams by Microsoft. Zoom stock has surged significantly for the past two months, especially after it reported that it had 300 million daily active users. Or so we thought

Zoom has confused the comparisons, though. Zoom originally stated it had “more than 300 million daily users” and that “more than 300 million people around the world are using Zoom during this challenging time.” Zoom later quietly deleted these references from its blog post, and it now only claims “300 million daily Zoom meeting participants.”

The differences are important, as is Zoom’s transparency around them. Daily meeting participants counts multiple meetings, so if you have five Zoom or Teams meetings in a day, then you’re counted five times. Zoom has not yet revealed exact daily active user counts, and it looks like Microsoft could be a lot closer to Zoom usage than many had assumed.

Source: The Verge

For comparison, Microsoft announced today that it reached 200 million daily meeting participants in April. Since the two use the same label, does that mean Zoom has taken Teams’ lunch? Not quite there yet.

The daily meeting participant count can be misleading. For example, Teams doesn’t have a limit on call duration, to the best of my knowledge, while Zoom puts a 40-minute limit on calls that involve more than three participants. So if the participants are willing to set up another call after the free 40 minutes expires, it will bloat up the daily meeting participant count, even though it’s still one meeting that has the same folks involved.

Daily usage can be misleading as well. For instance, I use Jabber at work and it is powered up automatically on my work station. If I don’t interact with anyone on the app, does it mean I am among the daily users still? To be fair, the two companies don’t elaborate on this, but there is one comment from a Microsoft executive

It’s been phenomenal, if I’m honest with you. Let me just start with the DAU thing because there’s a lot of needling on this and we define the DAU. Daily active user for us is the maximum number of users who take an intentional action over a 24-hour period. That’s really important for me to hit. What we call passive actions do not count. So auto boot does not count. Minimizing a window does not count. Closing the app does not count. We also got a lot of questions about that. Skype does not count. So when we release our numbers, we just don’t feel like we want to get in the weeds of kind of argue with people, but the DAU very real.

Source: Microsoft

Another reason is the mix of added users/usage. In its latest investor call in March, Zoom’s CFO commented the following

Image

Granted, there may have been more development since the comment. Frankly, it’s unclear how the surge in usage benefits Zoom financially without the company’s disclosure. Nonetheless, it’s not surprising that the majority of the increased usage comes from the free tier.

On Teams side, it’s not particularly providing a clearer picture either. Back in January, during the Q2 earnings call, Microsoft announced they had 20 million daily active users. 3 months later, the figure stands at 75 million. Quite an achievement. But like Zoom, Microsoft has a free tier that allows video or calls. As a result, barring a comment from the Seattle-based company, it’s not clear how many Microsoft added as paying customers.

Source: Microsoft

The point is that it’s really hard to determine which videoconferencing tool is the better performer between the two leaders Zoom and Teams. The way data is reported by the two companies makes it really challenging to have an apple-to-apple comparison.

Contactless and card penetration trend from Visa.

In this post, I want to share with you what I found while I was doing some research on credit card trends.

Tap to pay

  • As of March 2020, one in three card present transactions by Visa is tap to pay, up from one in four a year ago (1)
  • In 2019, excluding the US, 55% of Visa transactions were contactless (1)
  • In the US, there are 145 million contactless credit cards in circulation and Visa expects that the number will reach 300 at the end of 2020 (1)
  • 17 out of the top 25 issuers are fully issuing tap to pay cards. 8 out of the top 10 merchants are accepting tap to pay. 60% of all in-store transactions in the U.S. are now taking place at terminals that are enabled for tap to pay. (1)
  • Globally, tap-to-pay has resulted in 20% life in card transactions. (2)
  • In the US, tap-to-pay cards led to plus 4 more transactions per month and $160 increase of spend per month (2)
  • “CEMEA now has the highest tap to pay penetration of any Visa region. 2 of our CEMEA countries, Russia and Georgia, are in the top 10 tap to pay countries in the world. Georgia is, in fact, number one, with an incredible 96% tap to pay penetration.” (2)
  • 77% of active terminals in South America are contactless-enabled. Tap-to-pay penetration was doubled in one year. Chile and Costa Rica have a leading 50% contactless penetration
  • “For example, on transit for London services, we saw double the transactions and 70% higher growth in spend by tap to pay transport for London users versus those not using tap to pay. In New York City, Visa is partnering with Chase to promote tap to pay in and around subway stations that are contactless enabled. As a result, Visa has crossed 4 million taps within the MTA system and contactless payments will be accepted system-wide by the end of 2020.” (2)’
  • In Asia Pacific, tap to pay penetration increased from 29% in 2016 to 41% in 2019. Post activation, tap-to-pay card saw 3.8 times more transactions and 1.8 times more spend per card. Specifically, tap-to-pay cardholders made 3.9 times more transactions at fast food restaurants and 2.3 times more at supermarkets and grocery stores
Source: Visa

Card Penetration

  • On average, an American makes 12 cash transactions a month. 55% of all transactions under $10 were made in cash (2)
  • In daily segments such as gas or supermarkets, card penetration stood at 60% for the US (2)
  • Retail digital spending has grown at CAGR of 23% since 2016, yet it still only makes up 14% of global retail spending (2)
  • Cash and check penetration remains at 92% for Sub-Saharan Africa, excluding South Africa (2)
  • “The macro trends are incredible. It (Sub-Saharan Africa) has the fastest-growing population among major regions, double the global average and half of sub-Saharan Africa is under 18 years of age. It has 46 countries, and 6 of which are in the top 10 fastest-growing economies in the world. The market is still greenfield. Cards have only penetrated 3% of PCE, and 2/3 of the population does not have a bank account. Yet Africa is home to nearly half of all mobile money users. Sub-Saharan Africa is mobile first. People use their mobile phones daily to make and receive payments. This opens immense, immediate and long-term opportunities for Visa.” (2)

References

  1. Visa Inc at Wolfe Research FinTech Forum (11th March 2020)
  2. Visa 2020 Investor Day

Disclaimer: I own Visa stocks in my personal portfolio

Kindle App vs iBooks on iOS 13

Amazon isn’t exactly known for its design capability, yet I am relatively pleased with the Kindle App on iOS 13. Below is a brief comparison between the two apps in terms of features and UX.

Appearance

The Kindle app offers different options to adjust the font, the theme, the spacing between rows, the brightness and the view.

With the exception of the ability to change spacing between rows, all the other features are very similar to what iBooks provides. Personally, I appreciate the green theme available on Kindle.

Looking up and translating words

Additionally, readers can translate, look up unknown words and learn more about them via Wikipedia inside the Kindle app handily. All readers need to do is to select the word and the features are automatically presented.

On iBooks, it’s a little bit different. After clicking on a word and choosing “Look up”, readers will be taken to a page that includes various options related to the word in question

Taking notes

It’s a little bit frustrating to take and copy notes on iOS. As the short video shows, users have to select a block of text manually again for any use.

If users want to use the copied text somewhere, iOS has a default footnote that comes with every single copy. The note itself reminds users of the title and author at hand, but it creates another step that becomes annoying if repeated.

On Kindle, taking notes is a bit easier. A whole block of text can be chosen and copied with only a touch of your fingertip. Additionally, there is no default footnote as in the case of iBooks.

Flashcard

Kindle has one feature that is absent on iBooks: Flash Cards. It’s pretty handy for those that like to take notes and come back later to test their memory.

In short, the two apps provide very similar core functionalities. The difference comes, I suspect, mainly from special use cases. Personally, because I often copy quotes and notes from books to this blog in my book review entries, I prefer Kindle to iBooks.

Update your Mac OS to Catalina, if you want major disruptions to your computer

I have been on Catalina for almost a week and the experience has been nothing short of a disaster. I am using a Macbook Pro 2012 with 8GB RAM and a 2.9 i7 chip. It was running smoothly with Catalina’s predecessor: Mojave.

However, since I upgraded to Catalina, not only is my computer running more slowly, but I also have issues with a variety of apps. Even though I paid for my CleanMyMac, here is it asking me to upgrade because of Catalina

I am supposed to work remotely today and it requires using a VPN, which in my case is Citrix. Here is what my colleague in IT department told me this morning

My Snagit keeps freezing and crashing, prompting me to download another screenshot application.

Here is what my friend sent me this morning as well

I can’t remember the last time I was this upset with a Mac OS update. I hope that Apple will pull it together and release a new version that fixes all the issues

Disclaimer: I own Apple stocks in my personal portfolio

Quick review of iPhone 11

After years of delaying a phone upgrade, I finally gave in when my old iPhone 5S’s battery dropped from 50% to less than 5% after one phone call. I bought a new iPhone 11 last Friday at an Apple Store and wanted to share a few thoughts after using it for almost a week since I doubt that I will have major other use cases later on. It’s worth noting that while I was standing in line to get the new phone (and it’s a long line), I was pretty much one a few people who stood there to get the 11. Most customers were there to get the Midnight Green color which is only available on 11 Pro and Pro Max. I won’t be surprised to see that the color is the best selling iPhone this year. Apparently, Walt Mossberg, a famed tech journalist, had pretty much the same observation

Camera

The camera on iPhone 11 is fantastic. It can take photos with dim lights and photos have remarkable quality. I am not a photographer and I suck at making adjustments for photos, but these are some that I have taken so far

The setting has way less lighting than it looks and I didn’t adjust anything
Some food in Chicago close up

FaceID

FaceID works when my face isn’t directly in front of the camera, when I lie on my bed at night with only the reading lamp on and when I have sunglasses on. You can choose to set up FaceID so that it will work even when your eyes are closed, even though for security reasons it is not recommended. The feature facilitates log-ins and payment seamlessly, something that a person who upgraded from iPhone 5S very appreciates

No notification while driving

The phone’s default setup prevents notifications from app while you are driving. If you are on a train or bus, you can manually turn it off easily. If you just go about your day and drive without giving it much thought, don’t be surprised that you won’t receive alerts from your friends.

Blocking unknown callers

There is a feature that blocks calls from numbers that are not in your phone book. This option; however, may be annoying if, for instance, you are waiting for a call from Google to verify a log-in like I sometimes do, due to the two-step authentication security feature.

Battery

I am not a heavy phone user in a sense that I don’t listen to music much on the new phone yet and I don’t play games. So even though my battery lasts more than a day with all chat messages, Twitter, Facebook and maps, it may not be a practical true yardstick of the battery life. Nonetheless, if your use cases are similar to mine, the phone’s new battery is pretty awesome.

Because iPhone is one of the most covered products and Apple one of the most scrutinized companies, I am sure there are others that have reviews in depth. For the simple use cases and features that fit my life, the phone has been great. So far.

Disclaimer: I own Apple stocks in my personal portfolio.

If you are intellectually curious, these facts about Formula 1 will intrigue you

I am a Formula 1 fanatic. The sport is unpredictable, exciting and intellectually intriguing. Everything about the drivers and the cars is about maximizing every last drop of performance and gaining even one hundredth or one tenth of a second. The level of attention to details and state-of-the-art technologies that go to every aspect of the sport is astonishing. Here are a few clips that I found very helpful in understanding the sport. Even if you are not interested in the racing, I think it’s interesting when you are just curious about how stuff works

Car setup

A car setup is instrumental to the performance of the car. It’s more of an art and trial-error than science and there are a lot that go into the setup such as the nature of the tracks, driver preference, strengths & weaknesses of the cars, weather, tyre…The video below explains how one millimeter can mean the world in a car setup!

Braking System

Brakes are crucial in racing, even in commuter cars. As F1 cars travel at such a high speed and brake multiple times in one lap, brakes can get hot and fail, causing drivers to crash and fall out of races. The video below from Mercedes explains how brakes work and how setting up brake systems in certain races can be an engineering nightmare. For instance, Monaco Grand Prix is a twisty street track where speed is low and brakes are applied almost constantly. After every corner, brakes get increasingly hot. Cooling down brakes is a challenge as they are usually cooled when drivers accelerate in straights; which is, as mentioned, not what happens in Monaco.

In Baku Grand Prix, the challenge is different. Half of the track is made of long straights and the other half is a street circuit. At the end of long straights, brakes are cold and drivers run the risk of not having the best performance from brakes for the twisty part. Then, during the twisty part, there is not enough cooling for the brakes.

Logistics

A F1 calendar consists of around 21 races a year, spanning across the globe over a period of 9 months. Teams have to manage car parts, communication equipment, hospitality settings, fuel, kitchen, etc… Managing the logistics of a race, especially back-to-back races in different countries miles away from each other is a daunting challenge. This video explains very well this aspect of Formula 1

Steering wheel

Do you think you can remember how all the buttons work and make them work while driving at 180mph?