Britain to tackle 'Wild West' internet with new laws

LONDON (Reuters) – Britain will tackle “the Wild West elements” on the internet from cyberbullying to online child exploitation by introducing new laws for social media companies, digital minister Matt Hancock said on Sunday.

Britain’s Secretary of State for Digital, Culture, Media and Sport, Matt Hancock, appears on the BBC’s Marr Show in London, Britain, May 20, 2018. Jeff Overs/BBC/Handout via REUTERS

Launching a consultation on what measures should be used to ensure the safety of those using the internet, Hancock said the government would publish a white paper – a policy document that sets out proposals for future legislation – later this year and aim to bring in new laws “in the next couple of years”.

Better regulating social media companies has long been an aim of a government that has struggled to carry out its agenda with Britain’s departure from the European Union taking up much of ministers’ time.

“Digital technology is overwhelmingly a force for good across the world and we must always champion innovation and change for the better,” Hancock said in a statement.

“At the same time I have been clear that we have to address the Wild West elements of the Internet through legislation, in a way that supports innovation. We strongly support technology companies to start up and grow, and we want to work with them to keep our citizens safe.”

There was little detail on what kind of regulation should be used to protect those using the internet, but Hancock told the BBC that as part of the data protection bill now in parliament, firms could be fined up to 4 percent of their global turnover.

But when asked whether the government would stop companies from allowing children to spend hours on the internet, Hancock told ITV television: “We want to have a broad consultation.”

In his statement, Hancock said the ministry for digital, culture, media and sport and the interior ministry would work with regulators, platforms and advertising companies to settle on legislation that tackles “both legal and illegal harms”.

“I don’t want the trolls to win,” Hancock said.

Reporting by Elizabeth Piper; Editing by Mark Potter

Google, Alibaba Spar Over Timeline for 'Quantum Supremacy'

Google’s quantum computing researchers have been planning a party—but new results from a competing team at China’s Alibaba may have postponed it. The China-America corporate rivalry on an obscure frontier of physics illustrates a growing contest between nations and companies hoping to create a new form of improbably powerful computer.

In March, Google unveiled a chip called Bristlecone intended to set a computing milestone. It could, Google said, become the first quantum computing system to perform a calculation beyond the power of any conventional computer—a marker known as quantum supremacy. The group’s leader, John Martinis, suggested it could reach supremacy this year, updating an earlier prediction that his team might do so in 2017.

But new results from Alibaba’s quantum researchers suggest Google’s published plans for Bristlecone can’t achieve quantum supremacy after all. Chips with lower error rates will be needed, they argue. In an email, Google researcher Sergio Boixo told WIRED that he welcomes such research, but there are “a number of questions” about the paper’s results. Others see them as notable. “The goalposts have moved,” says Itay Hen, a professor at the University of Southern California.

Achieving quantum supremacy would be a scientific breakthrough, not a sign that quantum computers are ready to do useful work. But it would help Google’s standing in an intensifying competition to make practical quantum computers a reality. The search company and competitors like IBM, Intel, and Microsoft want to rent or sell quantum computers to companies such as Daimler and JP Morgan, which are already exploring how the machines might improve batteries and financial models.

Computers like the one forming these words use pulses of electricity to represent data as bits, 0’s or 1’s. Quantum computers encode data into quantum mechanical effects of the kind that perplexed Albert Einstein and other physicists in the early 20th century, to create qubits. The exotic devices operate at temperatures close to absolute zero. In groups, qubits can zip through some tough calculations using tricks such as attaining a “superposition,” something like both 1 and 0 at the same time. There’s evidence that could aid chemistry simulations; Google and others think machine learning could get a boost, too.

Google’s Bristlecone chip has 72 qubits made with superconducting circuits, the largest such device ever made, ahead of IBM’s 50-qubit device and one from Intel with 49. Google’s researchers calculated that was enough to run a carefully chosen demonstration problem beyond the reach of any conventional computer, achieving quantum supremacy.

Researchers at Alibaba, China’s leading online retailer, challenged that by using 10,000 servers, each with 96 powerful processors, to simulate the workings of Google’s new chip, drawing on the US company’s published plans. The results are a reminder that existing computer architectures are far from played out—and suggest that Google’s planned demonstration with its quantum chip wouldn’t be beyond the reach of conventional computers. “There was a lot of hope that this future processor will achieve quantum supremacy,” says Yaoyun Shi, director of Alibaba’s Quantum Lab. “Our result shows that this enthusiasm is perhaps too optimistic.” He says the company achieved its result by devising better ways to divide the task of simulating quantum computing operations across many computers working together.

Alibaba’s results moved Graeme Smith, a professor at the University of Colorado to tweet a link with the comment “wow.” Google’s Bristlecone appears to be the most capable quantum chip yet, Smith tells WIRED, but Alibaba’s results suggest error rates are still too high. “This suggests that we won’t be seeing a demonstration of quantum supremacy anytime soon,” he says.

Google’s Boixo counters that Alibaba’s simulations weren’t detailed enough to be definitive. Work on better simulations—like Alibaba’s study—is one reason Google has been working on new ways to test quantum supremacy, which Boixo says shouldn’t require big hardware upgrades. Hen of USC says this will, in turn, spur researchers trying to squeeze more from conventional computers. “I’m sure the goalposts will keep moving,” he says.

Alibaba’s rise in quantum computing has been rapid and demonstrates China’s technology ambitions. Google has been working on quantum computing since 2006, initially using hardware from Canada’s D-Wave. The Chinese retailer entered the field in 2015, teaming up with the state-backed Chinese Academy of Sciences to open a new research lab. In February the company made an experimental 11-qubit chip available over the internet. China’s government has committed $10 billion to build a new national quantum lab.

Those projects are part of a growing international contest: The European Union is planning a $1.1 billion investment in quantum research. The Trump administration has highlighted quantum computing in budget guidance. Although the White House Office of Science and Technology Policy has shrunk significantly under President Trump, in December the group got its first dedicated quantum computing expert—Jake Taylor, a researcher from the University of Maryland.

Google set up its own quantum hardware lab in 2014, bringing in Martinis from UC Santa Barbara to lead the group. The company’s recent talk of achieving quantum supremacy has irked some others in the field, who say building up the milestone as a definitive moment risks overhyping how close practical quantum computers really are. Intel CTO Mike Mayberry told WIRED this week that he sees broad commercialization of the technology as a 10-year project. IBM has said it can be “mainstream” in five.

Alibaba’s Shi doesn’t deny that quantum supremacy—when it comes—will be important. But he suggests that researchers at Google and elsewhere should be more philosophical about it. “For device physicists to worry about when to reach supremacy is like worrying about when your baby is going to be smarter than your dog,” he says. “Just focus on taking good care of her and it’ll happen, even though you aren’t sure when.”

More Great WIRED Stories

Cambridge Analytica files for bankruptcy in U.S. following Facebook debacle

(Reuters) – Cambridge Analytica, the political consultancy at the center of Facebook Inc’s (FB.O) privacy scandal, filed for Chapter 7 bankruptcy in the United States late on Thursday.

This past March allegations surfaced that Cambridge Analytica, hired by President Donald Trump’s 2016 U.S. election campaign, improperly used data of 87 million Facebook users beginning in 2014.

Cambridge Analytica and its British parent SCL Elections Ltd said earlier this month that they would shut down immediately and begin bankruptcy proceedings after suffering a sharp drop in business.

The petition to file bankruptcy was submitted at the U.S. Bankruptcy Court Southern District of New York and was signed on behalf of Cambridge Analytica’s board by Rebekah and Jennifer Mercer, daughters of billionaire Robert Mercer.

The Mercer family was one of Trump’s biggest donors.

FILE PHOTO: The nameplate of political consultancy, Cambridge Analytica, is seen in central London, Britain March 21, 2018. REUTERS/Henry Nicholls

Cambridge Analytica LLC listed assets in the range of $100,001 to $500,000 and liabilities in the range of $1 million to $10 million.

London-based Cambridge Analytica was created in 2013 initially with a focus on U.S. elections, with $15 million in backing from Mercer and a name chosen by former Trump White House adviser Steve Bannon, according to a report by the New York Times.

Facebook has faced multiple investigations in the United States and Europe over its handling of personal data of users, hurting shares of the Mark Zuckerberg-led company.

Zuckerberg has appeared before U.S. congressional committees to testify on data privacy and will meet leaders of the European Parliament soon.

Facebook said on Monday it has suspended around 200 apps in the first stage of its review into apps that had access to large quantities of user data before the company restricted data access.

Reporting by Abinaya Vijayaraghavan and Supantha Mukherjee in Bengaluru; Editing by Gopakumar Warrier

Vietnam set to tighten clamps on Facebook and Google, threatening dissidents

HANOI/SINGAPORE (Reuters) – A struggle over internet laws in Vietnam is pitting a government keen on maintaining tight control against U.S. technology companies trying to fight off onerous new rules – with the country’s online dissidents among the biggest losers.

Rights activist Le Van Dung (R) live streams on Facebook in a coffee shop in Hanoi, Vietnam May 15, 2018. Picture taken May 15, 2018. REUTERS/Kham

The latest conflict centers on new cybersecurity legislation set for a vote by Vietnamese lawmakers later this month. It aims to impose new legal requirements on internet companies, and hardens policing of online dissent.

Facebook, Google and other global companies are pushing back hard against provisions that would require them to store data on Vietnamese users locally and open offices in the country. But they have not taken the same tough stance on parts of the proposed law that would bolster the government’s crackdown on online political activism.

Vietnam offers a case study in the conflicting pressures the likes of Facebook and Google confront when operating in countries with repressive governments. It also shows how authoritarian regimes try to walk a line in controlling online information and suppressing political activism without crippling the digital economy.

Such tensions are playing out across Southeast Asia, where the enormous popularity of Facebook and Google has created lucrative business opportunities and outlets for political dissent. With that, though, has come both government censorship and a way to get propaganda to large audiences efficiently.

The region is particularly important for Facebook and Google because most Internet users in China are blocked from accessing them.

An industry group called the Asia Internet Coalition (AIC) is leading efforts to soften the proposed cyber law in Vietnam. Jeff Paine, managing director of the AIC, said he and others were able to raise concerns about the law directly with Vietnamese Prime Minister Nguyen Xuan Phuc and other top government officials when they visited Singapore last month.

The discussions took place as part of a seminar about internet issues that included academics, industry officials and the high-level Vietnamese delegation, according to Paine. He said there was “a healthy dialogue” that focused mostly on how Vietnam can leverage the next stages of the digital revolution.

But he said there was no discussion of content restrictions.

The Vietnamese government did not respond to a request from Reuters for comment for this article.

Political activists in Vietnam rely on social media to rally support, and the new cyber law comes on the heels of an April letter from more than 50 rights groups and activists to Facebook Chief Executive Mark Zuckerberg accusing the company of working too closely with the Vietnamese government to stifle dissent.

Facebook and Google say they have to abide by local laws in the countries where they operate.     

Facebook’s latest “transparency report,” released Tuesday, shows that in the second half of last year, the company began blocking content in Vietnam for violations of local law for the first time. The company reported 22 such instances – though it said they were prompted by “private reports of defamation” rather than direct government requests.

Google last year also blocked YouTube videos at the request of the government for the first time. Updated figures released Friday show the company was asked to remove more than 6500 videos in 2017, mostly for criticizing the government, and that it complied with a majority of the requests.

A man uses an iPad device in a coffee shop in Hanoi, Vietnam May 18, 2018. REUTERS/Kham

The transparency reports do show that the companies don’t automatically do the bidding of the government. Facebook said it had received 12 government requests for Facebook user account data in 2017 and complied with only 4 of them, all of which were “emergency” requests. The company defines an emergency as involving “imminent risk of serious physical injury or death.”

In cases where content is alleged to violate local law, both companies say takedown requests are subject to legal review, and when they comply the material is only blocked locally.

Direct government censorship requests don’t tell the whole story though.

Facebook also removes content and blocks accounts for violating its own global “community standards,” which bar material and behaviors ranging from posting pornography to hate speech and inciting violence.

“The first thing we do when a government tells us about content that violates laws is we look at whether it violates our standards,” said Monika Bickert, Facebook’s vice president of global policy management. The company this week began providing data on community standards violations but does not break it down by country.

“My account was blocked for 8 months,” said Le Van Dung, an independent journalist in Vietnam who signed the letter to Zuckerberg. “I sent letters to Facebook management for months but there’s only an automatic reply saying they have completed your request.”

His account was restored last month, the day after the appeal to Zuckerberg was sent, he said.

Facebook said Dung’s account was correctly removed for violating community standards provisions barring “spam” activities and was restored by mistake. Dung denies engaging in spam. He did, though, have more than one account. Multiple accounts are not allowed on Facebook and fall within the company’s definition of spam behavior.

TIGHTENING THE SCREWS

Vietnam has had tough internet regulations in place since 2013. They ban any postings that are anti-government, harm national security, cause “hatred and conflicts” or “hurt the prestige of organizations and individuals.”

The rules also ban social media users who “spread fake or untruthful information.”

New rules implemented in 2017 tightened the screws further. One turning point, according to Yee Chung Seck, an attorney in the Ho Chi Minh City office of the international law firm Baker McKenzie, was an April 2017 meeting convened by the government to discuss a range of Internet ills including disinformation, hate speech and bullying.

Slideshow (2 Images)

That came just after the government called on all companies doing business in the country to stop advertising on YouTube, Facebook and other social media until they found a way to halt the publication of “toxic” anti-government information.

Yet another decree implemented last month stated that social media platforms had to remove illegal content within three hours of it being reported by the government, though Paine said the rule applies only to domestic companies.

Still, Facebook and Google don’t seem to be under any imminent threat given how deeply they have penetrated into Vietnam society.

About 55 million of Vietnam’s 96 million people are regular social media users, according to research by Simon Kemp, a digital media consultant based in Singapore.

Facebook, YouTube and Google Search are far and away the most popular internet destinations, Kemp’s data shows. Facebook is also the most popular platform for online shopping in Vietnam.

And the government is eager to nurture the country’s digital economy: smartphones and all that they enable, especially e-commerce and online banking, are transforming economies across Asia, and no one wants to be left behind.

“They love that part of the story,” said Chung.

But the government also wants more control, including local data storage and local corporate offices – a provision company officials privately fear is designed to allow the government to intimidate companies by exposing individuals to arrest.

Both Facebook and Google serve Vietnam from their regional headquarters in Singapore.

The new law also gives more power to Vietnam’s Ministry of Public Security, which is tasked with crushing dissent in the communist-ruled country.

Facebook said it expected the new rules would require it to restrict more content. Google declined to comment.

LONG JAIL TERMS

For the rights activists, there appears to be little hope of relief.

For example, just this month, a Facebook user in Vietnam was sentenced to four-and-a-half years in jail for posts which “distorted the political situation,” according to a statement posted on an official Communist Party website.

Still, Facebook remains an important tool for activists in Vietnam – a country where government criticism is rarely tolerated and the battle between the authorities and dissidents is a game of cat-and-mouse.

“Sometimes we use Facebook to distract authorities, like we pretend to discuss an important meeting, which obviously won’t happen,” activist Nguyen Lan Thang said. “Then we watch from afar and laugh as they surround our fake meeting spot,” Thang added.

Additional reporting by James Pearson; Editing by Martin Howell

Amazon cuts Whole Foods prices for Prime members in new grocery showdown

(Reuters) – Amazon.com Inc (AMZN.O) and Whole Foods Market are making a surgical strike in the already brutal grocery price war.

FILE PICTURE – The logo of the web service Amazon is pictured in this June 8, 2017 illustration photo. REUTERS/Carlos Jasso/Illustration/File Photo

On Wednesday, Whole Foods debuted a much-anticipated loyalty program that offers special discounts to Prime customers, including 10 percent off hundreds of sale items and rotating weekly specials such as $10 per pound off wild-caught halibut steaks.

Those perks are available now in Florida and will roll out to all other stores starting this summer. Amazon previously announced free two-hour delivery from Whole Foods stores for members of Prime, its subscription club with fast shipping and video streaming.

The new loyalty strategy will test whether Amazon’s $13.7 billion deal for Whole Foods brings much-feared disruption and an intensified price war to the $800 billion U.S. grocery industry dominated by Walmart Inc (WMT.N) and Kroger Co (KR.N).

Whole Foods, with 463 U.S. stores and roughly 1 percent share of the fragmented U.S. grocery market, has gained momentum since the Amazon merger last summer, Whole Foods co-founder and Chief Executive John Mackey told Reuters.

Closely watched basket size – the number of items purchased per transaction – has grown since the merger, said Mackey. He declined to offer specifics.

Mackey is betting on Prime to convince shoppers wary of its “Whole Paycheck” reputation that it is an affordable option for more of their purchases.

The new perks could make Whole Foods cheaper than conventional grocers for about 8 million of its customers who already subscribe to Amazon Prime, according to Morgan Stanley analysts.

Prime members scan an app or input their phone numbers at checkout to receive the discounts.

Still, Philadelphia-area Whole Foods shopper and Prime member Heather Kincade, 46, is going to need convincing.

While Whole Foods’ prices on staples like rotisserie chicken, bananas and avocados have come down, she still thinks some every day items are prohibitively expensive. “If I start buying dish soap and other things there, I will have hit the big time,” she said.

LOWER MARGINS

In Amazon, Whole Foods has found an owner that is famously comfortable spending away profits on new businesses or on lower prices.

“Given how important it is for Amazon to provide value for their customers, and customers value lower prices, I would think they’d be comfortable operating Whole Foods at a lower margin while experimenting with the operating model,” said Tom Furphy, former vice president of consumables and AmazonFresh, and now chief executive of Consumer Equity Partners.

Mackey said more rounds of cuts are in the cards.

“Whole Foods is going to become more and more and more competitive,” said Mackey, who declined to detail how much of a haircut its suppliers will take.

Hain Celestial Group, one of Whole Foods’ biggest suppliers, says a lower profit margin may be worth it.

“I never mind giving up margin for growth,” Hain CEO Irwin Simon told Reuters.

Small grocers, who still control a hefty portion of U.S. sales, typically have razor-thin margins. They are under increasing pressure as German discounters Aldi and Lidl lower prices, too.

Walmart said it will keep offering everyday low prices to all shoppers at its more than 5,000 U.S. stores.

Kroger Co, the largest U.S. supermarket operator with roughly 2,800 stores, uses shopper data to personalize loyalty discounts.

CEO Rodney McMullen told Reuters earlier this month that the chain’s prices will “absolutely” be lower than Whole Foods on the typical shopper’s basket of about 50 items per week.

“It’s easy to beat somebody on four or five items,” said McMullen.

Kroger tested an annual grocery delivery subscription but tabled it due to insufficient demand, he added.

Reporting by Lisa Baertlein in Los Angeles and Jeffrey Dastin in San Francisco; Editing by Greg Mitchell

How to deal with bad data in your cloud migration

Do you have dysfunctional enterprise data? The symptoms are pretty easy to spot, including not having a single source of truth for customers, orders, inventory, etc. Or not be able to properly secure and govern the data, thus being unable to deal with regulations.

Many enterprises are taking their dysfunctional data to the cloud, and thus their limits and problems. But you don’t have to perpetuate that dysfunction in the cloud. Here are some ways to fix that dysfunctional data when moving to the cloud.

Option 1: Fix the data in flight to the cloud

Facebook Creates Youth Portal to Give Teens Tips About Using Its Service

Facebook has created an online resource center for teenagers to learn tips and tricks for using the social networking service.

On Monday, the technology giant debuted the Youth Portal, intended for teens to better understand how to control their Facebook settings, like determining who is allowed to see certain posts, as well as learning how other teenagers use Facebook to raise awareness about humanitarian issues.

Facebook said that it consulted with an unspecified number of teenagers in the U.S., Italy, the United Kingdom, and Brazil in designing the new site.

Some of the information that the Youth Portal provides includes safety tips for teenagers to adhere to when posting on Facebook. In one tip, Facebook recommends that teens ask themselves whether they would feel comfortable reading out loud to their parents or grandparents the contents of a Facebook post before posting it.

Another recommendation is that teenagers not give out personal information to people they just met online and to only accept Facebook friend requests from people they know.

Facebook also created a section in the Youth Portal about data privacy that shows teenagers how to change their user settings so that their posts or status updates only show to specific groups of people like their close friends or acquaintances. In that section, there’s also a description of Facebook’s data policy and another short account about how Facebook uses data to help companies better target their online ads. But both of those descriptions link to the company’s longer and more complicated explanations intended for the general public.

Facebook said it is still figuring out how to notify teenagers about its new tips. Earlier this month, as a test, it started showing some of the tips to an unspecified number of teens in their News Feeds.

Get Data Sheet, Fortune’s technology newsletter.

The social networking company’s release of a youth information center comes amid a general backlash against tech companies for failing to account for how their services will be used by children.

A few of Apple’s big shareholders, for example, urged the company to address the rise of smartphone addiction and other negative consequences that the overuse of smartphones present to children. Apple then debuted its “Families” site in March as a way for parents to learn how to better monitor how their children use smartphones and apps.

Two Chinese bitcoin mining equipment makers plan $1 billion Hong Kong listings: IFR

HONG KONG (Reuters) – Two Chinese bitcoin mining equipment makers plan to raise up to $1 billion each from Hong Kong listings this year, riding on strong global interest in cryptocurrencies, IFR reported on Tuesday, citing people familiar with the plans.

FILE PHOTO: A token of the virtual currency Bitcoin is seen placed on a monitor that displays binary digits in this illustration picture, December 8, 2017. REUTERS/Dado Ruvic//File Photo

Canaan Creative filed a listing application to the Stock Exchange of Hong Kong on Monday, IFR, a Thomson Reuters publication, reported.

Zhejiang Ebang Communication has also started working with advisers on a proposed Hong Kong float of up to $1 billon, reported IFR.

Ebang listed on China’s National Equities Exchange and Quotations, also known as the New Third Board, in 2015 and was

delisted from the over-the-counter market in March after announcing in January that it would seek a Hong Kong listing.

Chinese bitcoin mining equipment makers are hungry for capital to fund their growth as the heightened interest in cryptocurrencies has led to a surge in demand for their machines.

Canaan, which sells “Avalon” mining machines with customised super-fast ASIC chips, made revenue of more than 1 billion yuan in 2017. Although cryptocurrencies can be mined using regular computer equipment, specialised processing devices dedicated to mining are more effective and can generate more income.

The company’s co-chairman Jianping Kong told Reuters in April that he expected China’s push to promote the domestic chip industry to help drive growth for the company.

Credit Suisse, CMB International, Deutsche Bank and Morgan Stanley are joint sponsors for Canaan’s float, according to IFR.

Canaan Creative declined to comment. Ebang could not be immediately reached for comment. All the banks didn’t immediately respond to a request for comment.

Canaan’s IPO valuation has yet to be set as there is no listed comparable and the prices of cryptocurrencies have

fluctuated a lot, reported IFR. It was valued at $500 million in mid-2017, IFR said, attributing it to one of the people.

Reporting by Fiona Lau at IFR; Additional reporting by Sijia Jiang; Writing by Julie Zhu; Editing by Muralikumar Anantharaman

Bank Of America: Don't Let $30 Slip Away

The financials including Bank of America (BAC) have recently paused after a strong rally in the prior 18 months. A consolidation for the stock can be healthy and offers another opportunity to own the large financial as the regulatory environment continues to improve.

Source: Bank of America website

Operating Leverage Is Key

The market likes to stress out over the interest rate impact on financials and whether the economic activity will drive loan growth, but the goal of an established business should be on simple financial math: Revenues growing faster than expenses.

Over the last few years, BoA has done an exceptional job of generating leverage in the system. Watching sales fall, but pushing expenses down lower or generating revenue growth while still barely cutting expenses. The resulting impact is that the large financial generates leverage each and every quarter due to the current ability of the bank to control costs regardless of the revenue landscape. BoA has achieved at least 5% operating leverage in all but three quarters over the three years.

Source: Bank of America Q1’18 presentation

In a lot of ways, this scenario is better than growing at any cost while expenses soar just as fast. Clearly though, it doesn’t hurt that BoA is positioned for the rising rate environment. A forecast of a $3 billion benefit over the next year on a 100 basis point shift up in rates is nice, but the bank is still getting higher net interest income from higher deposits and not a higher yield.

Source: Bank of America Q1’18 presentation

The bigger key remains a management group able to manage the rate environment and mirror that with the cost structure to improve leverage in the system.

Decent Valuation

This discussion leads to why not own a financial with those impressive results trading at a meager 10x EPS estimates. The trend remains one’s friend in this scenario with the stock near $30.

The combination of a cheap stock and billions of cash flow generation on a quarterly basis allows for a compelling capital return program that will help boost the EPS in the future on top of the operating leverage boost. The large financial has closed the gap with JPMorgan Chase (JPM) and Wells Fargo (WFC) in the last year. The net payout yield that combines the dividend yield and net stock buyback yield is now virtually equal to that of the other large financials.

Chart

BAC Net Common Payout Yield (TTM) data by YCharts

The bank continues to ramp up capital returns, having returned $6.1 billion to shareholders in Q1 alone, a rate that would offer a 7.8% annualized net payout yield. A prime reason to close this gap is that BoA still trades at a discount to Wells Fargo that remains on the radar of regulators due to fraud issues.

Chart

BAC Price to Tangible Book Value data by YCharts

The general financial sector should get a boost from the Attorney General of New York stepping down. AG Eric Schneiderman led the charge on pushing for tougher fraud settlements with large banks over illegal foreclosure practices stemming from the financial crisis after taking over the position in 2010.

A replacement has to be more friendly to large financials based in New York now that the financial crisis is a decade old and the narrative has changed.

Takeaway

The key investor takeaway is that BoA remains a bargain despite the large rally since mid-2016. The large financial has sold off from the recent highs near $35 providing an opportunity to own the stock following consolidation and still trading at reasonable valuations and a discount to peers.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities. Before buying or selling any stock, you should do your own research and reach your own conclusion or consult a financial advisor. Investing includes risks, including loss of principal.

Acura's RDX Comes With an Easy-to-Use Infotainment System

The modern car has a problem. Over the past decade, automakers have raced to offer their smartphone-addled customers a bonanza of features: navigation, texting, phone calls, satellite radio, Bluetooth, ways to check tire pressure and oil temperature, suspension settings, charging status, and more. Then they try to stick all those things into an interface whose users are usually pretty busy—driving the 2-ton metal boxes that kill nearly 40,000 people in the US every year.

And the solutions are non-obvious. Touchscreens are easy to use but take drivers’ eyes off the road. Knob-based systems can land you in a warren of menus that get frustrating and distracting. No wonder then, that in a 2017 study, Consumer Reports found just 44 percent of respondents were “very satisfied” with their car’s infotainment system. Among the systems CR deemed the most distracting was Acura’s, which it panned for a “frustrating dual-screen setup, convoluted display logic, and finicky voice-command system.”

Now, after four years of work, Acura has a solution that finds that elusive territory between usefulness and distraction. Starting later this year with the 2019 RDX SUV, Acura will offer the True Touchpad.

Engineer Ross Miller, who led the project, began by talking to people about their washing machines and television remotes. “People get really passionate about things that annoy them.” At the top of that list of annoyances is complexity. Too many buttons, too many options, too many menus.

Miller frames this as a resource management problem. When you’re driving, you can only spare so much of your cortex to figuring out how to turn on that podcast or punch in Auntie’s address. To minimize the time and effort required by the driver, Acura’s team stripped down the main interface to eight tiles, which you can configure however you like. This way, the home screen doesn’t just offer you categories, like “Audio” and “Phone Book,” but shows whatever you tend to look for most often. People being creatures of habit, that usually means a couple of radio stations and one or two contacts. In Acura’s new system, your home screen can offer you “John” and “Jane,” “90s on 9” and “Hair Nation.” All your faves, just a tap away.

The screen sits up high, and is controlled by a touchpad that uses absolute positioning. Want to tap the icon on the bottom left? Hit the bottom left of the pad.

Honda

That tap is where Acura’s real innovation comes in. Miller says touchscreens draw too much attention away from the road, and knob- and button-based systems can be clunky and hard to use. To control the 10.2-inch screen, his team made a new sort of touchpad. Say you want to hear some sweet Mötley Crüe, and Hair Nation is the tile in the upper right of the screen. Just put your finger on the upper right of the touchpad, which sits a few inches forward of the right armrest. If you landed a bit to the left, drag your finger over, see the flash of orange highlight the icon you’re going for, and press down. (Then crank the volume using one of the few knobs.)

Other cars with touchpads use them in the conventional way, to control a cursor on the screen. The problem there is that, just like on your computer, before doing anything you have to find the cursor, then move it to where you need it. In a situation where every instant with your eyes off the road can prove deadly, that kind of timesuck is not ideal.

Meanwhile, touchscreens come with their own problem: The fact that you need to reach them means they’re usually low down, where the radio in an old-timey car would be. And because competently using one requires looking at it, that’s even more time looking away from where you’re going.

Acura’s system is a hybrid of the two. The touchpad allows for a screen up high on the dash, so you can see it with just a flick of the eyes. But instead of letting you control a cursor, it acts like a voodoo doll for the screen: Whatever part of the screen you would tap, you tap that part of the pad.

After a lifetime using a mouse and a decade with touchscreen smartphones and tablets, it took me a bit of getting used to. But within half an hour it felt totally intuitive. A spot to rest the heel of your hand and the raised ridge outlining the pad help with orientation. Real buttons for Home and Back, which Miller calls “centering points,” make sure you never get too lost. (Abandoned concepts: a cursor-like “ghost finger” on the screen representing where the driver’s finger was in real life, and gesture controls. “That didn’t test so well,” Miller says. “It was too complicated; it was really hard to learn.”)

Eventually, the team built the system into a driving simulator and put 30 people behind the wheel. While each performed a series of tasks (call so and so, switch the radio, etc.), Acura’s engineers measured how well they stayed in their lane and away from other cars, to gauge their level of distraction. They compared the results to how those same people drove when performing a simple task, like turning a knob to tune the radio, and found no significant difference.

To go with its new interface, Acura added an improved, more natural voice recognition system and an optional head-up display that’s more capable than most on the market. Where most just show information like speed and navigation directions, this one lets you change where you’re going and make phone calls, using a knurled click wheel on the steering wheel.

Now, Acura drivers get to try it for real. And if they like it as much as the focus groups did, you can expect to see it in the rest of the Acura lineup before long—then maybe the rest of the auto industry.

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