Data Sheet—Friday, September 26, 2014

Welcome to Friday, Data Sheet readers! Intel is traveling to China for mobile chip expertise. Will record-breaking iPhone 6 sales change the rules of digital marketing? Plus, do you struggle to keep up with email? Google Chairman Eric Schmidt feels your pain and offers these quick tips for de-cluttering your inbox. Wishing you a clutter-free weekend.

Intel doubles down on smartphones. Days ago, its latest $6 billion investment in Israel got the green light. Now, the chipmaker is pledging $1.5 billion for 20% of China's Tsinghua Unigroup, which owns two respected mobile design firms, Spreadtum Communications and RDA Microelectronics. The pact (like an alliance with Fuzhou Rockchip Electronics forged in May) will support Intel's goal to put its technology in 40 million tablets by year-end. WSJ

It's official: insider Michael Brown is Symantec's new CEO. The move comes after a "broad and thorough" five-month search involving more than 100 candidates. Brown joined after the Veritas merger in July 2005 and previously was chairman and CEO of storage hardware company Quantum. He's been holding down fort since March, returning Symantec to growth and making key executive hires.

Damned if they do, damned if they don't. Both Apple and Google are committing to tighter security that prevents anyone (even law enforcement officials) from retrieving emails on locked smartphones. That makes privacy advocates and businesses feel warm and fuzzy, but the FBI is not amused. Meanwhile, European privacy regulators just gave Google of long list of guidelines for collecting and storing data in EU countries. Re/code

CLOUD CHATTER

Amazon schedules extensive outage on relatively short notice. It won't affect all customers, but the cloud services leader is planning to shut down certain servers for maintenance, which could result in weekend service disruptions. This is probably its biggest reboot since 2011. ComputerWorld

STATS & SPECS

Rush to address serious server security flaw. Google, Amazon, Apple and Red Hat are expediting updates to protect Linux and Macintosh servers from "Shellshock," a vulnerability that could be used to spread malware and other nasty things, like denial-of-service attacks that cripple websites. The flaw has existed for years, but now that it's been disclosed publicly, expect more criminal activity. Is your company infected? Here's how to tell.

STARTUPS & DISRUPTORS

Big funds for digital healthcare prescription. Accenture predicts U.S. investments in telehealth applications and wearable technologies will reach $3.5 billion this year, growing to $6.5 billion by the end of 2017. eWeek

Chatter over Hootsuite's latest $60 million round. Word is Fidelity Investments is the lead investor, but the social media management company won't confirm it. The infusion brings total outside funding to $250 million. Some money is earmarked for this week's acquisition of Zeetl, which makes technology for triggering phone calls from within Twitter feeds. Fortune

SurveyMonkey invests in mobile feedback app. It is leading a $5.3 million round for Appentive—its first outside investment. Appentive's technology is used for customer engagement; customers include Concur and RealNetworks. People are definitely sick of taking 100-question surveys, but SurveyMonkey is late to the party. TechCrunch

FAQ

Why digital marketers should be excited about Apple Pay

In the first weekend of its existence, the iPhone 6 found its way into the hands of 10 million people—creating an instant audience for its forthcoming mobile payments service, Apple Pay. The numbers will be higher the instant I publish this.

That makes digital marketing expert Jack Philbin downright gleeful. "This is like the moment I remember from 2003 when 'American Idol' put text messaging on the map," he says, referring to the reality show's decision to let fans vote singers on or off the show via SMS. "Apple Pay is that moment when marketers really have to pay attention to mobile."

That's because the new service should draw attention to an app that a far larger number of iPhone owners already have on their smartphones, Passbook. Apple's mobile wallet lets someone save and organize airplane boarding passes, movie tickets or gift cards that can be scanned for redemption. Payments are usually tied to credit- or debit-card accounts. While few brands exploit its features today, the mobile payments discussion is prompting them to reconsider Passbook's potential for reaching consumers with promotional offers or loyalty apps.

"No one wants to carry 30 loyalty cards in their wallet," Philbin says. "Everyone wants to take it digital."

As co-founder and CEO of marketing technology company Vibes (and chairman of the Mobile Marketing Association in North America), he's got a vested interest in that point of view. Its platform helps the likes of Allstate, Bloomingdale's, Gap and Sears create and broadcast mobile campaigns. Historically this has been done using SMS, but now Vibes helps brands do the same within Passbook or Google Wallet (a similar concept for Android mobile devices). "They become a living, breathing loyalty card," Philbin says.

For an example of how this works, consider Vibes' work with Pep Boys. The automotive service and retail chain uses is mobile wallet application to (among other things) remind someone about when it's time for an oil change or some other sort of maintenance. Notifications can be scheduled or triggered by proximity. Early results suggest that about one-quarter of customers who received a promotion sent to Passbook opted to save it; 30% of offers added to either Passbook or Google Wallet were redeemed in store.

So far, Vibes has managed at least 300 campaigns of this nature. Its seminar focused on the new Passbook features (held in mid-September) attracted almost 1,000 people, Philbin says.

Still skeptical about the prospects? Sure, near-field communications technology (the "tap to pay" approach that Apple Pay will use) accounts for just 2.5% of mobile payments. But that's still almost $8.2 billion this year, and using a smartphone for transactions is something some of us do every day: close to 15% of all Starbucks transactions in the U.S. are now made with its app (that's an average of 6 million per week). "For some, it's becoming a learned behavior," Philbin says.

ONE MORE THING ...

Will new legal troubles stall ride sharing? Lawyers in San Francisco and Los Angeles have sent letters to Sidecar, Lyft and Uber Technologies threatening to put the brakes on their services. They believe their business models violate state laws governing how to charge for multiple people in the same vehicle, plus they don't think background checks for drivers go far enough. I wonder how this will affect Uber's new partnership with the Sacramento Kings, which next month will become the first professional sports team to include Uber services within a mobile app to help fans arrange rides to and from games. Reuters