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Chrome Browser Now Has Early Warning Alert

February 25, 2015 by mphillips  
Filed under Around The Net

Google has added an early warning alert to Chrome that appears when users try to access a website that the search giant believes will try to trick users into downloading suspicious software.

The new alert pops up in Chrome when a user aims the browser at a suspect site but before the domain is displayed. “The site ahead contains harmful programs,” the warning states.

Google emphasized tricksters that “harm your browsing experience,” and cited those that silently change the home page or drop unwanted ads onto pages in the warning’s text.

The company has long focused on those categories, and for obvious, if unstated, reasons. It would prefer that people — much less, shifty software — not alter the Chrome home page, which features the Google search engine, the Mountain View, Calif. firm’s primary revenue generator. Likewise, the last thing Google wants is to have adware, especially the most irritating, turn off everyone to all online advertising.

The new alert is only the latest in a line of warnings and more draconian moves Google has made since mid-2011, when the browser began blocking malware downloads. Google has gradually enhanced Chrome’s alert feature by expanding the download warnings to detect a wider range of malicious or deceitful programs, and using more assertive language in the alerts.

In January 2014, for example, Chrome 32 added threats that posed as legitimate software and tweaked with the browser’s settings to the unwanted list.

The browser’s malware blocking and suspect site warnings come from Google’s Safe Browsing API (application programming interface) and service; Apple’s Safari and Mozilla’s Firefox also access parts of the API to warn their users of potentially dangerous websites.

Chrome 40, the browser’s current most-polished version, can be downloaded for Windows, OS X and Linux from Google’s website.

 

 

Google Acquiring Softcard’s Mobile Wallet Technology

February 25, 2015 by mphillips  
Filed under Mobile

Google announced it has reached a deal with three of the country’s major cellular carriers to acquire “technology and capabilities” from Softcard, a competing mobile wallet app created jointly by the telecom operators. But the deal appears to be less about technology and more about branding.

The biggest immediate change is that Verizon, AT&T and T-Mobile will begin pre-installing Google Wallet on new Android smartphones later this year — something that had been blocked before in preference for the Softcard app.

At their heart, both apps are based on the same contactless payment technology as Apple Pay and a new generation of payment cards from banks and credit unions. They use NFC (near-field communication) to complete a transaction once a payment card or phone is brought within a few centimeters of a terminal.

Apple Pay brought the technology widespread recognition when it launched late last year, but Google Wallet has been around since 2011. However a lack of support from carriers, retailers, card issuers and Google itself had relegated the technology to the sidelines.

While Google Wallet and Apple Pay share a technology base, there are key differences in how they work. Perhaps the biggest is that in Google Wallet, all transactions are routed through Google before being charged to the customer’s credit card.

That gives Google even greater insight into the lives of its users. In contrast, Apple doesn’t see any details of purchases made on its system.

Getting the Google Wallet app in front of more consumers could help reduce confusion over the different brands — an important consideration when the biggest Android phone maker is making moves of its own in mobile payments.

 

 

 

Visa Europe Announces New Mobile Payments Method

February 25, 2015 by mphillips  
Filed under Mobile

Visa Europe has announced a new, more secure way for consumers to pay retailers usinng their mobile phones,a move that could set the stage for Apple’s  Apple Pay and rival mobile payment services to be introduced into Europe in the coming months.

Visa Europe said on Tuesday it would introduce to member banks by mid-April a “tokenization” service which substitutes random numbers for a user’s credit card details when a merchant transmits transaction data, reducing the risk of online theft.

Similar security from Visa Inc ,the former parent of Visa Europe, and rival card issuers MasterCard and American Express has been key to the success of Apple Pay since it was introduced in the United States last year, according to industry experts.

Apple Pay allows iPhone users to store their credit card details on their phones, then pay at the tap of a button. In its first three months, more than $2 out of every $3 which U.S. consumers spent using speedy new “contactless” systems at the three major credit card networks was done via Apple Pay, the company said last month.

Visa Europe’s move is one of several new services the London-based credit card giant is unveiling as it battles to retain its role as a middleman connecting banks and consumers in a fast-moving payments landscape being shaken up by major technology firms including Apple, Google  and eBay’s PayPal, as well as scores of ambitious start-ups.

These include a way for card customers to send money overseas to other Visa users via their social media profiles on sites such as Facebook, WhatsApp, Twitter or LinkedIn.

Steve Perry, Visa Europe’s chief digital officer, said in an interview his association’s plan for secure credit card data transmission parallels what Visa Inc offers in the United States. But he declined to comment on whether Apple Pay had agreed to use his organization’s version in European markets.

 

Samsung Moving Toward Mobile Payments With LoopPay Acquisition

February 20, 2015 by mphillips  
Filed under Mobile

Samsung Electronics Co Ltd has acquired U.S. mobile wallet startup LoopPay, signaling its intention to launch a smartphone payments service to compete with rival Apple Inc.

Mobile payments have been slow to catch on in the United States and elsewhere, despite strong backing. Apple, Google, and eBay Inc’s PayPal have all launched services to allow users to pay in stores via smartphones.

The weak uptake is partly because many retailers have been reluctant to adopt the hardware and software infrastructure required for these new mobile payment options to work. These services also fail to offer much more convenience than simply swiping a credit card, Samsung executives said on Wednesday.

LoopPay’s technology differs because it works off existing magnetic-stripe card readers at checkout, changing them into contactless receivers, they said. About 90 percent of checkout counters already support magnetic swiping.

“If you can’t solve the problem of merchant acceptance…, of being able to use the vast majority of your cards, then it can’t really be your wallet,” said David Eun, head of Samsung’s Global Innovation Center.

Injong Rhee, who is leading Samsung’s as-yet-unannounced payments project, said the Asian giant will soon reveal more details of its envisioned service. He would not be drawn on speculation the company may do so during the Mobile World Congress in Barcelona.

He said new phones such as the upcoming, latest Galaxy would support the service.

Apple Pay, launched in September, allows iPhone users to pay at the tap of a button. Executives have lauded its rapid rollout so far, including the fact that more than 2,000 banks now support it and the U.S. government will accept Apple Pay later this year.

But Apple Pay requires retailers to install near-field communication and some have been reluctant. In addition, many retailers such as Wal-Mart Stores Inc and CVS Health Corp, back their own system, CurrentC.

Samsung had invested in LoopPay, along with Visa Inc and Synchrony Financial, before its acquisition. Terms of the deal, which Samsung negotiated over several months, were not disclosed.

It’s unclear how else Samsung could differentiate its service versus Apple’s or other rivals.

 

 

Cox Communications Developing Digital In-home Health Service

February 20, 2015 by mphillips  
Filed under Around The Net

Cable TV and internet service provider Cox Communications Inc, working alongside the Cleveland Clinic medical center announced a new venture to develop in-home healthcare services, stepping into a market that is poised to grow as medical care goes digital.

The joint venture in Atlanta called Vivre Health is designed to help Cox expand its reach into healthcare beyond its current services such as providing broadband for hospitals.

The plan is to foster in-home monitoring and treatment, such as video consultation via broadband and home use of equipment to monitor and manage recovery from surgery, Cox executives said. That could cut down on costly in-person visits to doctors and hospitals.

The Cleveland Clinic, a world-renowned academic medical center based in Ohio, will offer expertise to help create new services for patients.

Cox also made an investment in HealthSpot, a company that provides walk-in kiosks where patients can interact with doctors through videoconferencing and take measurements with medical equipment such as blood pressure cuffs. The kiosks are being tested in several states at pharmacies and retailers. The amount of the investment was not disclosed.

“Home health is an area that will see tremendous growth over time,” Asheesh Saksena, chief strategy officer for Cox Communications, said in an interview. “It will require more and more broadband capability.”

Cable TV providers such as Cox are seeking new revenue in areas such as healthcare and home security as their traditional business of selling TV services to residential clients matures.

Cox, the third-largest broadband and cable provider in the United States with about 6 million customers, already provides Internet and other capabilities to hospitals as part of its business services.

Healthcare customers represent about 10 percent of Cox’s business services clients. Business services are the company’s biggest growth engine with more than $1.8 billion in annual revenue.

With its investment in HealthSpot, Cox hopes to get patients used to the idea that they do not always have to visit a doctor, clinic or hospital for treatment.

 

 

BlackBerry Files New Patent Complaint Against Typo

February 19, 2015 by mphillips  
Filed under Mobile

BlackBerry ramped up its battle with Ryan Seacrest’s Typo Products LLC, filing a new complaint that accusing the company’s new keyboard case for the iPhone of also infringes on its patents.

Last March, the Waterloo, Ontario-based smartphone pioneer won an injunction against the first iteration of the Typo case made for some of Apple’s iPhone devices. BlackBerry is now seeking another injunction to halt sales of the redesigned Typo 2 case as well.

BlackBerry, in a new complaint filed with the U.S. District Court for the Northern District of California on Monday, alleges that the company’s redesigned Typo 2 case for the iPhone 5, 5s and iPhone 6 models, also infringe on its patents, disputing the start-up’s claims to the contrary.

Earlier this month, the court ordered Typo to pay BlackBerry $860,600 in sanctions, plus attorneys’ fees and costs as it said that Typo had blatantly violated the court’s initial injunction.

At the time, a spokeswoman for Typo said the court order had no impact on its TYPO 2 product currently in the marketplace, or its other planned product releases.

Typo was not immediately reachable for comment on the latest complaint. BlackBerry declined to comment on the matter.

“Just as they did with the Typo Keyboard, defendants have again copied numerous proprietary BlackBerry designs and patents in the Typo2 Keyboard,” said BlackBerry in its complaint.

 

 

Yahoo Hosting First Ever Mobile Development Conference

February 19, 2015 by mphillips  
Filed under Around The Net

Yahoo, one of Silicon Valley’s legacy technology giants, wants to show it’s got the goods for today’s mobile app developers.

Today the company is hosting its first-ever mobile developer conference. The daylong event in San Francisco shows the company wants to develop lucrative relationships with developers and put mobile at the center of its turnaround effort.

The event will feature talks by top Yahoo executives, including CEO Marissa Mayer, and deep dives into Yahoo’s technology services for mobile apps. A critical part of those services is Flurry, a mobile analytics and advertising company Yahoo acquired last year. Flurry tracks more than 600,000 apps worldwide, providing information on app performance and users that can aid in ad targeting.

Yahoo needs that data to kickstart its sluggish ad business, especially on mobile devices.

During the show, Yahoo executives will try to sell third-party developers on the value of using Flurry. They will also promote Yahoo Gemini, the company’s platform for mobile advertising, and BrightRoll, a digital video advertising platform the company also acquired last year.

It’s a multi-pronged strategy, and the pieces are still coming together. But by encouraging more outside developers to use Yahoo’s services, Yahoo hopes to gain valuable information about how people use mobile apps.

That information could help Yahoo do its job. “We can help advertisers find the right audience they’re looking for, target the ads they want to target, using strong data from Yahoo, and find users wherever they are, on or off Yahoo,” Mayer said last week during the Goldman Sachs Technology and Internet Conference in San Francisco.

And if Yahoo can freshen its appeal to outside software developers and build new partnerships with them, then all the better.

“Yahoo is working on their own apps, but they will be able to extend their reach and their advertising inventory by getting outside developers into the fold,” said Karsten Weide, an industry analyst at IDC who studies consumer apps and platforms.

 

 

 

 

 

Will Sony Exit TV, Mobile Phone Markets?

February 19, 2015 by mphillips  
Filed under Consumer Electronics

Sony Corp hopes to increase operating profit 25-fold within three years by growing its camera sensors and PlayStation units, its chief executive said, laying out a strategy that could see the company exit the ultra competitive TV and smartphone markets.

CEO Kazuo Hirai said on Wednesday the Japanese consumer electronics firm would no longer pursue sales growth in areas such as smartphones where its has suffered competition from cheaper Asian rivals as well as industry leaders like Apple Inc and Samsung Electronics.

Sony would instead focus its spending on more profitable businesses such as camera sensors, videogames and entertainment as it seeks to return to growth after forecasting for this financial year its sixth net loss in seven years.

“The strategy starting from the next business year will be about generating profit and investing for growth,” Hirai told a briefing, adding that Sony’s units would be given greater autonomy to make their own business decisions.

Asked about the TV and mobile phone units, Hirai said he would not “rule out considering an exit strategy”, Sony’s clearest statement to date about the possibility of selling or finding partners for these struggling units.

Sony is in the midst of a restructuring that has so far seen it sell off its personal computer division and spin off the TV business. It has also axed thousands of jobs.

Sony shares have risen more than 80 percent over the past year as investors applauded the restructuring, which accelerated since Hirai appointed Kenichiro Yoshida as his chief strategy officer in late 2013.

 

 

Zynga Continues The Downward Spiral

February 16, 2015 by Michael  
Filed under Gaming

During the earnings call today CEO Don Mattrick highlighted where he believed the company had made mistakes this year.

“There are a number of things we could have done better this past year. First we had a challenging time implementing our new poker product. And we learned the tough lesson that we needed more adequate testing across consumer segments, geographies and devices,” he said.

“Second, we have big aspirations for our sports brand and view our NFL and Tiger Woods licences as incredible assets. We moved quickly to release NFL showdown to hit the season kick-off but by doing so launched an experience with less features than is typical for a worldwide launch. We believe in the potential of sports and our ambition for the category is bigger than our first product is showing out of the gate.”

“Finally, as a company, we are committed to managing the performance of our products and related cost structure. Local products from Zynga China, including the launch of FarmVillage at the end of Q4, have underperformed and not met our expectations. As a result, we are narrowing our international footprint and have decided to close our operations in China.”

Original story

During its third quarter, Zynga had announced a net loss of $57 million, which followed similar losses in the first and second quarters. Now the fourth quarter numbers are out and the company has lost another $45 million, nearly double the $25 million loss from Q4 2013. All in all, Zynga lost nearly $226 million for the year compared with a total loss in 2013 of nearly $37 million. 2014 was a “year of progress” though, if you ask CEO Don Mattrick.

“2014 was a year of progress for Zynga – we came together as one team and applied more discipline and rigor to our business. In the fourth quarter, we increased mobile bookings to 60 percent of our total bookings mix, expanded our mobile audience with monthly mobile consumers up 87 percent year over year, and grew our core franchise bookings by 35 percent year over year,” he said.

“In 2015, we will focus on three priorities: driving mobile growth, launching more products in more evergreen categories and building on our social legacy. We will deliver a 100 percent mobile-first new product slate featuring new games, with a goal of ending 2015 with more than 75 percent of our fourth quarter bookings coming from mobile. I am excited by the boldness of our 2015 product aspirations – this year we expect to launch between 6 to 10 new games in important categories like Match 3 and Action Strategy. We are building a high performing culture which takes time and while we would like to go faster, we are being methodical and purposeful about our decisions. We have a healthy balance sheet with $1.1 billion in cash and marketable securities which gives us staying power and the ability to invest in our future growth.”

Looking at the rest of the numbers, Zynga’s revenues did climb, year-over-year, from $176 million to $192 million in the fourth quarter, while bookings increased from $146 million to $182 million. For the full year, however, both sales and bookings dipped. Sales fell from $873 million to $690 million while bookings dropped from $716 million to $694 million.

As Mattrick alluded to, Zynga is hoping to boost its bottom line in 2015 with several new products. The talented folks at NaturalMotion are pushing Zynga into the action strategy category with Dawn of Titans, which will use NaturalMotion’s proprietary mobile technology and engine “to create unprecedented mobile visuals, animation and depth-of-gameplay that supersedes anything found today on mobile.” In addition, Zynga is preparing the mobile launch of a modern military strategy game, Empires & Allies, which should be out worldwide in the coming months. Beyond the strategy genre, Zynga also announced a new entry in its core FarmVille brand with a Match 3 category title called FarmVille: Harvest Swap. The game is expected to launch worldwide as a cross-platform mobile and web game this year.

Aside from the disappointing fiscal performance, Zynga also shared the bad news that it’s closing the Zynga China studio. All 71 employees in the Beijing-based studio will be laid off; the company noted that this “will result in an annualized cost savings of $7 million dollars.”

It’s been a challenging time for Zynga as the company continues to adapt its business to mobile. The space is more competitive than ever with giants like Supercell, King, EA and others topping the charts on a regular basis. The good news for Zynga is that it still has $1.15 billion in cash and cash equivalents as of the end of 2014, but the bleeding has to stop. Monthly unique users, monthly unique payers and daily active users were all down again in the fourth quarter. Zynga needs a hit, and fast. Hopefully one of the new titles mentioned above will do the trick.

Update: Investors are clearly not enjoying the earnings announcement as Zynga’s stock finished down 5.34 percent today at $2.66. In after hours trading, as of 4:55 PM Eastern, the stock is down 10 percent. By contrast, King, whose sales jumped 20 percent for the year, is enjoying a more than 17 percent boost to its stock in after-hours.

Courtesy-GI.biz

After Introduction Of Kill Switch, Smartphone Thefts Have Dropped

February 13, 2015 by mphillips  
Filed under Mobile

The number of thefts and robberies of smartphones, particularly iPhones, is declining in New York, London and San Francisco, according to a recently released study.

Law enforcement officials, who have been at the forefront of demands to include a “kill switch” in all smartphones, hailed the news as proof that the technology is working as a deterrent.

In San Francisco, overall robberies and thefts dropped 22 percent from 2013 to 2014, but those involving smartphones were down 27 percent. Thefts and robberies of iPhones fell 40 percent. In New York, smartphone theft dropped 16 percent overall with iPhone figures down 25 percent. And London saw smartphone thefts from persons drop 40 percent in a year.

“The huge drops in smartphone theft that have occurred since the kill switch has been on the market are evidence that our strategy is making people safer in our cities, and across the world,” said New York State Attorney General Eric Schneiderman in a statement.

The kill switch is a software lock that can be remotely activated when a phone is lost or stolen. It can wipe personal data from a phone and “brick it” so it can’t be reused or reprogrammed.

Law enforcement officials campaigned to make the technology standard in reaction to a growing numbers of thefts of robberies of smartphones on city streets across the U.S. and beyond. The assumption was that phones would be much less desirable targets if they could quickly be made useless.

Apple added a kill switch, called Activation Lock, to its iPhone in September 2013. Samsung followed in April 2014 with its Galaxy S5 and Google made it a standard feature of Android with the release of Lollipop.

Soon most smartphones sold will include a kill switch thanks to a new California law that mandates them in smartphones manufactured after July 1 this year and sold in the state. While the law only covers California, it’s leading to their introduction in phones sold worldwide.

 

 

Samsung Gives Vote Of Confidence To OLED Product Line, Investing Billions

February 12, 2015 by mphillips  
Filed under Consumer Electronics

South Korea’s Samsung Display plans to invest 4 trillion won ($3.6 billion) into manufacturing organic light-emitting diode (OLED) panels as parent Samsung Electronics Co Ltd attempts to boost components sales to countert waning smartphone profits.

A Samsung Display spokesman told Reuters the new production line would mainly make medium and small-sized OLED displays for consumer electronics devices like smartphones and tablets. The investment would be made from 2015 to 2017, he added, without giving further details.

Analysts said the new line will initially produce curved panels like those on the Galaxy Note Edge, and eventually help win external customers which are becoming crucial to parent Samsung Electronics’ future earnings growth as sales of its erstwhile cashcow smartphone business decline.

Recent data shows that arch rival Apple Inc caught up to or surpassed Samsung as the world’s top smartphone maker in the fourth quarter.

“In the long run I think it’s possible for sales to expand to outside customers,” said Oh Sang-woo, analyst at Leading Investment & Securities, adding that these clients may include competitors seeking to play catch-up by using curved screens.

Samsung Electronics invests heavily in its components businesses on an annual basis. Of 23.4 trillion won in capital expenditures last year, 14.3 trillion won was for the semiconductor business while another 4 trillion won went to displays.

In addition to the planned OLED investment, Samsung is expected to start building a 15.6 trillion won chip plant in South Korea sometime in the first half of the year. The company said in October that construction for this plant will be completed in the second half of 2017.

 

 

Samsung Puts Pressure On Other Internal Divisions

February 11, 2015 by Michael  
Filed under Computing

Samsung’s components businesses is finding itself under pressure to pick up the slack and secure external customers for chips and display panels and might even start flogging them to rival mobile companies.

According to Reuters the reason for this is that the Smartphone industry is tanking and the only one making any money out of it is Apple — and even it is suffering a bit.

Samsung Display has begun supplying organic light-emitting diode (OLED) panels to Chinese smartphone makers Lenovo, Coolpad, Oppo Electronics and Vivo Electronics.

The subsidiary says it’s on the lookout for more clients, aiming to have half its total revenue by 2017 from sales to outside customers, up from just over a third in 2013.

Industry experts think that external clients account for around a fifth of Samsung Display’s sales of smaller smartphone and tablet panels compared to about 50 percent for large panels for TVs, underscoring a need for more mobile clients.

Samsung was not interested in overseas sales when Samsung Electronics’ Galaxy S devices were selling well, but suddenly it is trying to push into new pastures.

Samsung’s systems chips business is also trying to grow its customer base . It lost a $1 billion last year on declining sales of Galaxy smartphones and the loss of a contract to supply the processor for Apple Inc’s iPhone 6.

Samsung’s next Galaxy S smartphone is widely expected to be powered by its own Exynos processor.

The outfit is in talks with third-party customers about supplying its Exynos mobile processors. Samsung is likely to win back the Apple contract and supply the majority of mobile processors for the next iPhone.

Courtesy-Fud

Canon Looking Beyond Camera Market With Latest Acquisition

February 11, 2015 by mphillips  
Filed under Consumer Electronics

Canon Inc will acquire network video surveillance leader Axis AB for about 23.6 billion Swedish crowns ($2.83 billion), the biggest purchase ever for the Japanese company that is trying to expand beyond the shrinking camera market.

Canon said it was launching a tender offer to buy all Axis shares for 340 crowns each, a premium of nearly 50 percent.

The Swedish company said its board of directors unanimously supported the offer, and that three of its top shareholders representing around 40 percent of total shares will accept it.

Canon already sells surveillance cameras and sees the sector as a growing market, although it has not disclosed how much it earns from such products.

The deal will make Canon a top player in the video surveillance market, which was worth an estimated $15 billion at the end of last year, according to researcher IHS. Within that market, there is a $3.86 billion segment for network-connected security cameras which is led by Axis with a 17.5 percent share as of 2013.

The deal comes after Canon late last month reported a slight increase in fourth-quarter profit, as a weaker yen and rising sales of office equipment offset weakness in a camera division competing with smartphones capable of high-quality imaging.

The company, which earned over 80 percent of its revenue overseas in 2014, said it would pay in cash.

Axis’ is targeting average annual growth of at least 20 percent and a profit margin of at least 10 percent. The company reported a fourth-quarter operating profit of 199 million crowns, slightly below analyst forecasts but up from 166 million a year earlier.

Around half of its sales come from the Americas, 40 percent from Europe, the Middle East and Africa, and the rest from Asia.

Axis said it will remain as a separate legal entity within Canon, and that its current management team will stay.

 

 

Cloud Analytics Growth Rate Seen Continuing For Years

February 10, 2015 by mphillips  
Filed under Computing

It’s no secret that cloud computing and data analytics are both rapidly expanding areas within information technology. Put them together, and you get a winning combination that’s expected to grow by more than 26 percent annually over the next five years.

That’s according to market-tracking firm Research and Markets, which recently released a new report on the global cloud analytics market.

Increased adoption of data analytics is one of the major drivers in this market, Research and Markets found. More specifically, many organizations are adopting data analytics in order to better understand consumption patterns, customer acquisition and various other factors believed to increase revenue, cut costs and boost customer loyalty.

HP, IBM, Microsoft, Oracle and SAP are among the dominant vendors in this arena, the company said in a press release.

Big Data is one of the particularly significant trends in the market, Research and Markets said.

“Cloud analytics deals with the management of unorganized data, which helps organizations access important data and make timely decisions regarding their business,” the company said.

The rates of growth in this arena might actually be much higher than those suggested by the report, said analyst Ray Wang, founder of Constellation Research.

In fact, Constellation Research predicts an annual growth rate of closer to 46 percent until 2020, he said.

Early-arriving cloud companies like Salesforce “had great reporting, but they didn’t necessarily have great analytics,” Wang said.

It’s for that reason that challengers such as Actuate have popped up, he noted.

“More and more, because of the size and complication, we’re seeing analytics move to the cloud,” Wang said.

 

 

Alibaba Looking To Push Own Mobile OS With Latest Deal

February 10, 2015 by mphillips  
Filed under Mobile

China’s Alibaba Group Holding Ltd is taking a $590 million stake in a little known domestic smartphone maker as the e-commerce giant explores ways to expand its mobile operating system in a shrinking, cut-throat handset market.

Extending a previously muted push into hardware, Alibaba said will acquire an unspecified minority stake in smartphone maker Meizu Technology Co. Dwarfed by rivals like Xiaomi Inc, privately owned Meizu’s slice of China’s smartphone market is estimated by analysts at below 2 percent.

The deal, unlike U.S. rival Amazon.com Inc’s foray into smartphones with its own-brand Fire Phone, is designed to help Alibaba push its mobile operating system within China through Meizu’s handsets. In return, Zhuhai, Guangdong-based Meizu will get access to Alibaba’s e-commerce sales channels and other resources, the companies said in a joint statement.

For China’s e-commerce king, with a market value of $213 billion market value, the $590 million price tag may be a costly entry fee. Meizu’s reach in China, and likely that of the Alibaba operating system, is severely blunted by domestic leaders Xiaomi, Huawei Technologies Co Ltd and Lenovo Group, as well as multinational giants Apple Inc and Samsung Electronics Co Ltd.

“You could say they’re spending $590 million to experiment a bit and see what happens – it’s an expensive experiment, right?” said Michael Clendenin, Managing Director at Shanghai-based RedTech Advisors.

“My concern is that some internet players are confusing being able to just spend a couple hundred million dollars to buy a piece of hardware that looks pretty cool but is essentially a copy of what Apple has done and what Xiaomi has done,” he said.

Together, the leading five brands accounted for nearly 60 percent of China’s smartphone market in the fourth quarter of 2014, said Nicole Peng, a Shanghai-based analyst with data research firm Canalys.

Meizu has pumped up shipments from a few hundred thousand in previous years to under 2 million in the last three months of 2014, but it still had less than 2 percent of China’s smartphone market share in that quarter, said Peng.