Line Pay Pay Pay

Disclaimer 1: As many regular readers know, I am not a QR Code fan. It’s not the technology so much as the assumption that the central processing model and constant network connections solve everything. When I went to Starbucks today I tried paying with the Starbucks app bar code and got a nice little rude reminder that when one link fails, the whole QR/bar code chain crashes. The WiFi at that particular Starbucks store is not robust and ends up jamming the smartphone 4G pipe because the device thinks there is a good WiFi connection. After 2 attempts without getting a bar code load, the staffer said, “turn off the WiFi.” I gave up and used Apple Pay Suica instead. Done.

Disclaimer 2: As many regular readers may not know, I am not a SoftBank fan. This goes back to the time when SoftBank bought Ziff Davis of which the Seybold Report was part of. SoftBank quickly destroyed the Ziff Davis business by sucking it dry and selling off the zombie for a good price before anyone realized it was dead. I wrote for the Seybold Report at the time. What had been a tightly run ship collapsed into chaos because the parent company starved the subsidiary groups and people didn’t get paid. Later on when I wrote reports for Off The Record Research, I regularly visited a Yahoo Japan source who complained that they could not create good iPhone apps because SoftBank constantly sucked the budgets dry. Later on he quietly told me he could not complain anymore because all the conference rooms were wired and everything was recorded. SoftBank is that kind of company. To me all they ever really do is play one big never ending shell game.


There are lots of people excited by the Line Pay/Yahoo Japan merger. IT reporter Junya Suzuki says it’s about creating a ‘Super App’ platform. Bloomberg says it’s about creating a super ‘big data’ platform that sucks up everybody’s everything (and of course nobody discusses where the big data will be stored and processed: will it stay in Japan or be sent to notoriously security lax Korean data centers).

There will be lots of news and discussion in the weeks to follow but it’s important to remember a few essential points.

One: Line Pay and PayPay operations are running in the red, some people estimate PayPay could never turn a profit with its current business model.

Two: neither SoftBank/Yahoo Japan nor NAVER/Line Pay own a real bank. At some point in the cashless payments process, real cash has to change hands. Payment processors without real bank operations have to live with real bank transaction rules and fees, real banks will always have the upper hand. Having a real bank for example, puts Rakuten in a much stronger position than SoftBank. Yahoo Japan does own half of Japan Net Bank but this is a co-venture and Yahoo Japan only runs the internet service side, the other half, the real bank transaction half is owned and run by SMBC. In this arrangement SMBC is calling the shots.

As for me, I have been hanging out on the Girls Channel where Japanese women let down their hair and diss. Japanese women make, or break, products in Japan, especially everything Keitai, not men. Comments on the Line Pay and PayPay merger are very interesting and cutting. They range from “Mercari Pay is disappearing next” to “Hello Rakuten, goodbye Hagebank,” (a diss of bald Masayoshi Son, but also a double entendre for the highly leveraged SoftBank going bust). Day after day it reads like the bloom is off the Line Pay Pay Pay rose and Japanese women who created the first Keitai boom and have money now, are ready to move on. They are in it for the campaigns but not really in it. I’m going to keep hanging out with the girls. It’s a lot more fun and informative than reading the news, and faster too.

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AWS outage takes down PayPay

The Amazon Web Service outage that started around 1pm August 23 local Japan time took down some PayPay service along with it. Japanese users tweeted about payment and recharge not working. AWS service was completely restored by 8pm Japan time. Engadget JP’s Takahiro Koguchi posted a complete rundown.

Since QR Code payment systems depend on centralized processing, a cloud outage can easily bring down the system for all transactions. While this is a minor annoyance for paying at a convenience store where you can always pay on the spot using something else, it’s not the case when QR is used for transit where large numbers of people can suddenly be stranded. This is exactly what happened in Chengdu last April. It’s a risk of using QR Codes for transit.

Locally processed transactions like Suica are resilient because it was designed to avoid the trap of central processing, the stored balance is held on the card and not on the cloud. When things do go wrong with cloud services like Mobile Suica or Apple Pay, damage is limited to the credit card recharge side. Cash recharge at the convenience store, the station, the ATM is always there as a backup because it only deals with the card, not the cloud.

iWork Pages Celebrates International Haiku Day with Vertical Writing

Today is International Haiku Day and Apple Education is celebrating it in Japan with the new version of iWork Pages that finally supports vertical text layout. In honor of International Haiku Day and vertical text support in Pages, I tried writing a haiku in vertical text using the new version of Pages. This is how it went…

Let’s see, I want to rotate the roman characters to stand vertical like they do in traditional ‘Tate-Chu-Yoko‘ Japanese layout.
Oh wait, Pages vertical rotation only works in groups 2~3 characters. Anything less or more does’t work. How about if I split them up.
Okay this isn’t working, but I have an idea…
I’ll just use egword Universal 2 instead. Problem solved with the Tate-Chu-Yoko setting.

Update: Japanese reactions to the Apple Education ad (top screen shot) now running on Twitter are fun and sarcastic: “Are you serious? Way too late,” “Good thing I didn’t wait and installed egword,” “10 years too late,” “Oh, Pages is finally useable,” etc.

It’s Baaaack

Now that PayPay has supposedly fixed all the security problems, and set some spending limits, they have have kicked off another 10 billion yen giveaway campaign that hopefully won’t melt down like the previous one. This time Reddit users are taking notice and have posted details in English. Happy shopping!

PayPay Troubles Quash QR Code Hype

SoftBank’s network meltdown was only the start of QR Code PayPay troubles. The 100 Million Yen giveaway startup campaign that was supposed to run December 4~March 31 was suddenly and unceremoniously shutdown at 11:59 pm December 13. The official excuse was that 100 million yen had been given away, but then Japanese tweets started appearing complaining of credit card holders charged for PayPay purchased items that they did not purchase. There were also reports that store staff were not checking customer IDs which they are supposed to do with PayPay purchases over 30,000 JPY. Last but not least once you register a PayPay account, there is no way to delete it.

2 days later top Japanese tech journalists Tsutsumu Ishikawa and Junya Suzuki started to pick up the story on Twitter. PayPay PR answers to Suzuki san’s questions were particularly damning: PayPay apparently allowed unlimited attempts to register credit card numbers and security code numbers, reported credit card fraud cases are “in the double digits” but PayPay does not have a handle on the problem and requests that anybody with suspicious credit card PayPay charges to contact the company (good luck with the user unfriendly ‘Help’ page). Yomiuri later reported that card frauders apparently used stolen card identities to register PayPay accounts with unlimited security code attempts. PayPay PR says this security lapse has been fixed.

Ishikawa san summed it up nicely: somehow it’s so ‘SoftBank’ that the very campaign meant to kick start a QR Code payment boon in Japan ends up destroying the opportunity to do so.