Amazon sellers get caught in U.S.-China trade spat as money transfer service abruptly closes

Many big Amazon sellers received a notice this week from a company they rely on for international money transfers. The message from WorldFirst, which is based in London, was alarming: its U.S. business was closing immediately.

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“We are writing to share some news that affects you as a US-based customer of WorldFirst,” the email said. “The WorldFirst shareholders have taken the decision to discontinue with the US operations. As such, we will no longer be able to offer our products and services to you.”

WorldFirst didn’t offer an explanation for the abrupt decision, and one Amazon seller, who asked not to be named, told CNBC “that was quite a shock.” The company said its U.S. business was being rebranded as Omega, which would operate independently from WorldFirst, and that no new transactions could be made after Wednesday, Jan. 30.

Sellers and competitors who spoke with CNBC speculated that the shutdown was directly related to a pending acquisition of the parent company by Chinese fin-tech giant Ant Financial.

Ant, the Alibaba affiliate and parent of Alipay, has reportedly been in advanced talks since late December to buy WorldFirst for about $700 million. Ant has been unable to crack the U.S. market because of opposition from the Trump administration. Last year, the Committee on Foreign Investment in the United States (CFIUS) quashed Ant’s attempt to buy MoneyGram for $1.2 billion because of national security concerns.

On Friday, the Financial Times reported that WorldFirst “abruptly closed” its U.S. business to avoid having the acquisition “derailed by American regulators.” The paper cited two people briefed on the decision. WorldFirst’s U.S. operation was based in Austin, Texas, and the company also had employees in San Francisco. One person told the FT that the move would result in “heavy job losses” among the U.S. staff.

WorldFirst didn’t respond to requests for comment.

It’s the latest example of the collateral damage that’s resulting from the escalating U.S.-China spat, which centers on a trade imbalance as well as alleged intellectual property theft by Chinese firms. The two governments have set a deadline of early March to come to an agreement on a trade deal. In the meantime, the Trump administration has been blocking big deals, such as Chinese companies taking significant stakes in U.S. businesses and from buying certain U.S. technology components, claiming such transactions would pose a national security threat.

WorldFirst is one of the main services used by Amazon sellers to handle transactions across the world so merchants can get paid in many different currencies on a single platform. An Amazon sellers group sent an email to members on Friday suggesting that WorldFirst customers switch to rival service Payoneer, which “can help if you are selling in the US, UK, Europe, Canada, Japan, China, Australia, and Mexico,” the message said.

WorldFirst said service for customers outside the U.S. and Canada will be unaffected by the change. Clients in those two countries were told that between Jan. 31 and Feb. 7, they could only make outbound transfers to existing beneficiaries. After Feb. 7, any balances would be returned to the sender, and after Feb. 20, the company would have no live phone or email service.

For Ant, the expected acquisition of WorldFirst supports the company’s global push and expansion beyond mobile and online payments service Alipay. Ant CEO Eric Jing told CNBC in November that his company was investing in technology services for banks so that it’s not limited to payments.

Ant is viewed as an IPO candidate, but Jing said the company doesn’t have a “timetable for that.” Alibaba agreed exactly a year ago to acquire 33 percent of Ant, and has said it won’t have any control over the company. Alipay was spun out of Alibaba in 2011.

WATCH: Ant Financial says it doesn’t have a “timetable” for an IPO

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Morgan Stanley says Spaceflight Industries is 'entirely' disrupting the rocket launch market

The rocket launch business is expensive and risky, and then there are the technical requirements: Launch providers have to ensure a customer’s delicate and expensive spacecraft survives the trip to orbit.

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But Seattle-based Spaceflight Industries is showing things can be done differently, according to Morgan Stanley analysts Adam Jonas and Armintas Sinkevicius. In a note to investors Friday, they said that the company “is disrupting this model entirely” by applying the ride sharing concept to satellites.

The company packed a record-breaking 64 satellites on a SpaceX rocket in December for a mission known as Spaceflight SSO-A. Morgan Stanley called it “a significant milestone for the company.”

The practice of satellite “ridesharing” has become more commonplace, in part thanks to Spaceflight. As technological advancements have led to smaller satellites, that means more of them can be loaded onto rockets as secondary payloads – hitchhiking on launches like SpaceX’s Falcon 9 as they bring larger satellites to orbit.

That makes it less expensive for satellite operators and fills space in what otherwise would have been empty payload for rocket launchers. “Spaceflight is significantly driving down the cost of launch with its ride sharing model, allowing smaller satellite companies to launch more cost efficiently and launch operators to fill excess capacity,” Morgan Stanley said. “Spaceflight is able to provide customers with flexibility by virtue of having capacity with many different launch providers.”

Curt Blake, the CEO of Spaceflight launch services, told CNBC, “Rideshare applies across the board and the whole idea of flexibility, and how crucial that is, as it brings the airline model to space. That is huge. We’re moving rapidly toward a model where you’re not buying a spot on a specific launch vehicle – you’re buying the ability to get to a destination.”

Blake said about Morgan Stanley’s analysis, “I think it means that people, and Wall Street, are starting to see this industry as a valuable one and they’ve identified our company as … a disruptor, which is a great term.”

The note is the latest in Morgan Stanley’s “Space Disruptor Series,” which features commentary on 90 companies by Morgan Stanley’s “Space Team,” which is led by Jonas.

Spaceflight Industries has two businesses: The all-in-one launch services unit, known as Spaceflight, and a satellite imagery unit called BlackSky. The former “has launched 210 satellites” to date, Morgan Stanley said. Spaceflight isn’t slowing down, either, with contracts to launch about 100 satellites this year.

BlackSky represents the company’s reach into satellite operations. The unit successfully launched two satellites at the end of last year, Global-1 and Global-2, and expects to launch six more this year. Spaceflight Industries aims to eventually have constellation of 60 satellites to provide high-resolution photos of Earth nearly on demand.

The company announced a $150 million fundraising round in March for the first 20 satellites of the BlackSky constellation.

Additionally, BlackSky is one of several companies working with Amazon Web Services for the recently-announced AWS Ground Station business. Amazon’s cloud business is building a network of satellite connection facilities, representing the e-commerce giant’s first public move into space-related hardware.

Ground stations are a vital link for transmitting data to-and-from satellites in orbit, used by companies engaged in a variety of activities like weather forecasting, communications and broadcasting. AWS Ground Station aims to remove the heavy capital costs for these companies of building their own ground station networks off of satellite operators.

Morgan Stanley hosted its first “Space Summit” in New York City in December and is telling clients to pay attention to space companies.

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Alphabet's Verily has been working on health-tracking shoes to measure movement, weight and falls

Alphabet’s life sciences arm, Verily, has been looking for partners to co-develop shoes with sensors embedded to monitor the wearer’s movement and weight, as well as to measure falls, CNBC has learned.

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Three people familiar with the project say that the Google sister company has in recent months shown a prototype of the design in private meetings, hoping to attract partners to build the shoes and take them to market. It is not known whether the project is still active.

If Verily progresses with the project, the shoes could have a wide range of health-related uses. For instance, sudden weight gain can be a sign that the body is retaining fluid, which is a symptom of congestive heart failure. Another area of interest is fall detection, two of the people said, which could be useful for seniors in particular.

Verily did not respond to a request for comment.

Apple recently introduced fall detection into its latest Apple Watch, which also provides a way for users to reach emergency services in the event of a more serious tumble.

Verily was previously known as Google Life Sciences, but in 2015 it became a separate company under Google’s parent company, Alphabet, and is tracked financially within Alphabet’s “Other Bets” segment. In January, it raised $1 billion from Silver Lake and others to “increase flexibility and optionality,” according to the company’s CEO Andy Conrad, which could be an indicator of a potential spin-out from Alphabet.

The company has recruited dozens of engineers, scientists and health experts to its ranks. Many of its technical leads originally worked at Google.

Thus far, Verily has found success in teaming up with larger companies to develop and potentially commercialize its project ideas.

Aside from the shoes, Verily is working on several other hardware projects, including a stabilizing spoon to help people with movement disorders eat, a smartwatch for its clinical research efforts and a “smart” contact lens for age-related farsightedness or improving sight after a cataract surgery.

WATCH: Verily’s Project Baseline: ‘Google Maps for health’

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Apple stood up to Facebook and Google like Cook has been teasing — and it made a powerful point

Apple finally stood up to Facebook and Google on matters of privacy, and it made a powerful point about the influence it wields in mobile.

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Apple this week revoked the enterprise developer licenses of Facebook and Google, temporarily disabling internal employee-only apps, after reports that each company had side-loaded apps onto Apple’s operating system that violated the company’s rules. The license suspensions halted app development inside both companies and disrupted basic corporate functions until the privileges were restored Thursday night.

Facebook employees couldn’t access even their calendars or company transit schedules, according to a report by The New York Times. Facebook will now have to rebuild “a few dozen” of internal apps, which could take weeks, according to a company memo defending the company’s research app obtained by Business Insider.

Both news outlets reported some Facebook employees blamed Apple for the snafu and thought of the suspension as an act of retaliation in the companies’ ongoing feud.

“Apple’s view is that we violated their terms by sideloading this app, and they decide the rules for their platform,” Facebook executive Pedro Canahuati said in the memo seen by Business Insider. “Our relationship with Apple is really important — many of us use Apple products at work every day, and we rely on iOS for many of our employee apps, so we wouldn’t put that relationship at any risk intentionally.”

Apple CEO Tim Cook has been teasing a privacy standoff with the internet giants. During a speech in Brussels in October, Cook stopped just short of naming Facebook and Google in his comments blasting data collection firms and claiming personal information has been “weaponized against us with military efficiency.” He also characterized data collection practices by companies like Google and Facebook as “surveillance.”

And yet this is the first time Cook has taken significant action against Facebook or Google. Apple has previously launched educational privacy measures — user alerts within Safari about data tracking or Time Spent measures on iPhones, for example. But it’s never hindered development or access.

The move this week underscored just how much damage Apple could to do to Facebook’s and Google’s core businesses if it wanted to.

Of course, there are reasons to play nice.

Facebook and Google products are among the most popular in the App Store, driving downloads and service fees for Apple’s burgeoning Services revenue segment. Google also pays Apple something like billions each year to be the default search engine on products like the iPhone.

Apple said on Wednesday the license suspensions were a means to “protect our users and their data.” It remains to be seen whether the company will recycle that logic in the future.

After all, as Canahuati conceded, Apple decides the rules.

WATCH: Facebook was misusing Apple platform to get data from kids, says expert

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Here's Netflix's new intro that the company worked on for two years

Netflix is getting a new cinematic intro.

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The company spent two years revamping the short branded clip that introduces viewers to a new episode or movie, a spokesperson told Fast Company. The previous intro simply featured Netflix’s logo on a white background. Now, Netflix’s iconic “N” appears on a black background before the camera zooms into the letter to reveal several colorful vertical beams.

Netflix assured followers on Twitter that its two-beat intro sound would remain unchanged. Viewers will start to see the new animation on all originals premiering on or after Feb. 1, the company said. It will be swapped into other Netflix originals “over the coming months,” Netflix added.

In a blog post announcing the new intro, Netflix explained its motivation for the change.

“Simply put, we’ve evolved, and wanted to update this signature brand moment to reflect the many choices our fans enjoy today,” the company wrote.

The beams of light in Netflix’s new design are meant to represent the company’s array of content.

“The new ident animation reflects the diversity and variety of our content. Our favorite part is when the Netflix symbol breaks out into an array of colors — which is inspired by the spectrum of stories, emotions, languages, fans and creators that collectively make up who we are as a brand,” the company wrote.

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Watch: Netflix film ‘Roma’ and Disney’s ‘Black Panther’ score historic best picture Oscar nominations

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