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Amazon allowed kids to spend millions on in-app purchases, FTC says

Amazon.com has billed parents for millions of dollars’ worth of unauthorized in-app purchases made by their children, the FTC said in a complaint filed Thursday in a U.S. court.

The FTC’s lawsuit, filed in U.S. District Court for the Western District of Washington, seeks a court order requiring Amazon.com to refund parents for unauthorized purchases made by their children. The FTC also wants the court to ban the company from billing parents and other account holders for in-app charges without their consent, the agency said in a press release.

Amazon.com keeps 30 percent of all in-app charges, the FTC said in its complaint. The Amazon case “highlights a central tenant” of consumer protection laws in the U.S., that companies should get customer permission before charging them, said Jessica Rich, director of the FTC’s Consumer Protection Bureau, during a press conference about the lawsuit.

Amazon employees raised concerns about in-app purchases by children years before the company changed its procedures, Rich said. Amazon customers seeking refunds found a process “unclear and rife with deterrents,” she said. Amazon’s official policy on in-app purchases said it does not give refunds, she added.

Amazon, in a letter to the FTC July 1, said it was “deeply disappointed” that the agency was moving toward filing a lawsuit. “We have continuously improved our experience since launch, but even at launch, when customers told us their kids had made purchases they didn’t want we refunded those purchases,” wrote Andrew DeVore, Amazon’s associate general counsel.

The FTC’s lawsuit against Amazon.com echoes a complaint brought by the agency against Apple. In January, Apple agreed to pay at least $32.5 million to customers in a settlement with the FTC over children’s in-app purchases.

This week, Politico reported that Apple has complained to the FTC that Google allows the same kinds of in-app purchases in its mobile app store.

The FTC’s recent focus on in-app purchases by children has drawn criticism. This week, Senator Deb Fischer, a Nebraska Republican, questioned the FTC’s actions in a letter to the agency.

“Few, if any, doubt that the app marketplace established in recent years by Amazon and its competitors has fundamentally expanded and improved the American economy,” Fischer wrote. “To pursue enforcement against these companies for specific policies in place at the market’s nascent stage would constitute a de facto tax on innovation that threatens future growth and opportunity.”

In the Amazon case, the FTC noted that the company offers many children’s apps for mobile devices such as the Kindle Fire. The company violated the FTC Act, prohibiting unfair and deceptive business practices, by billing parents and other Amazon account holders for charges incurred by children without adult consent.

Amazon’s app store allowed children playing games to spend “unlimited amounts” of money to pay for virtual items without parental involvement, the FTC alleged.

When Amazon introduced in-app charges to the Amazon app store in November 2011, there were no password requirements of any kind, the FTC alleged. Many kids’ games encouraged children to acquire virtual items in ways that blur the lines between spending virtual currency and real money, the agency said.

In one app, Ice Age Village, children can use virtual coins and acorns to buy items in the game without a real-money charge. However, they can also purchase additional coins and acorns using real money on a screen that is visually similar to the one that has no real-money charge, the FTC said. A one-time purchase in the app could cost as much as $99.99.

As early as December 2011, Amazon employees raised concerns about in-app purchases, the FTC said in its complaint. One internal Amazon communication said that allowing unlimited in-app charges without any password was “clearly causing problems for a large percentage of our customers,” the FTC said.

In March 2012, Amazon updated its in-app charge system to require an account owner to enter a password for individual in-app charges over $20. But Amazon continued to allow children to make an unlimited number of individual purchases of less than $20 without a parent’s approval, the FTC said.

An Amazon employee noted at the time of the change that “it’s much easier to get upset about Amazon letting your child purchase a $99 product without any password protection than a $20 product,” according to the complaint.

Then in early 2013, Amazon updated its in-app charge process to require password entry for some charges, but the process worked in different ways in different contexts, the FTC alleged. Even when a parent was prompted for a password to authorize a single in-app charge made by a child, that single authorization often opened an undisclosed window of 15 minutes to an hour allowing the child to make unlimited charges, the agency said.

Amazon changed its in-app purchase policy again in June, “roughly two and a half years after the problem first surfaced,” the FTC said in a press release.

The Top Five Most Innovative Tech Projects Of 2014 So Far

As the world sits in awe as another smartphone is launched, a gaggle of engineers and bright-eyed entrepreneurs have been quietly innovating behind the scenes. Want a natural alternative to street lighting? Or how about driving – via your iPhone – a free-roaming scalextric toy car that can blast out EMPs? Then, friends, you have come to the right place.

Here I’ll explore the top five startup projects and gadgets of 2014 so far.

1. SCiO molecular scanner

SCiO is like something straight out of science fiction. Aside from the fact that it looks like a cheap flashing toy that Dr Who might point at something with flailing tentacles, the concept itself if genius.

SCiO is the brainchild of Israeli startup Consumer Physics, which is a collaboration of brains from MIT, Stanford, CalTech, Harvard, Wiezmann Institute, The Technion, and Tel-Aviv University. SCiO is an affordable handheld molecular sensor that lets you scan and discover the molecular makeup of anything it’s pointed at, which then beams the data to your phone in real-time.

What that means is that you can scan anything and get a complete report on its molecular structure on your phone. How old is that apple you’re about to buy? Or which watermelon is the sweetest? How many units of alcohol in that glass of wine? That kind of thing.

The possibilities are as exciting as they are endless. Not least the wealth of information, data and analysis that could be built up from millions of people scanning everyday objects. The first batch won’t be shipped to Kickstarter backers until January next year. But it will go on sale in March 2015 for $249. You can watch the video of how it works on their Kickstarter campaign here.

2. Budget driverless car

Google’s driverless car dominates the headlines, but the reality is that it’s unlikely to be available any time soon and it’s certainly not going to be within your price range. But one startup is hoping, at least, to change the latter. Cruise Automation, based in San Francisco (where else?), is developing a car automation accessory that will retail for $10,000.

Kyle Vogt, the founder of the project, is hoping to start installing his “RP-1” invention onto cars early next year. It only currently works  on an Audi A4 or S4, but Vogt is hoping to modify the device so it can be retrofitted on to any car. It works largely in the same way Google’s driverless car works in that it has multiple sensors that can scan the immediate area for routes and potential collisions.

Vogt describes his invention as a “highway pilot”. He essentially means that it will work as a driving aid, rather than a system to fully takeover driving responsibility. Users will be able to switch on the system by tapping a button on an inbuilt interface in the car, and then let system take over. The driver can regain control of the car by tapping on the brake pedal or by placing their hands on the steering wheel.

Incredibly, the project only began in November 2013. Vogt and his team have worked around the clock to make it into a reality and they plan to start installing it onto cars early next year. Watch the video here.

3. Glow in the dark trees

Dutch designer Daan Roosegaarde and his colleague Alexander Krichevsky have developed a way of splicing illuminating properties of Jellyfish with trees to create leaves that glow in the dark. It’s brilliant, it’s innovative and it’s creation of a man who is comfortable in a turtleneck jumper and red velvet dinner jacket. There’s nothing you can’t be excited about here.

Roosegaarde first unveiled his idea at SXSW this year. Currently he only has a small houseplant prototype that works, but he’s hoping to create a much bigger version soon. To make this a reality, Roosegaarde has collaborated with the University of New York  and Krichevsky, whose technology firm Bioglowunveiled genetically modified glow-in-the-dark plants earlier this year.

Krichevsky creates the plants by “splicing DNA from luminescent marine bacteria to the chloroplast genome of a common houseplant, so the stem and leaves emit a faint light similar to that produced by fireflies and jellyfish.”Dezeen reports.

If glow in the dark trees were to be planted across pavements around the world, replacing street lights, the potential environmental benefits could be huge. Not to mention the  incredible drunken memories you’ll have of strolling down the Rainbow Road level in Mario Kart.

You can watch an interview with Roosegaarde here

4. AnkiDrive

AnkiDrive made a few waves at WWDC last year, but since then the plucky young startup has barely rocked any boats, or even made a splash in the last six months….. and other laboured water-related puns. But the Scalextric-style game officially launched this month and is looking to regain some of that initial acclaim.

Created by three engineers, Anki is one of the first genuinely high-tech physical games to hit the market. The premise is fairly straight forward, you control a car with your iPhone or iPad and drive it along a race-track. There are no barriers on either side of the track because the cars can determine its own position using some AI. As the Anki Team described it to me: “Each car scans the track 500 times per second using state of the art algorithms to determine its exact position, speed and trajectory. Using powerful AI, it then knows where it is in relation to every other car on the track.”

To add a bit of spice, not only are the cars designed by Harald Belker, the guy who designed the cars in Minority Report, but they also have some Mario Kart-esque weaponry attached to them. You can blast out EMP’s that stop rivals dead, fire missiles and hammer the gatling gun. There’s also a weapon and upgrade system on the accompanying iPhone app that lets you upgrade with the points you’ve accumulated from races and chose different loadouts. Before you panic, there are no in-app purchases, all points are acquired from playing the game.

5. PocketScan 

The Pocket Scan balances on the fine line between ludicrous budget invention on a cable infomercial and utter practical brilliance. I could easily imagine it being both advertised by Troy McClure and Dr. Nick or being demoed by a CEO at a marquee launch event at CES.

The simple, palm of the hand-sized, invention allows you to scan anything it comes into contact with. Whilst a hand-held scanner is useful, it doesn’t seem that revolutionary when many of us could just take a photo with our phones if we wanted a digital replica of something.

But it’s the Pocket Scan’s added functionality that stands it apart. If, say, you were to scan a document, the Pocket Scan’s accompanying software will recognise the text – in any language – and turn the scanned file into a document that can be edited. The same goes for pictures and anything else you scan. All scanned images appear in real time on the computer or tablet as you can them, too.

New Species Of Elephant, Aardvark-Related Shrew Discovered In Namib Desert

A Round-Eared Elephant-Shrew

A new species of elephant shrew has been discovered in Africa's Namib Desert; the animal is closely related to the sea cow, aardvark, and of course the elephant.

The newly-discovered critter is called the round-eared sengi, or Macroscelides micus. The animals is part of the order Macroscelidea, which currently contains 19 sengis. Members of Macroscelidea are characterized by their narrow snouts, LiveScience reported.

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The first representative of this species was collected Michael Griffin of the Namibia Ministry of Environment and Tourism by the Etendeka volcanic formation. When the species was first spotted researchers thought it was a Macroscelides flavicaudatus.

"We knew that it looked a little odd, but it was the genetic analyses that suggested that it was really very different," researcher John Dumbacher, curator of ornithology and mammalogy at the California Academy of Sciences in San Francisco, told Live Science. "Once we got back to the field and saw several live individuals, it was clear that they differed from M. flavicaudatus in many ways, and that this wasn't just an 'odd' individual."

The team found the animal was smaller than Macroscelides flavicaudatus, had rust-colored fur, lacked darks skin pigment, and had a hairless gland on the underside of its tail, aCalifornia Academy of Sciences news release reported. The team compared the animals with other specimens, revealing they had discovered a new species.

"Had our colleagues not collected those first invaluable specimens, we would never have realized that this was in fact a new species, since the differences between this and all other known species are very subtle," Dumbacher said in the news release. "Several museum collections were instrumental in determining that what we had was truly new to science, highlighting the value of collections for this type of work. Genetically, Macroscelides micus is very different from other members of the genus and it's exciting to think that there are still areas of the world where even the mammal fauna is unknown and waiting to be explored."

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Colo.’s abortion protest law stands

Colorado’s “buffer-zone” law – which creates a protective bubble between anti-abortion protesters and medical facilities, including those that perform abortions – likely remains safe despite Thursday’s unanimous ruling by the Supreme Court to strike down a similar law in Massachusetts.

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McLachlan

Colorado’s buffer-zone law won’t be affected by Thursday’s ruling, said Durango lawyer and state House Rep. Michael McLachlan. He successfully defended the state’s buffer-zone law before the Supreme Court in 2000 while serving as the state’s solicitor general.

In a phone interview a few hours after the high court’s ruling Thursday, McLachlan said, “It’s certainly not a decision that is in any way going to end the legality of – or the debate about – abortion rights in the United States.

“But it’s important to understand that this is a setback for women in Massachusetts. It isn’t a setback for women’s freedom, health or abortion rights in Colorado,” he said, pointing to important differences between Colorado’s and Massachusetts’ laws.

Other legal minds worried that the Supreme Court’s decision to strike down Massachusetts’ buffer-zone law, which barred protesters from coming within 35 feet of clinics that perform abortions, spelled trouble for similar state laws.

At liberal-leaning Mother Jones, legal commentator Molly Redden writes that in light of the court’s ruling, “buffer zones are basically dead.”

At Lifeguard, an anti-abortion group based in Durango, Shelley Gundrey, who is secretary to Lifeguard’s board of directors, said she was thrilled by the ruling.

“I think it’s great that they upheld our rights to the First Amendment and the fact that we have free speech,” she said.

“We do a prayer vigil outside of Planned Parenthood on Fridays – the day they do abortions, and we basically just pray, always over 100 feet from the front door. It makes it really difficult to talk to those girls going in,” she said.

Gundrey said while anti-abortion protesters have developed a reputation for trying to dissuade women from having abortions with violence and intimidation, Lifeguard’s anti-abortion protesters pose no threat to women trying to enter Durango’s Planned Parenthood.

“You definitely hear of every now and then some crazy kills somebody, and that’s horrible. We don’t advocate for any of those approaches. We believe in dignity of life for everybody, even the abortionists. I’m sure they have their struggles,” she said.

The ruling dismayed abortion-rights activists across the country.

“Obviously, we’re disappointed that the Supreme Court ruled against protecting women who want to access reproductive health care,” said Cathy Alderman, Planned Parenthood of the Rocky Mountains’ vice president of public affairs.

Alderman said the ruling does not directly impact Colorado’s buffer-zone law, which plays an important role protecting women trying to enter Planned Parenthood clinics in Denver and Colorado Springs from being harassed, threatened and abused by anti-abortion protesters.

The buffer zone is less relevant in Durango, she said because Planned Parenthood’s Durango clinic is on private property.

She said she expects Massachusetts’ Legislature to quickly pass another law reinstating buffer zones between protesters and medical facilities in a form that more closely models Colorado’s law.

Under Colorado’s buffer-zone law, it’s unlawful for protesters to come within 100 feet of medical facilities or 8 feet of people trying to enter them.

McLachlan, a Democrat who successfully established the constitutionality of Colorado’s buffer-zone law in the 2000 U.S. Supreme Court decision Hill v. Colorado, said the provisions in Colorado’s buffer-zone law are much narrower than those in the stricken Massachusetts law: Whereas Colorado’s buffer-zone law creates a protective bubble around all medical facilities, the stricken Massachusetts law specifically instated a 35-foot bubble around clinics that perform abortions.

McLachlan noted Justice Antonin Scalia said in a separate concurring opinion that Massachusetts’ law ran afoul of the First Amendment because it “singled out a group of speakers and treated them differently than other people. It was too broad,” he said.

He said the Supreme Court’s majority opinion striking the Massachusetts law, which was written by Chief Justice John Roberts and cosigned by Justices Ruth Bader Ginsburg, Stephen G. Breyer, Sonia Sotomayor and Elena Kagan, actually affirms the constitutionality of Colorado’s buffer-zone law.

When states pass laws that intrude on citizens’ freedom of speech, he said they must meet a high constitutional bar by demonstrating that they have a “compelling interest” in enacting the law, such as protecting the health and safety of the public.

The stricken Massachusetts law was passed in 2007 in response to a history of harassment and violence at abortion clinics, including a deadly shooting rampage at two facilities in 1994.

In the court’s majority opinion, Chief Justice Roberts acknowledged that Massachusetts had a “compelling interest” in creating a buffer zone that allows women to enter clinics that perform abortions safely and without harassment. But Roberts said Massachusetts’ law burdens “substantially more speech than necessary to achieve the commonwealth’s asserted interests.”

McLachlan said while Colorado’s buffer-zone law is in no danger, the court’s ruling against Massachusetts “still shows that the debate in the U.S. about a woman’s right to choose and make reproductive decisions is far from over. It’s a historic battle for women’s freedom. And this is probably going to be a conflict in our society after I’m long gone and probably after you’re gone.”

Apple launches $199 16GB iPod touch with rear camera in 6 colors, slashes prices on 32GB & 64GB models

Apple's entry-level 16-gigabyte iPod touch received an update on Thursday, dropping the price to $199 while adding a rear iSight camera and expanding its color options to six. Apple also slashed prices on the 32- and 64-gigabyte variants, now priced respectively at $249 and $299.

The update brings the 16-gigabyte iPod touch in line with its larger 32- and 64-gigabyte versions, which are all available in black, space grey, pink, yellow, blue, and (Product)RED. All three models are available from Apple's online store and are advertised to ship within 24 hours.

Previously, the 16-gigabyte iPod touch was priced at $229, it only came in space grey, and it lacked a rear camera. It also lacked support the iPod touch loop wrist strap. Customers will still have to buy the strap separately for $9 with the 16-gigabyte model, however.

Prior to Wednesday's refresh, the 32-gigabyte iPod touch was priced at $299, while the 64-gigabyte version reached $399.

Aside from the addition of the 5-megapixel rear camera to the 16-gigabyte variant, the specifications on the media players remains the same. All three include a 4-inch Retina display, a forward facing FaceTime HD camera, and are powered by Apple's A5 processor. They also run iOS 7 and ship with Apple's EarPods.

The iPod touch lineup last received an update in June of 2013 when the previous 16-gigabyte version lacking an iSight camera launched for $229 in one color. It took the place of the previous fourth-generation model, which had been priced at $199 but featured a slower A4 chip.

While the iPod once led Apple's comeback, its portable media players represent a shrinking portion of the company's massive business, now led by the iPhone and iPad. Still, as of the end of 2013, the iPod continued to lead an ever-shrinking market of portable media players, with the NPD Group pegging Apple's share at 72 percent.

In its quarterly earnings conference calls, Apple used to routinely note that the iPod touch accounted for more than half of all iPod sales, though it declined to break down specific share based on model. Last quarter, iPod sales dwindled to just 2.7 million units, a sum that didn't even garner a mention from the company as it discussed its financial results.

The iPod touch continues to be flanked by the display-less clip-on iPod shuffle, the multi-touch diminutive iPod nano, and the legacy hard-drive based iPod classic with iconic click wheel.

Apple buying Disney? A consultant explains why he thinks a deal is ‘frighteningly obvious.

Francis McInerney is convinced Apple will buy Disney.

Apple’s success has started to become a problem. The company’s revenue and profits have grown so fast that it’s difficult for it to find new markets that will be large enough to ensure its revenues continue growing.

Apple has introduced a stock dividend and bought back shares to appease investors who question whether the world’s largest technology company by market capitulation is still a growth company.

Apple is expected to release a smartwatch this fall, which should provide a boost. But Francis McInerney, a consultant at North River Ventures, has another idea for how Apple can keep growing. Why not buy Disney?

“The logic is so great this could happen tomorrow,” McInerney said. “The two companies have an identical way of thinking in complementary markets. There’s nothing they do that competes with another. And yet combined this would be a powerhouse deal in the imagining.”

Although an Apple-Disney union has been the subject of Wall Street speculation for years, McInerney believes the shift of content to the cloud will force Disney to act.

“This changing structure, this Gutenberg-like tectonic shift  in human behavior based on the cloud’s ability to offer unlimited computing at marginal cost, says to Disney, ‘We’ve got to be on the platform to grow in the new space,’ ” McInerney said.

His argument doesn’t draw from any inside information of either company, just his own analysis of their cultures, their tendency to prepare well for the future and their needs to remain profitable.

McInerney imagines the two combined as a “Netflix on steroids,” in which Apple would benefit from finding ways to monetize Disney’s content offerings, and Disney would have a safe and profitable place in the emerging, unbundled world of TV and video to peddle its wares. Having Disney under the Apple umbrella would also be an asset if Apple ever launches a television set, which has been suggested for years but may not become a reality.

At the same time, there are plenty of good reasons to think this deal will never happen. Apple rarely makes splashy acquisitions. The $3 billion it recently paid for Beats is the company’s largest acquisition. Disney’s market cap is $143 billion, and its shareholders would expect a premium on top of that price. Apple currently holds $151 billion in cash and marketable securities, but the majority of that is offshore and would be taxed if brought back to the United States. Another question mark would be ensuring regulators approve the acquisition.

Both Apple and Disney did not respond to requests for comment.

McInerney — who calls this potential deal “frighteningly obvious” — is quick to point out that Disney chief executive Bob Iger sits on Apple’s board of directors. The companies appear friendly, but expecting them to join forces still looks like a giant leap.

JP Morgan sees shares of Apple reaching $108, believes redesigned iPhone will exceed expectations

Investment firm J.P. Morgan became the latest to increase its price target for Apple stock on Tuesday, projecting that the company will be propelled to $108 per share thanks in part to this year's anticipated "iPhone 6" launch.

"iPhone 6" and "iPhone 6c" concepts

Analyst Rod Hall issued a new note to investors, a copy of which was provided to AppleInsider, to lay the case that shares of AAPL are likely to see earnings grow beyond current expectations on Wall Street. Hall anticipates that Apple has multiple new product launches in the works for late 2014, including a redesigned iPhone.

Hall's estimate is up from his previous target of $89, which has been underwater for some time. His new price target of $108 calls for Apple to reach that goal by the end of 2015.

In addition to a redesigned iPhone, Hall also expects that Apple will launch a so-called "iWatch" this fall. However, he doesn't believe that new product category would have a significant effect on the company's bottom line.

J.P. Morgan was the second investment firm to raise its price target on Apple on Tuesday, joining Needham & Company, which increased its forecast to $97. In that increase, analyst Charlie Wolf also cited an expectation that "iPhone 6" sales will be strong, but he was also impressed by the announcement of Apple's new programming language, dubbed Swift, at this month's Worldwide Developers Conference.

Other firms tracked by AppleInsider that revised their price targets upward earlier this month areCowen & Company ($102), and RBC Capital Markets ($100). Many have been prompted to increase their targets in the face of strong gains by AAPL stock since the company's successful March quarter results, in which iPhone sales came in higher than market expectations.

Google trains its firepower on Apple

Investors applauded after Google (GOOG) on Wednesday announced new versions of Android that will support wearable devices, cars and television, sending the company's stock up 2.5 percent at the close.

The excitement wasn't over a "killer" device that would immediately translate into massive new revenue for the company, but rather the search giant's move to engage Apple (AAPL) on key fronts. Google's new offerings will also widen its online platform, drawing more consumers to a range of products and, critically, convincing them to share their shopping and other valuable data.

Analysts with CRT Research said Google "now has a winning formula to conquer the living room -- with meaningful monetization likely to follow over the longer term."

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Google unveils new smartwatch

Google had to respond eventually to Apple's growing strategic directions. The latter introduced its iPhone interface for cars earlier this year. At the 2014 Worldwide Developer, the company found new ways to expand use of its devices, including home automation and health monitoring. Apple is still rumored to be planning a wearable device called the iWatch, as it has been preemptively nicknamed. A new, more powerful version of Apple TV also may be in the offing.

In other words, Google and Apple remain in a race for the hearts and wallets of consumers. Google has made great headway in market acceptance, with Android-powered phones taking the smartphone lead globally and tablets using the operating system gaining market share. Its recentacquisitions of Nest and Dropcam showed a focus on home security and automation. Music and video offerings underline the company's interest in diving deeper into entertainment.

To compete with Apple, Google has to show a willingness to enter the same consumer markets that its rival is targeting. That's what the newest version of Android, called L, showed. First, Google had been working on features similar to what Apple has recently added to iOS, including automatic owner recognition for improved security and 3D graphics capability for better gaming.

Then came the checklist of future markets. Android Wear for wearable computing includes health-tracking, navigation apps and voice-activated ride-sharing. More than 40 automakers -- more than Apple has recruited so far -- have signed on to include Android Auto. Meanwhile, Android TV can take video-streamed movies, TV and game feeds from any device and project them onto a TV screen.

The ability to have any or all of these versions of Android working together means that Google has greatly increased the potential reach of its ecosystem, as well as the markets for developers and possible arenas for advertising, which is the company's bread and butter.