How Blockchain will disrupt the smartphone industry
Since Apple’s iPhone launched in 2007, smartphone manufacturers have not been able to introduce any mind-blowing new products. Blockchain-powered smartphones can disrupt the industry by turning smartphones into trusted sharing economy revenue centers rewarding users and making payments easy and secure.
Ten years ago, in 2007, Apple introduced the iPhone to the world. It had a beautiful design, a great out-of-the-box experience, and a user interface that was easy and intuitive to use. Most importantly, it had a set of native applications, which later grew to be a massive ecosystem of over 2 million applications. Steve Jobs and his team had a vision of what a smartphone should be, and he ensured that the iPhone was built according to that vision. The phone of the decade was born. The iPhone kick-started the mobile internet economy.
Now, a decade later, even though smartphones have undergone incremental improvements for years, no major leaps has taken place. Smartphone innovation seems to have stagnated, and even worse, smartphone users’ data and privacy are being sold to big data and marketing companies. In today’s smartphone business, the customer is not king but, rather, a data-gathering mule.
Return of the king
Have you ever thought about how many of today’s online purchases happen via smartphones? In addition to data and voice packages, people buy airline tickets, pay for hotels, order food, books, videos, music, and much more via their smartphones. All of these purchases combined are worth thousands of dollars annually. Your lifetime value as a customer is at least 10 times the value of your smartphone, for which you paid a few hundred dollars. As a smartphone user, you should have the negotiating power to say “reward me, and I will be your loyal customer,” but all smartphones are optimized for gathering and selling your data, not for rewarding you. This business model was designed when online payments were still a rare occurrence, and the only way to monetize the operating system was to sell consumer data. Due to growth of mobile commerce, that business model has become outdated, non-value adding, and even dangerous for users. It needs to be replaced. The mobile user shall return as king.
Blockchain technology is perfectly suited to disrupt the smartphone industry and change the existing mobile business models to become more customer-centric and respectful of user privacy. Blockchain technology allows smartphones to become trusted decentralized revenue centers, where people and companies can make frictionless payments without borders. With Blockchain technology and tokens, companies can reward exactly those users who are loyal to them, and people can acquire and spend and borrow their money from person to person without the use of middlemen. This will be Economy 3.0, the true sharing economy, and Blockchain-powered mobile devices will take us there.
Introducing Zipper’s blockchain-powered mobile platform
Zipper and Jolla recently announced a community and developer program for Sony Xperia X mobile devices (Here is to the crazy ones) to develop a Blockchain powered smartphone platform, which enables easy and safe way to make payments with crypto currencies and builds a new business model for smartphones, which is customer-centric, privacy-preserving, and rewarding for users.
Users would be rewarded for their loyalty and contributions, whether this has to do with purchasing something online, inviting friends, or choosing to share their data. Our objective is to put users in absolute control of their phones and their information, while letting service providers reward customers for their loyalty. This is the Zipper mobile platform. Here is a brief description of what Zipper is and where it is headed.
The Zipper Vault and Wallet
In today’s environment, one of the problems regarding mobile payments is that users’ digital identity and payment information are stored in centralized databases, making them vulnerable to attack. There have been numerous recent cases in which people’s credit card and other payment data have been hacked. Blockchain provides an excellent solution for handling digital identity with private keys so that purchasers’ identity is not stored in centralized locations. However, everyone who has used cryptocurrencies for payments knows that the handling of private keys requires diligence and that it does contain some risks. Private keys can easily be lost, stolen, or forgotten (see for example https://www.wired.com/story/i-forgot-my-pin-an-epic-tale-of-losing-dollar30000-in-bitcoin/)
To provide a safe and easy-to-use solution for daily payments, we will build the Zipper Vault, a safe and secure space within Zipper-based mobile devices, which will be fully controlled by the user and will not be accessible by any apps or even by the operating system itself (such as Android). This will host your digital identity (or private keys), blockchain node software (such as Ethereum), decentralized storage software (such as IPFS), and, in general, provide a trustable environment for accessing your personal information and the world of decentralized services — along with the user experience of accessing it.
The Zipper wallet solution makes cryptographic identity management easy, through key splitting (Shamir’s Secret Sharing) and decentralizing the key holding to different online services. As the online service providers only holds part of the key, only the user, who has access to all parts of the key, can execute payments. The device itself never stores the full cryptographic key. We will demonstrate and describe this approach in depth in later blog posts.
The Zipper reward engine
The Zipper reward engine keeps track of and processes user purchases and activity and automatically rewards users by giving them ZIP tokens in a privacy-aware manner. Online service providers, such as airline companies, retail stores, e-commerce companies, and various applications, that want to participate in the reward program would buy ZIP tokens and use them to reward their users through the reward engine. These reward program participants are called Sponsors. They can be global players or regional players wanting to have a more direct and efficient loyalty model for their customers.
Blockchain technology is ideal for this use-case, as it makes it very easy to set up multi-party payment infrastructures without the need for a central authority. Users can then use the ZIP token in various ways by paying the monthly rent on their Zipper device, by getting additional discounts from Sponsors, by using ZIPs in in-app payments of various Sponsor applications, by gifting them to friends, or by sponsoring the development of their favorite applications. Users can also trade ZIP tokens with other users in an open marketplace.
John’s first day with a Zipper-powered smartphone
Here is an example of the Zipper user experience for the average guy, John. John is new to cryptocurrencies and decentralized technologies, and he would like to join the expanding community. He has heard that getting into crypto can be complex, as it is difficult to know which wallet can be used safely. Moreover, managing private keys by printing them and keeping them safe and hidden at home frightens him.
John has also heard from his friends that many people in the crypto community have been hacked, and he is worried that his transactions from his Android phone might be tracked and that this might result in his wallet being hacked. John has heard from his friend Rachel that there is a secure, easy-to-use solution available called Zipper. To get Zipper, John just needs to download Zipper from the project’s website and install it on his smartphone.
After John has downloaded and installed the Zipper platform, the device boots up and instructs him to take a photo of his ID and a selfie to create his digital identity. John now has a digital identity tied to his legal identity, which he can leverage immediately with applications that require it, or for cryptocurrency exchanges. If John so desires, the ID can also start building a reputation score based on his community and financial activity. A good score may help John, for example, to get loans or work from other Zipper users and projects.
John then opens the wallet on his device. He is happy to see that there is already $50 worth of ZIP tokens on his account, which has been deposited by Sponsors, who are the local e-commerce businesses, retail stores, airline companies and various apps that John and his friends often use. John can unlock the sponsored ZIPs by buying services from Sponsors or by inviting new customers to Sponsors.
John has heard that he can earn money in the blockchain space in various ways, for example, by renting his device’s processing power or storage or by sharing his WiFi hot spot. John opens the Zipper’s dapp (decentralized app) store and browses through various Blockchain-based services, with the most interesting ones curated to the main page by the community through the use of ZIP tokens.
John opens the Gig dapp, which is a portal for various short term online jobs. Although he is not actively looking for a new job, he is interested in whether there are small gigs that he could do in a few hours of his spare time. John notices that someone is inquiring about a technical opinion on a software package that he knows well, with a reward of 100 ZIP tokens. He decides to write the analysis after the reputation score connected to his ID gives him a chance to offer his services in this area. He gets the gig and delivers it in a few hours. The customer accepts the work, and the ZIP tokens are released to him.
He also starts renting his device’s unused storage and shares his mobile data package through a hotspot in case someone in the neighborhood needs internet access — a nice way to earn some tokens while helping others. John also notices that he can earn ZIP tokens by recommending the people he knows. He immediately realized that one of his friends was using Zipper, so he gave her a recommendation. John received a reward of 10 ZIP tokens.
What a good start for John in the decentralized mobile sharing economy! John now has a digital identity, a reputation score, is able to safely make payments and has various ways to earn with his mobile.
Zipper and Jolla are committed to make a new Blockchain powered smartphone reality and if you’re are interested to contribute, you can join our community. Zipper-enabled Sony Xperia devices will be available to Zipper community members in Q1/2018. Zipper will also be available on several other devices in the future.
Moreover, the ZIP token pre-sale is now open to all early contributors here.
Our next blog post will introduce the technical implementation of Zipper. Stay tuned!