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Sale of Gamma Medica, Inc.

 

Gerbsman Partners – http://gerbsmanpartners.com  has been retained by Hercules Capital, Inc. (“Hercules”), the senior secured lender to Gamma Medica, Inc. (“Gamma Medica” or”GMI”), http://gammamedica.com  to solicit interest for the acquisition of all or substantially all of Gamma Medica’s assets, including its Intellectual Property (“IP”), in whole or in part (collectively, the “Gamma Medica Assets”).

Please be advised that the Gamma Medica Assets are being offered for sale by HercGamma, Inc., a Delaware Corporation, (”HercGamma”) and an affiliate of Hercules Capital, Inc., Gamma’s Senior Secured Party.  HercGamma has acquired title to such assets pursuant to Section 9-610 of the Uniform Commercial Code.  Purchasers of the Gamma Medica Assets will receive all of HercGamma’s right, title, and interest in the purchased portion of  Gamma Medica’s assets, as provided in the Uniform Commercial Code.

Please see the attached for additional detail information regarding the Sale of Gamma Medical, Inc.’s Assets and IP.  (detail information summary, teaser, patent listing, trademark listing and mutual NDA).
The sale is being conducted by Hercules for the benefit of HercGamma.  Hercules will use its best efforts to make Gamma Medica’s employees available to assist purchasers with due diligence and assist with a prompt and efficient transition at a mutually convenient time.  Presently, all of Gamma Medica’s employee’s have been terminated; key employees have been retained as consultants.

Gamma Medica is headquartered at 12 Manor Parkway, Salem, New Hampshire. To date, $34 million of capital has been invested in the company by Psilos Group and senior debt, by Hercules Capital. Hercules Capital has approximately  $ 1.8 million of senior debt, plus other expenses, (including without limitation late fee’s and costs of professionals).

Gamma Medica Company Profile

Gamma Medica, Inc. (‘GMI”) was founded in 2013 following the acquisition of the intellectual property and commercial assets by Psilos Group, who currently owns 100% of the equity.

GMI pioneered the development and commercialization of the first fully digital, dual headed Molecular Breast Imaging (“MBI”) system. MBI overcomes the inherent limitations of anatomical-based imaging technology such as Mammography (MM), Tomosynthesis(Tomo), Ultrasound (US) and Automated Breast Ultrasound (ABUS) in women with dense breast tissue. 

  1.  LumaGEM® MBI is indicated for secondary screening or diagnostic imaging for women who have dense breast tissue. Over 45% of all women present radiologists with a diagnostic challenge since standard mammography or tomosynthesis cannot discern tissue density from cancerous lesions due to the appearance of the lesions as white on a white background if fibrous tissue is present.  Quoting from published peer reviewed clinical papers, mammography only detects 3/1000, however, when MBI is used as a secondary screening device a further 9/1000 are detected. Ultrasound, when used in a similar protocol, only finds 3/1000.  LumaGEM® is a breakthrough technology for women who are at risk and/or dense breast tissue.
  2.  LumaGEM® can be easily incorporated into a busy clinical practice, the patient experience is far superior to mammography since no breast compression is required, a frequent complaint and a compliance problem.  The procedure is fully reimbursed (CMS) at 3.5x that of mammography. It is covered by the majority of commercial payers too.
  3.  MBI, through published prospective and blinded studies, have proven to detect cancer with superior technical and clinical performance, delivering unsurpassed sensitivity (91%) and specificity (93%).  To put into perspective, MRI only delivers 75% specificity. Further, the Negative Predictive Value of MBI is 99.7%, providing unsurpassed clinical assurance.
  4.  The Mayo Clinic, a licensor to GMI, as published widely, is currently a user of the technology (placement of 5 cameras), has proven to reduce unwanted biopsies (false positives) by 50%. LumaGEM® MBI is FDA approved, reimbursed (CPT Code 78800) and the company has placed 22 units in the USA to date. In the next 12 months, the company had anticipated to sell a further 20 units and with a pipeline of a further 200 accounts.  With the recent decision by the America College of Radiology to publish practice guidelines for the use of MBI, this will further enhance the commercial opportunity. In addition, 32 States have now issued the Dense Notification Law that requires all providers to issue letters of recommendation for women who have dense breast tissue. This will further raise awareness and demand for MBI to be used a secondary screening and diagnostic tool.
  5.  Economically, MBI strikes a strong proposition for the Affordable Care Act’s Triple Aim; MBI provides a compelling reason to adopt the technology as it provides strong economics, improved clinical outcomes and high patient satisfaction.
  6.  LumaGEM® MBI has a CE mark and marketing has commenced in the EU market. The company has one distributor contract in the UK and Ireland and is engaged with a number of other parties in Europe too. It has also Saudi Arabian approval and anticipating Canadian approval in Q3 2017.
  7.  LumaGEM® MBI is disruptive technology that will transform breast imaging. It has superior performance to standard secondary screening and diagnostic modalities in use today and is by far a lower cost, more accurate diagnostic tool compared to the “gold standard” of MRI perceived today.

IMPORTANT LEGAL NOTICE:


The information in this memorandum does not constitute the whole or any part of an offer or a contract.

The information contained in this memorandum relating to Gamma Medica Assets has been supplied by Gamma Medica. It has not been independently investigated or verified by Gerbsman Partners, Hercules, HercGamma or their respective agents.


Potential purchasers should not rely on any information contained in this memorandum or provided by Gerbsman Partners and Hercules (or their respective staff, agents, and attorneys) in connection herewith, whether transmitted orally or in writing as a statement, opinion, or representation of fact. Interested parties should satisfy themselves through independent investigations as they or their legal and financial advisors see fit.


Gerbsman Partners, Hercules, HercGamma and their respective staff, agents, and attorneys, (i) disclaim any and all implied warranties concerning the truth, accuracy, and completeness of any information provided in connection herewith and (ii) do not accept liability for the information, including that contained in this memorandum, whether that liability arises by reasons of Gamma Medica’s or Gerbsman Partners’, Herucles’ negligence or otherwise.

Any sale of the Gamma Medica Assets will be made on an “as-is,” “where-is,” and “with all faults” basis, without any warranties, representations, or guarantees, either express or implied, of any kind, nature, or type whatsoever from, or on behalf of Gamma Medica, Gerbsman Partners, HercGamma and Hercules. Without limiting the generality of the foregoing, Gamma Medica, Gerbsman Partners, HercGamma, Hercules and their respective staff, agents, and attorneys, hereby expressly disclaim any and all implied warranties concerning the condition of the Gamma Medica Assets and any portions thereof, including, but not limited to, environmental conditions, compliance with any government regulations or requirements, the implied warranties of habitability, merchantability, or fitness for a particular purpose.

This memorandum contains confidential information and is not to be supplied to any person without Gerbsman Partners’ or Hercules’ prior consent. This memorandum and the information contained herein are subject to the non-disclosure agreement attached hereto as Exhibit A.

 

Hercules believes that Gamma Medica’s assets are attractive for a number of reasons:

Disruptive patented technology that delivers unsurpassed cancer detection rates, 91% sensitivity, 93% specificity, 99.7% negative predictive value and reduces biopsy rates due to false positives by 50%

Strong patent portfolio that includes (i) perpetual license agreements from the Mayo Clinic, Rochester, MN, (ii) GMI’s own strong portfolio, (iii) unique ASICS designed direct digital gamma technology.

Technology detects 9/1000 additional cancers in dense breast tissue women when used as a secondary screening device. Compare to Hologic’s new tomosynthesis device which yields <1/1000; they have an installed base of >4,000 machines over the last 4 years.

Delivers 1.6mm spatial resolution compared to the only other competitive (dual headed breast designated camera) GE HC at 2.5mm. This enables the technology to identify lesions 4mm in highly dense breast tissue. The CZT camera is the most sensitive on the market.

Due to the current IP and the in house knowledge, the risks of replicating are minimal.

Technology has application in other fields – superior SPECT camera to GE’s new platform.

Access to strong management team and trained sales force (7 direct) with extensive market and specific modality experience and expertise were involved with GammaMedica and are available to interview in due diligence.

USA installed base of 22 units, forecasted sale R12 a further 20 units, a pipeline of accounts of >200. Proven to be easily incorporated into clinical workflow and clinical adoption is seamless.

Reference account include Mayo Clinic (Rochester (MN), Jacksonville (FL), Phoenix (AZ); Einstein Medical Center (PA); Henry Ford (MI), Scripps (CA) to name a few.

Established supply chain, in house validated manufacturing camera capability.

FDA and CE market approved. Saudi Arabian approved. Canada – Q3 2017.

Reimbursed (CMS) CPT 78800 at global average rate $330; commercial coverage also established.

Potential to deliver cash flow positive by end 2019 by implementing the company’s business plan.

Planned and contracted (volume dependent)  COG’s reduction to yield 60% GP by 2020.

Turn-key operational handover.

Impact of Technology on the Market

With over 40,000 annual deaths due to breast cancer each year in the USA, there is clearly an unmet need. The current modalities in use today were discovered decades ago with no significant technology breakthrough since. The closest to an improvement has been the introduction of “3D” mammography (or Tomosynthesis) and Automatic breast ultrasound. Neither have yielded a significant increase in detection for women with dense breast tissue. Over 45% of Caucasian and over 65% of Asian women have dense breast tissue. Women with dense breast tissue are 3-5x more likely to develop breast cancer than non-dense breast women.

Breast cancer deaths are preventable if you deploy the appropriate personalized screening protocols and modalities. The current modalities deployed are not adequate. We now have published data from leading CoE’s that supportthis position.

GMI believes their MBI will be the standard of care for women at risk not only in the USA but other developed healthcare markets. The recent decision by the American College of Radiology to published practice guidelines, authenticates this position. This is what the radiologists have been waiting for.

GE is the only other competitor in the market. They have a repurposed cardiac imaging camera and delivers inferior performance to LumaGEM®.

Gamma Medica’s Assets

Gamma Medica has developed a portfolio of assets and intellectual property that fall into the following categories:

Patents, Patent Applications and Trademarks- integrated process

Service contracts on new placements

A $200K AR for a unit to be delivered to a site

Market equity – we have created the dense breast market and associated stake in as a leader in the field

Websites

Parts inventory

Tools and machinery

Manufacturing, Design and Calibration Equipment

FDA,CE and Saudi Approval

USA distributorship (3)

UK and Ireland Distributorship

The assets of Gamma Medica will be sold in whole or in part (collectively, the “GammaMedica ” assets). The sale of these assets is being conducted with the cooperation of Hercules and Gamma Medica previous management. Gamma Medica’s previous employees (consultants and interested previous employee’s) will be available to assist purchasers with due diligence and a prompt, efficient transition to new ownership. Notwithstanding the foregoing, Gamma Medica should not be contacted directly without the prior consent of Gerbsman Partners.

Personnel – as of 6.16.17, all personnel were terminated as part of a companywide reduction in force.  However, the following people have been retained by Hercules to act as advisors to interested parties as part of the sales process. Other key management personnel can also be contracted to assist as required.

 

Philip Croxford — Gamma Medica’s former President & CEO

Angie Dube — Gamma Medica’s former SeniorAccounting Manager

Steve Dallas – Gamma Medica’s formerVP Operations

 

The Bidding Process for Interested Buyers

 

Interested and qualified parties will be expected to sign a nondisclosure agreement (attached hereto as Exhibit A) to have access to key members of the management and intellectual capital teams and the due diligence “war room” documentation (the “Due Diligence Access”). Each interested party, as a consequence of the Due Diligence Access granted to it, shall be deemed to acknowledge and represent (i) that it is bound by the bidding procedures described herein; (ii) that it has an opportunity to inspect and examine the Gamma Medica Assets and to review all pertinent documents and information with respect thereto; (iii) that it is not relying upon any written or oral statements, representations, or warranties of Hercules, HercGamma or GerbsmanPartners, or their respective staff, agents, or attorneys; and (iv) all such documents and reports have been provided solely for the convenience of the interested party, and Hercules, HercGamma and Gerbsman Partners (and their respective, staff, agents, or attorneys) do not make any representations as to the accuracy or completeness of the same.  

 

Following an initial round of due diligence, interested parties will be invited to participate with a sealed bid, for the acquisition of the Gamma Medica Assets. Sealed bids must be submitted so that the bid is actually received by Gerbsman Partners no later than Wednesday, August 7, 2017, 3:00pm Pacific Standard Time (the “Bid Deadline”) at 211 Laurel Grove Avenue, Kentfield, CA 94904.  Please also email steve@gerbsmanpartners.com with any bid.

 

Bids should identify those assets being tendered for in a specific and identifiable way.

 

Any person or other entity making a bid must be prepared to provide independent confirmation that they possess the financial resources to complete the purchase where applicable. All bids must be accompanied by a refundable deposit check in the amount of $250,000 (this will be wired to Hercules counsel trust account and the specific wire transfer information will be supplied at a later date). The winning bidder will be notified within 3 business days after the Bid Deadline. Non-successful bidders will have their deposit returned to them. Hercules reserves the right to, in its sole discretion, accept or reject any bid, or withdraw any or all assets from sale.

 

Hercules will require the successful bidder to close within 7 business days.  Any or all of the assets of Gamma Medica will be sold on an “as is, where is” basis, with no representation or warranties whatsoever.

 

All sales, transfer, and recording taxes, stamp taxes, or similar taxes, if any, relating to the sale of the Gamma Medica Assets shall be the sole responsibility of the successful bidder and shall be paid to Uptake at the closing of each transaction.

 

For additional information, please see below and/or contact:

 

Steven R. Gerbsman                                                                                             

(415) 456-0628

steve@gerbsmanpartners.com                                                                                    

 

Kenneth Hardesty

(408) 591-7528

ken@gerbsmanpartners.com

 

 

Happy July 4th- Marine Sings Fourth Verse of National Anthem – You MUST watch this

Happy July 4th weekend

Please watch, listen an be Proud.

As we are going through challenging times as a country, may we never forget that “America is the land of the Free and the Home of the Brave”- We are a Judeo Christian nation with values handed down by our ‘Founding Fathers’.  Men like  George Washington, John Adams, Thomas Jefferson, James Madison, Alexander Hamilton, James Monroe and, of course, Benjamin Franklin

May God Bless America, our Troops and on this day – always remember

“Freedom is NOT Free

Be healthy, travel safe and enjoy family

 

th

WATCH: Marine Stuns Crowd at Tea Party

http://nation.foxnews.com/culture/2010/06/07/watch-marine-stuns-crowd-tea-party

God Bless America

“The Star-Spangled Banner” is the national anthem of the United States of America. The lyrics come from “Defence of Fort McHenry”,[1] a poem written in 1814 by the 35-year-old lawyer and amateur poet, Francis Scott Key, after witnessing the bombardment of Fort McHenry by the British Royal Navy ships in Chesapeake Bay during the Battle of Fort McHenry in the War of 1812.

Lyrics

Cover of sheet music for “The Star-Spangled Banner”, transcribed for piano by Ch. Voss, Philadelphia: G. Andre & Co., 1862

O! say can you see by the dawn’s early light,
What so proudly we hailed at the twilight’s last gleaming,
Whose broad stripes and bright stars through the perilous fight,
O’er the ramparts we watched, were so gallantly streaming?
And the rockets’ red glare, the bombs bursting in air,
Gave proof through the night that our flag was still there;
O! say does that star-spangled banner yet wave,
O’er the land of the free and the home of the brave?

On the shore dimly seen through the mists of the deep,
Where the foe’s haughty host in dread silence reposes,
What is that which the breeze, o’er the towering steep,
As it fitfully blows, half conceals, half discloses?
Now it catches the gleam of the morning’s first beam,
In full glory reflected now shines in the stream:
’Tis the star-spangled banner, O! long may it wave
O’er the land of the free and the home of the brave.

And where is that band who so vauntingly swore
That the havoc of war and the battle’s confusion,
A home and a country, should leave us no more?
Their blood has washed out their foul footsteps’ pollution.
No refuge could save the hireling and slave
From the terror of flight, or the gloom of the grave:
And the star-spangled banner in triumph doth wave,
O’er the land of the free and the home of the brave.

O! thus be it ever, when freemen shall stand
Between their loved home and the war’s desolation.
Blest with vict’ry and peace, may the Heav’n rescued land
Praise the Power that hath made and preserved us a nation!
Then conquer we must, when our cause it is just,
And this be our motto: “In God is our trust;”
And the star-spangled banner in triumph shall wave
O’er the land of the free and the home of the brave!

Congratulations to Michael Scissions and Grant Munro.  These entrepreneurs demonstrated how to start, run and exit a successful business model.

Shutterstock to Acquire Flashstock, A Leading Custom Content Creation Platform


News provided by

Shutterstock, Inc.


NEW YORK, June 27, 2017 /PRNewswire/ — Shutterstock, Inc. (NYSE: SSTK), a leading global technology company offering a creative platform for high-quality assets, tools and services, today announced that it has signed a definitive agreement to acquire Flashstock Technology, Inc., a Toronto based company that enables the efficient creation of custom content through its proprietary platform, for approximately $50 million cash. Flashstock has a fast growing customer base of enterprise marketers seeking on-brand content to feed the ever growing visual demands of multiple marketing channels. By integrating Flashstock into its product offerings, Shutterstock will be able to offer a high-quality custom content product to its 1.7 million customers. The transaction is expected to close in July 2017.

Flashstock established a new way of creating content for marketers. Its model ingests a brand’s visual identity and content strategy, which enables it to create relevant content on demand. Like Shutterstock, Flashstock has a global network of contributors and an innovative technology solution that has streamlined the content creation process. The company currently serves hundreds of top brands across the Fortune 500.

“Custom content has been something we always believed would be an important part of our long term strategy. We’re thrilled to have found Flashstock, a strong business with technology and management that will enhance our product offerings and allow us to grow our partnership with major brands as they look to efficiently create amazing content on-demand,” said Jon Oringer, Founder and CEO of Shutterstock. “This opens up a large new market that Shutterstock will now be able to serve with custom content. Flashstock’s DNA matches ours, and we believe that there is a great cultural fit and that the business can integrate seamlessly into our new platform.”

“Shutterstock’s global reach, commitment to technology and investment in its platform make it the perfect home for Flashstock,” said Grant Munro, Founder and CEO of Flashstock. “We will now be able to offer our cost efficient, streamlined content creation platform to Shutterstock’s global customer base.”

About Shutterstock, Inc.
Shutterstock, Inc. (NYSE: SSTK), directly and through its group subsidiaries, is a leading global provider of high-quality licensed photographs, vectors, illustrations, videos and music to businesses, marketing agencies and media organizations around the world. Working with its growing community of over 225,000 contributors, Shutterstock adds hundreds of thousands of images each week, and currently has more than 125 million images and more than 7 million video clips available.

Headquartered in New York City, with offices in Amsterdam, Berlin, Chicago, Dallas, Denver, London, Los Angeles, Montreal, Paris, San Francisco, and Silicon Valley, Shutterstock has customers in more than 150 countries. The company also owns Bigstock, a value-oriented stock media agency; Offset, a high-end image collection; PremiumBeat a curated royalty-free music library; Rex Features, a premier source of editorial images for the world’s media; and Webdam, a cloud-based digital asset management service for businesses.

For more information, please visit www.shutterstock.com, and follow Shutterstock on Twitter or Facebook.

About Flashstock Technology, Inc.
Flashstock Technology, Inc. provides customized visual content for the world’s top brands. Working with its global network of contributors, Flashstock enables the efficient creation of custom content through its proprietary software platform

For more information, please visit www.Flashstock.com, and connect with us on Twitter, Instagram, Facebook and LinkedIn.

NOTICE OF PUBLIC AUCTION

By public auction (the“Auction”) to be held on Friday, June 30,2017

at 2 P.M. Eastern, via telephone conference call, Hercules Capital, Inc.,

as agent (“Agent”) for Secured Party will sell or otherwise dispose of

substantially all of the assets (the “Collateral”) of Gamma Medica, Inc.,

a Delaware corporation (the “Debtor”) to one or more Pre-Qualified

Bidders (defined below).

Agent reserves the right to credit bid for the Collateral.The aggregate

amount of principal, interest, legal fees, costs and expenses due from

Debtor as of June 16,2017,is $1,836,866.38.

To be deemed a “Pre-Qualified Bidder”, interested parties are

required to deliver to Agent’s counsel, not less than 72 hours prior to

the commencement of the Auction: (1) a letter of representation from

a U.S. attorney; (2) a standby letter of credit for not less than $250,000

OR a wire transfer of $250,000 in immediately available funds to the

Cole Schotz P.C. Attorney Trust Account (with wire instructions to be

provided upon request);(3) adequate assurance of the ability to close on

the purchase of Collateral, including (i) information about the bidder’s

financial condition such as federal tax returns for not less than two (2)

years, a current financial statement, and/or bank account statements,

(ii) information demonstrating (in the Agent’s reasonable business

judgment) that the bidder has the financial capacity to purchase some

or all of the Collateral at the Auction, and (iii) evidence that the bidder

has obtained authorization or approval from its board of directors (or

comparable governing body) with respect to its participation in the

Auction and purchase of Collateral; (4) full disclosure of the identity of

the bidder (including without limitation all affiliates, equity sources

or other parties that will be associated with such bid or will otherwise

participate in connection with such bid, and the complete terms of any

such participation);and (5) an executed non-disclosure agreement,in a

form available fromAgent’s Counsel,fromthe bidder.

Upon inquiry to Agent’s Counsel, each Pre-Qualified Bidder will be

provided with specific information pertaining totheCollateral.

The Agent hereby reserves the right to cancel,postpone or re-notice

the time, date and/or method of the Auction at any time. All inquiries

with respect to the Auction should be directed to Agent’s Counsel

Indicatedbelow.

ALL OF THE AGENT’S RIGHTS ARE EXPRESSLY RESERVED.

Date: June20,2017

Cole Schotz P.C.,Agent’s Counsel, Stuart Komrower, Esq., skomrower@

coleschotz.com,Cole Schotz P.C.,Court Plaza North,25Main Street,P.O.

Box 800,Hackensack,NewJersey 07602,(201) 489-3000

Should you be scared of Amazon?

jeff bezosAmazon CEO Jeff Bezos. Amazon bought Whole Foods on Friday for $13.7 billion.REUTERS/Abhishek N. Chinnappa
AMZN Amazon.Com

About a month ago, New York Times columnist Farhad Manjoo helped coin a new term for the top-five tech companies that are increasingly dominating our lives: The Frightful Five, better known as Apple, Google, Microsoft, Amazon, and Facebook.

The top of his list? Amazon.

Farhad’s argument was that he’s increasingly dependent on Amazon for buying stuff and entertaining his family. That’s true.

But I’d argue Amazon’s reach goes deeper than that, deeper than any other company inside or outside the tech world. And its grip on our lives is only getting stronger, which raises some serious questions we haven’t had to ask ourselves about the power and influence a tech company can have over our lives.

Out of the Frightful Five, Amazon is the company you should fear the most.

Amazon’s surprise $13.7 billion acquisition of Whole Foods is the latest example. We already knew Amazon had ambitions to break into the grocery business through the Amazon Fresh delivery service and the futuristic cashier-free convenience stores, but this is a whole other level — a subtle troll that the online retail giant can creep its way back into the physical world and take over a popular chain of supermarkets.

But let’s talk about everything else Amazon has its grip on and how it continues to hold greater influence over:

  • Cloud computing. Amazon Web Services powers many of the apps and websites you use every day. (Remember when an Amazon outage took down a large chunk of the internet?)
  • Artificial intelligence. Amazon has quickly become a leader in AI thanks to its Alexa assistant, which has opened up a new world of voice-powered computing.
  • Logistics. Through Amazon Air, Amazon plans to use drones and its own planes to deliver goods. It’s also experimenting with autonmous trucking. Many have speculated that one day Amazon won’t need to rely on UPS, FedEX, or the Postal Service to deliver stuff.
  • Entertainment. Amazon has dumped millions into original TV programming and movies. It also runs a streaming music service, and lets you buy digital music and video.
  • Food. Between Whole Foods, those futuristic grocery stores, and the Fresh delivery service, Amazon is poised to be one of the largest grocers in the country.
  • Health. According to a CNBC report, Amazon is thinking about getting it the prescription drug business.
  • Retail and e-commerce. This one is self-explanatory.

There’s more. Amazon’s influence extends to other industries indirectly through CEO Jeff Bezos’ personal investments:

  • News media. Bezos owns The Washington Post and a small percentage of Business Insider.
  • Outer space. Bezos owns a rocket company, Blue Origin, that’s building reusable rockets.

That’s a lot of stuff that affects you every day from a company that started selling books online back in the 90s. Now it’s hard to find a need Amazon can’t fill.

That raises some serious, potentially scary questions if Amazon’s influence and capabilities continue to grow. Should one conglomerate have that level of control over the future of so many vital industries people rely on? What kind of check will there be on that power, if any?

Granted, it’s a little early to be thinking about all this. Most of the verticals Amazon is involved in are still dominated by traditional companies. But as we saw in the market’s reaction to the Whole Foods deal on Friday, it’s clear that there’s a strong possibility we’re accelerating toward a future where there’s a digital layer on top of everything we do. And the company best equipped to deliver all is Amazon. There’s literally no one else in a position to compete.

That’s a lot of power concentrated in one conglomerate, and puts Amazon in a position where it’s a company to fear.

Microsoft’s new standalone keyboard has one the best new features from Apple’s MacBook Pro

One of the best new features that Apple added to its 2016 and 2017 MacBook Pro is a Touch ID fingerprint scanner on the keyboard. And now, Microsoft has also added a fingerprint scanner on its new Modern Keyboard to work with Windows 10 computers.

microsoft modern keyboardYouTube/Microsoft

The fingerprint sensor on Microsoft new $129 Modern Keyboard, called Fingerprint ID, has its own button on the right of the right “Alt” key.

Microsoft already offers an easy keyboard-less way to unlock your computer called Windows Hello, which uses a webcam and facial recognition to unlock your computer. That’s great for computers that have built-in webcams, which many laptops have. However, the monitor I use on my Windows 10 desktop doesn’t have a built-in webcam, so I can’t use Windows Hello. And because typing in a password every time I want to unlock my computer is a pain, I don’t use a password, which is a terrible, insecure idea.

Microsoft’s new Modern Keyboard with a fingerprint scanner is the solution.

windows hello Windows Hello on a Windows 10 computer. YouTube/Microsoft

Touch ID on the MacBook Pro, and now Microsoft’s new Modern Keyboard, cuts out the need to type in your password to log in to your computer. If that doesn’t seem like a big deal, look at your smartphone and imagine if you had to tap in your PIN number every time you wanted to unlock it instead of using its fingerprint scanner. Seems like a pain, doesn’t it?

It might be true that you don’t unlock your computer as often as you unlock your smartphone, but your computer password if likely longer than your smartphone PIN, which could include four to six numbers. With that in mind, the fingerprint scanner on Microsoft’s new keyboard is a great shortcut to unlock your computer.

The Modern Keyboard costs $129 and will be available to buy soon.

The creator of Android explains how his new phone can take on Apple and Samsung

Andy Rubin at wired business conference Andy Rubin at the Wired Business Conference with the new Essential Phone. Getty Images for Wired

Andy Rubin is best known as the guy who created Android, sold it to Google, and nurtured it into the most popular smartphone operating system on the planet.

But Rubin left Google back in 2014, and now he’s on his own.

His latest gig is Essential, a startup he runs as CEO that’s trying to become a new kind of gadgets company. It starts with a phone, called the Essential PH-1, and the plan is to expand into smart appliances and cars from there.

Rubin spoke Wednesday at the Wired Business Conference in New York and shed a bit more light on Essential’s plans. After the Essential Phone launches this summer, the company plans to release Home, a voice-controlled hub for all the connected appliances in your house. Rubin claims Home will be compatible with the wide variety of smart home platforms, ranging from Apple’s HomeKit to Samsung’s SmartThings, even though it’d take a wild level of technical wizardy to pull it off. Many are skeptical he can pull it off. He calls this new platform Ambient OS.

Beyond that, Rubin teased that he’d like Essential to tackle the car, which is increasingly coming into focus as an area of growth for tech companies.

And questions remain how the Essential Phone, which costs $699, can find success in a market dominated by Apple and Samsung.

Business Insider and some other members of the press spoke with Rubin following his Wired talk. Below is a transcript of that conversation, which has been edited for length and clarity. (I’ve labeled each journalist’s question as just “Question” since so many people were in the room asking questions. I put my name on the questions I asked.)

Q&A with Andy Rubin, CEO of Essential

Steve Kovach: I want to talk more about Ambient OS. You were talking a lot about how you’re really confident you’re going to be able to stitch all these various platforms together.

Andy Rubin: I didn’t say I was confident. I’m definitely going for it.

Kovach: If I’m understanding it correctly, especially with Apple, it’s actually impossible. What they allow people to build into now doesn’t allow what you want to do. Does this thing fall apart if they say no to you?

Rubin: You have to understand this approach. There’s a client and a server. And what Apple has with HomeKit is a bunch of individual consumer electronics companies enabling HomeKit with their products. I don’t know what the percentages are, but they don’t all only speak HomeKit. They speak a whole lot of other stuff as well. And what Apple is trying to do is trying to be the screen that drives these things. And that’s excluding anybody in “Android Land” or Windows from driving those things. So the natural effect will be for those companies to support other products as well, and they’re the ones that are plugging into Apple’s APIs. So the trick that I talked about on stage is: I can produce the same APIs. And I can call it Essential Kit. And those same exact APIs that someone has already developed for their Sonos thing or whatever this point product is, I’m compatible with.

Kovach: But isn’t that just another product like Samsung’s SmartThings?

Rubin: No, no, no, no. You know what this is? This is [like] Windows emulation [on a Mac]. This is Windows emulation for IoT. APIs for all these people who are building these islands. And if I emulate eight things and turn it on, I control 100,000 devices.

Kovach: And have you been able to do that yet in testing?

Rubin: I haven’t launched a product. I’m teasing a product, but it’s going to be awesome. These are all forward-looking statements.

Question: How far in advance are you teasing?

essential home hub A rendering of what Essential Home will look like. Essential

Rubin: We have round LCDs — big ones. What’s after that is basically everything that’s in a smartphone. Right? There’s a bunch of cool things about starting a company today. I have a system in my lobby where I can print badges for people. There’s some startup company whose job it is to do lobby registration now. And when I used to start companies, those guys didn’t exist. But the other thing that happened, obviously, is smartphones have driven the supply base, based on the volume of the component tree of smartphones. And you’ll find those things going into a lot of products like these home assistant products. So it’s kind of a new era as far as leveraging the economies of scale of smartphones into these other products.

Question: So Essential Home is a touch interface. Is it also a microphone?

Rubin: Yeah it has far-field speech recognition. It has an array of microphones.

Question: Is there any plan to add video chat to something like that?

Rubin: Really good question. So once you do this job of bridging these islands, you kind of rise above all these other UIs, and you become a kind of holistic UI for every other product that might be in your life. So if you think of it purely from a UI perspective: Who is your UI developer? I actually thing developing for smartphones is too difficult. It’s almost like you have to go to school to learn how to be an iOS developer or learn how to be an Android developer. The good ones have four or five years of experience, and the industry is not that old. So the reason we created a new OS is to basically solve the UI problem and redefine the definition of who a developer is. I want the guy who owns the home to be a developer, in some regard. I can tell you today, there’s a $13 billion industry of Crestron or AMX or Control 4, and they’re drilling holes in your wall and installing screens in your home. That’s an outdated approach. But the guys that are doing the UIs for those are the same guys that are drilling the holes in your wall. There’s this whole installer thing with these high-end homes which is not a mass-market consumer value proposition. So I need to change who the installer is. And I think we’ve built enough technology for a consumer to kind of do a drag and drop.

Question: There’s this argument that’s been out there that innovation in smartphones has peaked, that they’ve already gotten so good and can do so many things. Where do you see things going? Where does it go from here?

essential ph-1 colors The Essential Phone. Essential

Rubin: When there’s this duopoly with these two guys owning 40% of the market, this complacency sets in where people are like, “Oh what they’re building is good enough. I’ll just go to them.” And that’s the perfect time to start a company like this, when people are complacent and it needs to be disrupted. And the real answer is you guys and the consumers need to tell me if there’s enough new innovation in [the Essential Phone].

I think the 360 camera and the magnetic accessory bus is a pretty good example of the innovation we’re thinking about. And there’s gonna be a string of those things. Let me broadly position this: In the era where smartphones were new and everyone was upgrading from their feature phone to their smartphone for the first time, the product cycle was every six months. There’d be some new thing coming out, everyone’s excited, there was a bubble kind of feeling that you were involved in something completely new and exciting. And then once everybody who wanted a smartphone got one, we’re in a saturated market — at least in the first world. In saturated markets, the upgrade cycle is every 24 months. And the problem with the 24-month cycle, which happens to snap to the carriers’ [ownership] of the consumer, is the consumer doesn’t get to see the innovation. It’s still happening in the background, but it happens every 24 months in these very lumpy onstage announcements. I think there’s a way, and the reason we built this magnetic connector to continuously produce innovation and show it to the consumer happening in real time. It’s almost like software updates for hardware.

Andy Rubin at wired business conference Rubin and his Essential Phone. Getty Images for Wired

Question: Explain how the Essential Phone is different from a modular phone. From the consumer point of view, it’s, “I’m getting this phone and I can snap a camera on and I can snap on a better battery.” Does it matter if it’s magnetic or not?

Rubin: That’s a good question. It’s two things. It’s kind of the core to the way we designed this from a product design perspective. The first one is what’s “modular.” [Google] Ara was the definition of modular, which is you can remove a core component of the phone, like its processor, and replace it with a faster one. We’re not doing that. You buy a phone, the phone works great as a phone. We’re adding stuff onto it. So that’s why I prefer accessory bus as an example. So that’s modular versus accessory.

Now, connectors, in my view, are dumb because they get outdated. So a wireless connector is the holy grail. We’re close to that. We transmit power between two pins and everything else is wireless. Actually, the technology we’re using is wireless USB 3.0. So it’s 10 gigabits a second of USB, and we’ve built these transceivers that do that. The benefit of having a connectorless connector is I don’t suffer from what Moto Mod suffered from, which is every phone they come out with in the future has to have that 33-pin connector in exactly the same location so all the accessories you’ve invested in as a consumer still work. So they’ve painted themselves in the corner. They can never change the industrial design of their next phone because it has to match all these accessories. Or they have to trick the consumer into throwing away all their accessories and getting the new one that fits this new thing.

A completely wireless thing means I can come out with a phone that’s invisible. And as long as it has this magnetic area on it I can use this legacy of accessories that I’ve purchased. Again, this is a pro-consumer brand. It’s not easy to articulate. We’re trying to do right by the consumer where they don’t have to throw away their stuff every time there’s a connector change. Or get some weird dongle. True story, I went and bought one of those beautiful new MacBooks with the OLED TouchBar. And that’s when they changed to the USB-C thing. And in the IT department in my company I needed to plug in to the Ethernet to get the certificate for the new laptop, and I went to the Apple store and I said, “Do you have a USB-C to ethernet dongle?” And they said, “Oh no we don’t have that yet.” So I had to buy a USB-C to Thunderbolt dongle, and a Thunderbolt to Ethernet dongle. So I had two dongles plugged into each other. And that’s the point where I’m just not feeling too good about being a consumer of those products.

Question: Based on the conversations you had today and at the Code Conference, Essential is much more than just a phone company. How do you find that your brand is going to track these consumers?

Rubin: It’s anti-walled garden. We chose Android because that’s a big component of that. We have a team of engineers, a lot of them, doing the job of other people to make our products work with theirs. These other companies, especially the walled gardens, they’re sitting here with their ecosystem and they expect people to come to them. And they get to be the toll gate guys and say “yes” or “no.” So we’re actively going out and making our products work with other people’s products because we know that’s how our consumers want to live.

Kovach: You spoke a lot on stage today about home and the car as major new platforms, but you didn’t mention AR.

Rubin: There’s baby steps into AR, and then there’s all-in. Scoble’s all-in is the shower picture… so the glasses might come later. Cellphones have had augmented reality for a long time…

What the real question is: ‘What is the end product?’ What is the developer going to build with augmented reality? And so far I’ve seen interactive media… movies and game-like movies, where you’re both a participant and a viewer, which I think is a little too mixed reality for me. There’s a lean back where you’re a consumer of this stuff and it happens, or you’re a participant like a game. The mixed part of it hasn’t been proven yet.

I think when consumers are ready to wear things, whether it’s a motorcycle helmet that overlays a map… or if it’s some goggles that they’ll use for a board game… in the end for these big things I think…

One of the problems is the price. It’s just crazy. It’s not ready for prime time. There will be a day where you might have a head mounted display and it costs $199, and you just plug it into your cellphone. And it won’t be ‘I’m wearing this 24 hours a day.’ It’ll be, ‘It’s time to sit down and play Monopoly with the family or something.’ It actually might be more social than what you would do with VR.

Question: Is that why you started the 360 camera? Because it’s a taste of that?

Rubin: This is all speculation, but I’m hoping there’s going to be a format change in the future. I think I can kind of move the needle a little bit in that format change by taking the world’s largest mass-market product and adding something onto it, rather than trying to create something completely new. So it’s more of a slipstream approach.