Good morning, im scott mcgrew. You probably received your new credit card in the mail. They are manufacturing them as fast as they can. These new cards contain a chip, they go by various names emb, chip and pin thats not accurate. Well talk about that shortly. Lets call these things chip cards, while youre getting a new chip card, stores are getting new chip readers. The new point of sale machines are more or less required this coming thursday, october 1st. Our chief technical officer at verifone, you are swiping through one of his machines. Although i say swipe, now we dont swipe. We just stick it in there and it sits there for a while. Thats exactly the difference between them. The traditional cards used to have this Magnetic Stripe in the back and with the chip card, the card holders information is on the chip and you have to insert the chip and let it interact with our device, thats how the card information is taken. Were world travelers, been to europe and seen the chip and pin. I still did a signature, is america going to be doing it differently . Thats a very good question. The answer is yes. In the u. S. , the Card Association decided to introduce the concept of chip and signature and not chip and pin as it is used in the rest of the world. Why . I think its to be possibly a little less disruptive on the consumer experience. We want to make it easier for consumers to use their cards. And theyve been used to signing on the relaceipts. You think it will be easier for them and adapt quickly . Some of them, im not sure it seems untim dating when they see something new . Thats always the case. One of the experiences that comes closest to the consumers, if you go to the gas station and youre trying, that going to change at gas stations and venues . Yes, the model will be employed everywhere. When you think about this technology, were just getting it in the u. S. Right now, in the developing world, they dont even use credit cards. If you go to kenya or india and certain places, its just mobile cash. Do you think on your phone. On your phone, paying with a text message. When do we get there . I think were already starting to get there with concepts like apple pay and others. Digital wallet helps us. But emv is an interesting path to get there too because if you think about it, its really a twoway interaction between the payment instrument and our device. Im going to interrupt for a second. Emv, is that the official when i say chip card, credit cards with chips in them, i want to make sure that from here on out, emv, that kred icredit car a chip inside. Does this apply to debit cards as well as credit cards . In china, a lot of residents dont like using credit cards for payment, they use debit cards because they dont like accumulating debt. Im wondering if that is going to apply to debit as well as credit . The choice of instrument and how the credit is handled, whether its debit or going on a credit statement is independent of how the transaction this october 1st deadline was not set by the federal government or something. Who set the october 1st deadline . Thats more a mandate coming from emv, which is the governing body that governs the emb standard. It consists of mastercard visa and theres a bunch of others. The Credit Card Company set the deadline. I go to my small dry cleaner and she still has the swipy sort of thing. She can still take credit cards after october 1st, right . Thats correct. What is her motivation for buying a verifone x5,000. Its not an x5000. Thats made up. But yes, the incentive is for the overall industry, the incentive for fraud to go down significantly. Losses have doubled in the last globally target, that was phenomenal. The challenge is advertise disportion atly hitting the united states. And if you look at where emv has been deployed around the world, losses come down dramatically. In europe it took about eight years, losses dropped 85 and in canada took half at a time to come down by 7 3 . Theres high hopes it leads to the same kind of thing. That small shop who doesnt buy how much entry level device, would she have to spend . Typically the small shop is likely not paying for the device himself or just being issued by credit card. But that said, october 2nd, she doesnt have it yet. Theres no penalty or risk on my end, right . Thats right. Even if you look at the Global Worldwide numbers and other places where such cards are prevalent, the number of cards that have chips in them is close to about 45 to 50 . Thats not prevalent. You go like you said, you can use the imagimagnetic side. Most of our devigss take both. Some of the places transitions, you swipe it and it says, oh, actually you have a chip card, you have to put it in the chip thing. Even though you already tried to do an action to pay, another hurdle. Is that just to train people . That is going to be a bit for consumer adoption cycle that we would have to go through but people familiarize themselves. With you hear about Security Breaches with credit cards, how much more secure is this chip than previous . I did quote some fraud numbers in loss numbers and weve seen trends like that around the world. But in terms of the mechanics of how this works, the Magnetic Stripe is really card holder information you passively read and get information on the stripe. In the case of the chip, in addition to the card Holding Information theres algirithms in there making the information a lot more secure as it transitions. The last question with the chip and signature, if it were chip and pin, you have to have the card and knowledge that europe. Here you have to have the card and be able to write my name. Thats correct. This is less secure even though less secure than europe even though the chip is in the card. So the bulk of the losses as theyve been tracked have been from card Holding Information itself is compromised. By securing the card hold being information youre getting a leg up. Could the target thing have happened with a chip and signature card . We should let target talk about it but in the end of the day, it involves many more steps besides the transaction point itself. This secures the point of the transaction and there are other parts of the chain. We appreciate you being here. Thank you. Up next, the swipe of a pen, ceo turns his entire workforce into employees when press here continues. Welcome back to press here. I have tax forms that sounds boring. But the tension between these two is a fascinating story in Silicon Valley. One is a 1099 and other is a w2 used for traditional employees. Lots of companies are trying to figure out, are they a 1099 or w2 kind of company. This question sometimes ends up in court. Uber says its workers are contract workers who come and go as they please. Many drivers want to be recognized as full fledged employees. Fedex went through this, a court decided the ground delivery drivers were not independent contractors but employees. A number of companies are changing on their own. Recently the startup ship decided to make all of its workers full pledged employees. In a blog post, ships ceo said this is an operational decision based on our interest in owning the entire ends to enshyp experience. It is not in response to recent lawsuits against other technology companies. Were doing this because we want to make this shyp experience as good as it can be for our customers and workforce alike. Shyp ceo joins us. Was this because of the uber lawsuit . No, ive been wanting to do this from the very beginning. We did a lot of modeling and its going to be netnet positive for us. Why start with let me make it clear. Some of your employees were already employees in the warehouses and what not. It was the people who go to the homes and pick up the package that were the contract employees . Absolutely. Why not start that way from the beginning. A lot of Companies Entrepreneurs investors its really around just like copying stuff thats been done. That was one of the things i think Companies Need to innovate where they need to innovate and we took learnings from other companies and talked to all of them. This seemed to be the right way. As we learn from the process, we actually are losing quite a bit of experience from not only the actual customer aside but the actual drivers side as well and just felt that this would be the better thing to do long term. What type of impact has this this financially on you and seconds part of the question, has it made people more investment in the company they work for and more productive . Were still seeing what the impact is going to be. We did a lot of modeling. As far as the operational decisions, we kind of walk through that. One of the things you cant do as a contractor, training is a big thing. We have quite a complete operation from end to end. We come to your home and want to make it so youre comfortable to ship a 1,000 painting or Something Like this. That piece alone was one of the things we felt the training piece we werent able to provide. But also can the contractor relationship is really its up to them if they want to accept. If youre an uber driver or shyp kourier to do the pickup. Its how operations work within a city. When people dont want to go up a large hill or whatever it is, its difficult to map that city to get our efficiencies and then in the end Customer Experience to the way we want. A number of those things actually went into the decision. As far as are people going to feel more a part of the experience, i know the answer is absolutely yes. So were rolling this out city by city. We just were getting ready to launch chicago our first full w how many . Companywide we have hundreds of employees. Another thing i wanted to do this earlier before we had tens and thousands of employees, its quite hard to make that transition, not only is a employee employer relationship but the management piece of it and all of the things that are difficult to transition. It felt doing that when we were smaller is better long term. One of the argument, should keep employees as contractor versus fulltime employees, they have more flexibility that way and people want parttime and do uber on the companies and work a fulltime job or whatever it might be. Do your employees still have flexibility even though they have the designation . I think so. I think this is something that you could still do even with the employee relationship. You look i look to other industries as well. Were in the Technology Company and look in the Service Industry and stuff. Theres a lot of things you can do. Flexibility schedule wise, why isnt it easier to switch a schedule if youre in the Service Industry. All of those things we could make really easy having that employee relationship. But i do think it does adds that additional benefit of plexibility. We felt for service we offered we werent able to do right by our new employees or customers alike. I think i would have loved to have that option as like college or whatever. That would have been a great thing to have. I can be a shyp guy in the morning and uber in the afternoon and youre not going to have any problem with that even though im your employee . Right, well schedule people. For your designated shift we expect you to work what i cant be is a shyp guy and uber guy simultaneously . Youre a contractor, you could, right . You could. We shouldnt believe them when they say making someone an employee makes no flexibility. I think that it can make less flexibility but i think theres a lot of things you can do to make it a flexible relationship. Are you insuring all of your employees . Workers comp just benefits and im thinking well have i think theres a little bit of a misunderstanding with the w2. Theres still different types. You have parttime and fulltime. Weve have a percentage of each in every city and people that are fulltime will get full benefits, same benefits as Technology Workers on hours worked per week . Exactly. Well have that as well. Does a portion work fewer hours to be parttime and not get those benefits . Were still working through that. I think the flexibility as far as the i could see that what were going to be doing is have a steady base of fulltime people that will have a steady maybe whatever day per week and well be able to do that. The flexibility part will add parttime on top of it. The function of your app, lets talk about the business for a minute. I have a thing and you will come get it and box it up and put the padding around it and send it. I have to hand over the thing. My concern is and this is less of a luxury app than say washeo which picks up my laundry and things. Some of these more luxurious things would be the first thing i would drop if the economy changed. Ive busy and have somebody deliver being my food and picking up my mail or shipping. Is that a concern to you, that youre doing very well in a hot economy . The answer is no. We when we set up a bill we knew this was a industry where fortunate or unfortunately, amazon has brought the cost of shipping down to zero. People are cost sensitive. When we designed it and when we launched, we knew that was going to be a big concern for people. If you do actually the math, its actually cheaper if you can believe it to use us, well come to your home, say you sold a 1,000 painting on ebay. Well come to you dont do the packaging in front of you. Well take it back to our warehouse and professionally package it. Then what well do, well charge you a 5 pickup fee, if you ten items, just 5, include all of the packaging for free and then what well do is price compare through the major carriers that you as a consumer have the ability to use and give you the lowest rate. How we make money, thats the next question, we get highly discounted rates from the carriers. You may have just went to the post office and well use those different carriers but use our rates, instead of having a ups truck making 1,000 pickups in san francisco, theyll come to one Central Location so the cost for them is lower and discount. Shyp is changing lots of employees lives. Thanks for being with us. Earlier this month, jerry brown was forced to scale back his plans to make california a cleaner, greener place. I set a very high bar but its a bar we must meet. Unfortunately we smacked into that bar with our head. A proposal to cut petroleum in halfwise defeated and carbon emission cuts defeated. Meanwhile pressure from electric companies on the Public Utilities commission to let them raise rates on solar users, people not using much electricity in the first place may see their bills go up. Ceo of a Solar Panel Maker and Silicon Valley chip pioneer, thanks for being back with us today. Let me ask you about the state of the solar industry. Are we running towards certain caps or things that if im a homeowner and looking at you know, i like three of the homes on my block have gotten solar, should i be rushing towards something . There anything were going to lose soon . Theres only one kind of time dependent thing from a policy point of view, thats the investment tax credit. Its 30 now. You get a 30 discount if you install solar in your home. In the end of 2016 it will be dropped to 10 . Its a little heck tech. It bad news, good news. If you look at in 2009, we installed a gigatwatt, we aemgs because of tax credit there will be one put in every month between now and then. So good news bad news. So it will be like christmas for solar people for 18 months then its going to be the solar winter because after it expires, you pull in all of the demand and all of the projects and then theres nothing. The Industry Groups anticipate we may 20 or 30 of the companies in solar. At the end of the calendar year 2016. When it expires, until 2017 will be a really tough year. And some good for investors as well. The thing about solar that intrigues me yet frustrates me, theres never a breakthrough moment. Even when you look at elon musks company, what is it . Is it resistance from maybe electric companies and playing into it or what is it . Consumers are . Its a slow move being story. What weve been growing 50 a year for a decade. You would think they would get more positive do you look at your electricity bill . Yes. You do . Going to take a poll now. I am reminded of it. I have solar and look at the electricity bill for the sheer joy. You may be the exception. A lot of people dont look at electricity. We look at phone bills and decide who is using the most data and i used to be the low end now im at the top and getting a lot of grief. When it comes to electricity, i get a lot of consumers dont check it out too much. It depends on how the bill is. If you live in hawaii you check out your bill. Its five or ten times more expensive in hawaii. Thats one of the reasons, a lack of attention. We dont have actually an industry figure like elon musk, but i think its an exciting story. You know, last year if you look at generation of electricity, all of the new generation put in place, 30 of a third was solar. Its moved up. This year it will be half. Also an industry that has a lot of impact from politics. Who do you want to be president . You know, i wont get into that as much but i can tell you just down at the solar power international, big conference we have once a year and joe biden showed up. Im a fan of joe biden. Its a legitimate question. I mean from an veflters point of view or solar point of view, what party i would assume it would be democrats. Clearly the democrats. Lead environmental. Yeah, we have amongst the climate deniers, almost exclusively republican. Im a republican so i have a problem with my own party. And oil prices arent helping. And also a ceo. Not surprising us that much. I watched sun run, still hasnt gone to the ipo price. Im not asking for stock advice, same model and yet it just cannot get any traction with investors. Is it still the costs are too high for putting up panels . The issue in this particular segment of the market where you deployment, youre putting in installations in and they are doubling in size, et cetera. We call it a land grab. And when youre trying to grab the land, youre not making money necessarily. Solar city, even with all of the excitement around it is still not profitable. We have a second ipo, and they are not profitable either. How do they get profitable . Is it the cost of the solar panels coming down, is that the main way . No, that has come down pretty far although my pet project, company im working on to drive it even further. The real cost for them is the cost of were seeing a lot of Solar Companies going to improved packages on how to get an installation on your house without a lot of design work. It is the upfront cost, kind of the marketing cost that is plaguing Companies Like solar city i wouldnt have guessed that. That and not the solar panels themselves. You think about it, if you have to sell every single home own on something they are not familiar with. I talked to a salesman once, its going to cost you nothing up front, et cetera. The number of times he gets the doors slammed in his face, thats too good of a deal. Thats actually what the deal is. Brett mattson has written the book. We appreciate you for being with us this morning. Thats our show for this week. My thanks to my guest. Kevin gibson on the move from contractors to employees and brad mattson with his expertise in solar. Im scott mcgrew, thank you for making us parts of your sunday morning. Home of the premier league, the nascar chase for the sprint cup playoffs and primetimes number one show, sunday night football. Only on nbc. From every corner of the globe, 24 of the worlds best coming to the land of the morning calm. Im pleased to announce that in 2015, the president s cup will be in south korea. It comes with the recognition of the development of elite players in korea and in asia. K. J. Choi. Another man from souor