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Main article: Asia

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India proposes new rules to access its citizens’ data

14:41 | 10 December

India has proposed groundbreaking new rules that would require companies to garner consent from citizens in the country before collecting and processing their personal data. But at the same time, the new rules also state that companies will have to hand over “non-personal” data of their users to the government, and New Delhi will also hold the power to collect any data of its citizens without consent, thereby bypassing the laws applicable to everyone else, to serve sovereignty and larger public interest.

The new rules, proposed in “Personal Data Protection Bill 2019,” a copy of which leaked on Tuesday, would permit New Delhi to “exempt any agency of government from application of Act in the interest of sovereignty and integrity of India, the security of the state, friendly relations with foreign states, public order.”

If the bill passes, and it is expected to be discussed in the parliament in the coming weeks, select laws drafted more than a decade ago would remain unchanged.

Another proposed rule would grant New Delhi the power to ask any “data fiduciary or data processor” to hand over “anonymized” “non-personal data” for the purpose of better governance, among others.

New Delhi’s new bill — which was passed by the Union Cabinet last week, but has yet to be formally shared with the public — could create new challenges for Google, Facebook, Twitter, ByteDance’s TikTok and other companies that are already facing some regulatory heat in the nation.

India conceptualized this bill two years ago and in the years since, it has undergone significant changes. A draft of the bill, which was formally made public last year, had stated that the Indian government must not have the ability to collect or process personal data of its citizens, unless a lawful procedure was followed.

Ambiguity over who the Indian government considers an “intermediary” or a “social media” platform, or a “social media intermediary” are yet to be fully resolved, however. In the latest version, the bill appears to not include payment services, internet service providers, search engines, online encyclopedias, email services and online storage services as “social media intermediaries.”

One of the proposed rules, that is directly aimed at Facebook, Twitter, and any other social media company that enables “interaction between two or more users” requires them to give their users an option to verify their identity and then publicly have such status displayed on their profile — similar to the blue tick that Facebook and Twitter reserve for celebrities and other accounts of public interest.

Last week news outlet Reuters reported portions of the bill, citing unnamed sources. The report claimed that India was proposing the voluntary identity-verification requirement to curb the spread of false information.

As social media companies grapple with the spread of false information, that have caused at least 30 deaths in India, the Narendra Modi -led government, a big consumer itself of social media platforms, has sought to take measures to address several issues.

Over the last two years, the Indian government has asked WhatsApp, which has amassed more than 400 million users in India, to “bring traceability” to its platform in a move that would allow the authority to identify the people who are spreading the information.

WhatsApp has insisted that such a move would require breaking encryption, which would compromise the privacy and security that more than a billion people globally enjoy on the platform.

The bill has not specifically cited government’s desires to contain false information for this proposal, however. Instead the bill insists that this would bring more “transparency and accountability.”

Some critics have expressed concerns over the proposed rules. Udbhav Tiwari, a public policy advisor at Mozilla, said New Delhi’s bill would “represent new, significant threats to Indians’ privacy. If Indians are to be truly protected, it is urgent that parliament reviews and addresses these dangerous provisions before they become law.”

 


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FintechOS raises $14M help banks launch products as fast as FinTech Startups

11:05 | 10 December

Over the last few years, we’ve seen the rise of FinTech startups like N26 and Monzo to challenge the incumbents with new products like challenger banks. But what if the big banks wanted to compete in that game themselves? This is the aim of FintechOS a Romanian startup that actually aims to help incumbents compete in this brave new, competitive, world.

FintechOS allows banks and insurance companies to act and react faster than the new upstarts on the scene with plug and play products. 

It’s announcing today that it has secured $14 million (£10.7 million) in a Series A investment led by the Digital East Fund of Earlybird Venture Capital and OTB Ventures, with participation from existing investors Gapminder Ventures and Launchub.

The additional capital will be used to continue the growth and expansion across Europe, and to expand into South East Asia and the US.

FintechOS’s technology platform lets traditional banks and insurance companies adapt to rapidly changing customer expectations, and match the speed and flexibility of Fintech startups with personalized products and services, in weeks rather than months or years.

The banks and insurance companies can then launch multi-cloud SaaS deployments, transitioning to the cloud and on-premises deployments, working alongside the existing technology infrastructure. It now has existing partnerships with Microsoft, EY, Deloitte, Publicis Sapient and CapGemini allow deployment in multiple markets.

Started in 2017 by serial entrepreneurs Teodor Blidarus and Sergiu Negut, the company now has customers in more than 20 countries across three continents.

Teo Blidarus, CEO and Co-Founder of FintechOS, commented: “Our disruptive approach is customer, not technology-driven. We created FintechOS to transform the financial industry, empowering banks and insurance companies to act and react faster than fintech startups,
to create a smarter, slicker customer experience.”

Dan Lupu, Partner at Earlybird, said: “FintechOS is a pioneer in a booming market, with a vision to transform the way financial institutions react to market and regulatory changes. We are proud to become part of a journey that will shape the future of financial services.”

 


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Daily Crunch: China cracks down on foreign hardware and software

21:03 | 9 December

The Daily Crunch is TechCrunch’s roundup of our biggest and most important stories. If you’d like to get this delivered to your inbox every day at around 9am Pacific, you can subscribe here.

1. China moves to ban foreign software and hardware from state offices

China has ordered the replacement of all foreign PC hardware and operating systems in state offices over the next three years, according to a report in the Financial Times. The government has previously ordered purges of western software, but they were more limited or related to certain security issues.

This time, the goal includes hardware as well, with tens of millions of devices targeted for replacement.

2. Snapchat Cameos edit your face into videos

Snapchat is preparing to launch a new feature that swaps out faces in videos with your own selfies. Some French users received a test version of the feature today.

3. The new Mac Pro goes up for order December 10

When Apple announced the new Mac Pro in June, it left out one key detail — when, precisely the latest version of the high-end desktop would arrive. Now Apple says orders will begin on December 10, although the shipping date remains unknown.

4. In wake of Shutterstock’s Chinese censorship, American companies need to relearn American values

By now, it’s well-known that China’s search engines like Baidu censor political photography. What we’ve been learning more recently, however, is that it isn’t just Chinese companies that are aiding and abetting this censorship.

5. Will the 2020s be online advertising’s holistic decade?

InMarket founder Todd Dipaola predicts that marketers will be held to a higher standard — both by clients demanding world-class performance and proof, as well as consumers who want relevancy, helpfulness and privacy from their brand relationships. (Extra Crunch membership required.)

6. See Atomico’s most senior VCs onstage at Disrupt Berlin

Atomico is among the most widely respected venture firms in Europe. And you’ll be able to hear from its leaders at TechCrunch’s big event in just a couple of days.

7. This week’s TechCrunch podcasts

Equity takes a look at Harlem Capital, one of the largest funds that’s focused on backing minority entrepreneurs. Meanwhile, Original Content reviews the latest season of Netflix’s hit series “The Crown.”

 


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Singapore’s Neuron Mobility raises $18.5M to bring its electric scooters to more international markets

16:00 | 9 December

Neuron Mobility, a Singapore-based startup, has closed an $18.5 million new financing round as it looks to scale its e-scooter startup in international markets – a month after the nation introduced difficult regulatory changes.

The new financing round, dubbed Series A, was funded by GSR Ventures, a venture capital firm that was the first institutional investor in Chinese ride-hailing giant DiDi Chuxing, and Square Peg, Australia’s largest venture capital firm.

Existing investors SeedPlus and SEEDS Capital also participated in the round. The three-year-old startup has raised about $23.5 million to date.

Neuron Mobility, which began its journey in Singapore, operates an eponymous e-scooters rental platform. In recent years and quarters, Neuron has expanded to cities in Malaysia, Thailand, Australia, and New Zealand.

Neuron’s e-scooters are affordable in every market where they are available. In Brisbane, Australia, for instance, anyone can begin a trip with a Neuron’s bike by paying one Australian Dollar (68 U.S. cents) and then 38 Australian cents for each minute of the ride, Zachary Wang, co-founder and chief executive of Neuron, told TechCrunch in an interview.

These electric scooters can go as fast as 25 kilometre per hour (15.5 miles per hour), and automatically slow down at certain places such as near a school. Wang said the startup closely works with city councils to understand how these e-scooters should operate.

In a statement, Square Peg’s Tushar Roy said, “the culture of collaboration with cities permeates through Neuron. Its entire DNA is built around working very closely with local leadership to bring new mobility solutions to citizens in a safe and sustainable way.”

On a single charge, a Neuron scooter can travel up to 60 kilometres (37.2 miles). These e-scooters are equipped with a swappable battery. Once the ride is finished, a customer can drop the bike at any nearby parking station or any suitable location. Neuron works with a large number of people who actively swap the batteries on these scooters.

Like India’s electric scooter and bike startups Bounce and Yulu, Neuron Mobility also designs its electric scooters, but relies on Chinese equipment manufacturer for producing them. (Yulu recently inked a strategic deal with Bajaj Auto to task the Indian auto manufacturing giant with the production job.

Singapore turns its back on electric scooters

As Neuron expands to international markets, it has had to halt its e-scooter rental service in the home market of Singapore. Last month, Singapore said e-scooters could no longer operate on footpaths, creating major challenges for all the players. Wang, as well as executives from other startups have expressed concerns over the decision.

Telepod, which uses e-scooters to deliver food, GrabFood, another food delivery startup, and shared e-scooter service startup Beam said they could no longer offer the same level of customer service to their users, and had little choice but to focus on other markets.

Wang said that Neuron still has teams that work from Singapore, but they have always focused on the larger Asia Pacific region and other markets. Besides, Neuron stopped its service in Singapore months before the nation passed any new law. (Prior to the recent order, Singapore had other issues with electric scooters.)

Neuron will use the fresh capital to further its footprint in the markets where it operates and explore building new categories, Wang said. “We feel we are in the midst of a wave where a number of technologies are falling into place that could help us improve our electric scooter and build more mobility solutions.” The startup is also exploring new markets, though Wang declined to name them.

Like in the United States, electric scooters and bikes have imploded in Southeast Asian markets, where a growing number of familiar brands such as Lime, Bird, Ofo, oBike and local players are increasingly expanding their presence.

 


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China moves to ban foreign software and hardware from state offices

15:50 | 9 December

China has reportedly ordered all foreign PC hardware and operating systems to be replaced in the next three years, intensifying an ongoing tech war. The country has attempted this sort of thing before halfheartedly, but this is the most serious effort yet to isolate itself from the influence of the western technology sector.

The order came from high up in the Chinese government earlier this year, according to a Financial Times report citing Chinese tech analysts. The goal is not simply to replace American and European software and operating systems with Chinese equivalents, but the hardware they run on as well.

China has previously ordered purges of western software, but they were more limited or related to certain security issues; there were efforts five years ago to wean the country off Android and Windows, but ultimately they proved abortive.

This time could very easily be different. The relationship between the U.S. and China has become strained, to say the least, especially in the world of tech, where the two countries have shifted from earnest rivals to real adversaries. The U.S. has recently moved to ban some large Chinese hardware providers, such as ZTE and Huawei, from use in American infrastructure (Huawei has called the ban “unconstitutional”), and miscellaneous other policy decisions have widened the rift.

The apparently decisive nature of the order, then, should come as no surprise. The goal is reportedly to replace 30 percent of the computers and software by the end of 2020, an additional 50 percent in 2021, and the remaining 20 percent in 2022.

The three year “3-5-2” plan is ambitious to say the least. Tens of millions of devices will need to be replaced, but it isn’t as simple as trading out HP machines for Chinese-manufactured ones. The components and software must be Chinese as well, so Intel and AMD processors are out, as are Nvidia GPUs, ARM architectures, Sony image processors, and so on.

This won’t be quite the shock it seems, however, as many Chinese companies have been preparing for this eventuality for years. China has made its desire to establish independence from U.S. companies especially quite clear and many state-backed enterprises have been unable to use U.S. suppliers for some time.

Even so, Chinese equivalents to products like Windows and Android have nowhere near the level of maturity and developer support necessary to swap them out with no consequences. And the ban may hamstring other major efforts like the country’s push to dominate the AI ecosystem. If Chinese government-backed researchers are unable to use the same tools as their academic and private counterparts elsewhere in the world, their results will almost certainly suffer.

The specifics of the plan are still confidential but will likely trickle out as they begin to be enforced. But this is likely to be a major driver of industry dynamics for several years as suppliers, developers, and manufacturers all learn to navigate the divergent markets.

 


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In wake of Shutterstock’s Chinese censorship, American companies need to relearn American values

14:25 | 8 December

It’s among the most iconic images of the last few decades — a picture of an unknown man standing before a line of tanks during the protests in 1989 in Beijing’s Tiananmen Square. In just one shot, the photographer, Jeff Widener, managed to convey a society struggling between the freedoms of individual citizens and the heavy hand of the Chinese militarized state.

It’s also an image that few within China’s “great firewall” have access to, let alone see. For those who have read 1984, it can almost seem as if “Tank Man” was dropped into a memory hole, erased from the collective memory of more than a billion people.

By now, it’s well-known that China’s search engines like Baidu censor such political photography. Regardless of the individual morality of their decisions, it’s at least understandable that Chinese companies with mostly Chinese revenues would carefully hew to the law as set forth by the Chinese Communist Party. It’s a closed system after all.

What we are learning though is that it isn’t just Chinese companies that are aiding and abetting this censorship. It’s Western companies too. And Western workers aren’t pleased that they are working to enforce the anti-freedom policies in the Middle Kingdom.

Take Shutterstock, which has come under great fire for complying with China’s great firewall. As Sam Biddle described in The Intercept last month, the company has been riven internally between workers looking to protect democratic values, and a business desperate to expand further in one of the world’s most dynamic countries. From Biddle:

Shutterstock’s censorship feature appears to have been immediately controversial within the company, prompting more than 180 Shutterstock workers to sign a petition against the search blacklist and accuse the company of trading its values for access to the lucrative Chinese market.

Those petitions have allegedly gone nowhere internally, and that has led employees like Stefan Hayden, who describes nearly ten years of experience at the company as a frontend developer on his LinkedIn profile, to resign:

The challenge of these political risks is hardly unknown to Shutterstock. The company’s most recent annual financial filing with the SEC lists market access and censorship as a key risk for the company (emphasis mine):

For example, domestic internet service providers have blocked and continue to block access to Shutterstock in China and other countries, such as Turkey, have intermittently restricted access to Shutterstock. There are substantial uncertainties regarding interpretation of foreign laws and regulations that censor content available through our products and services and we may be forced to significantly change or discontinue our operations in such markets if we were to be found in violation of any new or existing law or regulation. If access to our products and services is restricted, in whole or in part, in one or more countries or our competitors can successfully penetrate geographic markets that we cannot access, our ability to retain or increase our contributor and customer base may be adversely affected, we may not be able to maintain or grow our revenue as anticipated, and our financial results could be adversely affected.

Thus the rub: market access means compromising the very values that a content purveyor like Shutterstock relies on to operate as a business. The stock image company is hardly unique to find itself in this position; it’s a situation that the NBA has certainly had to confront in the last few weeks:

It’s great to see Shutterstock’s employees standing up for freedom and democracy, and if not finding purchase internally with their values, at least walking with their feet to other companies who value freedom more reliably.

Unfortunately, far too many companies — and far too many tech companies — blindly chase the dollars and yuans, without considering the erosion in the values at the heart of their own business. That erosion ultimately adds up — without guiding principles to handle business challenges, decisions get made ad hoc with an eye to revenues, intensifying the risk of crises like the one facing Shutterstock.

The complexity of the Chinese market has only expanded with the country’s prodigious growth. The sharpness, intensity, and self-reflection of values required for Western companies to operate on the mainland has reached new highs. And yet, executives have vastly under-communicated the values and constraints they face, both to their own employees but also to their shareholders as well.

As I wrote earlier this year when the Google China search controversy broke out, it’s not enough to just be militant about values. Values have to be cultivated, and everyone from software engineers to CEOs need to understand a company’s objectives and the values that constrain them.

As I wrote at the time:

The internet as independence movement is 100% dead.

That makes the ethical terrain for Silicon Valley workers much more challenging to navigate. Everything is a compromise, in one way or another. Even the very act of creating value — arguably the most important feature of Silicon Valley’s startup ecosystem — has driven mass inequality, as we explored on Extra Crunch this weekend in an in-depth interview.

I ultimately was in favor of Google’s engagement with China, if only because I felt that the company does understand its values better than most (after all, it abandoned the China market in the first place, and one would hope the company would make the same choice again if it needed to). Google has certainly not been perfect on a whole host of fronts, but it seems to have had far more self-reflection about the values it intends to purvey than most tech companies.

It’s well past time for all American companies though to double down on the American values that underly their business. Ultimately, if you compromise on everything, you stand for nothing — and what sort of business would anyone want to join or back like that?

China can’t be ignored, but neither should companies ignore their own duties to commit to open, democratic values. If Tank Man can stand in front of a line of tanks, American execs can stand before a line of their colleagues and find an ethical framework and a set of values that can work.

 


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Style Theory, a fashion rental startup in Southeast Asia, raises $15 million led by SoftBank Ventures Asia

15:36 | 6 December

Style Theory, a platform for renting designer apparel in Indonesia and Singapore, announced today it has raised $15 million in Series B funding. The startup says this is the first closing of the round. It was led by SoftBank Ventures Asia, the early-stage venture arm of SoftBank Group, with participation from other investors including Alpha JWC Ventures and the Paradise Group.

Both SoftBank Ventures Asia and Alpha JWC Ventures are returning investors and previously participated in Style Theory’s Series A.

Founded in 2016 by Raena Lim and Chris Halim to counteract the waste created by fast fashion, Style Theory currently has more than 50,000 pieces of clothing and 2,000 designer bags in its inventory. In addition to its app, the company opened a flagship store on Orchard Road in Singapore last month. On average, Style Theory’s subscribers rent up to 20 pieces of clothing and two designer bags a month and it has delivered more than one million items since launching, its founders say.

Style Theory co-founders Raena Lim and Chris Halim

Part of the funding will be used to further develop Style Theory’s tech platform. In an email interview, Lim and Halim told TechCrunch that Style Theory uses machine-learning algorithms to personalize clothing and fit recommendations for users based on their browsing and rental history and decide what designers and styles to carry to add. The startup also built a customized warehouse management system and distribution network that uses its own fleet of couriers to lower costs. In order to manage its inventory as the company scales up and expands into new markets, it plans to start using RFID tagging and will attach passive RFID tags on each of its rental items.

Lim and Halim say they plan to launch new apparel categories in Singapore and Indonesia before possibly expanding into more countries in 2020.

While Rent the Runway and Le Tote are the best-known fashion rental apps in the United States, Style Theory’s operating model has several key differences to serve the Southeast Asia market, Lim and Halim say. Longer hours means many customers are often not at home to receive deliveries. They also rely on public transportation more than most Americans. In order to make the service more convenient, Style Theory opened its brick-and-mortar store and partners with automated locker providers, coworking spaces and department stores. Its app includes different payment solutions, since the regions they serve have relatively lower credit card penetration rates.

Style Theory’s inventory is also picked with a diverse array of customers in mind.

“With the melting pot of cultures, we have to approach our merchandise mix with consideration to the different societal standards of formality and modesty in the workplace and social environment,” said Lim and Halim.

“Not only does our assortment have to serve the all-year tropical climate, with a seasonal selection for travel, we have to also meet the demands for the different cultural groups and customer preferences. We have introduced a line up of modest wear in Indonesia and more festive wear during the celebratory seasons in the year.”

In a press release, SoftBank Ventures Asia senior partner Sean Lee said “Fashion has emerged as one of the last frontiers of the sharing economy, and with an attractive business model, Style Theory has proven that the company can change the way people consume fashion in Southeast Asia. I am excited to support Style Theory’s expansion across the region as well as continuous disruption.”

 


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Netflix earmarks $420M to fight Disney in India

14:37 | 6 December

Netflix may still not have a million subscribers in India, but it continues to invest big bucks in the nation, where Disney’s Hotstar currently dominates the video streaming market.

Reed Hastings, the chief executive of Netflix, said on Friday that the company is on track to spend 30,000 million Indian rupees, or $420.5 million, on producing and licensing content in India this year and next.

“This year and next year, we plan to spend about Rs 3,000 crores developing and licensing content and you will start to see a lot of stuff hit the screens,” he said at a conference in New Delhi.

“This is significantly higher than what we have invested in content over the past years,” an executive at one of the top five rival services told TechCrunch. Another industry source said that no streaming service in India is spending anything close to that figure on just content.

While it remains unclear exactly how much capital other streaming services are spending on content, a recent KPMG report suggested that Hotstar was spending about $17 million on producing seven original shows this year, while Eros Now had pumped about $50 million to create 100 new original shows. (The report does not talk about licensing content expenses.)

Netflix, which entered India as part of its global expansion to more than 200 nations and territories in early 2016, has so far produced more than two dozen original shows and movies in India.

Hastings said several of the shows that the company has produced in India, including A-listed cast-starrer “Sacred Games” and “Mightly Little Bheem” have “travelled around the world.” More than 27 million households outside of India have started watching “Mighty Little Bheem,” an animated series aimed at children.

India has emerged as one of the last great potential growth markets for technology and entertainment firms. About half of the nation’s 1.3 billion population is now online and a growing number of people are beginning to transact online.

To broaden its reach in the nation, Netflix earlier this year introduced a new monthly price tier — $2.8 — that allows users in India to watch the streaming service in standard quality on a mobile device. (The company has since expanded this offering to Malaysia.)

More to follow…

 


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Flipkart leads $60M investment in logistics startup Shadowfax

11:35 | 5 December

Walmart’s Flipkart has backed Shadowfax in a new $60 million financing round as the retail giant works to strengthen its logistics network in the nation.

Flipkart, which alone contributed $30 million, led the Series D financing round for the three-year-old Bangalore-based startup, Shadowfax co-founder and chief executive Abhishek Bansal told TechCrunch in an interview.

Existing investors NGP Capital, Qualcomm Ventures, Mirae Asset, and Eight Roads Ventures also participated in the round, which brings the startup’s total raise to date to $100 million. The new round valued Shadowfax at about $250 million, two people familiar with the matter told TechCrunch. The startup declined to comment on the valuation.

Shadowfax operates a business-to-business logistics network in over 300 cities in India. The startup works with neighbourhood stores to use their real estate to store inventory, and a large network of freelancers who do the delivery. “Anyone with a bicycle or a bike can join our platform and deliver items for us,” said Shadowfax’s Bansal.

This logistics network can handle goods in a range of categories including hot food, grocery and e-commerce. Flipkart and food delivery startup Swiggy are among its “hundreds” of clients, he said.

“It’s a very reliable logistics network. And each grocery store is only serving to users in a kilometre radius, so the delivery could be incredibly quick. These grocery stores, whose staff also often participate in delivery, only have to work with us for a few hours in a day, so it’s a quick way for them to make extra money,” he said.

More to follow…

 


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In a first, Amazon launches a battery-powered portable Echo speaker in India

08:11 | 4 December

After launching nearly a dozen Echo speaker models in India in two years, Amazon said on Wednesday it is adding one more to the mix that addresses one of the most requested features from customers in the nation: Portability.

The e-commerce giant today unveiled the Echo Input Portable Smart Speaker Edition, a new variant in the lineup that includes a built-in battery. The 4,800mAh enclosed battery will offer up to 10 hours of continuous music playing or up to 11 hours of stand-by life, the company said.

“Portability has been one of the most requested features in India,” said Miriam Daniel, VP of Alexa Devices. “You want to be able to carry Alexa with you from room to room within your homes. So we have designed something just for you.”

The battery-powered Echo model, designed exclusively for India, is priced at 5,999 Indian rupees ($84). Users can currently purchase it at an introductory price of 4,999 Indian rupees ($70) and the device will begin shipping on December 18.

Other than the built-in battery pack, the new speaker model offers an identical set of features as other Echo variants. (There is an array of four LEDs that light up when a user taps the power button to show battery level.)

More to follow…

 


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