eBay vs PayPal - How Bad Is It? | 4
Business Wars
Audible
4.6 • 13.5K Ratings
🗓️ 2 August 2018
⏱️ 26 minutes
🧾️ Download transcript
Summary
Remember the summer of 2000? The Olympics were in full swing and PayPal was under attack. Not from eBay, but Russian hackers. In looking for soft targets in the early days of the untethered Internet, PayPal was the fattest cow. On top of that, there are competitors, and they’re catching on fast. Between the money stolen from hackers and competitors, PayPal has to figure out a way to survive, and fast.
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Transcript
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| 0:00.0 | Hey Prime members, you can listen to business wars at free on Amazon Music. Download the app today. |
| 0:12.0 | PayPal is under attack. |
| 0:15.0 | It's mid-summer, the year 2000. Russian hackers are looking for soft targets. |
| 0:20.0 | These are the early days of web security in America's banks and e-commerce sites are like unlocked candy shops for hackers. |
| 0:28.0 | The Russians in particular have a real sweet tooth. And PayPal is plenty appealing and easy. |
| 0:35.0 | And here's how they do it. First, the Russians hack into eBay where they call email addresses of PayPal customers. |
| 0:43.0 | Then they grab the PayPal domain name. Of course, the name is taken, but if you tinker with it, |
| 0:49.0 | well the hackers use an uppercase i instead of a lowercase l on the word PayPal, for example. |
| 0:56.0 | And then they just replicate the website and send a message to the email addresses they stole from eBay with a gift, 50 bucks. |
| 1:04.0 | All they have to do is enter their passwords on the bogus site. PayPal customers are used to getting gifts, so they do it. |
| 1:13.0 | Then the scammers just sit back and harvest email addresses and passwords. |
| 1:21.0 | CEO Peter Teal calls in his security chief, Max Levchin. |
| 1:25.0 | How bad is it? |
| 1:27.0 | Bad. It's costing us $10 million a month. |
| 1:31.0 | Credit card companies have good fraud detection, probably because they have so much experience with it. |
| 1:36.0 | I think they reject something like 0.07% of all credit card transactions. What about our reject rate? |
| 1:44.0 | 1% and growing fast. |
| 1:47.0 | Teal does some quick mental calculations and frowns. |
| 1:51.0 | At this rate, we could be out of business in six months. |
| 1:55.0 | What do we do? |
| 1:56.0 | Not we, you. |
| 1:59.0 | I get it. It takes a Ukrainian to stop a Russian, right? |
... |
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