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Google to Offer Payment Services Like Paypal
By: Ratliff J
Google Inc. this year plans to offer an electronic-payment service that could help the Internet-search company diversify its revenue and may put it in competition with eBay Inc.'s PayPal unit, according to people familiar with the matter.
Exact details of the search company's planned service aren't known. But the people familiar with the matter say it could have similarities with PayPal, which allows consumers to pay for purchases by funding electronic-payment accounts from their credit cards or checking accounts.
Some consumers like PayPal for the security it offers, since it allows them to share their banking or credit-card numbers only with PayPal without having to divulge the information to merchants.
Officials of Google and PayPal declined to comment.
EBay's PayPal service generated $233.1 million, or 23%, of eBay's revenue in the first quarter. PayPal has been widely adopted by buyers and sellers on eBay's auction marketplace as a way to pay for purchases. Recently, eBay has been trying to expand PayPal's presence as a payment system for other Web sites. In the first quarter, 71% of PayPal's revenue came from eBay auctions, the company says.
"It could be a pretty big negative for eBay if it happens," says Safa Rashtchy, Internet analyst at Piper Jaffray. Mr. Rashtchy said he believes Google is also working on a classified listing service, which also would compete with eBay, which is based in San Jose, Calif.
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About the Author
J. Ratliff is an avid article writer and creator of the Foovy Search Engine.
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