Google Gets Ready to Test GBuy, A New Online-Payment Option By MYLENE MANGALINDAN Wall Street Journal
June 27, 2006; Page D3 http://online.wsj.com/article/SB115136840690491346.html?mod=mostpop For years, consumers who didn't want to give Web merchants their credit-card information faced limited options when it came to making purchases online. This week, consumers could get access to another electronic-payment option -- and one that offers a mail-in rebate incentive to boot. Web-search giant Google Inc. is set to introduce a test version of its GBuy online-payment service as early as this week, according to people briefed on the situation. The service, which would challenge eBay Inc.'s PayPal online-payment service and others, has been expected for several months. To attract consumers, Google plans to offer an unspecified rebate to people who complete online purchases using GBuy, according to one person briefed on the company's plans. Here is how the service will work: Consumers who search for items like "shoes" or "strollers" on Google's search site will see text ads with a symbol or icon designating advertisers that accept GBuy payments. Shoppers normally would have clicked on an ad and been linked to that merchant's Web site. Now, while they will still be linked to the merchant's site, they will go through a different checkout process integrated with Google if they choose GBuy for their transaction. Details of the service could still change before Google's official GBuy announcement. The expected arrival of GBuy presages a shake-up in the online-payments market. Until now, consumers have only had payment options such as PayPal, which lets consumers pay using their credit card or a bank-account transfer without disclosing their account information to the merchant or individual receiving the payment. Consumers have also been able to use online checks and online credit options, such as Bill Me Later. Bill Me Later allows consumers to pay for purchases without disclosing their credit-card number, instead disclosing pieces of personal information that lets the company match up the person's identity with their credit information. Chris Mario, a Damascus, Md., resident, says he "would 100% use Google payments" because he likes the company's technology. He says he uses PayPal now but would prefer using an independent third-party payment service when making some online purchases, as opposed to the PayPal unit of eBay, which runs auction and other e-commerce Web sites. Though PayPal has more than 100 million users, it faces maturing growth and is now trying to expand its market from its payments business related to eBay purchases. A PayPal spokeswoman says the company doesn't comment on rivals' services and has managed to thrive despite strong competition. At the same time, Google's new payment service will be a test as to whether the company can be hugely successful outside its core search-technology market. A Google spokesman notes that billing and payments have been part of the company's services for some time and can be used in conjunction with several products now. Google plans to charge merchants a 2.2% commission on a sale, plus 30 cents per transaction using its payment service, according to people briefed on Google's pricing. That is higher than Pay-Pal's lowest published rate of a 1.9% commission plus 30 cents per transaction. Google's rate doesn't include the discount pricing that the company will give to merchants participating in its AdWords advertising program, according to these people. Merchants who spend money on Google's ad program could get the cost of payment processing through Google dropped to nothing, these people said. ================================================= George Antunes Voice (713) 743-3923 Associate Professor Fax (713) 743-3927 Political Science Internet: antunes at uh dot edu University of Houston Houston, TX 77204-3011 Reply with a "Thank you" if you liked this post. _____________________________ MEDIANEWS mailing list [email protected] To unsubscribe send an email to: [EMAIL PROTECTED]
