June 28, 2006 | written by Bruce Cundiff
PayPal vs. GBuy
With Google set to launch its payment mechanism (GBuy is the purported product name), there’s been much speculation on whether or not eBay/PayPal will allow the product to be used for eBay transactions.
I think the real competition between the two will be for “off eBay transactions” (as eBay/PayPal describes them). It would be difficult and potentially fruitless for Google to go after the eBay business, at least initially. So maybe GBuy non-acceptance for eBay transactions is a bit of a non-issue in the immediate term.
The real value to Google is deepening the relationships with merchants and enabling them to drive more sales not only through the payment product, but from the data and consumer knowledge Google would bring based on the payment product. This may in turn enable them to enhance revenue for paid search. Whether merchants will immediately see this value, and pay for the deeper relationship and enhanced knowledge remains to be seen.
PayPal definitely seeks to continue to grow its merchant relationships outside of the eBay community. There is certainly immediate value to merchants in PayPal’s 100 million account-holder base, and on that front, Google will be playing catch up for some time.
So the battle seems to be more one of synergy with the overall “core” business of each company. The real breakdown is the value that the merchants see in each product, PayPal’s user base, and the enhanced consumer knowledge or marketing boost they may get from the Google relationship. This is a balance that each merchant must determine, and a different case that each payment product must make.
It makes as much sense for eBay to integrate Google Checkout (GBuy) as it does for Google to accept PayPal for AdWords payments. Perhaps there’s some middle ground if Froogle where to add icons to identify listings by merchants that accept PayPal.
Is there something similar (http://monpaypal.blogspot.com/)with Google?
The fact remains that Paypal has not yet implemented wire transfer to most of the countries. For example, it shows absolute ineptitude on the part of Paypal not to provide the facility for transfer of payments to India. There are thousands of software firms in India which could have used Paypal to accept payments from clients. The number of users online is exploding in India and Paypal has already lost billions of dollars in potential business.
Obviously this would help Google!