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Google’s PayPal Could Be Big
http://www.redherring.com/Article.a...ctor=Industries&subsector=InternetAndServices
Analysts say the search giant’s payment service could be a cash cow on Google’s online listings site.
February 28, 2006
Google’s online payment service could prove to be a gold mine for the search giant, analysts say, as the company begins to allow consumers to use the service to shop on Google Base, an online listings site likened to Craigslist.
With the Google Payments service, the company could create a significant new revenue stream, said UBS Investment Research analyst Ben Schachter. He noted that Google payments service could eventually work with other vendors, just as eBay’s payments service PayPal is used by a variety of merchants.
“In our view, this is a clear shot across PayPal’s bow,” said Mr. Schachter, in a research note.
Google Base is a site where people can post any type of content along the lines of online listings site Craigslist (See Google Expands Search All Over). But unlike on Craigslist, on this site buyers will be able to purchase items with credit cards, thanks to the payments service. For sellers, Google is integrating the processing of transactions with the management of items.
People have been predicting the launch of Google Payments, which is a name given to it by observers and bloggers, for months (see Google Plans PayPal Rival and Google Wallet May Debut Soon).
The Mountain View, California-based search giant made sure the test got off to a quiet start. Google launched a video store last month, and shoppers found that they could buy videos by signing into their Google accounts. People have also been using their accounts to buy mapping-related products from Google Earth, information on Google Answers, and keywords on AdWords, Google's advertising program, in some cases for more than a year now.
As Google Base is a listings area, where consumers buy and sell products and services among each other, it offers a lot of potential to develop the payments service.
“We think that Google Payments will continue to spread and ultimately be a worthy competitor to PayPal, as even eBay’s Jeff Jordan has acknowledged,” said Bear Sterns analyst Robert Peck in his research note.
As far as search goes, Google’s share has been growing, inching up to 41.2 percent in the domestic search market from 39.8 percent in November, according to comScore Media Metrix. But search expansion might not be enough to keep the company growing at its previous high rates.
Google Chief Financial Officer George Reyes said Tuesday his company needs to come up with other revenue streams (See Google Warns of Slow Growth). The payments initiative could be one of them.
And as Google continues to branch out to new areas in addition to ads including offering Wi-Fi and video, it could extend its payments to all of them.
http://www.redherring.com/Article.a...ctor=Industries&subsector=InternetAndServices
Analysts say the search giant’s payment service could be a cash cow on Google’s online listings site.
February 28, 2006
Google’s online payment service could prove to be a gold mine for the search giant, analysts say, as the company begins to allow consumers to use the service to shop on Google Base, an online listings site likened to Craigslist.
With the Google Payments service, the company could create a significant new revenue stream, said UBS Investment Research analyst Ben Schachter. He noted that Google payments service could eventually work with other vendors, just as eBay’s payments service PayPal is used by a variety of merchants.
“In our view, this is a clear shot across PayPal’s bow,” said Mr. Schachter, in a research note.
Google Base is a site where people can post any type of content along the lines of online listings site Craigslist (See Google Expands Search All Over). But unlike on Craigslist, on this site buyers will be able to purchase items with credit cards, thanks to the payments service. For sellers, Google is integrating the processing of transactions with the management of items.
People have been predicting the launch of Google Payments, which is a name given to it by observers and bloggers, for months (see Google Plans PayPal Rival and Google Wallet May Debut Soon).
The Mountain View, California-based search giant made sure the test got off to a quiet start. Google launched a video store last month, and shoppers found that they could buy videos by signing into their Google accounts. People have also been using their accounts to buy mapping-related products from Google Earth, information on Google Answers, and keywords on AdWords, Google's advertising program, in some cases for more than a year now.
As Google Base is a listings area, where consumers buy and sell products and services among each other, it offers a lot of potential to develop the payments service.
“We think that Google Payments will continue to spread and ultimately be a worthy competitor to PayPal, as even eBay’s Jeff Jordan has acknowledged,” said Bear Sterns analyst Robert Peck in his research note.
As far as search goes, Google’s share has been growing, inching up to 41.2 percent in the domestic search market from 39.8 percent in November, according to comScore Media Metrix. But search expansion might not be enough to keep the company growing at its previous high rates.
Google Chief Financial Officer George Reyes said Tuesday his company needs to come up with other revenue streams (See Google Warns of Slow Growth). The payments initiative could be one of them.
And as Google continues to branch out to new areas in addition to ads including offering Wi-Fi and video, it could extend its payments to all of them.
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