They should also offer the core service of being able to send money free of charge to anybody anywhere, and not just payments. Any idea if they will?

More competition sounds good. I’d love to test their service if a beta is available to public. Any invites?

Awesome! Amazon rocks.. Beware Paypal & Google…

“Why does anyone think that google checkout and paypal are rival operations?”

Have you tried to sell an auction on ebay and include the words “Google Checkout”? Cuz you’ll get your item delisted if you do…

Even adding something like “We also accept G o og l e C h eck ou t” got an item delisted in ebay for me. Clearly PayPal sees Google Checkout as a rival - that’s enough for me.

Thank god! The PayPal experience leaves much to be desired. I love it how they try to trick you into using a bank transfer or a cash advance from your credit card instead of the usual (free) credit card payment.

They also launched Askville too: http://askville.amazon.com/askville/Index.do

Thank you! I don’t particularly care for PayPal, and Google’s been a huge disappointment.

-Chris

This is a much bigger competitor to Paypal than Google checkout will ever be.

they are not competing. they are looking to save money.

Strong competition is always good for the business and the services that are being offered. Amazon will kick some paypal … for sure

“PayPal also offers an integrated solution that allows users to remain on the original ecommerce site, an attractive feature for larger partners.”

Sounds better than it is. Paypal *requires* you to also offer the customer the ability to pay with “normal” Paypal, e.g. being transferred to Paypal’s site and doing it that way. Which totally sucks and ruins any advantages to be gained by being able to do real credit card billing.

That aside, we use Paypal at Clicky and we’re relatively happy with it. It limits our flexibility in some regards but its ease of integration makes up for that.

We would move to Google Checkout in a flash if they offered subscription support or some way to do recurring billing. I’ve emailed them about it several times and they just apologize for not having it but give no indication if they will ever support it. I think they’re dumb not to… I don’t hate Paypal, but I know that most people do, and Google could take a LOT of business from Paypal if they offered subscription support.

Amazon has very good buyer base and good reputation so possibly they will create very strong competition, I think they can beat paypal in future.

If Amazon follows the s3, ec2, sqs model of low level apis with utility pricing, they could have a big impact.

I’m very happy to hear about this. Paypal needs more competition!

My experience with Paypal is that there is way to much chance for fraud and they are not responsive to claims of fraud.

I don’t understand why we need another online payment service. What’s wrong with Paypal and Google’s services? What would Amazon offer that those two aren’t offering already?

I run an ecommerce site and I currently offer both Google Checkout and Paypal, as well as direct payments through the Paypal Merchant Gateway. I offer as many options as possible, and let my customers choose. We sell on eBay as well as multiple channels, but all of our transactions go through our single checkout process (through Channel Advisor). In ecommerce, the more choices you offer your customers, the better off you are. The vast majority of our payments go through Paypal. We get about 5% through google checkout and the rest via direct payment or even offline payments (money orders/checks). I usually add any new payment method that is safe and integrated with our software. If one customer uses it a month, thats one extra sale I probably wouldn’t have without it. I agree competition is good, but the winner will ultimately be determined by BUYERS choice not seller preference.

heard about this awhile back & have been waiting to see the product… could be a very big step for Amazon.

as noted above, this is a significant development & competition in the payments space… not because of the technology per se, but because there are already tens of millions of customers with Amazon accounts who have entered payment info & are comfortable using the service.

while Google is likely a long-term threat to PayPal / eBay due to pricing competition & other services they offer to merchants (CPC & CPA advertising is strong incentive), Google Checkout hasn’t made a ton of progress in gaining market share in the past year, and is still working on building brand recognition with customers as a payment option.

however, with Amazon’s customer footprint already huge due to their own online marketplace, the potential for competitive disruption here is notable. they can immediately bring comfort & familiarity & recognizable brand & millions of users to the table, and enable 3rd-party services to have a legitimate alternative to PayPal.

remains to be seen if they can take market share away, but this is potentially some real competition for PayPal. will be interesting to see what happens…

- dave mcclure

(disclosure: i used to work at PayPal from 2001-2004)

For users, the more payment providers, the more options and more chance to choose the best one. Why not amazon?

Rajesh Shakya
http://www.rajeshshakya.com
Helping technopreneurs to excel and lead their life!

Geez…when is Google going to just buy Amazon?

Just what we need, another payment option. Once it’s launched, though, I give a year or so and we’ll start seeing some consolidation in that market.

Ecommerce sites will definitely have to start accepting the Amazon payment system as well if they’re going to continue to compete.

I have found that merchants using paypal tend to provide a lessor quality check out service than merchants using google check out. Many times I have to unnecessarily enter my name and shipping address, and then be diverted to paypal which already has my name and shipping. One time paypal wouldn’t allow me to add and use a shipping address separate from my home/billing address. Several times the return from paypal back to the merchants page failed, leaving me wondering whether the transactions succeeded.

I look forward to Amazon’s entry into the market. More options that may allow me to avoid using paypal.

Does anyone know if this will be available to Canada?

billmelater is the most threatened here. they had this niche to themselves. agree paypal a nothing with merchants until they recost.

cool - how about one-click transfer to gold/euros for storage..

I have an Amazon account and if this service was integrated directly into my account I wouldn’t hesitate to purchase things with it. I actually prefer to use GCO when available over paypal but generally end up using paypal as I tend to have money sent to me it that form and therefore need to spend those funds.

Hopefully this will spur some innovation.

Thank god. Maybe we can have a reliable, quality payment service for once.

Great! More competition in a market that has delivered outsized returns. PayPal generates something like 3.2% net income off of every transaction (all in, including their credit products, currency transfers, etc). That’s a higher margin than Capital One or MBNA.

Now with three players in the online payments space (more if you count Chase Paymentech and their ilk), perhaps we’ll start seeing some innovative price wars: cash back to buyers, reward points, cash back to sellers, etc.

It’s about time.

What took Amazon so long? They have been collecting cash donations for non-profits for well over a year now.

good luck with that Amazon; PayPal will kick your ass just like they’ve done to every other competitor. payments is not an easy thing to do successfully, as google checkout has discovered. the only reason Amazon doesn’t accept PayPal payments is because Jeff Bezos is too big of an egomaniac to work with Meg Whitman. one time he was asked what it would take for Amazon to accept PayPal; he responded “there is nothing that can be done”. Way to burn bridges!

does paypal actually get 3.2%? Don’t they work with one of the big companies? Meaning they pay something like 2.5% for a merchant account?

Andrew — they charge between 1.9% to 2.6% for a merchant account — however, they also make money by charging 2% for currency conversion, 18% for credit, 2.2% for using a virtual MasterCard attached to your account, a flat monthly fee to merchants for use of their API’s, the interest they earn off of holding your money, etc.

According to Ebay’s 10K, PayPal earned 3.2% on Gross Transaction Volume (payments made between people or companies using PayPal).

@bdb: just to clarify: PayPal can operate in both of these capacities:
1) for small merchants: a credit card payment processor for visa/mv/amex/discover, as well as PayPal balance & debit card / bank txfr (if the customer has an attached bank acct), *AND ALSO*
2) for both large & small merchants: as an alternative “5th” payment mark, as an adjunct to other merchant processing systems.

(and in fact, can also operate as a low-end shopping cart, subscription / recurring payment provider, donations, invoicing, and several other features most people don’t know about — however the two listed above are the primary use cases, both on & off the eBay marketplace).

in the 2nd case note above, PayPal occasionally competes with traditional credit card processors, however more often than not PayPal is used in the 1st case, and in general has helped create more market opportunity for card processors than they take away.

PayPal *DOES* compete with traditional merchant account (and in fact, PayPal acquired a traditional payment processor subsidiary from Verisign in 2005), and Google Checkout also competes in this space.

While it’s unclear to me if Amazon will compete in both areas with their new offering, i think it’s likely they will. i could be mistaken, but i guess we’ll find out in a few days.

- dave mcclure
http://500hats.typepad.com/

PayPal makes money on funding mix. They make money when customers use bank accounts to fund transactions rather than with credit cards. They are not allowed to–and do not –earn interest on stored funds (hence the money market account, still one of the top performing funds, if I’m not mistaken). To earn interest on stored funds, PP would have to be a bank, which they most decidedly are not.

PP does charge fees on top of the base rate for things like currency conversion, but far less than the interchange charged small merchants by Visa, MC et al.

When most ecommerce merchants do the math, they discover that they pay up to 5-10% of sales in interchange and fees and paypal rarely comes above 3% all in. That’s why PP is everywhere and let’s just say that others are…not.

AMZN is trying to see if they can do the same thing, become vertically integrated if you will, at least on their own platform, that will help their gross margins.

In the end though, merchants ultimately want to own the customer data in a conversion, not turn that over to a 3rd party. That’s a big flaw in these services like Google checkout and now Amazon payments. PP allows merchants to return customers to their site and for them to know who bought from them. A person can checkout from google and the merchant will have no idea who actually did the transaction, just a shipping address. No way to email that person and have them buy more stuff. Yuck!

Dave is right though, AMZN is already a trusted name with an existing customer base of payment information (one click, anyone?). Will be interesting to see how it all plays out. As someone else here said, buyers determine success of the payments space, not merchants.

This is great news - more competition in this field, it has all be died out after the first crash - but with Google, eBay, and Amazon all trying to play king of the hill - things should get good - and hopefully transaction fees will decrease.

And here it was…
The announcement could be seen in the RSS feed, but following the link gives you only a “document not found”. Seems the announcment has been postponed.

Screenshot: http://aycu40.webshots.com/ima.....126_rs.jpg

Will eBay allow payments with this new Amazon payment service or will they deny them on the basis of “not having a long enough track record of commercial activity”?

a) Hi David Kaspar,

As somebody pointed out earlier, eBay does not allow Google Checkout. So, don’t expect they will accept Amazon payment system. It’s clear - every big shop wants their own payment system to reduce costs.

b) Paypal needs more competetion - in fact, not just Google Checkout and Amazon services - we need at least another 5 or 6 services for the so huge internet market.

>> A person can checkout from google and the merchant will have no idea who actually did the transaction, just a shipping address. No way to email that person and have them buy more stuff. Yuck!

I am not sure how Google Checkout works - because I do not trust Google for more than one reason. But if the above statement by Melinda is correct regarding Google Checkuout, yes, it’s really stupid. Actually the customer is mine - and the customer data should be with me - it’s not a property of Google Checkout. This is another reason I don’t like Google and their one-sided policies.

Perswonally I believe that merchant acceptance is the key to launching a successful new Internet payment service - and Google (so far) has failed to acquire a critical mass of large online merchants supporting it.

I rather believe in PayPal’s new virtual credit card service or smaller upstarts like Wirecard combining the best of ewallets (instant signup, various loading options, P2P,…) with the universal acceptance of virtual credit cards.

Large merchants like airlines, major retailers or hotels will not integrate any fancy new Internet payment service (even if it’s from Amazon) but rather stick with what they know - credit cards.

Amazon payments rocks:-)

Looks like they are out.
aws.amazon.com.

Seems to pretty powerful than what the story mentions. Cool. Good competions.

(typos corrected)

Looks like they are out.
aws.amazon.com.

Seems to be pretty powerful than what the story mentions.
Cool. Good competition.

http://beyondwork.wordpress.co.....t-service/

Call me when any of the three (PayPal, Google Checkout, Amazon Payments) offer support for the *API* to charge a credit card in any country (e.g. stay on merchant website, call WS API to charge card).

Support for that is spotty at best, and at any level greater than niche, supporting international customers is important.

So Amazon Flexible Payments Service (Amazon FPS) has arrived. I think it looks great. I’m a big fan and user of S3. Cost effective and reliable. I only hope they roll out extended international support for FPS (bank transfers, remove extra 1% transaction fee, allow GBP and Euro). Another addition could be quickstart versions of their services for small business, because it really does take a developer to get their head around these services.

It truns out the service is more fundamental than you thought: it allows otehr developers to build paypal and checkout. And it includes micropayments. See Amazon CTO’s weblog

Hey, Aaron from FreshBooks here. Just wanted to pop my head in and point to our blog post on our integration efforts with Amazon FPS so far. We’re definitely a unique case, in that we’re a Canadian company integrating with a U.S.-only service, but with about 60% of our users down in the States it’s absolutely worth it to provide this service to them.

It’s been an interesting experience so far! Our insights, and a little technical info, can be found here:

http://www.freshbooks.com/blog.....t-service/

I think this thing’s going to be big. Regardless of whether PayPal or Google Checkout are true competitors, this is clearly an attempt to take on both of them. It looks to be a very strong effort, too.

I agree with nexusprime. FPS looks like it offers great flexibility in how payments are structured, but mandates that transactions flow through the “cobranded UI pipeline”:

http://developer.amazonwebserv.....p;tstart=0

With that restriction, it’s an incremental improvement at best from PayPal and Google Checkout.

I read about a new, direct Paypal competitor called Pmints launching this fall. They’re based in Virginia and keying in on alternative merchants. http://www.pmints.com