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Google to Test PayPal Rival 268

Posted by Zonk
from the i'll-gbuy-that-for-a-dollar dept.
Carl Bialik from WSJ writes "Google is set to introduce a test version of its GBuy online-payment service as early as this week, presaging a shake-up in the online-payments market now dominated by eBay's PayPal, the Wall Street Journal reports. From the article: '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.'"
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Google to Test PayPal Rival

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  • by tpjunkie (911544) on Tuesday June 27, 2006 @11:06AM (#15612771) Journal
    but seriously, don't you think they've begun to seriously overextend themselves, as well as take on a sort of microsoft-borg-ish nature, assimilating anything and everything it encounters?
  • by FatSean (18753) on Tuesday June 27, 2006 @11:06AM (#15612772) Homepage Journal
    After hearing stories about people having their funds frozen with no legal means to get it back, I decided I didn't want anything to do with PayPal. I didn't miss eBay one bit, but I used to buy parts on web boards, and everyone there used PayPal.

    I hope GBuy will be less evil, and that it will catch on so I can buy used PC and car parts from forum members again.
    • GBuy *will* be less evil. It's hard to be more evil than PayPal, and we're talking about a company who believes in not evil.
      • GBuy *will* be less evil.

        I don't think you can enter the payment market without upsetting some percent of the customers. Put yourself in Paypal's shoes: you've got a huge number of he-said-she-said arguments over amounts of money small enough not to warrant an investigation, but big enough to infuriate people. As the arbiter of payment, you could try to be nice and absorb the losses as a cost of doing business, but that would quickly become a free-for-all. It's sort of like the insurance industry, wher

    • I actually haven't had any problems with PayPal. The one time they froze my account it was because I'd made an unusually large purchase with my PayPal debit card, and they froze it just in case my card had been stolen. One five-minute phone call later, and everything was back to normal. I give them a little slack on the security front; they're doing their damndest to be reliable and secure, and a lot of the horror stories I've heard have been overexaggerated.
      • by i.r.id10t (595143) on Tuesday June 27, 2006 @11:19AM (#15612866)
        Don't try to accept or send payment for *anything* firearm related with paypal. Quick way to get your account frozen with no recourse...
        • by 512k (125874) on Tuesday June 27, 2006 @12:27PM (#15613370)
          you can't use paypal to buy porn either. (it's part of their user agreement, there's an article online somewhere that claims, that this was a compromise with the govt. If paypal couldn't be used for 'morally offensive purposes' then the govt. wouldn't come down on paypal acting similar to a bank, but not following all the laws banks have to follow )

          and last year, during the Xbox360 shortage, and people were postings 360 scams on ebay, left and right. Paypal was freezing first, asking questions later, for people selling 360s. Unfortunatly, the general public probably approves of this, judging by the number of people who paid $600 for an Xbox that never arrived, and were demanding more oversight from ebay.
    • by Duncan3 (10537) on Tuesday June 27, 2006 @11:13AM (#15612822) Homepage
      Considering the insane rates they charge for ads, I'm sure their fees will be just as "evil" as PayPals. And that's all merchants _should_ really care about.

      Oh, and the fact that if you DON'T pay Google, you'll get zero visitors. Becasue of course, ads and fake sites are the first 3 pages.

      All hail our search Mafia overlords.
    • by Dannon (142147) on Tuesday June 27, 2006 @12:18PM (#15613277) Journal
      The "evil-ness" of PayPal is mostly in terms of eBay and PayPal turning a blind eye to the fraud others have committed using their web site. On the one hand, they say that they're just "establishing a marketplace", and what goes on in that marketplace is up to the merchants and customers.

      On the other hand, let's say I set up a flea market on my land. I need to lay down at least some basic rules, both to protect the customers and the merchants, and above all my own reputation. Even if the owner isn't doing any fraud himself, who wants to visit a flea market that's ridden with pickpockets?

      The major factor that switched me over to online bill-pay from checks-and-stamps was learning that my bill-pay service would agree to go to bat for me in case of any issues. Just having someone agree in a contract to stand in my corner is a powerful incentive to trust.

      Right now, you've got to jump through way too many hoops with eBay to convince them that a fraud has actually happened before they'll even consider opening up an investigation. If GBuy takes a more customer-oriented approach, I see two results:
      1) Success for GBuy, as the demand for a safe online marketplace shifts their way
      2) Fiscal pressure for eBay to actually deal with the issue, or lose their customer base. In its own way, I'd say this is probably better pressure than any lawsuit threats, or outcries from consumer protection experts.

      If they're more concerned with covering their own butts than covering their customers, it'll be just the same old same old. If, on the other hand, they put time and energy into protecting their customers, they'll find themselves pretty well protected.
  • Again?? (Score:5, Insightful)

    by tygerstripes (832644) on Tuesday June 27, 2006 @11:07AM (#15612782)
    I for one welcome my...

    Jeez, is there anything these guys won't get there fingers in? Don't get me wrong, I like what they've done so far, but is it possible for a company to expand beyond a certain critical mass and still stick to the operating principle "Don't Be Evil"?

    I just hope the Geegees aren't going to turn nasty and suddenly warrant a big anti-monopoly order or somesuch. I just couldn't take the smug look on Bill's face...
    • Re:Again?? (Score:5, Insightful)

      by Atzanteol (99067) on Tuesday June 27, 2006 @11:12AM (#15612819) Homepage
      I don't think you really know what 'evil' and 'monopoly' mean. Near as I can tell you seem to think they both mean 'large coporation'...
    • Re:Again?? (Score:5, Insightful)

      by linvir (970218) * on Tuesday June 27, 2006 @11:16AM (#15612852)

      The problem is that as Google grows and grows off the back of low-key ads and simplicity, the rest of the industry isn't taking the hint. So Google is pretty much alone in filling this gap in each area of the web.

      Don't worry though. If they really start to take over, the bean counters will catch on, and companies might actually start to compete with Google on their terms. I think this might have already happened at Yahoo, but even then most of of that page is taken up by an irrelevant photo [yahoo.com].

    • Re:Again?? (Score:2, Interesting)

      by TopShelf (92521)
      Frankly, I think the whole "Don't Be Evil" line was made for those still stuck with the heart and mind of a 12 year-old. They're a big-time corporation now, and they're acting like one - pursuing potentially profitable opportunities wherever they can find them. If they can extend their trademark minimalist design and user interface to the payments realm, they may well strike gold here.
      • How is *any* of what you said "evil?" You slashdotters are starting to remind me of the old Pit of Ultimate Darkness [youtube.com] skit on the Kids in the Hall...

        Google made money... Evil!

        Google is expanding their business... Evil!

        Google returned unfavorable search results for my name... Evil!

        • How is *any* of what you said "evil?"

          It's not. That was my point.
          • Oh, okay. I recind my 'attitude' then. :-)

            This place is becoming a big "7 degrees from evil" game against Google lately... Google made a web-site, which became popular, on which they sold ads, which make them money, money can buy guns, guns kill people, killing is evil!
    • Re:Again?? (Score:4, Interesting)

      by vertinox (846076) on Tuesday June 27, 2006 @11:38AM (#15612988)
      Don't get me wrong, I like what they've done so far, but is it possible for a company to expand beyond a certain critical mass and still stick to the operating principle "Don't Be Evil"?

      Well, depends... Do you believe the average human is good or evil? And does a good person have what it takes to recognize evil when he sees it? And if people at Google are above average and already good, can they continue to hire and be able to only hire "good" people.

      I just hope the Geegees aren't going to turn nasty and suddenly warrant a big anti-monopoly order or somesuch. I just couldn't take the smug look on Bill's face...

      I doubt it would be smug because if anyone gets taken to court over monopoly issues it means Microsoft is fair game or that Microsoft is no longer a monopoly (aka moot point).
      • Do you believe the average human is good or evil?

        Neither. The average human is selfish, and self-interested. "Good" people are often ones who have been trained to achieve satisfaction and gratification by being less selfish, and "Bad" ones are often people who do nothing but indulge in their selfishness -- but I don't think that there's a direct correlation. If you get your jollies by helping old ladies across the street, and you spend all of your time indulging this fetish, then I'd be reluctant to c

    • ah bollocks (Score:3, Insightful)

      by Colin Smith (2679)
      look, competition is good. Who else is going to go up against ebay and paypal, and it isn't as if you can't use a different search engine/webmail/whatever. You never know, someone may come up with a search engine which classifies and ranks results for the individual by some other bayesian/statistical/AI algorithm which turns out to be way better than Google.

       
    • Besides what people have written about Google, the only place I can find anything where they specifically state their stance on "evil" is number 6 in their list of http://www.google.com/corporate/tenthings.html [slashdot.org]">10 things that describe their philosophy. In it, they seem to narrow down on a specific kind of evil: pop-up ads and other annoyances in web advertising. Can someone point me to an interview or other direct source where "don't be evil" has broader implications?
    • Jeez, is there anything these guys won't get there fingers in? Don't get me wrong, I like what they've done so far, but is it possible for a company to expand beyond a certain critical mass and still stick to the operating principle "Don't Be Evil"?

      Maaaan, just put your bets, buy pop-corns and watch the fight...
    • Re:Again?? (Score:3, Informative)

      by asuffield (111848)
      Don't get me wrong, I like what they've done so far, but is it possible for a company to expand beyond a certain critical mass and still stick to the operating principle "Don't Be Evil"?

      There's two things you need to realise. The first is that "Don't be evil" was coined as a short way to sum up stuff like "don't fuck the interns" and "don't file fraudulent accounts", it doesn't mean "work in the best interest of the customer". You can find a commentary on how it came to exist here: http://en.wikipedia.org/ [wikipedia.org]
  • Good (Score:5, Interesting)

    by p0tat03 (985078) on Tuesday June 27, 2006 @11:09AM (#15612800)
    I run a web store on the side, and if GBuy can come up with the same type of merchant rates that PayPal can, I'm completely sold. I've never been screwed by PayPal (yet), but I've heard the horror stories.
    • Re:Good (Score:3, Insightful)

      Hit the nail right on the head. Everyone uses paypal because there's no alternative and the potential for profit is worth the risk. If Google can equal them merely in fees, the acceptance will follow. And even with all the Google "sometimes do evil" stories, they're still infinitely more trustworthy than paypal.
    • Oddly, according to the article, Google plans on charging more then PayPal. I don't really see an advantage to switching to Google, unless you just HATE PayPal... but Google seems to have equally crappy customer service.
  • by Skal Tura (595728) * on Tuesday June 27, 2006 @11:10AM (#15612801) Homepage
    As some of you know, this is perfect for what they are just testing: commissions advertising (aka affiliate stuff).

    This would nicely prevent frauds, as the payments will go thru google, a advertiser cannor report 0 sales even if sales was made. This would remove one cheating possibility, where as AdSense currently is plagued with click fraud, there won't be such a problem with this type of advertising.
  • by Cleon (471197) <cleon42 AT yahoo DOT com> on Tuesday June 27, 2006 @11:10AM (#15612802) Homepage
    As it stands now, the service seems more of a communal shopping cart than an actual payment system. That might be all well and good for certain sites, but the beauty of PayPal is its flexibility; for all intents and purposes, PayPal is a quick n' easy substitute for an online point-of-sale system. You can pretty much customize it for your individual needs. You don't need to use PayPal's shopping cart, you can use a different one (or even develop your own).

    I can see this fitting in well with their AdWords/AdSense system, but beyond that I don't see this as significant competition for PayPal.
    • I can see this fitting in well with their AdWords/AdSense system
      Exactly. Now we know how google can trust advertizer reports of sales when paying per sale rather than per click - they have to use google's shopping cart system.
  • by zegebbers (751020) on Tuesday June 27, 2006 @11:13AM (#15612823) Homepage
    We already have G'day, now we'll have Gbuy.

    Thanks, I'll be here all week, try the veal!

  • Google Micropayments (Score:5, Interesting)

    by sweetnjguy29 (880256) on Tuesday June 27, 2006 @11:14AM (#15612832) Journal
    If Gbuy would support micropayments, that would be groundbreaking! I have plenty of stuff to sell in the $1 range, but no economical way to do it!

    The other big question would be whether Ebay will allow people to pay with Gbuy!
    • I have plenty of stuff to sell in the $1 range

      Are you the guy that puts all those $0.01 items on eBay?

      The other big question would be whether Ebay will allow people to pay with Gbuy!

      This question will be vital in the Gbuy / Paypal war ... if Google can tap this market share ... I predict they'll be the #1 payment service within a year after.
    • by 14erCleaner (745600) <FourteenerCleaner@yahoo.com> on Tuesday June 27, 2006 @11:38AM (#15612992) Homepage Journal
      The other big question would be whether Ebay will allow people to pay with Gbuy!

      No, but Gbay will.

    • The other big question would be whether Ebay will allow people to pay with Gbuy!


      eBay owns PayPal. So, no.

      But Google Auctions will. Remember, you heard it here first.
    • Yes, but it won't be a built in function.

      Western Union's AuctionPay service is allowed as is any other payment method that the seller is willing to accept.

      I don't use PayPal anymore. I lost my account info, and PayPal want's $20 to allow me to associate my accounts with a new PayPal account.
    • How can they really stop them? I've stopped using PayPal since they screwed me over this past January, after using it for many years. I've found both BidPay and USPS money orders, neither of which are eBay services, to work fine. If a seller doesn't accept one of them, I don't bid on their item. It's pretty simple. I'd gladly use Google's payment service if the transaction terms are better than PayPal's.
  • competition is good! (Score:5, Interesting)

    by TheGratefulNet (143330) on Tuesday June 27, 2006 @11:15AM (#15612847)
    I have been WAITING eagerly for a real competitor to paypal. the amount of guff you have to put up with from the paypal corp is just too much! and the ONLY reason they get away with it is because there is no competition.

    my last horror story re: paypal was when I bought an online ebay item and there was no option to have shipping done (from this vendor) with insurance. the item was mailed 'media mail' which is UNCONFIRMED. the PO considers it confirmed delivery but the postman HIMSELF signs the delivery receipt! what good is that?? so my mailmain supposedly delivered it and signed for it himself. of course I never got the pkg.

    I emailed the seller and no reply. he had 'confirmation' from the PO and so ignored me. I filed a case with the PO but they didn't really care (obviously). I tried calling paypal (emailing them, first) and they kept saying 'it was delivered so your claim is rejected'.

    problem was: there was NO HUMAN looking at this so-called delivery receipt. the date was wrong (it was the wrong DECADE, too - what a blunder in their database!) and there was no signature online to prove it really did get delivered. it was a losing battle to explain this to them. they didn't care. they are on the side of the 'power sellers' and they know where their money is earned ;(

    if they think they can accept delivery confirmations that say "1900" as the year and then close my case, well, I hope they get some cosmic justice for all the scams and abuse from their customers. I hope google eats them alive.

    the more powerful google gets, the more I do worry; but paypal needs to have some humble pie fed to them. its about time.
    • I don't beleive the post office can ignore you here.

      Seriously, why don't mailmen simply take any package that's not insured, then, and blatantly defend the act? "You didn't insure it so I have no responsibility".
      • by Tx (96709)

        Seriously, why don't mailmen simply take any package that's not insured, then, and blatantly defend the act? "You didn't insure it so I have no responsibility".

        Because that would be theft, and they'd go to jail. However if they take it and deny all knowledge, good luck getting anyone to look into it. That's the case here in the UK, at least. There was a mailman near where I live, he wasn't even stealing mail, just dumping it instead of delivering it. He got away with that for several months, until someone a

    • since the post office says it was delivered, you're not going to get your money back from the post office. They'll just say that you're trying to defraud them. They consider insurance, another source of revenue, and boast about how low their payout rates are.

      And media mail, 1st class, parcel post, and priority mail don't have built in delivery confirmation, it's an extra service ($.60 for buying it in store, or $.15 buying it online) Signature confirmation is an extra service also, and it costs something li
    • How is failed delivery PayPal's responsibility? The buyer and seller appear to have held up their end of the agreement, which is where PayPal's responsibility ends. What on Earth do you expect them to do, call the Post Office for you and hound them until they find your book? Give you your money back on an item that was shipped uninsured? It sucks to lose stuff in the mail, but you take that risk whenever you ship without insurance.
    • My mail was delivered, but by delivered I mean dumped on my doorstep without notification. There was somebody home, but nobody noticed the package until I got home several hours after delivery. So here we are, with several hundred dollars worth of electronics just sitting on the freakin' porch waiting to be stolen (though luckily I live in a good neighbourhood)

      Sorry, but delivery means that I received the item. Dropping it on the porch doesn't count, and buyers should be wary of this. I believe the shippe
    • Whoa whoa, whereas I totally agree with your statement... what the ... is this:

      and they know where their money is earned ;(

      You can't frown and wink at the same time! Try it... that's crazy.
  • free as in beer (Score:5, Interesting)

    by Douglas Simmons (628988) * on Tuesday June 27, 2006 @11:18AM (#15612864) Homepage
    Google could snatch the market from paypal if they offered this service in the same manner they offer all their other services and goodies: for free. They'd benefit from this in the same way, good branding and promotion of their search engine which would ultimately trickle down into advertising profits. Also, Wall Street regards eBay and friends as a threat to Google, so hurting companies like paypal could increase shareholder wealth, possibly enough to offset the cost of handing this service out for free.
    • Re:free as in beer (Score:3, Informative)

      by Overzeetop (214511)
      But somebody has to pay the Visa/MC/Amex/Discover cartels their percentage. How else do you think they give you x% back? Right out of the merchants' pockets.

      No, there will still be fees. Now, if google can figure out how to reduce/eliminate the fixed fee portion and/or enable micropayments, paypal is going to have to make some moves to keep thier userbase. Of course, if google could wheedle their way out of the "perks" in your CC, (you know - 3% back at company stores, 1% everywhere else except gpay, no ben
    • They'd benefit from this in the same way, good branding and promotion of their search engine which would ultimately trickle down into advertising profits.

      Don't forget what a great big database they could build of your purchasing habits - perfect for targetted advertising which is Google's forte.
  • I just wonder... (Score:5, Interesting)

    by Vo0k (760020) on Tuesday June 27, 2006 @11:19AM (#15612872) Journal
    Will they enter Poland? Or other countries where Paypal does half-assed attempts to do enter, but doesn't really dare?

    I mean, currently there's no way I could sell stuff from Poland to other countries. The item mailing fee is okay. But any payments from outside, no matter how small, are associated with money transfer fee like $40-60. Or $200 if you pay when you get the item. Nobody's gonna buy $10 item and pat $60 for sending the $10 to me. They could send it in envelope... almost assuring some bastard in the polish mail service stealing it. Or they could send me some gift I don't need instead.

    Paypal is present in Poland, of course. But it works one-way. I can pay through Paypal, but I can't receive money. I really hope Google kicks in and I finally can sell stuff outside Poland.
  • by creimer (824291) on Tuesday June 27, 2006 @11:24AM (#15612907) Homepage
    The only nice thing to say about Google is that the backend security software should be "beta". Unlike a lot of real financial service providers who backend sercurity is "non-sxistent" (i.e., unencrypted backup hard drives lost in transit).
  • by fahrbot-bot (874524) on Tuesday June 27, 2006 @11:33AM (#15612957)
    Google already tracks our searching and email, now they'll track our spending habits and how much we pay for various items. Paranoid? Maybe, but how long will it be until we find that Google is maintaining a database of this sort of thing?

    On the earth, all your lives belong to Google...

  • by tlhIngan (30335) <(ten.frow) (ta) (todhsals)> on Tuesday June 27, 2006 @11:33AM (#15612958)
    Considering that eBay more or less has Paypal integrated into it? And where I suspect a large majority of Paypal transactions take place is to satisfy eBay transactions? While I've done a few non-eBay-related Paypal transactions, they are very few. I've used more online stores that took my credit card directly than Paypal (and a few of those stores offered Paypal - I paid Visa).

    GBuy sounds like it'll be a rival for Amazon zShops and other style system, except less centralized.

  • I'm going to create my own currency to compete with the US dollar.

    Seriously, competition is good and all, but why? It's success hinges on EVERYONE using it, and EVERYONE already uses Paypal. Even if it's just a little better, is it worth the trouble of switching? Methinks it would have to be revolutionary to replace an existing system, and even then, I'm banking on a lot of laziness and "if it ain't broke, don't fix it" type of mentalities.
    • Gold, it's the obvious choice.

      http://www.mises.org/money.asp [mises.org]

      Money, like everything else is a commodity, you trade for it in exactly the same way you do everything else.

      The only real reason that the government mandates that it holds a monopoly on money is so that it can print more itself to pay for stuff it hasn't taxed you on already. It prints more money, buys goods and services with it, the overall supply of money increases and the value of an individual dollar decreases, your bank balance loses worth jus
  • by damburger (981828) on Tuesday June 27, 2006 @11:37AM (#15612981)
    Google are to release 'GOxygen' to rival breathing.

    I remember when Google just did a great search engine.
    • Yes, but they have created a lot of other great tools as well. Google Earth, Maps, Gmail, etc. They weren't the first to do any of these (searching included) but they certainly did a good job on them. Is it against the rules now to do more than one thing well?
  • PayPal is an excellent thing, but it's very sadly limited in the number of countries they support. Looking at https://www.paypal.com/cgi-bin/webscr?cmd=_display -approved-signup-countries-outside [paypal.com] theres only 27 countries fully supported. The rest are supported in some crippled way or not at all (like, sadly, my country).

    Google could make a real boom if it supported more countries and made itself a more diverse market. I know it's a problem with banking and tax laws but there's money to be made with it :)

  • There's no evidence that Google has what it takes to make this work. Paypal's edge is that they understand risk management better than anyone else, so they reject fewer legitimate transactions and reject fewer fraudulent transactions. Google is good at distributed processing and search, and I don't see how they can duplicate Paypal's expertise.
  • by mlantz7 (953704) on Tuesday June 27, 2006 @12:27PM (#15613365)
    The article does discuss pricing and Google's strategy here. Pretty smart if you ask me...

        "Google plans to charge merchants a 2.2% commission on a sale, plus 30 cents per transaction using its payment service...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...Merchants who spend money on Google's ad program could get the cost of payment processing through Google dropped to nothing...

        "To attract consumers, Google plans to offer an unspecified rebate to people who complete online purchases using GBuy."
  • 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.

    I'm surprised to see that they're charging a higher rate than Paypal.
  • Does this help me as a consumer? Why choose to use Google's payment service? I personally would avoid it given Google's proclivity to keep all my information forever, even if I 'delete' it. This definitely smacks of a Microsoft-esque "we have to expand at all costs" boondoggle.
  • by cliffski (65094) on Tuesday June 27, 2006 @12:56PM (#15613636) Homepage
    I sell online, and use Plimus (www.plimus.com) to take payments for my games. I have heard too many horror stories about paypal myself, and had trouble getting through to them when I needed help once.
    Ok so plimus is a complete software registration service, not just a payment provider, but there has been massive consolidation in this area, with RegNow buying up everyone except Plimus one by one. The last thing we need is for someone like Google to come swallow up the small companies in that area.
    I give it maybe a year before you cannot use adwords or adsense if your website sells through a different payment provider. Regnow already do this, they wont give you the good commission rate unless you use them exclusively. I kinda thought that was anti-competitive and maybe not even legal, but apparently not ;(
    Anyway, I digress.
    I like a free and open market with good competition. Google are welcome as a competitor, not a monopoly.

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