Amazon FPS: another US-only payments service

Post ImageAmazon launched another web service on Friday, called the Amazon Flexible Payments Service (FPS). The interesting thing about the launch is that Jeff Barr was teasing everyone on Twitter, building up the anticipation. I was eagerly watching for updates! I wish more product launches happened in a similar fashion.

Anyway, here is how Jeff described FPS:

We’ve taken all that we know about dealing with credit cards, bank accounts, fraud checking and customer service and wrapped it all up into one convenient package.

In much the same way that S3 and EC2 allow developers to forget about leasing space in data centers, buying servers and negotiating for bandwidth, FPS shields developers from many of the messy and complex issues which arise when dealing with money. Once again, we take care of the “muck” and developers get to focus on being innovative and creative.

As you know, I love S3. It shouldn’t be much of a surprise then when I say that FPS gets me really, really excited. I haven’t looked at it too closely, but even a quick glance suggests that FPS is amazing. PayPal is the giant of the payments space, but they badly need some competition. Unfortunately, no one seems prepared to provide it. No, not even FPS.

The problem is geography. There’s competition for US merchants, but everyone else is left out in the cold. Just like Google Checkout, FPS has launched with support limited to companies in the US (though buyers can be anywhere…and Google has since added UK merchant support but that’s it). There are certainly a lot of Internet users in the United States, but they still make up less than a quarter of the world total, and that percentage drops every day. There is a ton of e-commerce taking place outside the US.

PayPal is supported in over 190 countries and regions. There are 14 countries that PayPal describes as “localized” and another 21 that support withdrawals to local bank accounts. For merchants in 34 of these countries (ignoring the US), Google Checkout and Amazon FPS simply are not options. PayPal is the only viable choice.

And don’t get me wrong, I quite like PayPal, but there are definitely things that need to be improved. The FPS feature set addresses a wide range of these issues (such as support for micro-payments). But Amazon FPS and Google Checkout will simply not beat PayPal until they are supported just as widely around the world. Maybe they don’t want to take on PayPal, you say? Bullshit, I reply. PayPal is the target, even if Amazon and Google will only admit that behind closed doors.

I would suggest there are only five companies that could build a payment system to rival PayPal. The first two are eBay and Amazon, the giants of e-commerce. eBay owns PayPal, and Amazon now has FPS. The other three are the usual suspects: Google, Yahoo, and Microsoft. Google has Checkout, and Yahoo seems to be fine with PayPal. That leaves Microsoft. A small part of me is hopeful for a wicked payments service as part of Windows Live Core, but Microsoft’s track record with launching worldwide services isn’t so great either.

Will there ever be a viable, worldwide competitor to PayPal? I hope so, but I’m not holding my breath.

Read: Amazon FPS

No GBuy Yet

Post ImageLike a lot of other bloggers (at least I’m assuming I’m not alone here) I have been waiting patiently today, for any sign of Google’s long-rumored “GBuy” service. A report was published a couple weeks ago by Forbes, that said today would likely be the day Google would launch the service.

According to bloggingstocks, eBay, who would feel the largest effects of a GBuy service, was doing better today:

So after eBay hit a 52-week low yesterday, mainly on fears of up and coming competition from Google, investors had time to cool off and rethink the ramifications of this play. EBay stock gained back 50 cents (1.77%) to close at $28.75.

And according to the Search Engine Roundtable blog, quite a few people would switch to GBuy if it was ever launched:

Currently we have over 38% saying they will switch, only 19% saying they will not and 42% saying they just don’t know. Why would someone switch without seeing it first? Well, it is Google.

I just want to see if it’s anything like PayPal, which I quite like.

Maybe it will come late tonight. Or maybe it won’t come at all?

UPDATE: I knew I wasn’t the only one waiting!

UPDATE 2: Looks like we’ll see Google Checkout on Thursday. The service doesn’t seem to be available yet, so I’ll reserve further comment until later.

Yahoo hearts PayPal

Post ImageIn a deal announced earlier today, Yahoo and eBay are teaming up around advertising, e-commerce, and search. Yahoo becomes the exclusive provider of graphical ads on eBay, and will also provide some text ads. They are going to make a co-branded toolbar, and they’ll work to make their respective VoIP apps work together (Yahoo Messenger and Skype). The biggest thing of all though, at least as far as I am concerned, is Yahoo’s adoption of PayPal:

Yahoo will make eBay’s PayPal service the exclusive third-party provider of its online wallet, allowing customers to pay for Yahoo services from bank accounts, credit cards or balances associated with their PayPal accounts. PayPal will also be integrated into product offerings for Yahoo merchants and publishers, including the Yahoo Publisher Network, Yahoo Search Marketing and Yahoo Merchant Solutions.

Yahoo using PayPal essentially removes any doubt that PayPal is the de facto payment service on the Internet. It will be very hard for Google to successfully introduce a competitor now. Two of the largest sites on the net in Yahoo and eBay, plus the millions of other smaller e-commerce sites all using PayPal is an enormous hurdle for any rival payment service. PayPal is the closest thing we have to a truly digital wallet. Incredibly smart move by Yahoo, and excellent outcome for eBay.

Read: CNET News.com

Google Wallet?

Post ImageThis is another one of those rumors that just will not die. I wonder if it’s going to turn out to be true, just like Google Talk was. Here’s the latest evidence to suggest that Google might be entering the online payment business:

Gary spotted a job opening (and here) for a “Fraud Operations Director, Merchant Payment Solutions” position at Google. Google already has people that look into click fraud issues with ads, so this seems like something different. We know that Google’s working on some type of payment system that’s apparently been dubbed Google Wallet. Perhaps this job is related to that? And is the system a rival to PayPal? No, said Google earlier this year.

Unlike Google Talk, I am eagerly awaiting Google’s payment system (if it really does exist). PayPal is far and away the best service available, and is incredibly entrenched, so I’d be interested to see what Google can bring to the table. And no, I don’t think anyone who currently supports PayPal would jump ship to Google Wallet – more likely, they’d support both.

Read: John Battelle