Google Testing AdWords GBuy System
The Wall Street Journal reports that Google is indeed testing what has been rumored for a long time: a payments system designed to allow consumers to buy things from AdWords. Called GBuy, the service will place little icons next to AdWords that are in the program, and allow searchers to buy products or services right there.
According to the Journal, Google has been recruiting online retailers to test the service, which it hopes will draw even more people to look at the ads, perhaps in search of a bargain. Users will be able to store their credit card information in Google, leaving only two items of personal information Google doesn’t have (your driver’s license and passport).
The article mostly focuses on eBay’ PayPal, which has been running an intelligence operation to discover information on Google’s service. Jeff Jordan, president of the PayPal unit, determined that Google CEO Eric Schmidt was not telling the truth when he said Google’s payments product would not compete with eBay.
According to rumors I’ve heard, although not printed in the Journal, Jordan knew Schmidt was being dishonest due to two factors: (a) Schmidt was speaking on behalf of Google, and (b) His lips were moving.
But in all seriousness, when this launches, the success of the program will be determined by the little choices that Google makes, the things that determine if retailers are comfortable with the service, and if enough customers feel safe to use it. If it does take off, given Google’s enormous audience, this could mean some very happy news in future earnings reports.
While Google Chief Executive Eric Schmidt confirmed in press accounts that the company was building a payment service, Mr. Schmidt also denied it would directly compete with PayPal. Mr. Schmidt said Google didn’t intend to offer a “person-to-person, stored-value payments system,” which many people consider a description of PayPal’s service.
Mr. Jordan says he and his team immediately “dissected the wording” of Google’s statements. He says he doesn’t believe Mr. Schmidt. In the past, Mr. Jordan says, Mr. Schmidt had denied Google would roll out a payments service, only to take it back later. “We took [the comments Mr. Schmidt made] as ‘Thou doth protest too much,’ ” says Mr. Jordan.
…
But PayPal must now contend with Google. The Mountain View, Calif., Web-search giant, which has terrified Silicon Valley with its ability to quickly create new consumer products and services, is developing a rival service called GBuy. For the last nine months, Google has recruited online retailers to test GBuy, according to one person briefed on the service. GBuy will feature an icon posted alongside the paid-search ads of merchants, which Google hopes will tempt consumers to click on the ads, says this person. GBuy will also let consumers store their credit-card information on Google.
(via WebProNews)
gpay and paypal will always be one of many options that users will have to purchase an item. Neither will ever be more than this. If I m a retailer I would want to except payment from as many sources as possible. I would not want to lock into any option that would exclude a fairly large amount of consumers. Paypal accepts credit cards as well as debit cards, and you can also use your paypal account. If Gpay is to succeed it will have to at the least mimic all of the paypal options. Once this is done what could the possible points of differentiation be?
Comment by William | February 6, 2006
The WSJ article doesn’t mention that Google has quietly rolled out their payments service already — using Google Video.
Google Video validates the user’s credit card and street address one time and stores the results in your Google Account. Subsequent purchases are handled with just two clicks - Buy and Confirm.
Feels like a payment service to me.
And when Google allows individuals to get paid for uploaded content, then we’ll also have “person-to-person” payments.
But since it only works for content delivered through Google, it’s not truly a PayPal competitor — I can’t email you a direct payment like I can through PayPal. So Schmidt’s comments are technically accurate, though he doth protest too much.
Can’t you see this working for all kinds of electronic content? Like books, journal articles, stock market newsletters, DNA sequences and other “dark web” content that’s currently locked up? As long as Google is the intermediary, making the market and delivering the content, this works nicely.
But a pure payments service that is for “person-to-person, stored value payments” and doesn’t involve Google in marketing or distribution, I don’t see this happening any time soon.
Comment by mahlon | February 6, 2006
Seems good news to add another source to monetize my efforts.
Comment by Osman | March 16, 2006
I think it will be a nice thing, if Gbuy will be more secure than PayPal, because PayPal has a lot of problems with unverifyed users, there are too many frauds through PayPal, and PayPal isn’t serious managing these frauds.
I think Google will be better, because they just collected millions of information about people, Adsense and Adwords, so they just verified million users, and I think Gbuy it will be the best and most secure payment system.
Comment by Giovanni | June 13, 2006
I have received lot of frauds and spoofs claiming that PayPal is the sender through different emails I am using. I agree with this point, but I returned to use PayPal to monetize som efforts because I found easy process to monetize there. Since I am using this service free and I pay only after purchases, I think the deal is too fair.
Comment by Osman | October 7, 2006