EcommerceBytes-NewsFlash, Number 1318 - July 07, 2006     2 of 3

eBay and Google Spar over Checkout Payment Service

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eBay and Google are locked in a battle over Google's new payment service, with both companies further clarifying their positions Thursday on why the service should, or should not, be banned from the eBay marketplace. And it appears the majority of people posting about the issue are skeptical over eBay's motivation in banning Google Checkout, believing it's a competitive issue, not a trust & safety issue as eBay has stated. The battle may be a precursor to a future war as eBay readies plans to encroach on Google's advertising turf.


You won't be seeing a Google Checkout icon on eBay anytime soon.

eBay spokesperson Hani Durzy said on Thursday that eBay had evaluated Google Checkout and it did not meet the Accepted Payments Policy requirement that it have a substantial track record. When asked about Google's position that it has a long history in billing and payments, Durzy said "from a user point of view, it's a different service. In our estimation, it fails in at least one requirement of the Accepted Payments Policy."

When informed of eBay's official ban of Google Checkout, a Google spokesperson said Thursday via email, "Billing and payments have been a core part of Google's advertising programs and online services for years. Google Checkout is a natural extension of this history. The service is designed to make online shopping faster, more convenient and more secure for Google users. We rigorously tested this new service before launch and have used this same service to process Google Video, Google Earth, Google Base, and Google Store transactions for months."

When asked when eBay would reevaluate Google Checkout, Durzy said it was impossible to say. "It depends, we don't know. We can't predict the future to see if it will be adopted, whether eBay users will want to use it, and what the community response will be." Durzy said eBay would reevaluate Google Checkout "if and when it is appropriate," but said eBay is not committing to a timeline.

eBay posted an announcement to inform software developers that they could not allow Google Checkout in applications that utilize the "Checkout Redirect" API. "We will review all new item listings to ensure they abide by our Accepted Payments policy. The AddItem family of API calls will now return an error when a listing violates this policy. Please pass along this message to your sellers. To fix this, sellers should revise the item description to remove offending content and resubmit" (http://ebaydeveloper.typepad.com/dev/2006/07/update_to_accep.html).

The eBay-Google dispute was fodder for bloggers and online board posters on Thursday. Many were sympathetic to Google. A few took a "what's good for the goose is good for the gander" attitude and thought Google should ban eBay listings from Google Base and Froogle.

Some called eBay's ban of Google's payment service anti-competitive - eBay owns online payment service PayPal. When asked if eBay was concerned over antitrust issues being raised due to the ban on Google's competitive offering, Durzy said "I don't think it's a legitimate concern. We are not requiring anyone to use eBay or PayPal. And we are not requiring the use of PayPal. There are dozens of payment services to choose from, and the Accepted Payments Policy only limits sellers from marketing prohibited services."

Durzy also said that, theoretically, a seller could accept Google Checkout if a buyer requests it. "There is no way for us to monitor it. We are not a middleman,...there's no way for us to know. We are concerned about sellers marketing inappropriate or unsafe payment methods."

As for eBay changing the name of the Safe Payments Policy, introduced in October 2005, to "Accepted Payments Policy" this week, Durzy said it was done because it was never eBay's intention to imply that any of the services not permitted on eBay were inherently unsafe in any environment. There are plenty of services that are safe in other contexts but that are not appropriate for the eBay marketplace, Durzy said, such as Western Union wire transfers.

Even as Google launches a payment service that could impact PayPal, eBay is readying advertising services that could compete with Google offerings. eBay AdContext is designed to give affiliates a way to automatically incorporate dynamic eBay content into their Web sites (http://auctionbytes.com/cab/abn/y06/m06/i12/s02).

And as early as next year, eBay will enter the online advertising space through a new pay-per-lead service utilizing its Internet telephony Skype service (http://auctionbytes.com/cab/abn/y06/m05/i04/s00).

Related Articles:
http://auctionbytes.com/cab/abn/y06/m07/i06/s02


About the author:

Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com.


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