PayPal Vs. Google Checkout!

It looks like a battle is brewing, a battle that might just lead to an all out war. A recent article on RedHerring.com mentions that it appears Google and eBay are going to war over online shoppers and merchants and Ina Steiner echoes these comments in her article Sellers in the Middle of eBay - Google Conflict. While there was much speculation about this growing conflict for most of 2006 it seems to be reaching the boiling point. Ina's article does a good job of explaining the escalation of the conflict.

It would be difficult to argue that Google's Checkout does not pose a threat to eBay's PayPal and that Google Base and Froogle are not in competition for eBay's sellers but at this point Google is not a major competitor. That, of course, does not stop the saber rattling and chess moves that are being made. Recent initiatives from PayPal look to be directly related to the perceived threat of Google Checkout.

At this point in the conflict PayPal has the high ground, mostly because of its stranglehold on the eBay platform, which just got stronger with the recent initiatives. eBay sellers want to offer Google Checkout but are being prevented by eBay. While eBay continues to state this restriction is not for competitive reasons, a reasonable mind can figure out that is exactly what is happening.

Google is getting some traction in the world of e-commerce outside of eBay where PayPal has had a tough time. Each combatant has their strength and both companies have deep pockets, so is this battle going to end in a stalemate? No, I think eventually that Google and PayPal will work together (maybe that is the opinion of my heart rather than my head). The two services are actually more complimentary than you would think.