GoogleBlog:
Today, Google is announcing Google Checkout, the combination of a digital wallet for consumers and a payment processing system for online merchants. The fees charged to merchants are lower than those they will generally receive from credit card processors.

While there’s nothing actually new here (digital wallet solutions were around at least as early as the 1998-1999 time frame), the market power of Google and the pricing structure give Google Checkout huge potential.

Back in the good ole dot com boom days, I was in the Strategic Planning Group at Globeset, a company developing a digital wallet solution for American Express, Citibank and other companies. For such technologies to function, there needs to be coordination with the merchant. Unfortunately, this led to a chicken-and-the-end problem as no merchants would make the needed changes unless there were a large base of consumers using the technology, and no consumers would use the wallet unless there were lots of merchants who supported it.

Google Checkout solves this problem. No internet company has ever had the consumer market power that they have, so signing up consumers shouldn’t be a problem, especially if they tie it in with other consumer services such as Gmail.

And, by offering processing services as well, and at a very attractive price, they solve the merchant problem.

This entry was posted on Thursday, June 29th, 2006 at 6:04 am by admin and is filed under E-Commerce, Google, Payments. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.