EBay's PayPal Looks To Real-World Commerce Opportunities

by Mercator Advisory Group 0

PayPal is looking to enter the bricks-and-mortar world onthe wings of software on mobile phones connected to mobile phones. Itspilot with Bling Nation is just an early example. Given its low-costconnection to millions of consumer checking accounts, PayPal will have acompelling cost proposition once merchant systems are able to accommodatemobile transactions. PayPal is moving from adroit exploiter of onlineniches to a real world payment alternatives.

PayPal President Scott Thompson said in an interview his company’s toppriority is to develop software that transforms mobile phones and other devicesinto “digital wallets” that consumers can use to buy merchandise,keep coupons and store loyalty program data. Some of the software is expectedto be unveiled at a PayPal conference in October.

A key goal is to let phone subscribers buy goods from mobile Web sites overtheir handsets. But PayPal also wants to get people using their phones atreal-world shops as more point-of-sale devices in retail outlets are connectedto the Internet.

“The tide is coming in and we will take advantage of that,” saidThompson, whose unit lets users send money over the Internet without sharingbank or credit card information.

PayPal’s move into real-world payments comes as eBay increasingly leans onthe unit to fuel growth while it turns around its auction-and-sales business.Last year, PayPal contributed 32% of eBay’s $8.7 billion in annual revenue, ashare that is seen to increase as the payment unit looks to new users andmarkets

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