This article in CNET indicates that discussions between PayPal and Amazon around acceptance of PayPal did not go so well:
“Ever wanted to use PayPal to make purchases on Amazon? Don’t hold your breath.
That’s the message Amazon Payments’ vice president Patrick Gauthier offered in an interview with CNET on Monday when asked whether his company might someday bring PayPal’s digital payments service to Amazon.com.
“It’s quite simple,” Gauthier said. “Amazon starts with the customer. If our customers were asking for it, it would have been on Amazon already.”
Well, so much for that bit of speculation. Since eBay first announced in late 2014 that it was splitting from PayPal, there’s been talk that PayPal could strike a partnership with Amazon, giving you an alternative form of payment at the biggest online retailer in the world by sales. The San Jose, California, payments company was prevented from such a deal while under eBay, a leading Amazon competitor.”
The real reason Amazon isn’t interested in helping PayPal increase its acceptance footprint was not revealed next, instead customer needs, or the lack thereof, were presented as a reason:
“Yet while such a partnership could get you interested in using PayPal again, Gauthier described how the benefits for Amazon weren’t as clear.
“Why make the experience more complicated than it needs to be?” said Gauthier, a former PayPal manager who joined Amazon early last year.
A PayPal representative didn’t immediately respond to a request for comment.
Gauthier’s rebuff comes as PayPal, a leader in digital payments, has been facing a growing list of competitors, its primary market swelling with a bevy of startups as well as new payment options from Apple, Samsung, Google and even Walmart. Losing out on Amazon takes away a big potential win for PayPal at a time when it could use one.”
With a lack of consumer demand out of the way, the real reason emerges with both current usage of Pay with Amazon announced along with future goals:
“On top of that, Amazon is also ramping up an alternative to PayPal around the Web.
Gauthier said Monday that his company’s Pay with Amazon service has been used by over 23 million customers since it launched in 2013, the first time Amazon has disclosed that figure. Offering a service similar to PayPal’s, Pay with Amazon allows customers to use their Amazon log-in on other retail websites to make a purchase without needing to create a separate account or re-enter payment information.
Amazon’s customer number is still small compared with PayPal’s 173 million active accounts, but it’s more than twice the size of Visa’s similar service, called Visa Checkout, which has about 10 million accounts. The advantage for Amazon is that it has more than 294 million customer accounts worldwide, and it hopes it can coax more of its customers to start using Pay with Amazon.
The effort to grow its payments services illustrates Amazon’s huge ambitions to expand well beyond its core business as an online retailer. The company is already a leading cloud storage player with Amazon Web Services, a consumer-device maker, a Hollywood studio and even a chipmaker, thanks to an acquisition last year. Not all its payments efforts have succeeded, though, as the company last year opted to discontinue its Amazon Register card reader, which allowed merchants in physical stores to swipe debit and credit cards using their mobile devices.
While Gauthier declined to say how many retailers are part of Pay with Amazon, he said the merchants using the service grew more than 200 percent in 2015 and includes Shinola, Gogo and Golf Now. Amazon doesn’t collect the data of merchants using the services, except to help it detect fraud, Gauthier said.
He added that he expected big things for Pay with Amazon this year.
‘Anything short of doubling the business,’ he said, ‘would not be success for me.’ ”
Overview by Tim Sloane, VP, Payments Innovation at Mercator Advisory Group
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