Initial, half-informed thoughts on new Apple/Google payment systems…

by DeAngelo on March 6, 2011

Actually published this post in the comments section in response to this nice article on TechCrunch by Ohad Samet (ex-PayPal guy). Figured I may as well make it a blog post!

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Interesting article and interesting perspectives in the comments. I love the fact that Ohad emphasizes that online commerce is a much, much harder problem than most people realize. Having dealt with such systems in the past, I can appreciate to some extent where he’s coming from. Add to that the fact that Apple/Google are essentially letting 3rd parties set up “stores” for customers where your system acts as the conduit for all the transactions and you’ve got a massive honey pot for fraud (as I’m sure Ohad is quite familiar with, having worked at PayPal).

That said, processing payments on a large scale seems like it’d be pretty familiar territory for all the companies mentioned since they all currently have large payment systems. So surely they’d be familiar with various issues like fraud, customer service, etc on some level. ( Whether they perform those services *well* is another story.)

I’m going to go ahead and predict the itunes system will be a success, largely due to Apple’s success is creating an iTunes-based stove pipe and the fact there’s no other system to process payment in that stove pipe (that I’m aware of).

Unfortunately, I believe the Google system, while being relevant (for some definition of relevant), won’t be a smashing success. The primary reason for this is I wonder if there’s truly a market need for an automated paywall system (which SEEMS to be a large party of Google One Pass’s functionality…please correct me if I’m wrong!). Paywalls for online content simply do not work (or a workable model hasn’t been found) and we’ve seen many people migrate away from them over the years.

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