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eBay's Google Checkout Ban: Hold the Rotten Tomatoes

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July 07, 2006

eBay's Google Checkout Ban: Hold the Rotten Tomatoes

Rob Hof

eBay has come in for a lot of criticism for its decision to exclude Google Checkout from the online marketplace's list of accepted payment methods. But a number of folks have noted that perhaps the criticism is premature. For one thing, it's undeniable that Google Checkout is unproven in terms of reliability and fraud protection, and there's no reason to assume at the outset that there won't be problems. Probably can't blame eBay for being cautious. One ex-PayPal employee lists several reasonable reasons for eBay to wait and see.

What's more, Google Checkout doesn't allow PayPal as a payment method. Hmmm. One would hope tit-for-tat doesn't determine policies, but clearly Google isn't completely open either, even for a payment system that actually is proven (if not perfect).

That said, my clear impression from folks at eBay is that the timing for allowing Google Checkout as an accepted payment system will coincide with a cold day in hell. If in fact Google Checkout checks out and proves not to have fraud or other problems after a few months, and eBay still hasn't approved it, then you'll know what's really at work here. Until then, eBay deserves some slack.

10:56 AM

Google, PayPal, eBay

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Isn't that natural ebay doesn't want the direct competition inside of home ground?

Why would they want that? Period.

Posted by: MK at July 7, 2006 12:05 PM

MK, you're right, it may be understandable that eBay doesn't want direct competition on its home ground. But for a company set up originally to provide a level playing field for everyone, it's also understandable that some people consider this exclusion of Google Checkout to be against the grain of what eBay says it stands for. So if Checkout proves to be safe and reliable, it's hard to see how eBay can justify keeping it out. (By the same token, neither should Google exclude PayPal as a payment method within Checkout.)

Posted by: Rob Hof at July 7, 2006 03:42 PM

Personally, I really like Paypal, and have zero interest in Google's thing. If I remember right, when Paypal started, Ebay tried to have its own system, but Paypal still became preferred for auction payment.

As an ex-Ebay Power Seller, I really liked the the way the two work together so easily.

And I never quite understood where the rule came in that everything on the net has to be free and open. Ebay has created something pretty damn cool, why is it supposed to let anyone come in and plunder it for free? Would we blame Wal-mart for objecting to Target setting up a lemonade stand in its beverages aisle?

Posted by: dg at July 9, 2006 10:25 AM

Cut ebay some slack? You must be kidding:


Posted by: Stefan Richter at July 13, 2006 07:25 AM

I had never heard of Google Checkout until today when I found thousands of dollars of unauthorized charges from Google Adwords (which I had also never heard of). Tracing it all down, I would say eBay should get an award for being wise enough to see the fraud coming down the pike with Checkout.


Posted by: Patrick Donnelly at July 14, 2006 04:19 PM

Oh Patrick please gimme a break. If you were a Paypal seller with any kind of significant turnover you'd know that Paypal is appauling. There is no way to protect yourself from fraud with Paypal, in fact Paypal is encouraging it IMO. I have yet to see one chargeback that I was able to successfully defend - and it was always me, the seller, left out of pocket. Funny but when you speak to Paypal buyers they also complain en masse. Why? Because Paypal is happy to shift ALL the risks of the transactions it charges us for to its customers, buyers and sellers.

I should know, I have to use Paypal because there are no real alternatives. I welcome Google's efforts, it's about time we see some competition in thsi space and they can hardly do much worse than Paypal does already.

Posted by: Stefan Richter at July 17, 2006 06:01 AM

I actually like paypal but do not like several things. One is the way that they close seller accounts without any specifics - this really can cramp a biz if they do not have a back-up merchant account for taking online payments.

Ebay/paypal does have a monopoly on the huge ebay auction market. The fact is though, I personally know 7-10 powersellers that have all quit selling on ebay due to either a) high fees, b) closure of accounts due to sketchy ip tracing, etc.

This means lots of lost revenue for ebay. What happens is people get merchant accounts, google checkout being one of them. Ebay already allows credit card payments (via merchant accounts) but they are not integrated in the auction checkout like paypal is.

Maybe ebay could charge a certain google checkout fee so that sellers/google checkout pay the same fees as they would with paypal, while they would still be paying ebay fees and have a healthy biz, which so often is closed due to fraud purchases/chargebacks.

I hope they due accept Google Checkout! It would make ebay popular again with sellers and sellers would stop defecting to getting merchant accounts and starting their own websites.

Posted by: Tunde at July 17, 2006 10:09 PM

Half a year later and still no Google Checkout. Hmm...

Posted by: Dave at December 7, 2006 02:01 PM

As an eBay powerseller with 11 eBay IDs, and Powerselle status on all. We focus on 5 categories, we are the top in 4 of them. WE avoid Paypal like the plague. This is a growing trend believe it or not and we actually have a higher percentage of completed eBay items by not using Paypal and using credit cards directly. The facts about Paypal are getting out there, Paypal is not a real bank, not FDIC insured, and a third party processor. Paypal's boasted insurance/warranty is all perception and when it comes down to it, they do nothing more than what your card supports (remember you sign over ALL legal rights to them, they can do as they wish/please with your money for ANY reason at any time).

So, we take cards directly using (not Verisign who is owned by Paypal/eBay). We hope that the Google checkout will be accepted to eBay for one more payment option and if not, we know eBay's true and possibly illegal reasons. By terms of eBay, they cannot determine how you pay, but ban one based on safety records. For now, they are on the line of their legal limits by banning Google checkout, but once they have a 180 day period of satisfactory ratings, if not better than Paypal's, eBay will have to recommend them, or end up banning their own service, Paypal. Double standards is the eBay way and wrong until proven innocent is the slogan. =)

Signed - A very profitable eBay power seller that has seen the times from good to worse to good to getting the worst in 2006-2007.

Posted by: eBay Powerseller at March 14, 2007 04:32 PM

Like the fellow preceeding my, I am also an ebay powerseller, and have found sales on ebay growing steadily for the past year. And like him (or her), I also don't use Paypal.

I used to, but after they froze my account with OVER $5000.00 in it, had vague reasons, and would never clearly tell me WHY it was frozen, the end result was I had no option but to start my own checkout and forget Paypal.

In truth, I was pretty sure I'd be put out of business when I lost Paypal. But, to my surprise, my sales didn't fall at all and in the past few months have substantially increased, all without using Paypal once in over a year now.

I offer Bidpay, which is still allowed, although I get only 1 or 2 bidpay transactions a week.

The rest either post their purchase on my own checkout or call my 800 number.

There is an odd perception that Paypal/eBay somehow protect sellers and buyers against fraud, but the reality is they do nothing at all. If you buy and don't get your item, you MIGHT get a token refund from one of those companies, but you may just as fast get nothing.

In comparision, if a seller buys from me, and checks out at our cart, and for ANY reason isn't happy, they can ask for and get a full (less shipping) refund. Simple and done. But, I know the skeptics say 'YEA RIGHT'.. But even if I don't produce a prompt refund, here's the catch. Paying by credit card holds all sorts of rights for buyers. They can go back to their bank/cc company and say I didn't ship, it was garbage, anything they want, and poof, in a few days, they get a chargeback against me. If I don't defend the chargeback, with proof of delivery or an assortment of other things, the customer gets ALL of his money back and even interest accrued on the time it was pending as a chargeback!

The customer gets cost of goods, PLUS shipping, all by the chargeback issued. The money is taken out of my account, without my choice. This is what ALL Visa/MC vendors agree to. And, if my chargebacks get too high (mine are at ZERO!! YEA BUDDY.. I have none, as I provide a good service I suppose) then VISA/MC can put me on 'high risk watch', my discount rate (what I pay to accept Visa/MC) goes up and if my chargebacks keep getting worse, they close my account and I'm out of business.

This is NOT what you get from eBay/Paypal. You'll get loads and loads of grief trying to collect and in many cases, you'll give up FAR before you ever see a dime!

Paypal has destroyed countless lives by their arbitrary and caprious nature, their God-like complex that they can do anything to anyone without the slightest Federal oversight that is so tight at banks and other financial institutions, it's mindboggling. Search for paypal sucks on Google and you'll find many websites with horror stories about how many people have lost their business, homes, and worse due to things Paypal does on a daily basis.

Being an ex-paypal supporter, I loathe everything about them, and wish them nothing but an Enron ending.

It would be would be wonderful for Google Checkout to be allowed access to ebay customers. Ebay would benefit and for those still entranced with Paypal, it won't matter. They'll keep using paypal as they do without interference. But for the millions of us who won't or can't use paypal, then having a strong company like Google operating an alternative would only be a strong benefit. And ebay would only benefit from alternatives.

In a recent SEC statement, Paypal claimed about 100 million customers, but amazing as it may be, claimed only about 10 million actually active customers. And once you start reading the horror stories about paypal in your searches, you'll realizr there is far more smoldering under the floorboards at paypal than you'd have have dreamt.

I love ebay, even if it owns paypal. It's a shame, but it's how it is. One day, when Paypal is brought up on Enron style criminal charges, those of us who've been abused will go out and do happy dances in the street celebrating!

Still selling and makin a buck or two on Ebay.!


Posted by: NoPaypal at March 17, 2007 02:34 PM

Talking about stifling competition. Let's just go somewhere else. Ebay is getting more and more expensive and full of commercial sellers anyway.

Often times you find the same items in your local shop cheaper than on ebay. Also Paypals free transfer between basic/private accounts is now restricted to a few transactions per year. It used to be unlimited. And more and more hidden charges for this and that. Greed seems to be the main motivation.

Posted by: Guy at March 18, 2007 07:30 PM

Sounds like a bunch of frauds and cry babies in here.

Posted by: Realist at April 3, 2007 11:13 PM

Paypal charges are unreasonable high. This is because Paypal deliberately abuses their ebay monopoly to ban and discourage any competition to Paypal. Are they seriously saying that Google checkout is less secure than accepting a cheque or bank transfer (which they allow)? They constantly try to scare bidders and sellers into thinking that Paypal is the only secure way to do business. Its anti-competitive and a downright abuse of the ebay's dominant position.

Posted by: Roy Gilbert at April 9, 2007 04:44 PM

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