A battle royal is raging in Australia following
eBay’s announcement that in order to ensure a more secure online
payments platform its wholly owned subsidiary PayPal is to become
the sole means of payment for purchases on its Australian
website.
eBay’s announcement that in order to ensure a more secure online
payments platform its wholly owned subsidiary PayPal is to become
the sole means of payment for purchases on its Australian
website.
The decision prompted an outcry from sellers
using the eBay website, prompting the Australian Competition and
Consumer Commission (ACCC) to launch a formal investigation.
using the eBay website, prompting the Australian Competition and
Consumer Commission (ACCC) to launch a formal investigation.
In a response to the ACCC’s request for comment
Australian internet payments specialist Paymates’ MD Dilip Rao hit
out at eBay. “Paymate does not consider that the claimed public
benefits arising from a more secure eBay platform will necessarily
accrue. Buyers and sellers will suffer from the lack of freedom of
choice and the benefits of competition,” said Rao.
Australian internet payments specialist Paymates’ MD Dilip Rao hit
out at eBay. “Paymate does not consider that the claimed public
benefits arising from a more secure eBay platform will necessarily
accrue. Buyers and sellers will suffer from the lack of freedom of
choice and the benefits of competition,” said Rao.
Notably when Paymate was launched in October
2001 it had eBay’s full support as a recommended payment service.
However, in its submission to the ACCC Paymate stated that eBay
withdrew its recommendation following eBay’s acquisition of PayPal
in October 2002. Paymate continued that eBay now promotes PayPal
exclusively in it communications with its members, on its website
and via email and has disallowed Paymate from advertising on its
website or email newsletters. “Accordingly, eBay members are
hindered in identifying Paymate as an alternative payment method,”
stated Paymate in its submission to the ACCC.
2001 it had eBay’s full support as a recommended payment service.
However, in its submission to the ACCC Paymate stated that eBay
withdrew its recommendation following eBay’s acquisition of PayPal
in October 2002. Paymate continued that eBay now promotes PayPal
exclusively in it communications with its members, on its website
and via email and has disallowed Paymate from advertising on its
website or email newsletters. “Accordingly, eBay members are
hindered in identifying Paymate as an alternative payment method,”
stated Paymate in its submission to the ACCC.
Of particular concern to Paymate is that by
mandating PayPal all 5 million Australian eBay members will be
forced to register with PayPal.
mandating PayPal all 5 million Australian eBay members will be
forced to register with PayPal.
Paymate asserts that once registered with
PayPal consumers will be more likely to use PayPal when shopping on
other internet merchants’ websites. This, explained Paymate, is
because it is its experience that online consumers have a general
preference for not registering with a number of payment service
providers. “Once a critical number of website merchants are forced
to offer PayPal then the entire online marketplace will be
dominated by PayPal,” stressed Paymate.
PayPal consumers will be more likely to use PayPal when shopping on
other internet merchants’ websites. This, explained Paymate, is
because it is its experience that online consumers have a general
preference for not registering with a number of payment service
providers. “Once a critical number of website merchants are forced
to offer PayPal then the entire online marketplace will be
dominated by PayPal,” stressed Paymate.
According to Paymate, eBay is the most popular
destination for Australian online shoppers with a 31.9 percent
share of visits compared with the next two most popular; Amazon,
with a 2.2 percent share and Trading Post Online, with a 1.2
percent share.
destination for Australian online shoppers with a 31.9 percent
share of visits compared with the next two most popular; Amazon,
with a 2.2 percent share and Trading Post Online, with a 1.2
percent share.
Go deeper with GlobalData
