20 June 2005 Google, the world’s most used search engine, is planning to introduce an online payment system to rival PayPal, according to reports.
Both the Wall Street Journal and the New York Times cite unnamed sources familiar with the plans, claiming that the search engine giant will launch Google Wallet by the end of 2005.
The service is expected to rival PayPal’s online payment system, which enables people or companies to trade online without a license to receive credit card payments. PayPal has 72 million accounts, and handled $6.2 billion in payments in the first quarter of 2005.
According to the reports, online retailers have claimed to have been approached by Google to work with the system.
In April 2005, online newsletter SearchEngineWatch also reported that Google had filed documents to establish a new company called Google Payments Corporation.
Google currently runs an online shopping service Froogle and the introduction of a payment system that could run alongside this may be attractive for the search giant.
Since its floatation Google has seen its stock price rocket. That has led some commentators to question whether the stock is overpriced: At its recent peak, Google had a market capitalisation of over $80 billion, making it worth more than media giant Time Warner – and this on the back of 2004 revenues of just $3.2 billion.
Much of the interest in Google is down to its brand value, and the loyalty it enjoys as the foremost search engine available. But executives at Google are mindful of the need to drive up revenues. Recently it has expanded its offerings through such services as web mail.
To date, Google has refused to comment on the speculation surrounding a payment service.