Amazon Launches PayPal Competitor

I've read a few articles today about the launch of Amazon's new payment system. Their payment system allows developers to use Amazons back end. I for one welcome. According to the New York Times there are 81 million customers in the USA with their credit card details in the amazon system so it would be beneficial for some websites to add this feature in that respect.

Many are not so keen on using this system though.

One advantage PayPal has over Amazon is that many large retailers see Amazon as a competitor. Companies like Toys “R” Us and Borders, the book chain, have retreated from selling products on Amazon.com, complaining that the company was undermining their sales on the site and using their sales data to compete more effectively with them.

“Many larger retailers express concern about partnering with Amazon because Amazon is one of their largest competitors and they don’t want Amazon to know their information,” said Scot Wingo, the chief executive of ChannelAdvisor, a company that helps retailers sell online. “On the other hand, eBay and PayPal aren’t going to use sales data to go source product themselves because they are not a retailer.”

When you think about it, this is a very smart move by Amazon. With over 80 million people with their details online with them in the USA alone, they are in a great position to get a head start into the payments industry. I can see why some retailers are a little reluctant though.

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