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EBay Acquiring VeriSign Processing for $370 Million
Forum124 was one of the first in a wave of readers to tell us that eBay is acquiring VeriSign's payment processing business for US$370 million. VeriSign will be merged with PayPal and is estimated to generate a 20 percent operating margin which eBay hopes to help offset the recently reported high purchase price of Skype.
Great, all they need to do now is buy Amazon and they'll own half the internet.
Please wait while we process your credit ca^^439 Ba ding ding ding bwaaaaaaaaaaaaaap bwaaaaaaaaaaaaaap boom bom ding ding ding...
October 10, 2005
Dear Colleagues,
Today, VeriSign took another step forward on our Journey--this time with a respected technology leader and trusted partner, eBay. VeriSign and eBay have formed a strategic alliance that calls for our two companies to collaborate globally on payment services and security initiatives for e-commerce.
This alliance brings together two leaders in online commerce and security to benefit customers and merchants with greater protection, improved technologies, and more streamlined payment processing.
As part of the alliance, PayPal, an eBay company, will acquire our Payment Gateway assets and combine them with their leading merchant services platform. Additionally, we will provide eBay and PayPal with a suite of security services that includes the deployment of the VeriSign Unified Authentication service and up to one million two-factor authentication tokens to be rolled out in 2006. The deployment of VeriSign Unified Authentication will cut across all eBay companies, and we believe it will constitute the largest consumer authentication deployment in history. Please see the fact sheet for details.
Along with our Payment gateway assets, eBay will also be integrating the majority of our Payment Services employees into PayPal, and will be moving them to eBay's San Jose, California campus. I want to thank all of our Payment Services employees for their hard work and incredible results in building this successful business, and for contributing to a strategic alliance that will support the VeriSign mission to enable and protect all forms of digital interactions over the world's voice and data networks.
Sincerely,
Stratton
"I've been developing small business ecommerce sites for the past 10 years, and on every single development I've been part of we've tried to avoid Paypal integration simply because it puts users off."
Let's even skip over the bad perception of PayPal, and trusting my money to someone who's ostensibly not a bank, makes no guarantees, isn't backed by the government, and generally is just some dot-com.
But let's put it like this: if an e-commerce site can't afford to just make a contract with a bank to deal with credit-/debit-cards, why should I feel confident in them. We're not talking some starving web-cartoonist taking micro-payments for a living, we're talking a business and trusting them with, say, a few hundred quid for a new PC or a new 20" TFT monitor. Then I'd expect them to, you know, act like a business and inspire some confidence.
If they can't even afford to get some credit-card processing capability, can they even afford a warehouse, or will I get to wait for a month while they order the stuff directly from the manufacturer? Can they even afford employees, then? (E.g., will I have to wait for a month if it's a one man business and the guy is on vacation?) Will they be around next month, if I need support or to file a RMA?
Plus, I suspect for a lot of people it's also a matter of "usability". Yes, I know it doesn't really fit the real definition of "usability", but please bear with me. It's the same idea: making people jump through extra hoops and go through extra web pages just to buy your product is bad. If someone doesn't have a PayPal account, having to go through all those hoops to register a PayPal account, get confirmed, etc, then finally return to get the product they wanted... some may lose interest and go shop somewhere else.
A polar bear is a cartesian bear after a coordinate transform.
Shame I was looking forward to the browser updates:
Do you trust this certificate?"A++++ excellent certificate, would do secure business with it again!!! "
Do analysts ever consider the revenue for the next year when eBay takes over Verisign payments be lower than expected? If I was a merchant, I wouldn't have any ties with Paypal. If I had an account with Verisign, I would be looking for another merchant provider such as Moneris to protect my business.
Paypal doesn't bring any value to those processing credit card payments. I am not saying it because it seems to be the norm these days bashing Paypal, but the fact of the matter is Paypal has conflict of interests everywhere. Merchant providers are supposed to be in favor of the merchant and the bank's credit card business is in the favor of the cardholder. Paypal likes to be bank and provider at the same time.
Lastly, Paypal already offering merchant services. Paypal is simply buying customers to add to their existing clientel. I see a lot of former Verisign merchants leaving.
Not to mention VeriSign owns Jamba!: http://jamba.de/s/dcw/html/about-us_en.html, which produces MAJORLY annoying ringtones and tv commercials to sell them. They try to rip off kids in a way which is actually often illegal (the fine print says you dont actually buy a ringtone, you buy a subscription.. which kids aren't allowed to. etc. that kind of stuff), and annoy the hell out of the rest of us. They operate all over Europe, and according to that link apparently also in North America.