Digital Transactions Authoritative, insightful and timely information for payments professionals
Online payments processor ClickandBuy this week announced what it calls “Version 2.0” of its digital-content platform, which includes an electronic wallet, long-awaited billing through two major U.S. phone companies, lower merchant pricing, and a new name, to boot. Parent company Firstgate Internet AG of Zug, Switzerland, has chucked the ampersand in Click&Buy's old name in favor of “and” for its regional divisions. The U.S. unit, ClickandBuy LLC, is a joint venture with San Antonio, Texas-based BSG Clearing Solutions and headquartered in New York City. The rebranding, which includes an updated Web site, is aimed at projecting a unified market presence worldwide, according to Fabian G. Siegel, chief technology officer. ClickandBuy reports 7 million users, most of them in Europe but about 6%, or approximately 400,000, in the United States. Some 7,000 merchants accept ClickandBuy, a number that's growing by 50 to 100 each month, according to Siegel. The base includes 107 merchants in the U.S, up from 87 in early 2006. Acceptors include voice-over-Internet phone-service provider Skype, electronic game developer Electronic Arts Inc. and, in Europe, Apple Computer Inc.'s iTunes service. The name change is just the beginning of what's new at ClickandBuy, which is trying to carve out an alternative-payments niche in the U.S. just as other specialists such as online auction service eBay Inc.'s PayPal unit, Google Inc., and established merchant acquirers are all pursuing emerging payment venues. With online payment options proliferating, ClickandBuy is trying to meet the competition by giving its system greater utility for users. Until now, ClickandBuy users could register only one bank or credit card account to fund purchases. Now they can create an e-wallet by registering a host of accounts, including credit and debit cards, as well as bank accounts for e-checks, Siegel says. The e-wallet also will enable consumers to, in effect, become merchants and sell things to each other, allowing ClickandBuy to compete more directly in person-to-person payments with PayPal, whose core business remains facilitating transactions for eBay buyers and sellers. ClickandBuy is aiming to book entrepreneurial bloggers and digital-content creators such as those who create songs for online sites or videos for YouTube.com, the popular consumer-produced video site that Google Inc. bought in November for $1.65 billion in stock. “We want to solve the problem [for content creators] that PayPal solved for eBay five years ago,” Siegel says. The cost to these merchants will the same as for ClickandBuy's regular merchants, 2.9% plus 30 cents. Rates decrease with volume. The micropayments rate for transactions under $2 remains 5% plus 5 cents. Users also will be able to send money to each other at no charge if the transaction is routed over the automated clearing house, Siegel says. Funded by a credit card, the transaction will cost 3.8% of the transfer. Another upcoming option for U.S. consumers will be the ability to charge ClickandBuy purchases to bills from two large telephone companies that ClickandBuy won't identify until January. Adding a phone-bill option, which is used by about a third, or more than 300,000, ClickandBuy users in the United Kingdom through BT Group plc, formerly British Telecom, was no easy task in the U.S., according to Siegel. ClickandBuy first hoped to have the service available by September 2005 and then pushed it back to April of this year (Digital Transactions News, Jan. 26). Siegel says the firms were especially concerned about disputes and chargebacks. “It was a slow and painful process,” he says. “It seems those companies are run by lawyers.” The telecoms are requiring ClickandBuy to get specific approval from each merchant for telephone billing, and have banned promotion of the service in marketing materials. Five merchants currently are signed on for phone billing. ClickandBuy also plans to launch a billing service next month through TelMex, Mexico's dominant phone company. After receiving a $23 million investment about a year ago from London-based venture-capital firm 3i plc, ClickandBuy raised additional capital in August by selling a 10% stake to Germany-based Deutsche Telekom. DT took that stake in part to facilitate payments at 17,000 hot spots of T-Online, a leading European Internet service and German-language content provider.
