Amazon’s Mobile-Payments Boss Expects Fast Traction for Service

It won't be long before more merchants sign on to Amazon.com Inc.'s new Amazon Mobile Payments Service (MPS), according to the man who heads up the mobile-payments venture for the world's largest online retailer. “Reaction's been very positive,” Howard Gefen, director of Amazon Mobile Payments, tells Digital Transactions News. “We are in constant conversations with the mobile ecosystem.” That so-called ecosystem includes application developers, application stores, merchants, and others looking to sell goods through the emerging channel of mobile payments. Amazon announced MPS last week and highlighted Kansas City, Mo.-based Handmark Inc., a creator of applications and services for mobile devices that began using it the preceding weekend (Digital Transactions News, Oct. 5). Gefen won't say how many consumers have signed up for MPS or use the Amazon Payments online service. But Amazon's massive customer base, 94 million, gives the Seattle-based firm a deep well from which to draw potential users as the still-nascent mobile-payments market grows. And for merchants selling online, MPS is one more payment service they can get from Amazon as it seeks to differentiate itself from PayPal Inc. and Google Inc.'s Google Checkout with a menu of options for merchants that want a simple hosted solution up to application developers that want to integrate Amazon technology into their own systems. “There are thousands of merchants that have registered with Amazon Payments; we hope to see a lot of interest and adoption of Amazon Mobile Payments Service,” says Gefen, formerly an executive with mobile-payments processor Obopay Inc.. An Amazon customer who is a first-time user of MPS goes through a four-step process on a mobile device when he or she is about to purchase digital content. The customer clicks the “Pay with Amazon” button that appears on the merchant's site and then is taken to co-branded mobile pages hosted by Amazon Payments to enter his or her e-mail address and password. The customer then sees a list of payment methods he or she already has on file with Amazon and chooses one to make the purchase. The customer then returns to the merchant's Web site and downloads the content. With future purchases, however, the customer can simply use Amazon's “1-click” feature for fast checkout with no login required. But Andy Kleitsch, chief executive of online payments firm Billing Revolution, says requiring would-be users of Amazon MPS to first have an Amazon Payments account could result in lost sales. “Amazon's approach will kill any impulse purchase behavior, which the mobile device is perfectly suited for,” says Kleitsch. Billing Revolution is a 2-year-old Seattle-based company marketing a system that lets consumers buy products on their handsets with a single click, and charge their transactions to their credit cards (Digital Transactions News, Sept. 24). Gefen, however, does not see the initial registration holding back MPS either on the consumer or merchant end. “Merchants can employ it in such a way that there's one-click functionality,” he says. “We think that for our [consumer] users and our partners it is a friction-free way to pay, and facilitates impulse buys.” And Gefen dismisses some takes in the tech press that Amazon MPS is competing with Apple Inc.'s iTunes, the huge music and online content site that allows fast payment from registered accounts. “We are very, very focused on our customers, our end customers and our development customers,” he says.