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The nearly 7-year-old Google Checkout online payment service, once touted as a rival to PayPal, will cease operations in November, Google Inc. announced in a blog post on Monday.
In the post, online-search kingpin Google Inc. says it is “retiring” Checkout as part of a “transition to Google Wallet,” the company’s 2-year-old mobile-payments service. According to the post, Checkout merchants that have existing payment-processing arrangements can adopt Google’s new Instant Buy service, which the company announced last week as a new feature for Google Wallet. Instant Buy lets users make purchases of physical goods within Android apps with a minimum of data entry.
Merchants that use Checkout but don’t have a payment processor will have to find one in the next six months. Google says in the post that it has made arrangements with three online processors—Braintree, Freshbooks, and Shopify—to take on Checkout merchants at an unspecified discount to ordinary pricing. Developers selling through Checkout on Google’s app store, Google Play, will “transition to the Google Wallet Merchant Center in the next few weeks,” the post says without going into detail.
Google will host a Webinar on Thursday to take questions from Checkout merchants. A company spokesperson did not respond to questions from Digital Transactions News.
The decision to shut down Checkout comes at a time of considerable payments ferment at Google, most of it revolving around Google Wallet. Besides Instant Buy, Google announced two other new services last week for Wallet, including a person-to-person payment service that works with Gmail, Google’s e-mail program, and an application programming interface that lets Wallet support coupons and other loyalty apps.
These new services, however, fell short of the major Wallet overhaul that the payments industry has been expecting ever since a top Wallet executive said last October that one was coming. That executive, Osama Bedier, has since left Google, leading to further industry speculation about the future of Wallet.
The product has struggled to win adoption among consumers and merchants since its commercial rollout in September 2011. In an effort to breathe new life into the product, Google last year dropped its reliance on near-field communication based in the mobile device and adopted a server-based alternative. But Wallet’s availability is restricted to a limited range of handsets, with Sprint remaining as the only major carrier supporting it.
The history of Checkout is similarly checkered. It launched to considerable fanfare in June 2006 as a potential challenger to PayPal Inc.’s hammerlock on e-commerce transaction processing. Among its advantages were merchant pricing that was generally lower than PayPal’s and Google’s offer of $10 of free processing for every dollar merchants spent on AdWords, the Google service that inserts short, hyperlinked text ads next to relevant search results.
But in March 2009, Google dropped the free-processing offer and reset Checkout pricing to match PayPal’s, a move that upset merchants and seemed to slow the service’s momentum. By late 2011, Google had decided to fold Checkout into Wallet.
