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Checkout by Google rivals PayPal in ecommerce arena

Major search engine specialist Google launched Checkout, formerly called GBuy, for online purchases. The new service at can store all of the pertinent information needed to quickly complete a transaction with any participating merchant.

In essence, Checkout streamlines the e-commerce buying process, much like PayPal does, by letting you create an account with Google that includes contact information, payment preferences, and shipping information.

Then, when completing a purchase at any participating store, you simply click on the Checkout shopping-cart icon and sidestep the need for filling out forms at each online retailer.

The AdWords Connction

In addition to offering a quick payment method, Checkout can keep track of purchase history, including orders and shipping details, all in one place. Like PayPal, the Checkout service can handle all major credit cards.

At the same time, the company has created yet another way to boost its search-related advertising revenues by courting retailers of all sizes with enticements to use the new service.

For every $1 merchants spend on AdWords, they can process $10 in sales through Checkout at no charge. Participating stores also get an advanced interface that integrates Checkout with existing shopping carts and order-processing systems.

A Checkout icon placed on AdWords advertisements will help consumers find Checkout-authorized stores when they search for products on Google or on sites that use Google's advertising system.

Getting Personal On Ecommerce

"This supports Google's core business by tying search to e-commerce," said Sue Feldman, a research vice president at IDC. "They, along with Yahoo, MSN, and AOL, are entering a new area by matching queries to advertising and other information on the Internet, and selling access to a large audience."

While security could become an issue with Checkout, as it is with all online payment system, Feldman said, the service will attract more advertisers to Google and is poised to give PayPal a run for its money.

What's intriguing, she added, is that Checkout represents Google's push into delivering more contextual search results using information obtained from users to zero in on what they are looking for. "Now they can use the information obtained from a transaction, such as a shipping address or purchase history, to deliver results that are more personal, or local."

On the flip side, though, some people might be wary of letting Google store such sensitive, personal information. "That's the trade-off for being able to make quick purchases online," said Feldman.

The service is currently open to all U.S. merchants, even if they are not AdWords members. Google plans to expand the Checkout service to retailers around the globe at some point down the line.

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