DISQUS

sujamthe · 6 months ago

Facebook has to go through the adapting/learning process to excel in fraud protection which is HUGE! if they do that on facebook, they cud potentially sell their payments to all Connect partners. The adoption challenge is not w user but w the merchants I think!

johnklin · 6 months ago

Online classifieds. I'd rather buy/sell something from/to someone I know or a friend-of-a-friend than a complete stranger.

When I had lunch recently at Facebook with a friend of mine (an ex-Googler), he agreed that Facebook should have rolled out a payment system much faster - as in - look what the iPhone Apps store did for application developers - a very easy and direct way to monetize.

Now imagine if the Facebook platform had come with a built-in payment system - Facebook could have monetized applications faster and more easily rather than now major Facebook applications monetizing through advertising primarily....

Too bad Zuckerberg didn't live Silicon Valley through Web 1.0's rise and dot com bust, otherwise he'd be more focused on monetization rather than growth, growth, growth....

chudson · 6 months ago

John,

I agree - there was an opportunity for Facebook to have capitalized on the opportunity to provide a monetization solution for app developers. I kind of feel like that ship might have sailed - offer partners, PayPal, Zong, Boku, etc have that space pretty well covered at the moment. Many of the top apps are doing more revenue through virtual goods than ads - that's a great use case for direct payment systems.

vadhri · 6 months ago

interesting thoughts ... payments, unlike general social media, has fraud/privacy/legal/compliance angle which very few realized. It took PayPal several years to build a decent/competent system. Interesting to see how Facebook would manage this, as it might "distract" its core competence

Joshua March · 6 months ago

Good post. However, I disagree with your assertion that PayPal is low friction - I find it very annoying and frustrating to pay with paypal because of the hassle of having to go through an additional log in process that I use rarely, so usually forget my password etc. I also get very annoyed with it when I just want to make a card payment and have to go through that whole process when it would have been quicker to just type my card details in.

If a retailer is already using Facebook Connect, then either a) I will already be logged into Facebook, allowing me to make an API payment with probably just a click, or b) I have a one-click log in to Facebook, and then a one-click payment. Both of these processes would be much easier for me that paying with PayPal.

Additionally, I dislike PayPal; I've been ripped off from them before with cases of fraud when using Ebay, as their protection was so weak. They've actually changed their terms now to make it much better, but for me (and lots of other people I know) the damage was already done. (specifically, if someone paid you for an item on ebay when they'd hacked into an account, even though you did everything in good faith paypal would take the money back from you even after you've sent the item. This was unfair and money grabbing, and if Facebook maintain their brand with their payment terms they can avoid this kind of thing).

chudson · 6 months ago

Hi Joshua,

Thanks for the thoughtful comment. I do think that PayPal is generally low-friction at the time of purchase. All you need to do is to type in your email address, password, and off you go. I use PayPal for my conference business and can agree that the post-purchase experience is not the greatest and that fraud can be an issue.

PayPal has lots of people working on keeping that service safe and usable. Facebook has lots of people working on payments, too, but I'm not sure that they'll have the resources or focus to make a great user experience and manage the back and fraud / chargebacks that will inevitably arise. A simple 1-click experience for users is a proven value proposition - I'd like to see what Facebook ends up implementing.

Matt · 5 months ago

Hi Charles,

I've been wondering the same thing as of late, and I can't see any reason why you would want to own your own payment infrastructure at this point. Its a nightmare to maintain, and with everyone competing on price per transaction so heavily right now, it doesn't seem like a good investment.

Also, the most pressing issue from where I sit is that there is simply too much risk associated with touching transactional data. Being subject to PCI is reason enough to just outsource and call it part of COGS.

Anyhow, that's my 2 cents (for this transaction :) ).

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Clint Wilson · 3 weeks ago

Charles, I think having a simple yet powerful shopping cart which can enable employees to sell items from their own company could potentially revolutionize Facebook's member adoption of payments. Everyone could be an channel for their company sales which is ultimately tied to their social life anyway in terms of stability and work/life balance.

I know all of our current SaaS members as well as clients are watching us as we implement our Payvment "Storefront" inside of Facebook. We will also give spiffs to our members who put up the "Storefront" on their pages @CnC as well as Cazoomi for discounts on member products. As 2010 rolls out we will see how our members fare in their efforts. Hopeful.