Amazon rolls out Flexible Payment Service

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You’ve heard of Amazon’s S3 and EC2 services, right? Well tonight Jeff Barr announced that Amazon is shipping a new Flexible Payment Service. Lets developers build credit-card and other transaction services into their Web apps.

UPDATE: this is a big deal because of the trust that Amazon has. Amazon is a fulfillment house if you think about it. They have awesome systems set up to bill people and ship things out.

Add this to Amazon’s existing S3 and EC2 services and this is significant. I’ll watch the chatter on this over the next day or two and bring you the best info on my link blog.

I wonder how this compares with PayPal and Google’s payment systems? Looks like the API is very well thought out, though. What do you think? If you are looking to build a payment system into your Web apps how would you chose? One thing I’d focus on is the fees. I’m not sure what the others charge but the fee structure is very well laid out on Amazon’s site.

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Published by Robert Scoble

I help entrepreneurs build their technology business' story, help with getting ready for investors, with other launch plans, and many other strategic things that can help your new startup. Call to talk: +1-425-205-1921 (text first).

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36 thoughts on “Amazon rolls out Flexible Payment Service”

  3. This is a HUGE step for Amazon. They have become a company that developers love with S3 and EC2 (I swear by S3), and with this they’ve added a service that will generate loads of revenue in the future if developers take it in, which I think they will, given how great S3 and EC2 have been for everyone.

    A lot of people don’t understand why an announcement like this could be so important to a company like Amazon, but they are saying to developers, “We are here for you.” And guess who gets to make the decisions about what payment system to use when developing applications? The developers. And I’m sure Amazon will be taking a 1% + $0.25 charge or something for every transaction, which adds to their bottom line.

    Great move on Amazon’s part, there are some very smart people working there.

    Like

  4. This is a HUGE step for Amazon. They have become a company that developers love with S3 and EC2 (I swear by S3), and with this they’ve added a service that will generate loads of revenue in the future if developers take it in, which I think they will, given how great S3 and EC2 have been for everyone.

    A lot of people don’t understand why an announcement like this could be so important to a company like Amazon, but they are saying to developers, “We are here for you.” And guess who gets to make the decisions about what payment system to use when developing applications? The developers. And I’m sure Amazon will be taking a 1% + $0.25 charge or something for every transaction, which adds to their bottom line.

    Great move on Amazon’s part, there are some very smart people working there.

    Like

  5. The amazon announcement is really significant because there is no other way for a small developer to do micropayments at a reasonable cost. Credit card companies typically charge a buck or fifty cents or whatever (I forget the actual fees) for a transactions no matter how small they are. So selling a song at $1 or $0.50 is really not easy. Most developers deal with this by requiring that the user buy “tokens” or “credits” on the service to deal with the minimum transaction fees. So for example you could buy $10 worth of credits and then use them as you need them. Fixing this will make micropayment services possible on the net on a large scale beyond companies like apple and amazon.

    Like

  6. The amazon announcement is really significant because there is no other way for a small developer to do micropayments at a reasonable cost. Credit card companies typically charge a buck or fifty cents or whatever (I forget the actual fees) for a transactions no matter how small they are. So selling a song at $1 or $0.50 is really not easy. Most developers deal with this by requiring that the user buy “tokens” or “credits” on the service to deal with the minimum transaction fees. So for example you could buy $10 worth of credits and then use them as you need them. Fixing this will make micropayment services possible on the net on a large scale beyond companies like apple and amazon.

    Like

  9. Hello,

    If you aren’t a programmer but want to take advantage of the lower transaction fees, check out:

    http://www.junglepayments.com/faq.aspx

    They have developed the web service for you and allows you to generate links to place in your storefront/website. They are currently doing this for free and might plan to add a fee for extra services later. But the good news is that they do not add additional transaction fees … they use only what Amazon requires per transaction. Enjoy!

    Like

  10. Hello,

    If you aren’t a programmer but want to take advantage of the lower transaction fees, check out:

    http://www.junglepayments.com/faq.aspx

    They have developed the web service for you and allows you to generate links to place in your storefront/website. They are currently doing this for free and might plan to add a fee for extra services later. But the good news is that they do not add additional transaction fees … they use only what Amazon requires per transaction. Enjoy!

    Like

  11. I use Google Checkout for my company (College Knowledge LLC– it works quite well. Integrating has been a real pain, though, but at this point we’ve put so much into it there’s no real reason to switch over to Amazon (at least not quite yet). This move could pay off down the road for Amazon, sure, but it won’t have an immediate effect on the bottom line!

    Like

  12. I use Google Checkout for my company (College Knowledge LLC– it works quite well. Integrating has been a real pain, though, but at this point we’ve put so much into it there’s no real reason to switch over to Amazon (at least not quite yet). This move could pay off down the road for Amazon, sure, but it won’t have an immediate effect on the bottom line!

    Like

  13. At FreshBooks, we think it is a huge deal for our customers. So many of our customers want to get paid online, but their clients are still afraid of online transactions. Amazon’s trusted and familiar status will help get more people over the hump, and that means our customers will be paid faster. One step closer to the ultimate dream.

    By the way, if you’re looking for some details on how it compares to PayPal, FreshBooks has detailed our experience so far at

    http://www.freshbooks.com/blog/2007/08/03/amazon-flexible-payment-service/

    Like

  14. At FreshBooks, we think it is a huge deal for our customers. So many of our customers want to get paid online, but their clients are still afraid of online transactions. Amazon’s trusted and familiar status will help get more people over the hump, and that means our customers will be paid faster. One step closer to the ultimate dream.

    By the way, if you’re looking for some details on how it compares to PayPal, FreshBooks has detailed our experience so far at

    http://www.freshbooks.com/blog/2007/08/03/amazon-flexible-payment-service/

    Like

  15. I wonder to what extent FPS developers will have access to Amazon’s data aggregation and auto-recommendation technology. Will Amazon tell me what other content/products/services my customers might like? After all, they know what these people have searched for/viewed/purchases in the past…

    Was interested to see Freshbooks listed as one of the first FPS users. One of Freshbooks’ claim to fame is their use of aggregated data to help customers benchmark their financial performance.

    Like

  16. I wonder to what extent FPS developers will have access to Amazon’s data aggregation and auto-recommendation technology. Will Amazon tell me what other content/products/services my customers might like? After all, they know what these people have searched for/viewed/purchases in the past…

    Was interested to see Freshbooks listed as one of the first FPS users. One of Freshbooks’ claim to fame is their use of aggregated data to help customers benchmark their financial performance.

    Like

  19. In the end, one service will come to dominate the market. So the question becomes, do consumers and business owners like Amazon enough to implement a new payment system? If they do, we could see Amazon overthrow PayPal in the online transaction market? Personally, I like this. I just wonder if other people will. We are resistant to change.

    -Vainentree
    http://thenerdcan.wordpress.com/

    Like

  20. In the end, one service will come to dominate the market. So the question becomes, do consumers and business owners like Amazon enough to implement a new payment system? If they do, we could see Amazon overthrow PayPal in the online transaction market? Personally, I like this. I just wonder if other people will. We are resistant to change.

    -Vainentree
    http://thenerdcan.wordpress.com/

    Like

  21. With their current price rate, they won’t be overthrowing anybody.

    Their fees are higher than what I’m currently paying for paypal and google checkout combined. (of course, google has the price discounts to eventually free if you spend enough in advertising)

    that 30 cents per transaction + a % of sales is killer. It’s high compared to other places out there.

    Like

  22. With their current price rate, they won’t be overthrowing anybody.

    Their fees are higher than what I’m currently paying for paypal and google checkout combined. (of course, google has the price discounts to eventually free if you spend enough in advertising)

    that 30 cents per transaction + a % of sales is killer. It’s high compared to other places out there.

    Like

  25. I use Amazon’s S3 storage, currently via the JungleDisk interface.

    It is fantastic – very cheap, infinitely scalable.

    I just got my first bill for a trial I did: ~300MB stored for a month, with about 50MB of that re-downloaded back to my PC.

    Total for the bill? $0.06!

    Im a happy chappy.Great, cheap offsite storage. Sure there are a couple of others that offer various things, but in terms of scalability and price once volumes get very high, S3 is damn good.

    Like

  26. I use Amazon’s S3 storage, currently via the JungleDisk interface.

    It is fantastic – very cheap, infinitely scalable.

    I just got my first bill for a trial I did: ~300MB stored for a month, with about 50MB of that re-downloaded back to my PC.

    Total for the bill? $0.06!

    Im a happy chappy.Great, cheap offsite storage. Sure there are a couple of others that offer various things, but in terms of scalability and price once volumes get very high, S3 is damn good.

    Like

  29. A countertrend move motivated by Paypal envy. Payment processing is just an incidental service to online commerce. Now that it’s emergent, it seems more significant than it is. Eventually, it will be no more remarkable that checking out at a supermarket. At that point it will become a low-marging commodity service, and will be farmed back out to specialist processing companies.

    Like

  30. A countertrend move motivated by Paypal envy. Payment processing is just an incidental service to online commerce. Now that it’s emergent, it seems more significant than it is. Eventually, it will be no more remarkable that checking out at a supermarket. At that point it will become a low-marging commodity service, and will be farmed back out to specialist processing companies.

    Like

  31. The transaction fees are way too high compared to paypal and google, which imho are just as reliable.

    Like

  32. The transaction fees are way too high compared to paypal and google, which imho are just as reliable.

    Like

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  36. Pingback: Webreakstuff » Amazon does it again: Flexible Payments Service

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