Amazon.com, Inc. (NASDAQ:AMZN) is a threat that eBay Inc (NASDAQ:EBAY) should pay attention to, Jon Fortt said in a discussion on CNBC’s Squawk Alley.
The comment comes after Amazon has been reported to be challenging eBay in the mobile payments space.
Jon Steinberg started the discussion by saying that eBay Inc (NASDAQ:EBAY) which owns PayPal should be really worried. PayPal is currently the biggest player in the mobile payments space. According to Steinberg, there is already an appeal to for Amazon.com, Inc. (NASDAQ:AMZN) especially for people who buy from third-party retailers on their marketplace because the company alleviates fear of fraud because they process the transactions. He noted that Amazon already has a play in the mobile payments industry with it being able to process payments for Gogo Inflight internet.
Reuters recently reported that Amazon.com, Inc. (NASDAQ:AMZN) will be launching a service that manages subscription payments for start-ups and other companies on their marketplace, a move the news organization notes adds to its threat to eBay Inc’s (NASDAQ:EBAY) PayPal.
Meanwhile, Fortt said that what Amazon is banking on is their reputation for security and reliability. He also said that since people likely remember their Amazon password better than their passwords for other companies, friction is reduced.
Moreover, he added that it’s not only eBay being threatened by this move but also credit card companies. Fortt said that Amazon could eventually give customers enticements to directly connect to their bank accounts and implement their own loyalty programs.
Kayla Tausche remarked that she feels Amazon.com, Inc. (NASDAQ:AMZN) has slowly been increasing their involvement in the payment space noting that they launched small business loans two years ago. While they increasing their play in the payment industry “fairly quietly,” they are eventually going to go directly against PayPal, she added. She continued that at a time PayPal is vulnerable because of the recent eBay Inc (NASDAQ:EBAY) security breach, people will notice it when Amazon says they can also process payments with this new service.
Later on, Steinberg also said that this new service from the internet commerce giant can also be seen as a threat to Google Inc (NASDAQ:GOOGL) because people are increasingly going to Amazon instead of Google to search for things they want to buy.
The discussion can be viewed below:
Amazon.com, Inc. (NASDAQ:AMZN) investors includes Christopher Lyle’s Scge Management which had 170,000 shares in the company by the end of March. This stake is valued at about $57.18 million. Foxhaven Asset Management managed by Michael Pausic also reported an 80,633-share stake in the company by the end of the first quarter.
John Kim’s Night Owl Capital Management owned 289,456 shares in eBay Inc (NASDAQ:EBAY) by the end of the first quarter. Paul Tanico’s Castlerock Asset Management also reported 40,997 shares in the company.