Eyeing a shift in consumer habits, eBay has announced it is buying Zong, a provider of payments through mobile carriers, for $240 milllion.
The cash acquisition will let consumers pay for purchases from their phones or computer by using their mobile phone numbers for verification. (The payment shows up on their phone bill.) The idea, according to a statement from eBay, is to provide consumers with another payment option in addition to PayPal. Such options are thought to increase sales conversions since consumers wonât have to leave the site to pay for their goods. (In a video, the use is demonstrated by a cartoon figure using his phone to buy credits on a Zynga-like game.)
âCommerce is changing. With mobile phones, we walk around with a mall in our pockets. PayPal helps to make money work better for customers in this new commerce reality â- no matter how they want to pay or what device theyâre using,â said Scott Thompson, president of PayPal. âWe believe that Zong will strengthen this value by helping us reach the more than 5 billion people who have mobile phones, giving them more choice and security when they pay.â
Founded in 2008 by David Marcus, Zong reaches 3.2 billion users through more than 250 carrier connections. PayPal has 100 million active accounts and expects to transact $3 billion in mobile payments this year.
For a look at the Zong story, see the video below:
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