eBay buys carrier-billing startup Zong for mobile shopping

Jul 7, 2011
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Online auction giant eBay has bought mobile payments specialist Zong, spending $240m on the startup despite already having PayPal onboard. According to eBay, the interest in Zong is down to its existing connections with mobile operators, which allows users to charge items directly to their monthly bill.

"Commerce is changing. With mobile phones, we walk around with a mall in our pockets" PayPal president Scott Thompson said of the deal. "PayPal helps to make money work better for customers in this new commerce reality – no matter how they want to pay or what device they’re using. We believe that Zong will strengthen this value by helping us reach the more than 4 billion people who have mobile phones, giving them more choice and security when they pay."

eBay does already offer mobile payments, with apps for iOS and Android, but the Zong technology would enable a second payment method for those uncomfortable with registering their credit or debit card, or their current account, with PayPal. There's also the possibility of using carrier-billing in other ways, with the Zong service enabling payments to be made not on the handset itself, but by punching in the user's cellphone number into a site. Zong already offers users the ability to buy Facebook Credits, for instance.

That obviously requires some sort of tie-in between Zong and online retailers, and it's that which eBay already has through PayPal. No word on when the functionality will merge, though eBay says it expects the deal to be final by the end of Q3 2011.

[via Mobile Entertainment]


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