eBay has made a major push into mobile payments, acquiring Silicon Valley-based Zong, a specialist in carrier billing. The online auction giant will pay approximately US$240 million in cash for the firm and expects the deal to close in the third quarter. Zong boasts connections with more than 250 mobile operators worldwide, offering “localised, secure and easy-to-use payments capabilities for digital goods and services” in 21 languages and 45 countries. eBay described Zong as a “complementary technology” to its existing online payments business, PayPal – a market leader with over 100 million active accounts. Zong will “strengthen PayPal’s leadership position in mobile payments and digital goods,” eBay said in a statement.
Zong’s technology allows users to pay for virtual goods on mobile devices – such as game credits – using just their phone number with payments added directly to the operator bill. This space is also a current focus for PayPal. eBay launched ‘PayPal for Digital Goods’ earlier this year and claims that PayPal processed US$3.4 billion in payments for digital goods in 2010. “[eBay is] pushing faster and harder on mobile than any other company in the e-commerce payments landscape,” Colin Gillis, an analyst with BGC Partners, told Bloomberg. “[Zong is] one of the best private mobile plays out there and there aren’t many.” Zong spoke at last week’s GSMA Mobile Money Summit in Singapore. See here.