Amazon Expands One-Click Payments to Subscriptions (June 10, 2014)
Less than a year after Amazon launched a one-click checkout feature for outside Web merchants, the online retail giant has unveiled a similar service for recurring and subscription-based payments. Launched this week, the initiative enables users to pay fees for services, such as phone bills or digital music subscriptions, using payment details stored by Amazon. The company has been testing the program over the past several months with startups, including mobile phone provider Ting, according to Reuters.
The move is an expansion of Amazon’s role as transactional middleman; third-party merchants selling through the site comprise 40 percent of the company’s sales. In October 2013, the company announced Login and Pay with Amazon, a button e-commerce merchants can add to their online checkout, enabling shoppers to enter their Amazon user name and password to make purchases. Amazon charges a 2.9 percent transaction fee plus 30 cents for each sale made via Login and Pay with Amazon. The company also will take a cut of payments made with the new service, but the exact percentage hasn’t been announced.
Like Login and Pay with Amazon, the new subscription payment service is a clear shot across the bow of PayPal Inc., which has long been dominant in online third-party payments. Amazon has considerable ammunition to make a foray onto PayPal’s turf, with more than 240 million users’ payment card data already on file.
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