GoogZilla Vs. King Ebaydorah the Three Headed Monster!

In the great tradition of Japanese cinema, the battle between Google and eBay is starting to look like one of those classic Godzilla movies. GoogZilla and King Ebaydorah are fighting over Tokyo (ecommerce). In this sequel to GoogZilla vs. Microsoftra, Google is directly challenging PayPal, which is one of King Ebaydorah's three heads.

If you ever wondered what would happen if eBay really had a true competitor for their CORE business, take a look at the battle being waged between PayPal and Google Checkout.

Google Checkout is working tirelessly and spending tons of cash to get traction among buyers and sellers with promotions for both groups. No fees for sellers for the entire year -- had that deal been available when I was selling, I could have saved nearly $200,000 in PayPal fees - as well as $10 promos for new buyers and now a Valentine's Day promo. They are also aggressively moving toward launching Checkout Internationally where PayPal is dominant.

The counterpunch by PayPal is a buyer promotion of its own, a $15 off of $30 purchase, this following a $100 million promotional campaign during the holiday shopping season.

I've had over 5 years of experience using PayPal and they haven't offered this many promotions since the days before eBay bought them. eBay and PayPal can continue the PR spin that they don't consider Google's Checkout as competition but actions speak louder than words.

Now the battle gets even fiercer with the news from the Wall Street Journal that eBay and MySpacealon are in talks about working together - that's the best monster name I could come up with for MySpace, sorry -- Google is using the best weapon they have to combat this union by holding up the completion of their ad revenue sharing agreement. Believe me, MySpace is not going to put their $900 million deal in jeopardy.

One thing you can say about eBay's management team. They make the hard decisions. When PayPal was obviously eating their lunch in the payments area they agreed to purchase them for $1.5 billion in 2002. When it became obvious they were getting nowhere in China they shutdown Eachnet and signed a Joint Venture with Tom Online. When eBay sees competition they react swiftly and forcefully. Most small under-funded competitors shrink away in defeat but now they are in a battle with GoogZilla and they can't buy them or outspend them.

Google has more cash than eBay and will not shrink away from a fight. They've taken on Microsoftra with the Firefox browser and their Office products; they blew away Yahoodan -- again, sorry -- in the search arena. Now they are going after the pride of eBay, PayPal. What is next?

I hope that Google will eventually go after eBay's Marketplace business by launching its own Stores Platform. If 37% of all shopping searches begin on Google right now, then why not keep those shoppers on your own platform. Sure eBay is one of Google's largest Advertisers, but that's because they need Google. What would happen if 37% of eBay's shoppers started their search somewhere else? Google knows this. I don't think Google wants to be in the marketplace business but they do want to rule the payments world, so a little pressure on the ecommerce front could force eBay to capitulate and open up to Checkout.

Eventually, eBay will make a deal of some type. My guess is they will allow Google Checkout into eBay's Marketplace business if PayPal is included. I guarantee you that King eBaydorah is nowhere close to doing this right now, but if GoogZilla keeps breathing fire at them they will be forced to make a move to protect their territory.