Paypal X and the 2 Million Dollar Launch Party.

Paypal X and the 2 Million Dollar Launch Party.

As always, these type of product pitch conferences start out with a tough crowd and caffeine hyper introduction speaker. (Remember bouncing Steve Balmer?) My estimated guess is that Paypal put a whopping 2 million dollar into the conference to launch their new X platform.

Just spending 300K on gifts alone, must give you an idea of how excited they are with their new API’s. The 1500 developers in the house got a Eee netbook. An internal marketing team of 20 people switched into crunch time, to make sure the conference was a success. Only 18 people signed up, two weeks in advance.

Let me give you an introduction to the new Paypal features that will make your life easier as an online service startup. Without the monkey screaming sounds from the audience and the guys on stage that is.

Freemium services can now be built using Paypal’s pre-approved payment feature. You can setup a contract with your customer, to bill a monthly/ instant fee within a pre approved bandwidth. This allows your customers to instantly up/downgrade and be charged accordingly without going to paypal again. – A feature most Credit Card payment providers had in place years ago. Current subscriptions can’t be converted to the pre-approved method automatically. You have to guide your clients trough paypal again to make this happen.

Seller protection will stay an issue for online services and e-goods providers. It’s hard to actually prove you provided the service or granted access to the e-good. Paypal policy was and will be in the favor of the buyer.

Mobile payments allow you to add a pay-with-paypal button directly in your iPhone app. A barcode scanning app was used as an onstage example. By scanning the barcode you get a list of local and online suppliers. With the integrated buy-now feature you can buy direct from the app at one on the online retailers. In this case the mobile app functions as a store front for multiple parties. Paypal facilitates the transaction between the buyer and the seller and the middle man, without bothering the buyer. The middle man takes the commission directly from the transaction. An SDK for iPhone is already available. For Blackberry this will take an other couple of weeks to months.

A funny demonstration was the online banking solution with integrated paypal support. Not only could you send a check, but also send the money to a paypal account… wow! Although better than sending a cheque, Paypal does take its share from this transaction. While this might seem innovative for the US, in most European countries you can send money directly from one to an other bank account at no charge. Even corporate accounts have a couple of hundred free transactions a month.

Paypal wants to push e-commerce to new heights by providing an easy to use, all purpose, money transaction platform. To give a perspective of the massive opportunity they have. Retail is the corner stone of today’s e-commerce. Only 5% of retail is sold online. And retail in general is only good for 5% of earths 31 trillion dollar yearly turnover. So Paypal wants to make sure you have the tools to move another 5% of any industry online.

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