Google Inc. has expanded its online payment service so that users can buy and sell everything from bicycle brakes to Beanie Babies through its Web site, posing an immediate challenge to eBay Inc.
Google added the payment service to its nascent Google Base classified listings Friday, an expected move that nonetheless sends shockwaves through the Internet industry.
EBay dominates e-commerce with its online marketplace and PayPal payment service. Analysts believe Google’s entry into both arenas could cause headaches for more established competitors.
“In our view, this is a clear shot across PayPal’s bow,” Ben Schachter, an analyst for UBS Securities, wrote in a research note Monday.