Google Readying PayPal Competitor?

According to reports, Google is readying a new electronic payment service that could pit the search giant against eBay-owned PayPal. Rumors of the new initiative peaked over the weekend following a Piper Jaffray Internet conference, where a number of industry exectives suggested they had heard of plans for "Google Wallet."

While few details are known, the service would likely integrate with Google's existing payments for advertising on its searches, and with a new Google Video service that will allow consumers to purchase video clips offered by third-parties directly through Google.

Google and PayPal both refused to comment on the speculation, but the Wall Street Journal cited a number of people familiar with the matter who said Google wished to diversify its revenue stream, which is currently comprised completely of advertising.

PayPal has proven a boon for eBay, which purchased the company in July 2002. Last quarter, PayPal brought in $233.1 million in revenue, almost a quarter of eBay's earnings.

The Wall Street Journal also reported that Google filed incorporate an entity called Google Payment Corp in California on April 13, although it's not known whether the move is linked to Google's payment service efforts. It's also not known when such a service could debut, but some industry executives say it could "launch soon."