Google Unveils Online Payment System, Yahoo Settles Click-Fraud Suit

Excerpt from today's One Page Annotated Wall Street Journal Summary (which you can get emailed to you every morning by signing up here):

Google to Unveil Online Payment Service and Google Picks Egypt For Middle East Hub

• Summary: Google is today unveiling its new online payment service, called Google Checkout. Merchants that accept Google Checkout are highlighted by a green shipping cart symbol in Google searches, and receive payment processing fee discounts depending on the volume of pay per click ad business they do with Google. Users enter their credit card numbers, name and address and Google forwards payments to the merchants. Separately, Google has selected Cairo as its Middle East hub and is not courting potential content partners, particularly in government and academia. Google chose Egypt, the article claims, because it has the largest population in the region with 78 million people. Egypt has 5.2 million Internet users, and Google predicts that the number of Internet users in Arab countries should rise to 50 million by 2009.
• Comment on related stocks/ETFs: Short term positive impact on Google's stock (GOOG). The article speculates that Google may damage its relationship with eBay (EBAY) by competing with PayPal, but eBay has no alternative to buying ads from Google so that concern is likely overstated. In the long term, Google and PayPal may be able to replace the credit card companies for online transactions, a negative for Mastercard (MA).

Yahoo's Click-Fraud Settlement Gets Preliminary Court Approval

• Summary: A federal judge approved a settlement in which Yahoo will pay legal fees of $5 million and agree to extend the period for reviewing click-fraud complaints. Google settled a click-fraud suit in March for $90 million in legal fees and advertising credits.
• Comment on related stocks/ETFs: Marginally positive or zero impact on Yahoo (YHOO) as the issue is settled at low cost.