AP Google CEO Eric Schmidt on Tuesday that Google has an electronic payment product is in the works, but he denied recent reports that it is preparing to directly compete with eBay's PayPal payment service, reports the Associated Press. "We do not intend to offer a person-to-person, stored-value payments system," Schmidt told the AP. Reports emerged over the weekend that Google might be contemplating just that with a new product, "Google Wallet," but Google allowed the rumor mill to keep grinding, until yesterday.
Its recent incorporation of a subsidiary called Google Payment Corp. fed those rumors, but Schmidt said the subsidiary is working on something that's connected with its search engine. "The payment services we are working on are a natural evolution of Google's existing online products and advertising programs which today connect millions of consumers and advertisers," Schmidt said, but would not elaborate.
Some think Google's payment product would be tied to its comparison-shopping service Froogle. Others point to the company's plans to offer viewing of online videos, predicting that the payment service would be for selling online content found via search. Investors are likely hoping that Google is looking at income sources other than advertising revenue, which has accounted for most of its profit.