Seattle-based Amazon has started a mobile payments service that allows consumers to make purchases from their mobile devices using their Amazon accounts, according to a statement released today. More significantly, the service also gives developers, retailers, and distributors of mobile applications a way to process mobile payments from customers using Amazon’s online checkout system—without having to ask for their credit card numbers, which Amazon (NASDAQ: [[ticker:AMZN]]) already has.
It’s a bold strategic move for the e-commerce giant, which has been relatively quiet in the mobile space up to this point. It also puts Amazon directly up against big competitors like PayPal, Apple’s iTunes store, and Google’s Checkout service. One of the first mobile content distributors to use Amazon’s Mobile Payments Service is Kansas City, MO-based Handmark, which sells mobile games, applications, ringtones, and the like. By forming partnerships with other online stores like Handmark, Amazon could potentially reach a very broad mobile market since its payment service should work on many different types of devices and carrier networks.
Amazon has been diversifying across Internet retail lately. In recent months, it has made strong thrusts into shoes and clothing (with its acquisition of Zappos), electronics, and, of course, digital books with new variations of the Kindle. It would seem well-positioned to open, or buy, its own mobile app store in the future. Perhaps today’s announcement is a first step in exploring such a strategy.
