Google Inc.'s chief executive Tuesday denied reports that the online search engine leader was gearing up to compete directly with EBay Inc.'s pioneering PayPal service, but acknowledged some kind of electronic payment product was in the works.
Eric Schmidt did not give details about the project but said it wouldn't trespass on PayPal's turf.
"We do not intend to offer a person-to-person, stored-value payments system," Schmidt said.
That description fits PayPal, a service that creates "digital cash" by accepting credit card payments from its users and then delivering the payments to a designated recipient.
As e-commerce thrived so did PayPal, growing from 24 test users in 1999 to 72 million account holders through March. Looking to profit from the fees that PayPal collects from completing online transactions, San Jose-based EBay bought the service for $1.3 billion in 2002.
The Internet industry began buzzing about the possibility of Google competing with PayPal after the subject surfaced last week during an e-commerce conference hosted by Piper Jaffray. The Wall Street Journal subsequently reported that Google hoped to roll out a rival payment service later this year, quoting people familiar with the company's plans.