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Amazon-Stripe partnership

(stripe.com)
258 points polyrand | 7 comments | 23 Jan 23 15:38 UTC | HN request time: 0.769s | source | bottom
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vishnugupta ◴[23 Jan 23 17:17 UTC] No.34491814[source]▶
I worked on Amazon Payments systems for quite some time back in the day. We took pride in being the best payment processors. Had direct connections with card networks, banks and what not. We even launched a PayPal competitor[1]. They launched a Square like device for physical retailers[2]. They invested some serious money in building and maintaining all of that.

However going by this news seems like Amazon has more or less given up on their payments ambitions. Could be also due to recent layoffs. This is a big news. Maybe Amazon wants to focus on being good at few things instead of running hundreds of experiments.

Edit: References.

[1] https://pay.amazon.com

[2] https://www.forbes.com/sites/ryanmac/2015/10/30/amazon-kills...

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1. morpheuskafka ◴[23 Jan 23 18:37 UTC] No.34493001[source]▶
I'm not surprised that they are giving up on Amazon Pay, as that never seemed to get much traction or customer recognition.

However, I am very surprised that they are abandoning their own first-party payments to Stripe. Don't you all already have the very best rates possible, directly negotiated by every bank? In other countries Amazon has even threatened to stop accepting cards because they couldn't negotiate the fees they wanted, and they are about the only merchant big enough to dare doing that.

I'm sure they won't be paying Stripe the standard 2.9%, but still--what value does Amazon get out of this? Stripe is supposed to make payments easy from both a coding and business perspective for developers. Everything Stripe does, from card acceptance to fraud handling to UX to ACH payouts Amazon already has working at large scale.

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2. ghostingbanana ◴[23 Jan 23 19:09 UTC] No.34493460[source]▶
> I'm sure they won't be paying Stripe the standard 2.9%, but still--what value does Amazon get out of this?

These deals are priced on a cost-plus basis. Amazon might pay Stripe the cost of the underlying network fee plus .1% or half of cent.

Stripe negotiates fees with leverage.

note Stripe is publicly commuting to AWS in this announcement. It’s likely that the exchange here is “we use you for payments and you commit to $Xbn in AWS spend.”

Similar to MSFT and OpenAI. We give you billions, you spend it right back on Azure.

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3. cstejerean ◴[23 Jan 23 19:27 UTC] No.34493685[source]▶
It's not clear from the announcement that they are giving up all first-party payments to Stripe.

> Stripe will become a strategic payments partner for Amazon in the US, Europe, and Canada, processing a significant portion of Amazon’s total payments volume across its businesses, including Prime, Audible, Kindle, Amazon Pay, Buy With Prime, and more.

That makes it sound like some things (and certainly a significant percentage of the total) will be processed by Stripe, but not all spend. For example it doesn't seem like normal purchases on amazon.com would actually be processed by Stripe at this time.

4. di456 ◴[23 Jan 23 20:04 UTC] No.34494196[source]▶
> Stripe negotiates fees with leverage.

Same with Amazon's leverage for vendor negotiation. They will go for stock warrants if it's a big enough deal and they have the right leverage. More upside that way and it creates a competitive moat.

No idea if that's the case here though.

5. babypuncher ◴[23 Jan 23 23:45 UTC] No.34496805[source]▶
Google Pay, Amazon Pay, and other attempts by big companies to shoehorn their way into this market have to contend with the fact that PayPayl came first, and is "good enough" for the vast majority of people.

The real innovation in this space seems to have come from companies replacing more layers in your typical e-commerce stack, like Shopify.

For me, Apple Pay is the only "new" payment processor that actually competes with PayPal because Apple made the user experience a lot faster and more convenient.

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6. txcwpalpha ◴[24 Jan 23 01:19 UTC] No.34497754[source]▶
They aren't giving up on Amazon Pay. There's misunderstanding in this thread about what this announcement is.

Amazon Pay and other payments products from Amazon are customer-facing products that make it easier for customers to make payments. Stripe is the backend software that makes it easier for Amazon to process those payments. They coexist, they don't replace each other.

7. AuthError ◴[24 Jan 23 01:42 UTC] No.34497955[source]▶
google pay has decent presence in APAC