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News > Technology
Yahoo! buys payment biz
March 23, 2000: 3:31 p.m. ET

Acquisition of Arthas.com aimed at boosting growth of e-commerce services
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NEW YORK (CNNfn) - Yahoo! on Thursday added to its growing roster of electronic commerce services when it took Arthas.com, which provides online payment services, into its fold.
    Arthas.com, which had been operating under the trade name dotBank.com, provides a Web-based "person-to-person" payment service, which enables individuals conducting online transactions to exchange funds electronically.
    Yahoo! (YHOO: Research, Estimates), which did not disclose the financial terms of the transaction, bought Arthas.com to support its aggressive push into the e-commerce business, according to Tim Brady, senior vice president of network services.
    While Yahoo! has not shown an interest in becoming an online retailer itself, the company has been taking advantage of its large base of users and strong name recognition to become a "facilitator" of e-commerce. That means it uses its site as a platform through which to bring buyers and sellers together.
    Currently, Yahoo! has e-commerce services including consumer-to-merchant retail shopping, classified advertising, business-to-business e-commerce, and online auctions.
    Together, the volume of transactions through those service has grown roughly fivefold over the past year, according to Brady.
    Yahoo! plans to integrate the Arthas.com technology into its suite of online e-commerce services, and launch the technology this year under the name Yahoo! Pay Direct.
    When an individual purchases an item online from another individual and uses the service to make payment, his credit card or bank account will be debited and the account of the seller credited, eliminating the need to mail checks or money-order payments, a process which delays final purchase of their goods by several days, or even a week.
    "We have a lot of transactions, and the ones that are the easiest to do are the consumer-to-merchant, where they pay by credit card," Brady said.
    "On the auction side, it is a person-to-person payment, and right now they have to do that off line," Brady added. "The reason this is great for Yahoo! is that it really lowers the barrier for those transactions to take place."
    Although the service will be available for use in all of Yahoo!'s e-commerce areas, it is particularly beneficial for its online auction business, a field currently dominated by eBay (EBAY: Research, Estimates), noted Andrea Williams, an analyst at Deutsche Bank Alex Brown.
    "Yahoo! auctions has grown considerably, but it still trails eBay by a wide margin," she said. "I think this would play into that quite well."
    Earlier this month, eBay also took steps to streamline the payment process for its users, entering into an alliance with Wells Fargo (WFC: Research, Estimates) to offer a similar electronic payment service.
    In early-afternoon Nasdaq trade Thursday, Yahoo! shares were up 1-5/16 at 198-1/2. Back to top

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.