Google, PayPal in Talks for Android Deal

Google's current Android Market payment process has users and developers grumbling.
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Mountain View, Calif. (

TheStreet

) --

Google

(GOOG) - Get Report

may be catching up to

Apple

(AAPL) - Get Report

in the mobile application market, but selling the apps has become a huge problem for Google's Android business.

Users hoping to purchase apps in Google's Android Market are confronted with the nuisance of having to enter credit card info or set up Google Checkout accounts. The hassle has created a hurdle not just for would-be buyers, but also for application developers looking for payback on their efforts.

Looking for help to ease the transaction friction in the Android Market, Google and

eBay

(EBAY) - Get Report

are said to be getting closer to a deal that would add

PayPal

to the checkout process, according to analysts monitoring the situation. Google's press office was not available for immediate comment.

Google and eBay were reported to be in

talks over using PayPal on Android

by

Bloomberg

last month.

The move highlights Google's effort to find a simple and comprehensive payment system that can compete with the popular Apple iTunes network. Google's own checkout effort has not taken hold among consumers, making PayPal a more attractive option.

There have also been reports that

Amazon

(AMZN) - Get Report

is working on its own Android tablet as part of its Kindle family. If true, the Amazon version will offer yet another Android Market payment system, likely to be seen as superior to Google's own checkout system.

Google's also been expected to arrange a carrier payment system that would let users add purchases to their

Verizon

(VZ) - Get Report

,

AT&T

(T) - Get Report

or

Sprint

(S) - Get Report

phone bill.

"Having PayPal or another service will certainly help," said Nielsen analyst Roger Entner. And bringing the phone company in, said Entner, "will alleviate a lot of the problems and tie the carriers closer to their customers."

--Written by Scott Moritz in New York.>To contact this writer, click here: Scott Moritz, or email: scott.moritz@thestreet.com.To follow Scott on Twitter, go to http://twitter.com/TheStreet_Tech.>To send a tip, email: tips@thestreet.com.