eBay on Thursday announced that it is acquiring payment startup Braintree for US$800 million in cash. eBay will combine Braintree, which provides technology for processing payments on the Web and mobile devices, with its PayPal payments division.

"eBay's acquisition of Braintree complements the expansion of PayPal into the mobile payment space," said Jennifer Kent, a senior analyst at Parks Associates. "PayPal is well-positioned to capitalize on the growing mobile payments ecosystem, with high consumer awareness of and trust in the PayPal brand."

In fact, "Parks Associates' data from 1Q13 shows that 10 percent of smartphone users are currently using the PayPal app, and 60 percent are at least somewhat familiar with the app," Kent told the E-Commerce Times. "This makes the PayPal app the most widely used and best-known mobile payment app on the market."

PayPal already has a strong presence in mobile, where its projections show a payment volume of more than $20 billion this year. eBay could now get a bigger piece of that pie.

"By acquiring Braintree, including its mobile payment Venmo division, PayPal has just removed at least one mobile payment competitor from the market and is extending its lead over the rest of the pack," added Kent.

From the article, "eBay Snags Braintree's Mobile-Payments Brain Trust in $800M Buy" by Peter Suciu. 

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