Visa plans to buy PlaySpan, which makes software that lets users make purchases inside of apps and games, for $190 million. This is Visa’s second e-payments buy–it bought ecommerce payment company CyberSource last year–and increases its presence in the e-payments industry. TechCrunch has the story:
This is a big exit for PlaySpan, which has raised a total of $46 million in funding since its launch four years ago. PlaySpan has been growing like a weed, striking partnerships with a number of social network, gaming and media companies, including Viacom, Disney, Facebook, Ubisoft, and Sanrio. As virtual goods becomes a booming business, PlaySpan has reaped the benefits of technology and media companies looking to incorporate virtual goods into their platforms.
PlaySpan’s flagship product UltimatePay is a ‘Monetization as a Service’ platform for apps, games, videos and digital goods. Based on the user’s location, the payments platform draws from over 85 different payment options. Because of its vast variety of payment options (which include PayPal, pre-paid cards, and a number of credit cards), UltimatePay is designed for a global audience. Currently, PlaySpan powers virtual goods marketplaces across 1,000 video games, virtual world publishers and social networks.
Visa says that ecommerce sales, which reached an estimated $948 billion, are a big growth area for the company. Approximately 45 percent of U.S. online spending takes place on Visa’s network today and for Visa’s fiscal first quarter 2011, the company reported 25 percent year-over-year growth in ecommerce payment volumes globally. Visa is going to use PlaySpan to capitalize on the growing digital goods market, which generated an estimated $25 billion in consumer spending globally in 2010 and is expected to reach $280 billion by 20143.
PlaySpan was started by a 12-year-old, according to TechCrunch. That’s some reward for the kid (and his dad, who is the CEO of the company).
Mobile is currently a huge part of Visa’s strategy. As the Visa blog notes:
The company is currently testing contactless payments methods in over 20 markets located in both developed and developing countries. Our collaboration with DeviceFidelity— transforming a phone into a payment device—has already been introduced at high volume retailers, such as fast food, taxis, drug stores throughout New York and other metropolitan areas, where speed matters. Outside of the U.S., mobile phones are accessible in ways that a traditional payment infrastructure can’t reach. Visa is moving on all fronts—creating new mobile services, acquiring technologies and platforms, and working with leaders in wireless —to ensure that Visa’s network plays a vital role in bringing secure, reliable and globally interoperable mobile payments to consumers everywhere.
I wonder whether Visa, if it gets a majority share of the mobile pay market, will find a way to game the market in its favor, the way it did with debit cards.