eBay Acquires Zong for $240 Million

July 11, 2011

Zong, a mobile payments pioneer founded in 2008, was acquired last week by PayPal parent company eBay for $240 million in cash. The companies said Zong’s technology, which enables consumers to pay for digital goods via their mobile phone bill, will give PayPal’s 100 million users worldwide another way to make mobile payments and increase conversion for merchants of digital goods. “Our customers love the convenience of paying with their mobile numbers – a number they know by heart, and a device that they always have with them,” said David Marcus, CEO of Zong. “We look forward to extending our services to PayPal’s more than 9 million merchants around the world. And we’re committed to working with carriers and merchants to help them drive more sales across devices.” A PayPal executive recently wrote in its corporate blog that the company expects consumers to spend $3 billion on mobile devices this year, double what it thought 2011 mobile payments volume would be in its first prediction last year. eBay said it does not expect the acquisition to affect the financial guidance released in April and that the deal should close some time in the third quarter this year.