PayPal Plans to Shift Core Applications to Google Cloud
By John McCormick
PayPal Holdings Inc. plans to move several core
payment-processing applications to Google Cloud as the company
experiences an upswing in activity fueled by changing consumer
The migration, part of the digital payments company's ongoing
move to host all its applications in the public cloud, includes
PayPal peer-to-peer payments, merchant checkout and bill-payment
apps, as well as user account management, the company said
PayPal declined to provide a scheduled completion date. Neither
PayPal nor the Google LLC unit would detail terms of the latest
Google Cloud contract. Google Cloud and Google are part of Alphabet
PayPal in 2017 moved software development and testing to Google
Cloud and last year moved some payment processing for the Western
U.S. from its own computer infrastructure to the cloud-service
provider, although it declined to provide specifics.
The company said about 20% of its processing volume last year
was handled in the cloud.
"By moving into the cloud, we can actually capitalize on the
fact that we can just pay for the capacity that we use in the
cloud," said Wes Hummel, PayPal's vice president of site
reliability and cloud engineering. "We're not paying for unused
capacity that's sitting in our data center."
Mr. Hummel reports to PayPal's chief technology officer, Sri
Shivananda, who is overseeing the cloud migration.
Since the Covid-19 outbreak, PayPal has seen a 24% increase in
active customer accounts, which numbered 392 million at the end of
this year's first quarter. The company last year handled 15 billion
payment transactions and nearly $1 trillion in total payment
volume. Last week, PayPal said it expects total payment volume to
grow by about 30% this year.
Demand for public cloud services is rising. Technology research
and advisory firm Gartner Inc. last month said it expects spending
on public cloud infrastructure services to grow to $106.8 billion
in 2022, up from $59.2 billion last year. Amazon.com Inc. is the
leader in public cloud infrastructure services, controlling almost
half the market, with Microsoft Corp. holding less than a 20% share
and Google with around 5%, according to Gartner research released
But Google has notched some notable wins. Last month it secured
one of its largest-ever cloud-computing contracts with
Spanish-language broadcaster Univision Communications Inc.
PayPal said having payment-processing information in Google
Cloud would allow it to more efficiently aggregate and analyze
customer and merchant data to spot shopping trends -- information
that PayPal merchants could use to tailor discounts and other deals
-- as well as prevent fraud and find other ways to improve the
service. Currently, the company pulls customer and merchant data
from different sources.
Last October, the company said it would allow its U.S. users to
sell, buy and hold cryptocurrencies, becoming one of the largest
companies in the U.S. to enter the market for digital
Mr. Hummel said the cloud would play a part in all the company's
lines of business, but added that the launch of its cryptocurrency
market didn't play a role in its latest cloud move and declined to
say which of its cloud providers would handle its crypto
While PayPal is moving its core payment-processing applications
to Google Cloud, subsidiaries, such as money-transfer services Xoom
and Venmo, already have their payment-processing applications in
the cloud. Xoom is using Google Cloud, while Venmo is using
Amazon's cloud service.
PayPal also says it has some payment applications still running
on its infrastructure, although it declined to disclose which ones.
It said it plans to eventually move those applications and its data
stores to one or more of its existing cloud providers.
Write to John McCormick at email@example.com
(END) Dow Jones Newswires
May 13, 2021 09:14 ET (13:14 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.