Essay on Paypal Case Study

2735 Words Mar 11th, 2013 11 Pages
Technology Evolution
Case Analysis

The case is intended to be used as a basis for class discussion. It is not intended to serve as endorsement, source of primary data, or illustrations of effective or ineffective management. Copyright © 2010 SOM, AIT, P.O.Box 4, Klong Luang, Pathumthani 12120, Thailand.

PayPal -Technology Evolution - Case Analysis

Technology in PayPal
The digital wallet, firstly introduced by Peter Thiel and Max Levchin, might not be a success in the first introduction but it disrupted the payment service in the world. Some trial and error and finally integrate its service with eBay, the technology was accepted by the market. The digital wallet was such a radical technology turning a new face of payment
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The digital wallet took some time in development and introduction phase, and it failed to impress the Palm Pilot and PDA market due to the demand and usage of PDA devices. Later,
PayPal focus on the online payment system rather than focusing on the PDA devices. It is a good start for PayPal and the number of user grew up. After PayPal integrated its service to eBay, installed base dramatically increased. Increasing number of user is as if PayPal could across the chasm of technology diffusion and moved to the growth stage.

Figure 1. The product life cycle plan.

In growth stage, PayPal started to diffuse to the mainstream customers very quickly. Effectiveness of core technology significantly rose up with its application and incremental technologies such as
PayPal Web service, PayPal X, etc.
During 2002 and 2008, PayPal was at its highest and overwhelmed its competitors in the market. It becomes the main player and the dominant design in the online payment system.

Page 2

PayPal -Technology Evolution - Case Analysis
Once a technology becomes a rising star, it turns down to decline stage however. The user behaviour will be changed and the new strong competitors will emerge in the market. With overlook of PayPal, new radical technology was invented parallel to enhance the current maturity position.

Figure 2. Parallel or Dual Development life cycle

PayPal seemed to emerging in the mobile payment market easily. It was from

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