Good to see the boys squabbling, and threats to PayPal coming thick and fast. It’s interesting times for all we eBay “haters” (oops, I mean “watchers”). I hope that someone has remembered to bring the popcorn.  The rusting old hulk eBay is presently being kept afloat by PayPal. PayPal is usually registered in various places as only a “money transmitter” (like Western Union), and PayPal actually claims to be not a “payment processor”, and there is a minute degree of truth in that claim because it could be (nonsensically) claimed that they do no more than facilitate the transmission of money by riding on the back of the retail banks’ existing payments processing systems.  The only thing creative about PayPal has been their use of the email address as an identifier for online transactions. Regardless, PayPal is literally no more than a blood-sucking parasite on, and in the main cannot function except via, the retail banks’ existing payments system (via their banker, GE Money Bank).  PayPal, outside of whatever will ultimately be left of the Donahoe-devastated eBay Marketplace, will undoubtedly eventually be consigned to the history books by all those same banks/Visa/Mastercard once those players get their act together.  Some people may not like some “banks” but all those participating banks at least supply a professionally run payments processing system; and PayPal agrees—they use that system all the time and simply could not exist without it.  All the above comments apply equally to all of the other third-party payments processors that are emerging out of the woodwork and wanting to have access to your banking account. Unless they have formal arrangements with all the participating retail banks, as do the likes of Visa/Mastercard, then the result is invariably going to be as potentially problematic as is PayPal’s clunky operation.  All anyone needs to know about the clunky PayPal: http://forums.auctionbytes.com/vbulletin/showthread.php?p=165263  Is that PayPal’s blood in the water I see, and are those sharks (oops, banks) I can see circling?  Enron / eBay / PayPal / Donahoe: Dead Men Walking.
Shortly after Google's announcement of its new online payments service, Google Wallet, PayPal sued the company as well as two of its former executives over trade secrets.