Google pressuring app developers to use Google Wallet instead of PayPal

Google (GOOG) has been pressuring applications and mobile game developers to use its costlier in-house payment service, Google Wallet, as the Internet search giant tries to emulate the financial success of Apple's (AAPL) iOS platform.

Google warned several developers in recent months that if they continued to use other payment methods -- such as PayPal, Zong and Boku -- their apps would be removed from Android Market, now known as Google Play, according to developers, executives and investors in mobile gaming and payment sectors.

Developers say the Internet search giant is trying to simplify consumer payments, hoping apps-buying will rise and offset their higher costs. Google's payment service charges a higher cut per transaction than some rivals'. But the move also suggests Google is using its powerful position in the mobile apps market to promote an in-house offering.

"Although this move by Google might seem highhanded, it reduces the friction for purchases inside Android apps and therefore makes users more valuable," said Hugo Troche, chief executive of Appsperse, a cross-promotion network for app discovery.

A Google spokesman declined to comment on Thursday...

continues