Recently PayPal announced that its second-largest merchant partner in 2009 was the social game publisher Zynga following auction site (and PayPal owner) eBay, according to a report by Citi Group's Mark S. Mahaney. PayPal also accounted for 50% of all transactions made involving the Facebook platform.
For Zynga and other merchants, PayPal processed $500 million in payments for virtual goods in 2009, up from $250 million in 2008. The company's total amount processed for 2009 was $60 billion, most of which was generated by eBay. Mahaney estimates that PayPal virtual goods revenue will increase by 50% in 2010, to roughly $750 million.
This growth in the virtual goods category may have influenced PayPal's recent decision to restructure the way it charges fees on transactions valued at less than $10. The new structure is more favorable to merchants who primarily sell microtransaction items and should make PayPal a more attractive payments option for virtual goods sellers.
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