Tricia Duryee

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Xbox Live Adds PayPal to its Payments Options. Is PlayStation Next?

Microsoft is now allowing its Xbox 360 users to pay for digital downloads with their PayPal accounts, adding both convenience and an additional layer of security to its gaming systems.

The addition of PayPal to Xbox brings into question whether Sony will be next after its very public debacle, which included shutting down its PlayStation Network after hackers obtained personal information associated with accounts, including names, addresses, email addresses, birthdates, usernames and passwords.

Additionally, it cautioned consumers that their credit card information may have been obtained.

Integrating PayPal may not eliminate all of those concerns, but it could potentially add another barrier between a customer’s sensitive information and the outside world.

In the announcement, neither Microsoft or PayPal hinted that the integration had anything to do with security or Sony’s woes. A PlayStation spokesperson did not respond to an email, asking whether it was considering alternative payment methods in the future.

However, beyond Xbox or PlayStation, it is becoming increasingly common for a variety of payment methods to be offered by merchants. In particular, game companies have been aggressive. For instance, on Facebook players can commonly charge virtual goods to their mobile phone bill or PayPal, among other options.

Other new payment mechanisms are also in the works. Visa revealed part of its digital wallet strategy last week, saying that it would allow consumers make payments with their credit card through an associated username and password instead of typing in their entire credit card number.

Not only could it be more secure, consumers often find it more convenient. In fact, convenience seems to be one of the main factors of the relationship between Xbox and PayPal.

Microsoft said Xbox 360 owners in more than 20 countries around the world will now be able to use their PayPal accounts to buy Microsoft Points, Xbox LIVE Gold subscriptions and Games on Demand.

The integration began rolling out early yesterday morning and will be available worldwide in the next few weeks.

eBay-owned PayPal said in a blog post nearly 75 percent of people who identify themselves as gamers also have PayPal accounts, according to an Ispos study from March of this year.