I just got this email. That's a real bummer!

<<<Hello,

We're writing to let you know that on May 5, 2009, Google
Checkout's transaction processing fees will be changing. We'll be
transitioning from our 2.0% + $0.20 per transaction rate to a new
tiered fee structure, where the rates will vary depending on the
dollar amount of your monthly sales processed through Checkout.
The rate you'll be charged beginning on May 5, 2009 will be based
on your sales processed through Checkout during the month of April
2009. Each month thereafter, we'll continue to use the prior
month's sales volume to determine your transaction processing
rate. For more details about the new rates, please visit
http://checkout.google.com/seller/fees.html

We'll also be discontinuing the AdWords free transaction
processing promotion on May 5, 2009. Any AdWords transaction
processing credits accrued during April 2009 will be applied
towards transactions that occur on May 1-4, 2009.

Fees are the same for all payment types (Visa, MasterCard,
American Express, and Discover) and there are still no monthly,
setup, or gateway fees. For cross-border transactions, there will
be an additional 1% fee assessed per transaction. To learn more
about Google Checkout fees, please visit
http://checkout.google.com/seller/fees.html

Google is committed to the continued growth and development of
Checkout and to helping merchants increase sales by driving more
leads and higher conversions. Advertisers who use Checkout have
the opportunity to display the Checkout badge on their ads, which
has proven to be an effective way to differentiate ads and attract
user interest. Checkout users click on ads 10% more when the ad
displays the Checkout badge and convert 40% more than shoppers who
have not used Checkout in the past.

For more information about this change and how it affects the
product, please read our post on The Official Google Checkout
Blog: http://googlecheckout.blogspot.com/2009/03/google-checkout-fees-in-2009.html

If you have any questions, please visit our Help Center at
http://checkout.google.com/support/sell/bin/answer.py?answer=134473
Thank you for using Google Checkout.

Sincerely,
The Google Checkout Team>>>

PayPal has identical fees:
https://www.paypal.com/cgi-bin/webscr?cmd=_display-receiving-fees-outside&countries=

I suspect that Google Checkout will be discontinued in the near future since its main advantage was the low price.

http://googlecheckout.blogspot.com/2009/03/google-checkout-fees-in-2009.html

Ionut How pessimistic you are... I completely agree with you :)
Anyway, it would be a bad thing because I know a lot of people who are afraid of Paypal – because of phishing, ... – while they would rely on Google about security of their data and privacy.

I can't see any reason to use Google Checkout instead of Paypal: identical fees (except cross-border payments: Google costs more), lower market penetration etc. Is Google trying to kill Checkout for some reason? http://blog.rac.me.uk/2009/03/11/google-checkout-same-fees-as-paypal-what-advantages/

Shame!, The Adwords linked free transaction processing was good for my business, along with the 1.5%. Sadly I will be dropping google checkout from my payment pages after 5th May, and switching to VoicePay at 1.99%. Good while it lasted. Gutsy move by google, hope it doesnt back fire on them. Andy

Outrageous

Join the facebook group

http://www.facebook.com/group.php?gid=57485523675

<<I suspect that Google Checkout will be discontinued in the near future since its main advantage was the low price.>>

Although this move is a bit surprising to me, i don't see Google Checkout being discontinued. I'm pretty sure google does have plans for Google Checkout (though i'm not sure how soon until we see them materialize): they should be working on implementing all the features paypal has the gcheckout currently does not. Legal stuff is what they're mainly sorting through, i believe.