The Wall Street Journal today picked up the story (sub req'd) that Google Base and Google Payments could threaten eBay's juicy fees.  But the article is quite imprecise, and doesn't do a very good job in describing the competitive landscape.  Here are a few snippets:

Google Inc. is increasing the number of sellers who can use its online payment-processing service, in a move that could put pressure on eBay Inc.'s online auctions and PayPal payments services to cut or even eliminate some fees.

Last month, Google began processing payments for some sellers using its Google Base service, which lets users submit information such as classified-like listings of items for sale. The Mountain View, Calif., company in recent weeks extended that offering to more sellers. Under the program, Google handles the billing of a consumer's credit card for an unspecified number of sellers.

Google charges the seller 25 cents plus 2.5% of the value of the transaction. The company doesn't charge Google Base sellers who handle credit cards or other payment methods themselves.

Some financial analysts say the Google Base payment service could put pressure on eBay and PayPal, which generally charges fees ranging from 1.9% to 2.9% per transaction, plus 30 cents, depending on factors such as a seller's payment volume.

But the Journal doesn't capture the fee threat precisely.  In fact, to list and sell an item on eBay, the seller must pay an insertion fee (whether or not the item sells), a buy-it-now fee, fees for multiple photos, a final value fee, and a PayPal payments fee.

For a $100 item, these fees can amount to $10 to $12 on eBay.  On Google Base, there is only a payments fee (if using Google Payments), which on the same $100 item would amount to $2.75.  This is where there could be dramatic pricing pressure on eBay if Google Base achieves traction.

But of course, it's not all about the fees.  Even if it were free, Google Base doesn't have the network and captive reputations of eBay, which is the biggest barrier to entry.  Without that network, sellers on Google Base will find it difficult to find buyers, even if the fees are a small fraction of eBay's.

In addition, buyers and sellers have years' worth of feedback in eBay's reputation system which is not portable, and would need to build their reputations from scratch in Google Base.

Finally, the big unknown is whether Google can counter the immaturity of its Base network with Google's incredibly high traffic on its other properties, primarily search.