According to Forbes, GBuy will allow merchants to use the service free of charge during the beta period. When it's released from beta, they will begin seeing a small fee (probably 1.5 - 2 percent) on each transaction -- less than PayPal's rates of 1.9 to 2.9 percent (plus $0.30 per transaction).
PayPal is up for some pretty stiff competition -- Google will likely take what they have minus any extra or annoying features. If it lives up to this expectation, it just might be a product that merchants consider switching to.
Unfortuantely, it will probably be limited to the United States only. Without an internationally compatible service, adoption of GBuy may be significantly lower due to the number of merchants who conduct businesses across borders -- something that PayPal handles without breaking a sweat.
We will see what happens on the 28th -- I for one am looking forward to some competition for PayPal.