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Whatever Happened to Micropayments?
prostoalex writes "Remember Flooz? Or Beenz? With a few notable successes (PayPal, and that's about it) online micropayment industry is saving its success stories for future generations. New York Times reports about two nascent micropayment systems, one coming out of Stanford, one out of MIT, that are supposed to help the content producers and Internet users to engage in less-than-a-dollar financial transactions without huge overhead costs, so typical of credit card payments. BitPass requires you to purchase a virtual debit card with a certain amount on it to pay for products and services, and PepperCoin consolidates numerous micropayments into one bill that is then split between the content providers that managed to sell their product to the Internet user." I still believe that single penny transactions will revolutionize the net.
What worked best was simply putting an inexpensive yearly fee in place. People pay once and can forget about worrying about any recurring charges or running up some kind of tab that will only come back and surprise them later.
After a year, more than half of them renew their accounts too. And just so they can have access to a giant database of humorous, strange, and twisted photos and media files. Go figure ...
And the answer is, they will *never* happen. read all about it here. In that article, Clay says so much, so perfectly, that I won't quote any of it--just go and read the whole thing. OK, I can't resist. One of his points is micropayments have too much "user overhead"--you have to make a descision for literally every penny you spend, and that alone makes it not worth it. As he says, the user is getting conflicting messages: "This is worth so much you have to decide whether to buy it or not" and "This is worth so little that it has virtually no cost to you."
Dear Slashdot: next time you want to mess with the site, add a rich-text editor for comments.
I remember reading about this system. What they do is actually pool your mico transations and charge at the end of the billing period instead of instantly charging you when you make the purchase. Apple is gambling that you'll buy enough stuff during the billing period to make the transaction fee charged to Apple palatable.