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Micropayments Going Mainstream? Not Yet.
DotEdu writes "Today's NY Times has an interesting article on two new micropayment companies, BitPass and Peppercoin, and the venerable PayPal. More interesting than the companies are the critique: Micropayments are not the silver bullet. You still need to actually have a viable product that you can sell."
Peppercoin is still limited, though, things like music downloads, for instance, don't seem to be viable on their payment scheme. They seem to be mainly concerned with content, such as 'pay .01 cents to see this web page.'
Paypal of course offered their own payment scheme for micropayments as well, but they are limited ONLY to music.
Where I'd personally like to see micropayments is in the services department. You can charge 1.00 per transaction to perform a service, and not get raped by the 33% service charge that forces most of these types of service-oriented businesses to use subscriptions.
It's not stuff in most cases, but intangible goods, like articles, papers, etc. We're not talking about the $5000 IDC papers, but about $.05 John Doe web site selling content. Sometimes the content is even free, but the micropayment is an option to allow users to help keep the site costs down.
I thought of using this on my site Geekzone. The idea of keeping the content free, but being rewarded by happy readers is quite cool. It's being use in on-line comics, e-zines, and sometimes even with tangible goods too.
I have to say that I have Donate Paypal button and some users do act on that - mainly adding messages like "Thanks, your content helped me doing this and that", or "Keep the good work".
This is about knowledge sharing, and helping the people who put these things together and make available.
The micro payments system erodes our privacy. With a cc number connected to micro payment id numer connected to every user id in many websites, a lot of web activity will be recorded on your credit card statement as a summary of what your micro payment bill was. Thus, your isp, micropayment company, and your credit card company (and the govenment via patriot act) could see your activity. If you throw it all into a database, anyone who wants to can infer via datamining all sorts of fun information about you.
It didn't bash or hype micropayments, just described them as useful in certain situations for certain individuals or businesses. Which is the truth. (Although can I just say that I hate the word monetize? As in, "This allows us to monetize our content." I don't want to buy anything from anyone who monetizes. Please, just use "sell".)
He who refuses to do arithmetic is doomed to talk nonsense.
Micro payments don't necessarily imply may small automatic payments as you seem to think. Essentially there is a min payment that the credit card company gets no matter what. It is basically impossible to sell something for 10 cents via a credit card because you'd then pay 25 or 50 cents for the cc transaction.
The micropayment companies provide a way for an individual web site to make small transactions. For example a site that used to only sell 1 year subscriptions could allow you to buy on a per issue basis.
Just my 2 cents. (which I can now give with a micropayment system)
First, BitPass uses a pre-paid card model, so there's only one charge on your credit card, the charge for buying the card itself. No individual transactions are listed. Your wife isn't going to know you're looking at micropayment pr0n, if that's what you're afraid of.
Second, the internet has no privacy in the first place. There are IP logs and traffic sniffers galore out there. If you want total privacy, stay off the internet and build yourself a cabin in Montana.
He who refuses to do arithmetic is doomed to talk nonsense.
If you want the site's content enough, you'll pay. If you won't pay, it's obviously not worth that much to you. Economics 101. I have no objection to your choosing either option, but don't pretend that there's something fundamentally wrong with charging a fee for web content or that you deserve to get the content for free despite the author's wishes.
I mean, as it is, much of the free little "perks" that companies offer for their products are little things - little conveniences. Now, as it is its not too practical for them to charge, but we all know that if the means are available, they will. Hmm...just think on that I suppose.
Technology such as this has many good uses, but it also has the ability to become a nuisance.
Yeah, but the definition you just quoted doesn't say "age, dignity, character, and position." In that definition, any one of those four qualities would make something venerable. By acknowledging PayPal's age, you are supporting the original statement.
I dont get it. If you really love my art but dont respect me as a person then that makes it okay to rip me off? FSCK that. My art stands alone. vote with your wallet instead of rationalising theft
micropayments are a vendor problem.
Until vendors can provide a benefit to consumers that motivates them to use a micropayment system, people aren't going to care about the overhead on their transaction. As far as they're concerned they've already paid the money with their credit card and could care less about how the vendor processes the money.
If the only reason motivating consumers to use micropayments is "so the store I'm doing business with makes more money" it just isnt going to work.
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|-_-| . o O ( bEef!)
Because:
a) People goto vending machines _far_ fewer times then they'll click an article.
b) Most people don't hang out at vending machines trying something new without reason. A lot of people hang out at websites and do the exact opposite.
To me, if i have 50 cents in my pocket and i'm hungry, I'll eat that nice twix sitting in box B3. There's not much thought that goes into it and I'll only make that descision once or twice a week. However, deciding whether or not I want to fork over 10 cents or a dollar or whatever a particular website is charging to read an article I think may be neat would be annoying since I would do it so much and each time would involve a judgement call.
my 2 cents.
-Bucky
The savings on transaction costs can be the difference between a profit and a loss. For a lot of products, this may be the silver bullet.
blah blah micropayments suck blah blah
What, is this discussion a cron process? Every couple of months we trot out Bitpass, Peppercoin, PayPal, online comics and copyright and criticize them for how "l4me" they are.
The most entertaining part is how willing people are to, in the same thread, proudly proclaim how they will steal anything that is placed online, yet bitch and gripe when spammers steal their bandwidth.
If micropayments truly sucked, PayPal would have gone out of business years ago. Period. End of story.
Now let's have another story about spam! Anyone see the irony? Anyone?
Business isn't willing to pay for products, innovation and careers, so we get brands, mortgage commercials and layoffs.
The problem with 'micropayments' is that when web companies try to introduce them, then they seem to think that their customers think that paying a dollar or more for a single article is considered a micropayment...
But what is a micropayment on a CEO or CFO salary is usually not worth the money for the rest of the world. So, many companies who claim to have tried micropayments failed, because they were charging too much.
Other forms are micropayments for email are talked about by people who never heard of mailing lists... Even a cent per email will make a tremendous amount of mailing lists shutdown. And I'm talking about true opt-in mailing lists, not about spam.
--- Hindsight is 20/20, but walking backwards is not the answer.
Everybody seems to have accepted without blinking the statements made by Apple on the cost of selling iTunes where they conclude that Apple only makes money by selling iPods. But if we think about the algorithms described in the article then it is clear that there is nothing to stop Apple charging customers for multiple transactions instead of just for one. In which case the cost per transaction would drop dramatically. And the profits to Apple of iTunes would be much higher than stated.
At the very least it is clear that Apple has a lot of room to maneuvre to either bring its prices down, or increase its profitability.