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Why micropayments are (still) a terrible idea

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Re: Why micropayments are (still) a terrible idea

#21

Post by blhack »

skinnymuch wrote: post #19
blhack wrote: post #6

Earlier quoted context omitted.

I imagine that you wouldn't actually have to process the transaction until somebody owes a largish ammount of money (relatively). Something around $10-20. What would work even better (this is how allofmp3.com used to work) would be to buy a bunch of credits...$10-$20 worth of them, then as you make "micropayments", it draws from this supply. Google's ad program also works this way. You pay in $50 or so, then each cli…

I really don't think the buying credits would work better. It would work, but not better. The whole point of micropayments is spending a tiny bit of money. How is buying $10+ in credits beforehand a micropayment? Defeats the purpose.

It sounds like somebody needs to create a micropayment service.

I don't have the coding chops, but I know a lot of the people around here do.

You put $10 into a micropayment account that can then be used across websites like facebook or blogger, or whatever else service decides to do this.

I could even see ISPs rolling this into part of your payment plan for internet...$50 a month for access, $10 a month that gets picked at by people that use micropayments.

If anybody does this, will you buy me an Ariel Atom?

Re: Why micropayments are (still) a terrible idea

#22

Post by adamc »

skinnymuch wrote: post #20
chollida1 wrote: post #16

Earlier quoted context omitted.

StarBucks, and I assume other retailers, have figured this out and offer refillable cards. The idea is that you put say $25 on the card and that is a one time VISA charge. Then each time you use the card there is no additional merchant charge to them. At the price of say $3 drink this can save them 7 of the 8 flat fee credit card processing charges, the variable charges for using the credit card are of course still t…

I go to Starbucks regularly and rarely see anyone using the Starbucks card. Though I see it being advertised near the cash register everywhere.

Does it offer any advantage to consumers? (I don't drink coffee.)

Re: Why micropayments are (still) a terrible idea

#23

Post by derefr »

frossie wrote: post #4
Kadin wrote: post #3

I don't really buy his argument. At first he says that most online purchases are too big to really be considered "micropayments." Well, duh -- there's no micropayment infrastructure, so no true micropayments. The business models that exist today are the ones that somehow get the customer to cough up a couple of bucks. Then the main thrust of his argument is that consumers won't accept micropayments because there's a…

At first he says that most online purchases are too big to really be considered "micropayments." Well, duh -- there's no micropayment infrastructure, so no true micropayments. Exactly. There is no data in his argument - you can argue that people wouldn't want to pay a little versus nothing but how can you know? There is no real opportunity to test this on the Internet. In real life, there are people who make a living…

> There is no real opportunity to test this on the Internet.

I imagine you could set up an HCI test that makes it look like people are going to be able to micropay, and observe their reactions.

Re: Why micropayments are (still) a terrible idea

#24

Post by dave_au »

stcredzero wrote: post #13
anigbrowl wrote: post #11

Earlier quoted context omitted.

Well, there are a few things where you pay first - books, as you say, but also movies, theater, fast food and so forth. Unsurprisingly, this involves high marketing and a tightly controlled supply chain to be profitable, or else a very qualified consumer (no way am I going to pay >$30 for the privilege of reading a paper in Nature or something that I might find interesting, but if I was a specialist in that field tha…

What if Google hosted something like TipJoy, and the scheme was built as a very specifically formatted REST call with open source server-side software that authenticated and forwarded the transaction. If Mozilla built this into Firefox, then it would quickly become a part of what the users perceives as the Web Infrastructure, just like the (default) Google search box on the upper right hand corner, or the SSL lock ic…

Whenever micropayments come up - and specifically with the idea of making the payments from some kind of broker account so that the transaction cost isn't a hassle - it colours my thinking for the next couple of days.

It gets tied into my "vote up" reflex that I've gotten used to from reddit and HN. Normally I'll come across something I like, think "I should vote that up" if I found it from some place with votes. After I'm primed with the idea of micropayments I think "I'd micropay for that".

I don't know what I'd pay, but I get the feeling that the thought corresponds to the same payment amount. It would be nice to have a configureble browser widget that would make paying the default amount as bookmarking something or tagging it for delicious.

The troubling thing is that I'd spend a bit on stuff that I'd optionally get for free, but I don't know how much I'd pay for something like the new york times - the "you must register thing" really bugs me (even now, after I registered with a mailinator account to avoid the hassle). I guess I've just gotten used to trying before I buy (thanks torrent people...)

Re: Why micropayments are (still) a terrible idea

#25

Post by joeyo »

adamc wrote: post #22
skinnymuch wrote: post #20

Earlier quoted context omitted.

I go to Starbucks regularly and rarely see anyone using the Starbucks card. Though I see it being advertised near the cash register everywhere.

Does it offer any advantage to consumers? (I don't drink coffee.)

Yes, if you register a Starbucks card you become eligible for "rewards" according to: https://www.starbucks.com/cardrewards/default.asp

Re: Why micropayments are (still) a terrible idea

#27

Post by anigbrowl »

dave_au wrote: post #24
stcredzero wrote: post #13

Earlier quoted context omitted.

What if Google hosted something like TipJoy, and the scheme was built as a very specifically formatted REST call with open source server-side software that authenticated and forwarded the transaction. If Mozilla built this into Firefox, then it would quickly become a part of what the users perceives as the Web Infrastructure, just like the (default) Google search box on the upper right hand corner, or the SSL lock ic…

Whenever micropayments come up - and specifically with the idea of making the payments from some kind of broker account so that the transaction cost isn't a hassle - it colours my thinking for the next couple of days. It gets tied into my "vote up" reflex that I've gotten used to from reddit and HN. Normally I'll come across something I like, think "I should vote that up" if I found it from some place with votes. Aft…

You're right on the money: your momentary attention to a HN post has a value, and that accumulates with authors you like - you're more likely to upvote someone who has already impressed you.

What if tipping is free for the consumer of a blog or video or tune, but the tips are redeemable for a discount with online retailers? Tips and/or comment depth presumably have some kind of analytic value and might be orthogonal or inversely proportional to the the kind of SEO-hackery designed to pull adwords bidding.

Re: Why micropayments are (still) a terrible idea

#28

Post by pyr3 »

I have a bunch of issues with this post, regardless of the feasibility of micropayments.

First off, saying that people didn't go for the $0.xx/kB data plans on cellphones due to 'mental accounting' that people have when the price is Second, the proliferation of prepaid credits has less to do with people getting over some mental hurdle to spending money in The mental hurdle that people have isn't some difference between spending $0 and spending $0.01. It's the difference between not getting something and spending 5 minutes going through a process to spend $0.01 on something.

Re: Why micropayments are (still) a terrible idea

#29

Post by eru »

blhack wrote: post #21
skinnymuch wrote: post #19

Earlier quoted context omitted.

I really don't think the buying credits would work better. It would work, but not better. The whole point of micropayments is spending a tiny bit of money. How is buying $10+ in credits beforehand a micropayment? Defeats the purpose.

It sounds like somebody needs to create a micropayment service. I don't have the coding chops, but I know a lot of the people around here do. You put $10 into a micropayment account that can then be used across websites like facebook or blogger, or whatever else service decides to do this. I could even see ISPs rolling this into part of your payment plan for internet...$50 a month for access, $10 a month that gets pi…

Isn't this exactly what your bank or credit card company should be providing? (Only massively cheaper than they do now.)

Re: Why micropayments are (still) a terrible idea

#30

Post by eru »

ryanwaggoner wrote: post #17
dan_the_welder wrote: post #2

Transaction costs are a killer. It hurts on cups of coffee which I sell a lot of. Merchant services are bastards.

I've always wondered about this...I live in SF, where a huge number of the little coffee shops are cash only or have a $10 minimum or whatever. As a result, I don't go there, I go to Starbucks instead. I get that the transaction costs of $.25 + 3% is brutal on a $1.50 cup of coffee, but wouldn't it be better to just raise the price of the cheaper items in the store by $.25, or even just $.15? The COG on a cup of coff…

Why not just two different prices? Just make sure to call it a cash discount, instead of a credit card markup.

This way the store does not care how a customer pays, and the customer can decide for herself whether fifteen cents are worth the convenience.

(By the way, why aren't you paying with cash? I find it much more convenient in general than plastic cards.)

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