Micro Payments

I have been an active reader of Slashdot for many years. They regularly post interesting articles, and sometimes they even post my own. Slashdot is a great place for wacky geeky stuff. Sometimes the ideas there are a bit wacky too.

There has been a growing idea concerning the viability of "micro payments." The idea is someone pays 25 cents or perhaps even less to view your site's exclusive content. The problem is credit card fees erase any profit from a company doing this. New companies using different billing methods (as in your pre-pay for $10 worth of micro payments) solve these problems.

But mirco payments have more problems then simple billing. Will someone pay 25 cents to access your site let along 25 cents for a single article? Some people have shown they are willing to pay 99 cents (technically not a micro payment) for a single song from iTunes but the vast majority still download from peer to peer networks.

Here's the larger issue -- do we really need micro payments when advertising programs such as Adsense pay for high quality content? Or a better question -- with the smaller audience that micro payments bring in can you make as much as you do from CPM advertising and afford to isolate your site's audience?

Are micropayments a bad idea for all sites? Certainly not. Unfortunately there is no data or statistics to give an undisputable answer. People will have to take risks to learn if it will work. I believe that people who are willing to pay 25 cents for content are willing to pay $20. The majority of premium content sites understand this. Mainstream or not, e-books and other paid content sites seem to have figured this out.

As one marketer stated, consumers are more willing to buy a three book set for $70 than a single book for $30. If you can successfully market your site's this may be the way to go. Micro payments may be more successful for certain content niches than others. If you can not afford the risk but have the marketing skills do not be afraid to starta "paid content" website.

For micro payments to truely succeed on a wide scale they need to be hardwired into infrustructure all consumers use be it the operating system or mobile phone payments. Perhaps in 20 years micropayments will be viable for all sites.

There is tons of free content on the web -- thats what makes it so great. Unfortunately consumers don't want to pay for content -- you've got to sell it to them -- and if you can sell it to them, why sell it for pennies?

Of course I could be completely wrong about micro payments. What I do know -- as a surfer -- is that I don't want to feel like I'm surfing the information super tollway. Do you?

Ads aren't so intrusive now are they?

©2004