Micropayments, redux

John R. Levine johnl at iecc.com
Tue Dec 17 00:55:36 EST 2002


> Peppercoin is a new approach to an old challenge: how to make small
> value transactions--micropayments--feasible. There is a whole world
> of digital content gathering dust because owners cannot find a
> profitable way to get it into the hands of paying customers.

I believe that both of these sentences are true, but I don't see any
obvious connection between them.  Micropayments have two problems.
The minor one is that technically we have no idea how to implement
them.  The major one is that users hate the idea.  Look at Andy
Odlyzko's work on pricing of communications, and you'll find that the
trend has always been away from nickel and dime per unit charges
toward flat rate subscriptions.  That's why all of us cell phone users
and dialup Internet users have plans with bundles of service, even
though it'd usually be cheaper on average to go a la carte.

For all I know, in a world where lots of people wanted to make lots of
tiny payments, Peppercoin would work.  But is there any reason to
belive that world is this world?



-- 
John R. Levine, IECC, POB 727, Trumansburg NY 14886 +1 607 387 6869
johnl at iecc.com, Village Trustee and Sewer Commissioner, http://iecc.com/johnl, 
Member, Provisional board, Coalition Against Unsolicited Commercial E-mail

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