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I'm curious about what a micro payments world would be like, but I'm skeptical about their prospects in the near-future. In general, I don't think people like

I'm curious about what a micro payments world would be like, but I'm skeptical about their prospects in the near-future. In general, I don't think people like being nickel & dimed, and that's basically what micro payments are. Subscriptions allow one to rationalize the price upfront, then consume without concern. This appeals to heavy consumers, consumers who overestimate their usage, as well as consumers who don't want to think about each purchase. There would need to be a large enough category of people who would be willing to buy a few articles per month, but not want a subscription. And that would need to generate a large enough profit beyond paying for the micro payments implementation, support, etc.

ghaff 10y ago
Pay per use sometimes works well and sometimes doesn't. I don't think I've ever seen an intellectually rigorous analysis of what factors may favor all-you-can-eat vs. pay-as-you-go. Pretty much all of us have examples from daily life that are more toward one end of the scale or another. By and large, it seems that once you get to $1+ per unit cost, people are willing to put at least a modicum of thought into whether they want to buy/rent something. For a long period, people had no problem renting a film (or going to a theater) for $5 or so. There wasn't a lot of demand for unlimited passes. (Of course, now we have Netflix as well.) I suspect it's the literal nickel and dime-ing that's the problem. It's too small a transaction to want to fuss with. Think if you had to go through some sort of transaction process every time you flipped on a light switch (which is pay-as-you-go but the financial transaction is largely opaque). And I strongly suspect that, at the end of the day, the dollar amounts involved just wouldn't be large enough to be interesting.
lefstathiou 10y ago
Have you watched Twitch by any chance? It's fascinating to see people tip players $2, $3 bucks as they play. Of course not everyone gets tipped and I'm sure the top 1% account for 99% of tips but still worth checking out if you're interested to see how a micro payment model can unfold.

ghaff 10y ago

Pay per use sometimes works well and sometimes doesn't. I don't think I've ever seen an intellectually rigorous analysis of what factors may favor all-you-can-eat vs. pay-as-you-go. Pretty much all of us have examples from daily life that are more toward one end of the scale or another. By and large, it seems that once you get to $1+ per unit cost, people are willing to put at least a modicum of thought into whether they want to buy/rent something. For a long period, people had no problem renting a film (or going to a theater) for $5 or so. There wasn't a lot of demand for unlimited passes. (Of course, now we have Netflix as well.) I suspect it's the literal nickel and dime-ing that's the problem. It's too small a transaction to want to fuss with. Think if you had to go through some sort of transaction process every time you flipped on a light switch (which is pay-as-you-go but the financial transaction is largely opaque). And I strongly suspect that, at the end of the day, the dollar amounts involved just wouldn't be large enough to be interesting.

lefstathiou 10y ago

Have you watched Twitch by any chance? It's fascinating to see people tip players $2, $3 bucks as they play. Of course not everyone gets tipped and I'm sure the top 1% account for 99% of tips but still worth checking out if you're interested to see how a micro payment model can unfold.