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Ask HN: Why aren't micropayments a thing?

• Finnucane 6y ago
  Fees? Sure, a service might charge you a small rate per email, but are they going to charge you for just one email at a time? Probably not. But that could easily be a problem for a news site.
  • wppick 6y ago
    I guess there would need to be a 3rd party or even in house token system where you buy something like 1000 token for a dollar. And you can spend x tokens to view an article. Online advertising like Google ads is essentially doing this for ad views/clicks
    • quickthrower2 6y ago
      PayPal could easily offer this sort of thing, along with the integrations for news sites etc.
      • bserge 6y ago
        Yeah, I'm surprised Paypal has fallen so much. They were a pioneer in online payments, they used to offer Patreon-style subscriptions that could be integrated on any website, they'd automatically transfer the monthly fee to your account, but damn the interface was extremely confusing and buggy, I wonder if it got any better...
    • Finnucane 6y ago
      I suppose a news site could offer monthly billing based on usage rather than a flat fee. Surely someone has tried it. But then, consider all the pay sites that are linked here on HN that you might only look at occasionally.
• posguy 6y ago
  Processing a credit card costs $0.02 per card, plus interchange of up to 3%. Debit processing is $0.22 cents plus 0.05%. Both of these are the baseline cost, your merchant processor often won't be able to even get these rates for their own wholesale rates. Now try and build a micropayments ecosystem ontop of this infrastructure that is very expensive to interact with (in the context of $0.01 charges). Amazon can do it for AWS as they aggregate many small charges into one bill, resulting in the service cost not being dwarfed by the payment processing cost.
  • choeger 6y ago
    I doubt that any transaction costs some percentage of the transaction's value. The true cost shouldn't differ whether I charge $1 or $10 (maybe large transactions incur extra costs for security measures). It's just a convenient way of pricing for the credit card company.
    • lostcolony 6y ago
      That's pricing in the risk of taking the charge. The $10 transaction is 10x as risky to a credit network's bottom line as the $1 transaction. That's also why the debit percentage is lower.
    • lalaithion 6y ago
      Many of the entities that process transactions do fraud monitoring. Oftentimes, the fraud monitoring has different levels of time spent depending on amount: under $10 and the system just ignores it, under $1000 and a computer uses some heuristics, and above that, it might be flagged for human review. These aren't exactly 5% of the cost of the transaction, but they do show that the cost to process the transaction does increase as the amount increases, and fraud prevention, detection, and responsibility is how companies justify charging a percentage on a transaction.
  • acjacobson 6y ago
    The answer to this, which I am a little surprised no one has tried to implement (maybe someone has tried?), is to charge the end customer in some larger amount - say $5 or $10, and then draw down the micro transaction amount as you go. So if you could pay $5 a month (or at a time) but gain access to every article, site, video, piece of content etc, and it auto deducts from your balance then you don't have the transaction cost to manage with the CC, and you don't have the friction of purchasing. The challenge here is like any two sided marketplace - you need consumers to pay, and then you need content providers to sign on to get enough on offer for it to be worth it for both sides.
• PaulHoule 6y ago
  Because payments are a hassle. People resent that the credit card companies take 3%, but it takes more than just 'transfer money from this account to that' but also dealing with fraudulent buyers and sellers. In the case of you visiting a site and feeling you didn't get 0.005 cents worth of value it is very clear that somebody could perceive it was unfair. In the advertising economy, however, no one party sees the whole transaction so rip-offs can be pervasive and people don't know.
• RedditKon 6y ago
  Transaction fees
• BitwiseFool 6y ago
  Accounting, transaction reversibility, and taxation. In real life if you want to give somebody a dime, you just do it. But online you have to query your account to make sure you have enough money to make the payment, reserve the funds so the payment can go through without stopping other pending transactions, pass it the amount through some infrastructure where you can dispute the charge at a later date (if needed), and you also have to make sure the government is able to track your transactions for tax and anti-money laundering purposes. For Amazon it's a different situation because they're charging you for a service based on usage. They have given you an account number and they handle all the accounting on their end. It's not a general payments system.
• aurizon 6y ago
  I get stock quotes with 15 minute delay. If I want real time, I am charged 2 cents. At the end of the month all the 2 cent charges are summed and added to my monthly fee. News sites could easily do something similar
  • wppick 6y ago
    Yes, and as a 3rd party service would be great too. I can login with Facebook, Google, etc. It would be great if I can just pay 1/2 cent to read 1 article vs signing up for monthly or yearly subscriptions. And I can choose pay with service a, service b or service c. They should all adhere to a single standard so any new service can just plug into it. Why should I have to choose only between ads or some big monthly/yearly subscription?
  • deleted 6y ago
    [deleted]
  • GekkePrutser 6y ago
    But people into finance are already pretty much into money... I still view the internet as something that should be free and any transaction pisses me off. No matter how cheap it is I will avoid having to pay unless one of the conditions are met: - I really need the article in question - It's something substantial that I really think is worth money (e.g. a book) For example, if I spend 2 cent on an article that turns out to be clickbait I will be royally pissed. Which I acknowledge is totally absurd because 2 cents affects my financial situation in no way whatsoever. But this is not how it feels to me. Logically I shouldn't even think about it at all, it's not worth even thinking about. But this is not how this works. I'm pretty sure that people dealing with stocks are generally less bothered having to deal in stuff because they are in the middle of the economic model (it makes them money as well as takes it) whereas I'm purely at the end of it, only spending.
    • aurizon 6y ago
      Yes, It would be nice to enslave a few AI's to run a free web, but come the revolution when they control the food synthesizers.... I know the stock quote company pays a fee to get real time quotes(RTQ) (versus the 15 minute delayed free quotes), so it is fair for me to pay a fractional fee. In the old day I would phone the broker and he was get me the RTQ and I could also get the bid-ask array. Now lots faster and easier. The phone brokers got old and died off, mush like the classified ads were mugged by Craigslist and the internet killed display advertising. These were all paid, the papers were paid, you want free - eat some more ads. I do not pay for clickbait. I would hit the roof if I clicked for a RTQ and got an ad how to get rid of my wrinkles or to manscape my groin - so no, these 2 cents fees will get the real goods clicked from the snippet that lets you decide if you can spare the 2 cents. If you have no job, just spending, the library helps...
• mimikatz 6y ago
  People don't like to do transactions. It taxes our brains and makes us make decisions constantly. We like all you can eat and watch as much as you like. Paying for things sucks even if you just pay small amounts.
  • spurdoman77 6y ago
    Yeah. For example, thats why people like all-inclusive hotels. The reason is that you dont have to think about the prices all the time. You just go through the package only and thats it. The less tranactions, the better. At least for the majority of us. It is very rare to prefer doing many small transactions over one big.
    • wppick 6y ago
      How do you explain paywalls then?
      • davidkellis 6y ago
        Everyone hates paywalls
        • wppick 6y ago
          Yes, because they want you to pay for a monthly or yearly subscription and you just want to read one article and maybe never come back to their site. But if I can do a 1-click "pay 1/2 cent" to read the rest of the article that would be totally fair
          • GekkePrutser 6y ago
            That's not the only thing. It's the hassle as well. First they want you to sign up for an account. Give a lot of personal data. Then set up a payment model, often recurring. Just to read one article? No way. Micropayments will save some of that hassle but I don't want to have an account with every news site linked to by HN.
• solus_factor 6y ago
  Because nobody yet built a good implementation of the idea. There was Flattr, but they pivoted from their original idea because they couldn't make it work for some reason. It can't be implemented on the level of individual sites - the solution needs to be universal, like Google adding a 'tip' button to Chrome + Play Store payment integration.
• egypturnash 6y ago
  Because payments are a for-profit industry. If we had some kind of digital money that could be transferred without any fees (because, say, the infrastructure was operated by the government, under the assumption that a medium of exchange that doesn’t take a few percent off every transaction is a Public Good we should have) then it would be much easier to see if micropayments are actually a thing that anyone is willing to do.
  • wppick 6y ago
    Nothing is stopping the payment provider from taking a percentage. I pay 0.5 cents for an article and service provider takes 0.1 cents. Still $4 RPM for the news site after a 20% fee!
  • kube-system 6y ago
    The US already has a government-facilitated money transfer system that was specifically created to make small electronic money transfers accessible for more people. https://en.wikipedia.org/wiki/ACH_Network https://en.wikipedia.org/wiki/ACH_Network
  • beefman 6y ago
    Nano is a cryptocurrency that is completely feeless. It's the only feeless payment system I know of. (This is not an endorsement, though the handful of transactions I've done with it over the past couple years worked as advertised.)
    • strombofulous 6y ago
      How are miners incentivized to maintain the network?
      • rkho 6y ago
        I was curious and looked into this myself. According to Coinbase[1]: > users provide the computational power required to verify their own transactions, allowing transactions to be processed without fees [1] https://www.coinbase.com/price/nano https://www.coinbase.com/price/nano
• dannyobrien 6y ago
  Here's some older explanations: Clay Shirky: http://web.archive.org/web/20060214180624/http://www.openp2p.com/lpt/a/515 http://web.archive.org/web/20060214180624/http://www.openp2p... Andrew Odlyzko: http://www.dtc.umn.edu/~odlyzko/doc/case.against.micropayments.pdf http://www.dtc.umn.edu/~odlyzko/doc/case.against.micropaymen... Nick Szabo: http://web.archive.org/web/20080514172459/http://szabo.best.vwh.net/micropayments.html http://web.archive.org/web/20080514172459/http://szabo.best....
  • ghaff 6y ago
    I still think Shirky is pretty much spot-on after a couple of decades. Even when it seemed as if "midi-payments" might be getting some traction in music and apps, they've now mostly turned into either subscriptions, ad-supported, or "free to play." And arguably a bunch of midi-subscriptions (e.g. $1/month) is even worse because enough of those and they add up to a real money leak. For subscriptions, I'd much rather have a $5-15/month that is a sufficient line item that I'll spend the time to consider whether I really want this or not.
• uncledave 6y ago
  Because it’s a pain in the butt. You end up keeping track of who’s charged you what. You end up being a full time accountant and adding a value judgement to every little thing you do. It’s just another thing chipping away at you constantly. Another distraction and another treadmill.
  • GekkePrutser 6y ago
    This! Totally this. It'll be super hard to keep track of finances with thousands of transactions per month. And yes the value judgement. I'd hate having to think whether every page I visit is worth it.
• lostcolony 6y ago
  Because a lot of news sites know you're not loading them intentionally in your browser, but landing on them because of shares or search. Meaning you may only see their pages 10x a month or similar even without a paywall. The hope with the paywall is if you keep seeing it, you'll go ahead and pay to unlock it, and the amount you're paying offsets the transaction fees. 1000 users each paying 20 cents for ten articles (so assuming -double- the rate you propose, and charging only at the end of the monthly billing cycle) is still a loss of likely around 1/4th the revenue even with a cut rate payment provider (due to the large fixed cost of 2-4%). So might make $50. It's -negative- if using something pleasant to integrate with (because they will charge for that convenience with a larger fixed cost, like Stripe, who will charge $.30 + small percentage per charge), unless you work with them to design a new pricing model for you. Converting 50 of those thousand (so just 5%) of those people to paid users at $5 each is going to be north of $200 you keep, even if you use Stripe and don't negotiate anything. And for those users that -will- load up a news site intentionally, the economics are even starker; a subscription means you'll likely go to their site, and stay there. Pay-as-you-go pricing incentivizes you to not visit the site, and instead find other, cheaper news sources. AWS pricing works because of the scale of the resources people tend to use, and that for businesses, using those resources = additional revenue. It is spending money to make money.
  • GekkePrutser 6y ago
    Well in a way this actually works.. There's been several sites I'm paying a subscription for because I came across them in some search and found them really good. Like Ars Technica and some local sites. Besides paying for the content I like sponsoring them so they can keep doing the thing they do. But usually those sites are the ones I open at least once a day to see what's new. I don't want to pay for every clickbait I visit.
  • jokethrowaway 6y ago
    The funny thing is that they're exposing their content for indexers but hiding it for users. When I encounter these websites I just write another greasemonkey / tampermonkey script to delete the popup and unlock the content.
• finm 6y ago
  My two cents: https://www.finmoorhouse.com/writing/micropayments https://www.finmoorhouse.com/writing/micropayments The bottom line is network effects, I think.
• smithza 6y ago
  The idea is akin to a driver going through a modern toll. They take a photo of your license plate and send you a bill in the mail after looking it up in the state registry. For those who registered (have an express RFID chip or similar), that process is cheaper and you get a cheaper bill that is summed up each month/quarter. To stay strictly with the analogy, 1) what is our online license plate? 2) how would one send a bill after translating license plate to home address? To me, these are fundamental web browser capability deficits. Tim Berners-Lee envisioned this and put some HTTP response codes in the registry with a TODO bookmark and never got around to it or something like that. It is possible but we will have to call in the committee.
• GekkePrutser 6y ago
  I'm kinda happy they're not. It'd be much harder to track expenses that way, and literally everyone would be constantly asking for money.
• rgblambda 6y ago
  Companies prefer stable income, even when it means making less overall. It makes it easier to plan future spending.
• rogerallen 6y ago
  Hear, hear! I would love to give money to a "read-the-article.com" and have them dole out money on a per-article basis for articles I read online. They can make money on the float. Google & Apple should waive their 30% for this.
  • GekkePrutser 6y ago
    Like Blendle? https://en.wikipedia.org/wiki/Blendle https://en.wikipedia.org/wiki/Blendle
  • mumblemumble 6y ago
    This roughly is how Medium works. I subscribed to Medium mostly because I liked the idea of paying writers with money rather than with ads. Very shortly after, I stopped bothering with Medium because it's a pit of eternal clickbait. Pay-per-read sets up bad incentive structures.
• eitland 6y ago
  I want to pay for the things I want to read in other papers that I don't subscribe to. Up to $1 or $2 a piece. I just want it like Blendle used to be that I can get my money back if I jump back out after a few seconds and I want some more choice (travel and fashion isn't exactly my stuff but actively looked for tech stuff to read there and hardly found anything).
• deleted 6y ago
  [deleted]
• wbobeirne 6y ago
  There are a lot of complications to this, but I'm optimistic that eventually this will be a more common user experience. 1. Credit card vendors have flat fees that will eat up a whole transaction if it's too small. For instance, strip has a flat 30c fee. This means the only reasonable way to do this is to have a user pre-pay a large sum and reduce from that, or to batch their transactions and extend them some credit. The former dissuades people from making a payment at all, and the latter runs the risk of bounced charges or users never purchasing enough to justify the charge. 2. There is no universal payments API. Browsers are starting to work on this with the w3c web payments standard https://www.w3.org/Payments/ https://www.w3.org/Payments/ but this is just for user input. You still have to work with companies like Stripe or PayPal to then actually make the charge. 3. Dark patterns are more successful. You see this with a lot of game currencies. By forcing users into larger purchases, you can get them to justify spending more (e.g. bundling multiple items into one package, maybe with "discounts") and if you sell your own currency, you can make the values not add up evenly so that the user has leftover balance that they perceive as being "wasted" unless they buy more. I work on a web extension that provides a javascript API for making payments using the Bitcoin Lightning network: https://lightningjoule.com/ https://lightningjoule.com/. I really love the possibilities that small payments open up, and have been working to smooth out the UX of having to confirm a payment every time: https://medium.com/@wbobeirne/introducing-joule-allowances-2b08bec75e3a https://medium.com/@wbobeirne/introducing-joule-allowances-2.... However it's still a long way from any mainstream adoption.
• ericnolte 6y ago
  Is the Brave browser a pseudo-solution to this problem? It can hold a crypto coin balance and either collect more of it through advertisements or pay it out to publishers like news sites.
  • 0-_-0 6y ago
    Why pseudo-solution?
    • sliken 6y ago
      Maybe because it requires the content provider to join a new ad/payment network and most haven't.
      • cblconfederate 6y ago
        BAT is a cryptocurrency which can be traded for another coin which can then be traded for USD or other etc etc. It's not a lock-in
  • jasonv 6y ago
    Brave doesn't have enough market share to matter for this, so far. This was revealed in a recent HN thread where webmasters shared the browser breakdown for their traffic.
  • herbst 6y ago
    Its a few years ago, but when i earned something like $1500 in ads each month, brave paid calculated something around $2. I haven't looked into it since.
• kgwxd 6y ago
  You know exactly what you're buying from cloud services. Micropayments for digital media would feel like buying blind bags. I loath buying blind bags.
• tzs 6y ago
  Taxes are a big reason. Consider a site in the US with customers in the US. Quite a few states require you to collect sales tax on sales to customers in those states. Most have thresholds and you only have to collect taxes if you exceed those thresholds, but unfortunately most of those thresholds are of the form sales of at least $D dollars or at least T transactions. $D is usually reasonably high, like $100k or $200k, but T is often 200. So 200 people in South Dakota each pay $0.01 for an article on your site generating a whopping $2 in revenue...but you have 200 transactions so you owe sales tax on that $2. Same thing will probably happen in a bunch of other states. And so there you are, with tiny revenues from many states, but having to register with their tax authorities, having to file tax reports (quarterly in most cases, but I think some may be monthly), pay filing fees in some (which might be more than your revenue in those states!), and of course actually send the tax money. Now throw in other countries. There is VAT in the EU, for instance. Most countries have VAT thresholds, but those often do not apply to out-of-country sellers, so you might have to deal with VAT for European that comes and buys one of your $0.01 articles. There are some things that help with this. In the US there is the Streamlined Sales Tax Agreement, which is an agreement between about half the states where if an online seller agrees to collect sales tax for all sales in all the participating states (even the ones that they do not meet the thresholds for), the states will pay for the seller to use a service like Avalara or Tax Cloud, which will handle the rate calculations, the filing, and all that at no charge to the seller. But that only covers about half the states. Those services will handle the rest for you, but not for free, so you can't escape tax pain. With VAT in EU, there is a thing called VAT MOSS that you can sign up for. You sign up for VAT MOSS in one country (Ireland is a good choice for US businesses), and then you just have to file one quarterly report with them listing your sales in all EU countries and the tax owed, pay that tax to the VAT MOSS country, and that country then distributes their shares to the others. The VAT situation is considerably nicer than the US sales tax situation, because VAT is per country. I just have to know that a customer is in, say, Germany, to know how much VAT to collect. In the US, the sales tax depends on address. 123 Fake Street in a town can have a different tax rate than 124 Fake Street, and the seller is expected to deal with that. If instead of charging $0.01 per article you make the site free to users and plaster it with ads and make your money from those ads all those tax issues go away. The money you make from the ads is just ordinary business income, that gets taxes as part of your corporate income tax. The tax is the same regardless of whether someone who saw the ad lived at 123 Fake Street or 124 Fake Street.
• m34 6y ago
  For reference, there's Web Monetization [1] which tries to solve exactly that. As others have noted it all boils down to user agent support. Otherwise most publishers probably won't consider giving up ad or subscription financed models. Also, forcing users into subscriptions allows for better demographics data/statistics. [1] https://webmonetization.org/docs/explainer/ https://webmonetization.org/docs/explainer/
  • westurner 6y ago
    https://webmonetization.org/ https://webmonetization.org/ lists Coil (flat $5/mo) as the first Web Monetization provider: https://coil.com/ https://coil.com/ Web Monetization builds upon ILP (Interledger Protocol), which is designed to work with any type of ledger; though it's probably not possible for any traditional ledger to beat the <1¢ transaction fee that only pre-mined coins have been able to achieve.
    • viraptor 6y ago
      I really like their approach and I paid for Flattr for quite a while when it started. But something big needs to push them to the critical adoption rate. On a number of very techy blog posts, I got... 0 from WebMonetization. And that's on best case audience (coming from HN and tech Reddit).
• defertoreptar 6y ago
  Part of it may be the mindset of "paying for something = negative" and "getting something = positive." Micropayments maximize the time we spend thinking about the negative part of the transaction. On the other hand, if we wait too long and have a $1000 bill at the end of the year, that may be even more painful than having to think about smaller payments more often. The psychological sweet spot for many things is the once a month subscription.
• davidw 6y ago
  People have been asking that since at least the late 90ies. I think even Xanadu had some notion of micropayments.
• catchmeifyoucan 6y ago
  As a consumer, I don't want to do this because I don't want to pull out my credit card to pay $0.01. I think they're hard to make work on a small scale. So an aggregate of people say putting $10 into a news pool, and each paying $.01 cent to read, and the news pool paying the providers, might make more sense. The micropayment could be like "credits", and may be refunded.
• dyeje 6y ago
  Isn't this essentially what the Brave browser does?
• ksm1717 6y ago
  An idea I had recently that relates to this - sites use some of your compute power to mine crypto in your browser and credit your wallet some rate, other sites like news sites draw from your wallet when you browse
  • mbreese 6y ago
    Wouldn't it be more efficient to just send money directly? I mean, the user will still end up paying someone. But with the mining strategy, instead of directly paying sites, the user will pay the electric company.
    • ksm1717 6y ago
      I haven’t thought about it enough, but the other comments talk about credit card fees. And then browsing the internet becomes like a utility. Hopefully the amount you net from (mining - cost of browsing) offsets the extra power usage cost
  • 1-more 6y ago
    when apple trademarked applecoin I had a harebrained idea that they were gonna offer an ad free internet by letting sites mine on their own ASIC on your phone subject to their terms (no other ads). So far nah. I think the basic attention token was something like this?
    • ksm1717 6y ago
      Basic attention token sounds like this. Would be super cool if you could just drop a webassembly component onto your site and it could run this exchange for you, maybe this is how it works
• RustyRussell 6y ago
  As sometime who has worked full time on this for over 5 years now, I have found a few aspects of your answer: The technical challenges of doing it with credit cards are overwhelming (in CC parlance, a "microtransaction" is anything under $10) due to fee structure. You can simplify this by using a different payment rail (in my case, Lightning over Bitcoin), but now you have a different problem: nobody has Bitcoin. You also need to add the lack of convincing incentive: since microtransactions don't yet exist, there's no proof that that's a market for them. That leap of faith is a significant barrier.
  • 37ef_ced3 6y ago
    Obviously you are aware of this, but here is a concrete example of micropayments in practice: When I use (for example) Vultr cloud compute (https://www.vultr.com/ https://www.vultr.com/), I load my Vultr account with $10 via credit card. Once the money enters the account it remains there until it is spent Then I pay 1 or 2 cents each hour for a cloud instance. At the end of each month, Vultr tells we what's due if I exceed what remains in the account. If necessary I load more money in This kind of simple micropayment scheme (with a trusted entity holding upfront credit card payments) is widely implemented If you are willing to trust an intermediary (and most people are) then distributed ledgers (blockchains) are unnecessary The benefit of Bitcoin (or blockchains generally) is that you don't need to trust anyone. In 2009 this was considered important, but today, does anyone care? No
    • oarsinsync 6y ago
      The example given (Vultr) is equivalent to a Starbucks card. You’re prepaying a company for a service. The transaction is the prepayment. How you use that balance is now irrelevant. Micro transactions to a range of different independent businesses requires using existing payment networks (visa / MasterCard / etc: relatively expensive; crypto: lack of widespread adoption) or building a new payment network. > If you are willing to trust an intermediary (and most people are) We already do. It’s called the bank. We also have regulation that helps. How many people keep real money in their personal PayPal accounts? How many people can even afford to? EDIT: I retract my Vultr / Starbucks equivalence. > At the end of each month, Vultr tells we what's due if I exceed what remains in the account. If necessary I load more money in Starbucks will not let your spend exceed your deposits on your card. Your statement suggests Vultr will. Credit accounts are a whole other risk. What happens if you don’t pay off your balance after you’ve already consumed the service?
• cJ0th 6y ago
  There was (is?) a website that charges you a couple of cents per article. They offer content from many different magazines. I got some free credit during the early phase. Even though I wasn't even spending my own money, seeing the amount go down after every article made me realize that none of the articles I read were worth any money. On the other hand, I am willing to spend $80 on a book if it contains really valuable information. One idea I like is spending $x flat each month and then consume as much as I like knowing that the amount gets shared equally among all the creators whose contents I have consumed. There probably are businesses with such a mode out there but I am not aware of any.
• lisper 6y ago
  > why can't news sites just charge you $0.01 to read an article, or even half that They can. See https://blendle.com/ https://blendle.com/, though the going rate there is considerably more than 0.01. But that's a question of pricing, not of logistics. The way it works is that you pay a small-ish lump sum up front and then you draw down that balance in small increments. That is different from true micropayments where you can send small amounts to anyone on demand, but it's a proven model. The real problem is that to scale this beyond payments to a fixed set of vendors you basically need a license from the federal government. You need to either be a bank or a money-transfer agent, and both of those have extremely high barriers to entry, basically insurmountable, mainly to prevent money laundering, which is the tough nut that no one has been able to crack.
  • justaguy88 6y ago
    Is there admin overhead that gets in the way? For example, someone disputing 400 different 1 cent charges
    • lisper 6y ago
      That too, though that's actually easier to deal with than the regulatory issues because there are technological and ToS solutions here.
• amelius 6y ago
  Isn't this what in-app payments are already doing?
• xeromal 6y ago
  Google tried that years ago but it didn't pan out. I was part of the program and always had a few bucks in there. I loved the idea. I can't remember the name though
• tonymet 6y ago
  Merchant fees
• hehehaha 6y ago
  Think of it as a cable subscription. When you bundle a whole bunch of articles, it’s easier to up charges due to volume and perceived value.
• floatingatoll 6y ago
  People don't like paying money for things, and they especially don't like paying small amounts of money for things. People also have less money these days to spare, and an overflow of content that doesn't require them to pay.
  • 8note 6y ago
    I'm fine paying for things, but I don't like paying to receive advertisements. I refuse to subscribe to magazines and news papers and the like because if they get my address, the go open season on sending me junk mail advertisements for their other magazines
• michael1999 6y ago
  TLDR: https://en.wikipedia.org/wiki/Transaction_cost https://en.wikipedia.org/wiki/Transaction_cost The transaction costs of small transactions quickly overwhelm the value of the transaction. This gives rise to market structure included (especially) the firm and the bundling within of non-market transactions. https://en.wikipedia.org/wiki/Theory_of_the_firm https://en.wikipedia.org/wiki/Theory_of_the_firm
• sameers 6y ago
  There are some great answers here already, I'll just add a what I think is different perspective on it. Each newspaper is already charging you $0.01 an article, from their perspective. They give you an issue every day that has 100s of articles and it costs you like, a $1? $2? So each article is indeed super cheap for you to consume. As others observe, you as a consumer probably aren't asking to be gated at every article - you are probably imagining some sort of general fund from which the paper draws down. Now if you really like just one paper or magazine, then you are back to a subscription model in this case. So your use case is most probably that you want to read a FEW articles from LOTS of sites. Like, 20 from the NYT, 20 from WSJ, 30 from Slate etc. Now the problem is to have an entity that is a 3rd party relative to these sites, which manages the common kitty. I vaguely remember some companies trying this, I can't remmeber the names, but you can see why this won't be easy. First, there's conflict of interest. It's tough to decide to enable a platform which also enables subscriptions to competing sources. Second, the platform company itself has to strike these deals individually because AT&T/the Mercers/George Soros haven't yet bought up all the news sources, which is a lot of friction. And third, the execs at the sites have to decide that this complicated arrangement is really going to attract a completely new set of subscribers who actually like their content but just haven't signed up because the subscription price is too much. Why is it intuitive that _at scale_, a non subscriber's main barrier is not their affinity to or interest in the content itself, but this reluctance to commit to the subscription model? Why even should I assume that this unserved market has significant marginal utility to me as a company, relative to all the other ways I am making money? Even if all this is true, as an exec, I'd probably first experiment with tiered subscription on my site, and have multiple gates, rather than buy into some micro payment kitty system. [Edit] As I ruminated on my own analysis, I realized that what you are looking for is the "cable TV" business equivalent for news sites. So maybe it's not totally undoable, if it's already happened with another media industry, but I think it'll be worth thinking about whether such a model works on time sensitive content or not. The typical participant in a cable TV system has a TON of resale value but with news articles, it's mostly one-and-done. Is there really enough aggregation value that a new business can survive on it? Just how many different versions of this riot and that election and those chicken fajita recipes and these 50 cool ways to decorate your bathroom are you, the consumer, going to pay for? It could work if you started with some long-form subset of this content, and I think that's somewhat the inspiration behind sites like Medium and Substack. Not entirely ofc, because they are betting on the long tail of producers, not consumers, but there's also the aspect of the latter, in that this content tends to have long-term value. As with any new business idea, there's no "will work/won't work" answer here. It's more like, "What form does this work in?"
• zaptheimpaler 6y ago
  The problem is the mental overhead, not the fee. If every single article click adds an extra mental overhead of "is this worth paying for? how much have i spent this month on reading?", people will simply stop clicking. Headlines are already super optimized to get you to click. The impact of a mental tax before every click would be at least -10x a good headline and seriously puts the media company at risk of bankruptcy. A fixed fee per month is psychologically and logistically easy to manage. There may be other concerns about cost per transaction & payment networks, but they are secondary honestly.
  • morgandixon 6y ago
    I agree that mental overhead is a large factor. The technical challenges to enable micropayments seem inconsequential to me. I’d add that the very act of deciding something’s worth could cost more than the thing itself. For example, an article might be priced at $.01, but it costs me $.50 worth of my time to decide if $.01 is a reasonable price.
  • CryptoGhost 6y ago
    I disagree. Take Youtube as an example. A ton of mental overhead: videos padded for time, clickbait titles and thumbnails, in video promotions, reminder to check their patreon, reminder to like and subscribe, interruptions for Google ads, etc, . All this adds up and makes you question if the time waste was worth the chance at maybe getting to view some decent content. A system where you are throwing a penny at somebody to unlock a video is preferable.
    • paraselene_ 6y ago
      Not if you use SponsorBlock. Been using it for months, it greatly improves the youtube experience.
      • Jommi 6y ago
        And greatly removes the way these creators can actually pay for their lifestyle of creating. Good job!
• Darmody 6y ago
  Technologies like IOTA aims to solve similar (and more) problems. And probably other crypto coins/networks.
• paxys 6y ago
  People are mentioning technical & payment processing hurdles, but those are all easy to figure out. Look at the gaming industry, mobile app stores, iTunes, online gambling, toll booths, tipping on various online platforms. Micropayments are most definitely already a thing, and have been for a while. A better version of your question is – why do newspapers charge for a monthly subscription instead of a per-article fee? The simple reason is that the numbers just don't work out. They'd have to charge a lot per article and have people pay for a lot of them to break even with the current subscription or ad-supported model, and that's not going to happen. And even if it does, there would just be too much day-to-day variance in sales. The reason subscriptions are popular is that businesses like a steady, predictable stream of revenue.
  • benlivengood 6y ago
    > A better version of your question is – why do newspapers charge for a monthly subscription instead of a per-article fee? The simple reason is that the numbers just don't work out. They'd have to charge a lot per article and have people pay for a lot of them to break even with the current subscription or ad-supported model, and that's not going to happen. And even if they do, there would just be too much day-to-day variance in sales. The reason subscriptions are popular is that businesses like a steady, predictable stream of revenue. What the newspapers need is something like ASCAP that can act as a single revenue management entity for microtransactions. What no one wants is to have 30 news subscriptions, and so what actually happens is everyone has ~zero news subscriptions. It's happening with video now too as Disney+, HBO, Prime, Netflix, etc. are each fighting over limited monthly subscriptions to segmented markets as opposed to Spotify, Pandora, etc. being gateways to one large market. I don't know the details of how or why ASCAP has managed to do for the music industry what pretty much no other industry has been able to achieve. ASCAP isn't even exclusively licensed.
    • freeone3000 6y ago
      > ASCAP isn't even exclusively licensed I think this might actually be the innovation here. Artists can use their normal distribution channels, and also sign up for ASCAP because, why not, it's free money. If enough people do this, they become a very useful distributor simply due to the size of their catalog.
• benlivengood 6y ago
  Aren't micropayments on mobile platforms a big thing in India, China, and Africa? Practically things like Spotify and Netflix are microtransactions; you just don't have to worry about the details of how much each product costs. Unfortunately the incentives for these marketplaces are to power them with subscriptions instead of, say, a monthly bill, and so what tends to happen is fragmented markets where new players hope to capture a segment of the monthly subscriptions people are willing to maintain instead of a fraction of the market as a whole.
  • peter303 6y ago
    These locations never had a widespread creditcard infrastructure. The US cc companies pretty much have a monopoly on transactions. And 3rd parties build top of that.
• rognjen 6y ago
  While the comments cover a lot of ground there are two things that aren't completely addressed in my opinion. 1. It's not merchant fees or inconvenience. E-wallet apps are very common in Asia and they let you load an amount once and pay multiple smaller amounts. They even auto reload. They're, at least for the time being, cheaper then using any other payment gateway and are even free most of the time. They're also in fact quicker and more convenient than using a credit card because your phone is more likely to be at hand and the transaction often involves just scanning a QR code and tapping confirm. They're a very viable way to do microtransactions. 2. Culture Microtransactions have been around for a long time in Asia so have good adoption rates. This was the result of having to pay transaction fees in USD but having a currency that's a lot weaker. Think having to pay $1 for lunch and the transaction fee being $0.50. In the west, not so much. People aren't used to doing that because companies prefer a steady income from recurring subscriptions and the cost of transactions are proportional. Quite a few things that don't need to be subs are for some reason. In Asia subs are a higher threshold for sales. (At least they used to be, they're much more common now.)
• DoreenMichele 6y ago
  You can give someone as little as a dollar via a service like PayPal. In the world today, that's pretty small. I think the endless discussion of a desire for "micropayments" is just another excuse for "We don't really want to pay for content and we imagine if you get it down to a penny, that's so close to zero, we think it would basically be free." I imagine if someone solved it, there would be some new complaint (like "Do you know how many articles I click into each week? I am getting charged a penny for every single one! This is killing me!") The internet doesn't like paying writers/content producers. The internet loudly objects to every means to pay content producers: ads, content marketing, tip jars, etc. It all gets decried by someone, somewhere for existing at all. People basically think content producers are supposed to be slave labor and then don't like it if you put it that way. Edit: to be clear, I think chasing the mythical beast of "If only we had micropayments, then we could pay for content!" is like friends who say "If I won the lottery, I would give you half." What they really mean us that in theory they would like to do something for you, but in reality they aren't going to do anything for you in the here and now and probably would change their mind if they really won. Both winning the lottery and solving the micropayments problem are sufficiently long shot that you probably won't have to pay up. It's frequently code for "I wish you people could get paid. It's sad that writing is slave labor. But I don't want to give you my hard earned money."
  • herbst 6y ago
    > You can give someone as little as a dollar via a service like PayPal. In the world today, that's pretty small. In theorie you can with "friends and family", but you can't charge a dollar. It costs 2.9% and $0.30 for any transaction. You end up with something like 0.68 before transfer costs to your actual bank.
    • DoreenMichele 6y ago
      This is true. It also means the minimum you can practically give as a micropayment is 68x more money for the recipient than the piddling penny the OP claims they would like to be able to give content creators. I'm fairly confident this means that they don't actually want to pay. They just want to believe that if we got payments as close to zero as possible and got enough people to chip in a penny, magically it would be enough to live on and stop being slave labor. In reality, that doesn't align with how the world works. Once you get it down to a penny, then people can tell themselves that not paying at all won't really matter because it's such a tiny amount. And then we are right back where we started: with people wanting content for free while not wanting to admit this is an expectation of slave labor. The way to pay producers mere pennies for visiting thier site without having to pay them at all is via ads and the HN uses as blockers very aggressively and while they claim this is for reasons other than money per se, if you want ad-free content and don't want to be demanding slave labor, the way to do that is pry your wallet open and kick in a few bucks via Patreon, PayPal, etc. Based on my tendency to hit the front page here with my writing, my ongoing inability to make ends meet and the degree to which I get downvoted for talking about that late in the month when I'm stressed out because the bank account is empty and the cupboards are bare, I'm quite confident that the constant talk of how micropayments will solve this is just a BS excuse to help well-heeled people feel okay with expecting slave labor from writers and telling themselves it is not their problem that writers go hungry while journalism goes to hell, democracy suffers as a consequence, etc ad nauseum.
• anarchop 6y ago
  Simple: friction cost. Going through a sign up and payments process is simply too much of an investment of time for the value equivalent to a 1c payment. It’s like asking: “why don’t people drive to stores to buy 1c single pack toothpicks instead of picking the food stuck in their teeth out with their fingernails, even though it’s unsanitary etc?”. The answer is friction cost: the time, effort and cost is simply not worth it for one toothpick, so people typically buy at on average $100 when they shop for groceries etc. Another example is quantity preference: why don’t gyms offer weight lifting charged at 10c per kilogram lifted or 1c per 10m run on a treadmill? Because most people prefer to consume in large and varied quantities and don’t want to have to restrict or plan consumption in such low quantities. Same goes for music streaming or video streaming services: most people would prefer to consume as much as they like with a fixed regular committed cost, though pay per movie / view do exist they are not considered micro payments and can be relatively expensive.
• BlackFly 6y ago
  I had an idea for micropayments once upon a time that worked with existing industry: buy your own ads. As in, you sign up for my service, ACME Micropayments, and give me whatever you want as a monthly subscription. Based on that and your web activity, ACME Micropayments determines a per ad amount and starts bidding on advertisement space (but only to show to you). In the sense of GDPR this is one of the few things that might make sense to opt into tracking for. Anyways, if you win the ad space you don't see an ad and if you don't win the ad space the site you are visiting still gets paid. If you pay enough monthly to outbid everyone, you are paying for an ad free experience. If you low ball it you still see a bunch of ads (until the end of your year/subscription period where with a surplus of money the bidding can go up).
• skmurphy 6y ago
  Human psychology
• sneak 6y ago
  Micropayments are technologically simple. Being a payment processor in the ways that are safe and efficient and irreversible, at least in the US, requires a money transmission license in each state that costs on the order of $1M per state to obtain. I really really wanted to start a micropayment processor, but it's basically illegal to do it the way I wanted to.
• cblconfederate 6y ago
  They are a thing in gaming. There are companies that will handle the micropayments for you as an indie or small developer. The overhead costs are high so the $0.01 will become $0.007 or sth. Importantly, those companies act as merchant of record which makes accounting much simpler for the developer. I m not sure why this model is not being adopted by blogs , i guess it's because those companies don't want to go into the content moderation minefield. It's all fun when coins are paid for virtual sheep, but if people start being activists with the micropayments vendor it's a really bad I don't think Ads are a bad model for content monetizing, they have been the dominant way to monetize newspapers since forever. HN's constant preaching against advertising is illogical, and discourages people (willfully?) from creating more ethical , better forms of advertising.
• ThePhysicist 6y ago
  Mozilla tries to changes this with their "Grant for the Web" (https://www.grantfortheweb.org/ https://www.grantfortheweb.org/), we hope to participate in the second round with an open-source tool that gives people the choice to regularly pay for websites they like in exchange for zero tracking and advertisements. 1 cent for an article wouldn't work though as the numbers just don't add up for most sites, 10 cents to 1 USD/EUR are more realistic.
• sli 6y ago
  The biggest one I know of that's meant for your example use-case is Flattr but as you can tell by needing to ask, nobody's heard of it or really cares much about it anymore. These days it seems to be a bit more similar to Patreon. https://flattr.com/ https://flattr.com/
• namrog84 6y ago
  I read through a ton of comments and didn't see anyone really mention twitch. On twitch you can buy with credit card bits. A bit is about 1 penny. But you usually buy $5 bits incrementally. You can watch ad for 10 bits sometimes too. You can then give anywhere from 1 bit to whatever to the streamer. Some streamers will set minimums of 5 or 25 bits. At end of month the bits are converted back to real money minus twitch fee. And they send check to streamer. The problem really isn't in the tech. Its solved and easy. Its getting some intermediary to be used by many. New York times can't be it for itself. It needs to be something that a user buys bits or whatever and then can use a large variety of websites.
  • FalconSensei 6y ago
    But the thing, for news at least, is: I don't want to pre-pay 10 different news sites, that I may or may not use. That would work if it was like: I pre-load money into a service (i.e paypal). Then I use that account to unlock articles/donate to many different sites. Then, at the end of the month, paypal (or whatever the service is) makes 1 payment to all those sites, for all users combined. That way, instead of me transferring 1 cent, twice, to New York Times, Paypal could do 1 large transfer of all contributions.
• mewpmewp2 6y ago
  Why wouldn't an aggregator service work where you pay $50 per month and it gives you access to all news sites without ads? Your money would be distributed proportionate to the views you did on each website. There could be different packages, to have different limit of articles read, this way you wouldn't have to constantly so mental calculations whether it is really worth it?
• jvvlimme 6y ago
  Seems like a lot of people say they want to pay per article but in reality don’t. There was such a service in The Netherlands but they pivoted to a subscription model (still p*ssed about it) https://www.niemanlab.org/2019/06/micropayments-for-news-pioneer-blendle-is-pivoting-from-micropayments/ https://www.niemanlab.org/2019/06/micropayments-for-news-pio...
• FerretFred 6y ago
  > why can't news sites just charge you $0.01 THIS! And having seen the standard of journalism and the amount of ads they fill the content with, I'm rarely, if ever going to waste $5 a month for a subscription. Often, I see an interesting article which hides behind a paywall, and I'd pay to read it, if a micropayment system was in operation.
• jitendrac 6y ago
  If I have an option to pay every article, post, tutorial I read automatically pay $0.01, I will willingly do so. But in real world all website want their own payment processing independence, on top of that payment processors charges some minimum fixed 20-30 cents per transaction + 2-3% of transaction and that is crazy. I will not pay 30 cents for a brief article written in 20 minutes, also not pay to a website that I am going to visit once in a lifetime. the only solution I can think is a crypto wallet based browser add-on which takes deposit of $xx from me every month and distribute the 1 cent per article I read to original author every once in a while with a pool of thousands of transactions ultimately making processing fees negligible per transaction.
• saadalem 6y ago
  If we design it like an electricity meter, it would work perfectly in my opinion!
• vilinskyy 6y ago
  I explored this once in a short text piece: https://vilinskyy.substack.com/p/transactional-model-to-rethink-our https://vilinskyy.substack.com/p/transactional-model-to-reth...