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Can you comment on how you handle the fact that PAYG could be open to abuse with customers running up large bills with API usage and then not paying them ? I u
by whyleyc 13y ago
Can you comment on how you handle the fact that PAYG could be open to abuse with customers running up large bills with API usage and then not paying them ?
I understand that if you're Amazon you can chase them down, but I'm assuming most small startups wouldn't have the manpower to do this.
- idupree 13y agoSome pay-as-you-go services are prepaid and thus don't have that problem (e.g. NearlyFreeSpeech.net, DiamondCard.us, I think Skype). I'm curious about collecting from postpaid customers too, both for pay-as-you-go and fixed per-month models (unless paid-per-month Internet services are always prepaid?).
- malyk 13y agoTwilio is an example of this and so are some mail delivery services. Basically, you set up an auto-load so they get something like $20 up front and charge your account down as you use the service. Seems like a nice middle ground.
- rpedela 13y agoCouldn't you just deny further access to the service?
- RobAley 13y agoTypically services set an internal "comfort" limit. When a client passes that limit, it is flagged internally for review. You can then risk-assess: look at who the customer is, what are they doing with it, do they have an incentive to pay a large bill (i.e. would it kill their service if you cut them off for not paying). You can then decide to let them continue, contact them for an interim payment, or suspend their service if the risk is too high. While you're risk-assessing them, they can continue to use the service (it's not automatically suspended) so the customer need not know what is happening. And of course, its usually wise to factor in a level of non/tardy payment into your cash flow projections, as a realistic cost of doing business.
- whyleyc 13y agoThanks - this is a really nice approach as it doesn't interfere with customer usage, plus you don't end up with runaway costs.