Ask HN: Why aren't micropayments a thing?
Amazon aws and related services can charge you a rate per email, or per unit time of computation, so why can't news sites just charge you $0.01 to read an article, or even half that?
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.
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.
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.
They'll do whatever it can to make a penny in this cutthroat industry and especially on mobile, so losing a significant portion on transaction fees is better than nothing to them.
In other industries, it's better to maximize your transactions ROI and reduce them to a minimum, even if it means making the payment a bigger amount that covers a longer subscription period. They'll even offer a promotional rate if you take a yearly subscription instead of monthly.
Micropayments are a hassle for any system that has people, actual human organisms, being responsible for a gazillion of small transactions. The involvement of a human increases the cost of each money transaction. Only for detecting and resolving fraud a human needs to spend minutes and hours of his life, his boss has to pay him at the end of the day, and that cost bubbles up to the consumer. Minimum fees have be to many cents or dollars for each transaction, so the micropayment starts to not being a micropayment, it starts to seem very much like a payment.
The only solution to that, is a fully automated money transfer mechanism, an immutable public ledger with all the pseudonymous transactions, i.e. bitcoin. The miner network ensures the validity of the transactions, that no malicious actor in the whole network change one bit of a transaction to his benefit. Humans can do that, have done that for centuries in the banking system, by hiring trusted employees, and by following protocols to ensure the validity of each transaction, papers with stamps and all of that.
Micropayments can help for a person to change a light in the street, and charging all the residents around, a thousand of them, for 1 cent each. 10 dollars he will receive in total, 5 dollars for his work, 5 for the light bulb, and he will be paid the minute the work is done. No need to give a corrupt politician 10 million dollars, for all the work in his municipality, and the politician afterwards he will pay the technician for the fixing of the light. That creates a honey pot ready to be exploited. Micropayments can make that honeypot disappear.
Which is generally how games do it
If I pay for something with a credit card, that's a payment transaction. It also involves (a whole chain of) IOUs.
Consumers despise paying for usage. They'd rather pay a monthly fee and have unlimited usage.
When you visit any website, a dozen or so companies are charged tiny amounts of money for showing their ads to you. Charging a single entity, the reader, is much less complicated. So it's not a technical limitation.
Their independence/neutrality is the key differentiator.
Is this really true though? Aren't ad prices very very low, how much do those dubious ads pay that appear next to the articles we read? Surely not that much?
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.
The difference between this and a micropayment platform would be the fees. In the toll system, the fees are paid once. With a micropayment platform, the fees would be per transaction.
There can be a "self hosted" version of such a platform that say each content-provider can host but I am not sure it will work out against the cost of maintaining it includes much more than just hosting (securty, auditing, refunds, taxes etc).
I see they're moving to a subscription model now too in an attempt to make it more attractive.
Wow, I just realized why Steam does this for in-game purchases.
> with the singular exception of Apple who does not compel all purchases through an intermediate currency balance.
Google Play doesn't have one either, FWIW.
As secondary evidence for it being illegal in the US, the scheme you are proposing is pretty much exactly what WeChat and Alipay do in China. It is also exactly the problem that Paypal and Venmo were made to solve, but for some reason they chose much more convoluted and restricted solutions even though from a technical standpoint it is harder to do what they actually did rather than the absolutely trivial technical problem of the fully featured solution which just manages account balances and transfers between them, a literal CS 101 type of technical problem.
I think the bigger issues is that if I see an article presented to me as shared on social media or in search results I assume it is free access. I click in, and if they ask for payment, it's a turnoff since I thought it was going to be free. Also, I don't like how credit card information can be continuously used by the organization.
I want to be able to hand an authorization for a single one-time payment to any organization and not an authorization to charge however much they want, whenever they want.
That goes for hotels too. I want to be able to say "Here's my credit card" [but I don't authorize more than $130/day].
Edit: I suppose that doesn't work as well for hotels specifically, at least in terms of giving a card for incidentals. Since it isn't a physical card, not sure if the receptionist would be keen on entering a digital card like that? But I've definitely used it to pay for rooms online.
How do they do it so easily in other countries?
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.
When I use (for example) Vultr cloud compute (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
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?
The difference is due at the end of the month. If I didn't pay, they would simply charge the last credit card I used to load the account (I suppose)
Another example: Linode (https://www.linode.com/) charges my credit card at the end of each month, to cover my usage. So a $5 cloud instance isn't paid for until the month ends. The point is to aggregate a whole month of spending into a single credit card payment
I dont see how this is any less relevant today than it was 12 years ago.
Why is a little bit of data exchange so expensive? (Ok because they can, so why aren't the competitors to drive that fee structure down? What's the barrier to entry?)
Any real users and devs moved to other project like Ethereum and Bitcoin Cash, now only trolls and bag holders keep pushing BTC as a "store of value", a totally meaningless concept.
Hilariously BTC had this problem solved from day one, then Blockstream hijacked the GitHub repo, kicked out all the original devs and artificially limited the block size to try and push people onto their own "second layer" products.
Why anyone would use LN rather than just real Bitcoin (now called Bitcoin Cash) is beyond me. They have lots of trolls (Adam Back) and social engineers (Greg Maxwell) pushing a false narrative but how real people fall for it is still just bizarre.
The problem is that Lightning essentially is a subscription service. The user has to lock much more Bitcoin in a channel in order use Lightning for micro transactions, which defeats the purpose. The minimum fee to get a Bitcoin transaction confirmed in a reasonable amount of time is often over $20 USD at this point. That's a very large deposit for a $20 fee to be worth the effort.
They could deposit a smaller amount of Bitcoin in a custodial wallet, but at that point you might as well use a credit card or Paypal. It defeats the underlying appeal of Bitcoin, which is controlling your own money.
More people would have, and more importantly use, Bitcoin if it was allowed to scale on-chain. Why that hasn't happened yet is a different rabbit hole.
To give you an example, the withdraw fee for BTC on Kraken is 0.0005 BTC, which is currently about 17.50 USD.
Here is the current mempool: https://jochen-hoenicke.de/queue/#0,24h
To get your transaction confirmed in the next few blocks, you have to be in the "yellow" of the chart, and use a fee of around 120 satoshi's per byte.
The average transaction is around 200 bytes, so you need to pay 24000 satoshis, which is 0.00024 BTC.
That's 8.40 USD right now. The problem is that it's a double blind auction, so to have a very high likelihood of getting into the next block, you often have to pay 200-400 satoshi's per byte, which puts you right up at the $20 level. If your transaction is larger, it can be significantly more.
Also, if the mempool gets even more backed up than it is right now, the fees can literally go as high as people are willing to pay when fighting over the restricted block space.
>You don't usually need a priority transaction when funding LN channel, so ~$1 fee will be enough.
If you try sending a Bitcoin transaction with a $1 fee right now it may not confirm for days and might confirm at all! That isn't a user experience that's going to create mass adoption. It needs to be an improvement on the existing options.
How, exactly, is my statement that the fees are often over $20 a lie?
You should stop accusing people of being liars without data to back it up. This forum is supposed to be for intelligent discussion, not trolling. This isn't twitter.
Compare a tangible market situation: remember the old Bazooka gum that used to say "3 cents" on each piece? Few customers are going to walk into a store and buy a single piece, no matter how cheap and frictionless payment is. At that level, the burden of thinking "I have to actually go and buy it" exceeds both the financial cost and likely the perceived upside of a single bite of gum. You can successfully sell a handful alongside another transaction, or a bag of them for a dollar, though, because you've raised the stakes of the total transaction high enough that it's worth thinking it through.
Maybe the classic micropayment story-- the individual news article/video view/song play-- is a single piece of Bazooka. Since it's likely to be ephemeral and competing with a nearly-as-good free alternative (the same content on an ad-based site), you don't have much room to make the case that it's worth going through a purchase process.
The challenge is probably mostly that a lot of publishers would need to get together and create a unified account that could be charged.
Clay Shirky: http://web.archive.org/web/20060214180624/http://www.openp2p...
Andrew Odlyzko: http://www.dtc.umn.edu/~odlyzko/doc/case.against.micropaymen...
Nick Szabo: http://web.archive.org/web/20080514172459/http://szabo.best....
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.
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.
They can. See 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.
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.
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.
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.
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.
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.
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.
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.
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.
Half a cent per article is a plausible target for all the weak/cheap sources who can't possibly afford to put up a paywall right now because nobody would pay. It's not going to be used by the currently paywalled sites, their business model relies on getting a not-micro amount from each customer.
That extends to relatively low-friction cases like Patreon. The number of podcasters and bloggers where I've thought, quite earnestly, "I really like what this person is doing, I should kick a few quid their way," and then just not done that is near infinite. And it's never because I was feeling stingy; it's because I couldn't be arsed.
Gas, electricity, water are all cases where my use is metered, I _could_ try to micromanage it on a daily basis, but so long as my bills don't vary wildly from month to month, I don't pay especially close attention. To the degree that I self-regulate my use, it's more about the environment than the dollar cost. I don't think about it every time I take a shower or turn up my thermostat.
The amount of online stuff from for-profit institutions I read from month to month doesn't vary that much, and if I knew from habit what the typical range was, I think I could learn to be ok with that. But the current experience, where whenever someone links to something in a _different_ paywall than the ones I'm already in, I do have to think "would it be worth it to pay for this source?" and often the answer is "no".
Personally I don't like them because these things don't normally opt you out of ad tracking as well. When I pay I want to be the customer and not be tracked. I also don't want to give any personal details. They know nothing about me when I buy a newspaper in the shop. It should be like this :)
Brave will block tracking to some extent but we know it's not perfect.
For the longest time I thought there was just something wrong with me. Rarely would you find a comment in an article about micropayments that pointed out that micropayments sound, stressful!
It causes me anxiety just having to think about having to consider making payments everytime I click on an article, for example, even if it's a tiny $0.01 amount each time.
So, on such note; when you turn on the light when entering a room, do you have anxiety thinking about how that costs money? We are constantly making tiny momentary transactions without thinking about it at all: the issue is UI, not transactions.
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.
> users provide the computational power required to verify their own transactions, allowing transactions to be processed without fees
This was revealed in a recent HN thread where webmasters shared the browser breakdown for their traffic.
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.
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.
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.)
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."
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.
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.
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.
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/ 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/. 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-2.... However it's still a long way from any mainstream adoption.
And yes the value judgement. I'd hate having to think whether every page I visit is worth it.
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.
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-pio...
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.
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).
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.
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.
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.
When I encounter these websites I just write another greasemonkey / tampermonkey script to delete the popup and unlock the content.
Google & Apple should waive their 30% for this.
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.
The bottom line is network effects, I think.
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).
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.
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.
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?"
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.
I doubt many non-US companies meet this condition in more than a few states. Hell, I doubt many US companies even meet this requirement (nb, that's why a lot of smaller ecommerce stores don't collect tax). That would be a minimum of $5,000,000 in yearly revenue from the US alone - more than enough to assume that they have at least one accountant on payroll to deal with this.
A large number of other states have followed South Dakota's lead, and went with $100k or 200 transactions for their sales tax nexus laws.
[1] https://www.scotusblog.com/case-files/cases/south-dakota-v-w...
Albeit a platform could do it for everyone (like Amazon does).
Also I agree you have it better in the USA (even if things are going downhill, especially after 2018 nexus changes), VATMOSS is so bad I'm selling to businesses worlwide + customers from everywhere but Europe.