Providing a better compensation model for the internet

It's a nice article, and the reference to Gresham's Law[1] is something I haven't seen before applied to content.

The microtransactions idea isn't new, and as other people have said, the main issue is adoption, by both producers and consumers. Making it voluntary after the fact rather than a pay-wall might improve adoption, at a potential loss of overall revenue.

As I see it, there are 3 main classes of blogs, from the author's perspective:

As a marketing tool - to gain readership by writing around the field you do business in, and pointing them towards your products. You don't really care about the money - it's part of your marketing/advertising budget.

As a hobby - writing about things you enjoy doing, but would like some small amount of money as validation of your content quality, and to cover things like hosting expenses and maybe to fund your hobby projects.

As a business - writing things with a direct emphasis on SEO, going for maximum advertising revenue by targeting niche keywords, generating crappy quality content from MTurk, etc.

All of those would benefit from tipping, but in all likelihood only the first two would actually receive tips, and only the second really requires them.

Would it be enough to operate without/with reduced advertising? I suspect not, but you might be able to tie some incentives into tipping like removing ads from other content for the day/week/whatever. Would be an interesting topic to research, but without a decent microtransaction system it's impossible to know.

[1] https://secure.wikimedia.org/wikipedia/en/wiki/Gresham%27s_l...

The problem with all these tipping services is always traction. There is no pain point for the consumers of content that is going to drive them to install a bookmarklet like the one he suggests. This especially applies since all of these services are unknown.

I would love to see an already established player like Disqus attempt something like this.

Have any of you signed up for the service yet? It looks quite slick. I've tipped a couple of people as well as verified my own website so that I can claim tips that people leave for me. The really neat thing (as the ERE post mentions) is that you don't have to sign up for people to start tipping you. All the tips for a site are logged until you claim them as the site owner (via meta tags or file upload). It's a great way to overcome the initial adopter problem WRT getting people to accept your payment method. So website owners don't need to install anything in order to accept tips. I'm interested to see if this catches on. It's really great from both a concept and implementation perspective.

I learned the hard way that there are two types of people - those who like to talk and those who like to pay. The two groups pretty much do not overlap.

So if you start off with a free product, you get some mixture of both groups, and when you start charging later you will only ever hear from the cheapskate brigade.

For me that means making paid apps with a price of $2.99 or above. I'm not sure what that means for writers...

Whenever I see any new enthusiasm for micro-transactions I think of this: http://penny-arcade.com/comic/2001/06/22

Since this is very similar to TipJoy... ivankirigin, can you comment on whether you think this company will succeed in the same space that yours did not?

My version of this model would have the lowest possible barrier to usage such that you don't need to register or authenticate initially at all. Let the user provide some kind of identifying token, say an email address or Facebook ID token, and a pledge amount. Tie it to whatever client data is offered (e.g ip address or cookie). At some later date authentication and collection takes place. A database in a cloud somewhere tracks all these pledges, their IDs, and when and if they get authenticated and paid. The exact mechanism is left as an exercise to the entrepreneur.

The key would be complete revocability. This would be necessary due to the ease with which imposters could, for example, put your email address in a form or spoof an ip address. But I think it also provides interesting data about those who pledged, authenticated, and reneged. It could be tracked as a new form is currency itself. It might also provide interesting data about the origins of scams and spam on the internet.

To compete with free alternatives, you need ease of use, social proof or loyalty. These can be monetized.

Perhaps a site where readers subscribe to info ahead of time and pay, and then rate articles. People who write great articles get paid more.

Sigh. Why, oh why, do these sites use OpenID and not let me write my own OpenID URL?