I know it's not game releated but I thought that it was interesting. We'll it look's like another internet site (store) bites the dust. It's really looking like the only companies that are going to thrive and survive on the internet are the brick and mortar stores. =(

Interesting. I didn't see the story. With Egghead I figured they had problems. If they couldn't make it as a retail chain, I didn't see why selling online would work for them.

At some point selling software online might work if people are willing to stream it. Just think -- the store needs to carry zero physical inventory then. You just need a room full of servers and the people to run them.

I used to buy games at the Egghead retail stores. That's where I bought Privateer. I have fond memories of talking about games with the clerks there. They were all gamers too.

"At some point selling software online might work if people are willing to stream it. Just think -- the store needs to carry zero physical inventory then. You just need a room full of servers and the people to run them."

You advocate this, but go out of your way to explain to me why micropayments won't work? Man. Time for a reality check! The first major problem is bandwidth, then there's the whole XP-style activation brouhaha.

For that matter, _pirating_ games is inconvenient. I can't imagine what it would be like to purchase Baldur's Gate II and "stream" 4 CDs of info. That would make those old 1x 150kbps CD-ROMs seem like greased lightning in comparison.

Apples and oranges, man. Bandwidth? Sure. But you're charging for the game. It's way time-consuming, too. But there's no physical need for anything, except the servers. And if they're streaming, then that does a lot to prevent piracy, as opposed to downloading. Not a bad idea -- at least, once broadband becomes more prevalent.

Long post here. You may want to skip it.

Here's why micropayments won't work, probably ever.

"Jakob Nielsen, in his essay The Case for Micropayments writes, "I predict that most sites that are not financed through traditional product sales will move to micropayments in less than two years," and Nicholas Negroponte makes an even shorter-term prediction: "You're going to see within the next year an extraordinary movement on the Web of systems for micropayment ... ." He goes on to predict micropayment revenues in the tens or hundreds of billions of dollars."

"Alas for micropayments, both of these predictions were made in 1998. (In 1999, Nielsen reiterated his position, saying, "I now finally believe that the first wave of micropayment services will hit in 2000.") And here it is, the end of 2000. Not only did we not get the flying cars, we didn't get micropayments either. What happened?"

"Micropayment systems have not failed because of poor implementation; they have failed because they are a bad idea. Furthermore, since their weakness is systemic, they will continue to fail in the future.

"Proponents of micropayments often argue that the real world demonstrates user acceptance: Micropayments are used in a number of household utilities such as electricity, gas, and most germanely telecom services like long distance.

"These arguments run aground on the historical record. There have been a number of attempts to implement micropayments, and they have not caught on in even in a modest fashion - a partial list of floundering or failed systems includes FirstVirtual, Cybercoin, Millicent, Digicash, Internet Dollar, Pay2See, MicroMint and Cybercent. If there was going to be broad user support, we would have seen some glimmer of it by now.

"Furthermore, businesses like the gas company and the phone company that use micropayments offline share one characteristic: They are all monopolies or cartels. In situations where there is real competition, providers are usually forced to drop "pay as you go" schemes in response to user preference, because if they don't, anyone who can offer flat-rate pricing becomes the market leader."

"Why have micropayments failed? There's a short answer and a long one. The short answer captures micropayment's fatal weakness; the long one just provides additional detail.

"The Short Answer for Why Micropayments Fail
Users hate them.

"The Long Answer for Why Micropayments Fail
Why does it matter that users hate micropayments? Because users are the ones with the money, and micropayments do not take user preferences into account.

"In particular, users want predictable and simple pricing. Micropayments, meanwhile, waste the users' mental effort in order to conserve cheap resources, by creating many tiny, unpredictable transactions. Micropayments thus create in the mind of the user both anxiety and confusion, characteristics that users have not heretofore been known to actively seek out."

[cut some of the article]

"Beneath a certain price, goods or services become harder to value, not easier, because the X for Y comparison becomes more confusing, not less. Users have no trouble deciding whether a $1 newspaper is worthwhile - did it interest you, did it keep you from getting bored, did reading it let you sound up to date - but how could you decide whether each part of the newspaper is worth a penny?

"Was each of 100 individual stories in the newspaper worth a penny, even though you didn't read all of them? Was each of the 25 stories you read worth 4 cents apiece? If you read a story halfway through, was it worth half what a full story was worth? And so on.

"When you disaggregate a newspaper, it becomes harder to value, not easier. By accepting that different people will find different things interesting, and by rolling all of those things together, a newspaper achieves what micropayments cannot: clarity in pricing.

The very micro-ness of micropayments makes them confusing. At the very least, users will be persistently puzzled over the conflicting messages of "This is worth so much you have to decide whether to buy it or not" and "This is worth so little that it has virtually no cost to you."

There's quite a bit more. The author lists many other well-argued reasons why micropayments won't be accepted. Good article.

http://www.openp2p.com/pub/a/p2p/2000/12/19/micropayments.html

just a personal opinion, i used to love Egghead Software... I loved em so much i got one of there cool Egghead tshirts which i still wear today! It has the Einstein Egghead with a bird coming out of it... pretty cool!

btw, i never knew they had an online store, i thought they were kaput.

etc

Back when Gamecenter was still around (and I had a job), we'd be visited on a fairly regular basis by folks looking to stream traditional software programs and games. I've seen a lot of that stuff in action, and some of it worked really well. You download a small segment of the game/prog and then little chunks are cached ahead of time as you progress through the game. It was entirely possible to save your settings and saved games and over high-speed access, there was little noticable lag or slowdown.

I think it's a cool idea, especially for software. Not everyone is willing to shell out $500 for PhotoShop; but if I can pay ten bucks and have access to the program for a week, I'd be up for that.

--Billy

Hmm...Well, that kinda goes back to Microsoft's idea to rent software, doesn't it?

I'm all for renting software. Just give me the option to buy it outright too.

RIP Egghead. I wonder who will be next? Buy.com? I know that some of the brick internetsites such as Compusa and been majorly scaling back their online selection.

"Hmm...Well, that kinda goes back to Microsoft's idea to rent software, doesn't it?"

Now, let's not start that again!

Egghead has always been mismanaged at the top level. When I was with Electronics Boutique, they were somewhat of a laughing stock of the industry. The higher ups had no clue how to run the business and when you were on the other side of the coin at EB, it was obvious.

Then they went and closed all the stores. I think they filed bankruptcy, but later announced they would reinvent themselves as a web retailer. I actually bought my GeForce2 GTS from them. They had the best price when Creative released the Annihilator 2. Other than that, I never went to the site. They had no marketing presence, either online or in print, throughout their history. Some closings simply are not surprising in the least.

--Dave

Yes, the folks at Egghead were short sighted.

I remember they had this really draconian policy on software returns. They just wouldn't do them. For any reason. I think I got burned on a game that I just couldn't get to work, no matter what I tried. When I found I couldn't get any support with Egghead but could get EB, my choice was clear. I suspect lots of people made that same choice.

Now that you mention it Dave, their inablity to market themselves well was also an issue, now that I think of it. I never saw ads for Egghead anywhere.

I don't know if I'll miss Egghead or not. I stopped using them when they went to online-only. I'll happily pay a little more for the convenience of having the retail box in my hands right away, so Egghead lost me on that account. Essentially, they dropped off my radar. Admittedly, I did make out rather well at their retail close-out, picking up a lot of games dirt-cheap.

- Alan

Mark why did you mention Nicholas Negroponte? I fucking hate that guy. Goddamn do I hate that guy. He is on the fucking list!

Do you know who invented the multi-media computer 2 years after the amiga was out? Why Nicholas Negroponte! He also coined the phrase - again years past it already being used in ads for both the amiga and the mac in print magazines. He is one the geek philospher kings that fucked the whole internet and stock market. It really is people like him that influence people like wumpuss to go ahead and just make any cyber wild claims without any facts - or even in the face of facts or logic - but go ahead - because you can see the future! Only the brave! I think jeane dixon has a better record than Negroponte.

As for egghead. Losing all of their customer's credit cards to russian hackers and then denying it happened while fraudulent charges piled up - that might have hurt them. Nothing like losing your entire customer base and then not having the resources to go out and market for new ones.

Fucking Nicholas Negroponte.

I just quoted an article that mentioned Negroponte, though not in a complimentary way.

I vaguely remember something about that credit card problem that Egghead had. Yeah, I guess that would be a killer.

BTW, I emailed the author of that micropayments article to compliment him. He said part 2 is coming out this fall. I don't even know what else he needs to say. He completely demolished micropayments. Another article would be like dropping a second bomb on Hiroshima.

Egghead went online by buying/merging with Onsale.com. That's a site that used to be great, in the first year or two it was in operation. You could bid on overstocked or discontinued hardware.

When AT&T got out of the computer business, I got a 21-inch AT&T monitor from Onsale.com for a mere $900. Back then -- early 1996 -- the *cheapest* 21-inch monitors were $1700 or so. Still using that monitor.

Bought a few things from egghead.com, too. They had decent prices on some items. But once the unwashed masses flooded the net, they started bidding the onsale items up to ridiculous levels. Put an end to the usefulness of that site.

You know it's bad when a retail site has an X-10 "popunder" on its homepage.

---

Quote:

RIP Egghead. I wonder who will be next? Buy.com? I know that some of the brick internetsites such as Compusa and been majorly scaling back their online selection.

---

There's another advantage to streaming. Almost all the cost of the goods you buy comes from packaging, transportation and middleman profits. The actually cost of goods for a $50 computer game is probably around $5-8 per unit. If you download the game vs. buying it in a store, the cost of goods would be even lower. They could charge $10 for what would otherwise be a $50 game, and still make twice the profit. I can't see that being a bad thing for gamers.

Beyond.com is next. Having been a customer, I got an email recently about the launching of the Beyond.com mall. It looks to me like they have quit carrying most products, and just refer you to other sites, like Amazon, under some referral program. I can't quite figure out why I would bother including them in my transaction instead of going directly to the seller's site.

We'll in the beginning it looked like the internet would level the playing field between the brick and mortar stores (Walmart) and the smaller stores. But it hasn't happened. People are starting to notice that when the bigger companies made the transition to the internet they brought with them there huge customer base that the smaller stores just can't compete with. Let's face the facts, when you need an item do you search the smaller internet sites or do you go right to the brick and mortar stores?

One question about streaming, and one only:

Would The Sims have sold as many copies as it did if you'd had to download it at 56k?

Streaming's great if the entire nation's on broadband. Too bad it's not.

"He completely demolished micropayments. Another article would be like dropping a second bomb on Hiroshima."

Here's one mistake I think the author makes-- what people object to is being billed PER MINUTE, not paying for a solid article. In other words, which is more onerous: getting charged 5 cents to read Tom's latest Shoot Club? Or getting charged a dollar an hour to read it? Big, big difference.

I'll still take anyone up on Chet's bet. Within 5 years, there will be at least one viable micropayment system in use on the internet in significant numbers.

We covered all the issues ad nauseam in the other thread, and as much as I enjoy hearing myself type, there's no point. Either you take the bet, or you don't.

Meanwhile, we can sit around and watch traditional advertising continue to implode on the web. It's amusing.

"Streaming's great if the entire nation's on broadband. Too bad it's not."

I would think streaming software would just be an alternative way to sell something, not the sole way. That's what Amazon did with tax software this past year. You could still buy the software in a store, too.

Wumpus, if you read the article the author discussed how tiny payments cause confusion and anxiety, and how in an open market flat rate pricing tends to become the market leader.

I really think he hit it on the head. When I thought about micropayments before I imagined how I'd feel about deciding to buy an individual article for a penny. When I imagined it, I didn't think of it as a penny but as a buying decision. Do I want to pay for this? The overriding feeling I had was, man, this is really a bother. I don't want to have to decide to buy or not to buy. I was feeling that confusion and anxiety the author predicted.

I'm pretty sure I'd be one of those consumers who would flock to flat rate pricing. And that's the real crux of it. It's not like the web will adopt micropayments en masse. Should a system be implemented, it will be sites with micropayments competing with sites with flat rate pricing and with sites that remain free. Given that scenario, micropayments probably lose.

"Wumpus, if you read the article the author discussed how tiny payments cause confusion and anxiety, and how in an open market flat rate pricing tends to become the market leader."

Wow, it's surprising that so many people are able to overcome their confusion and anxiety in order to DIAL THEIR GODDAMN CELL PHONES.

You can certainly bundle "content plans" just like the cell phone guys do. Pay $29.99 for a certain minimum level of content, but anything beyond that level, or calls to Africa, obviously aren't included. The question is, can we handle that level of uncertainty and confusion? Will grown men curl into the fetal position and cry like little girls? I don't know, I'm just asking.

"I really think he hit it on the head."

Re-read his article, and think about how you use a cell phone. All of his arguments apply. Therefore, nobody should use a cell phone, right? And last time I checked, there is competition in the cell phone market-- and even flat rate pricing plans, though it's clearly still a micropayment system. Whoops! Don't look now, but there goes his whole argument.

Flat rate plans are just emerging for cell phones, though. As they become more common, and get better coverage areas, you'll see that people won't pay for limited-minute plans anymore. And most people who pay $29.99/month for 1500 minutes (or whatever) choose that one because they don't expect to use more than that -- so they're avoiding the "micropayment" part of the bill.

Murph-- the telephone system is built on a core of metered usage. Every single call is tracked and billed.

That's the core system required for micropayments. In fact, that ENABLES the choice between pseudo-flat rate and per-usage.

What we choose to do beyond that is really an issue of marketing. The "flat rate" plans for cell phones are really just pre-purchasing a block of usage. We could certainly do something similar for content.. eg, $29.99 gets 500 premium articles per month. You won't be up all night, tossing and turning, wondering if you clicked on too many one cent links.

Trying to get value for your dollar is not the same as rejecting micropayments. Someone who rarely uses their cell phone, for example, might jump at a no-monthly-fee plan with 20 cents per minute airtime. Hell, I'd probably save money on my cell phone if I could get that. But I can't. I have to buy one of the monthly plans for a zillion more minutes than I need.

But if you could use that same $29.99 to get unlimited talk time, wouldn't you do it, just so you don't ever have to keep count?

And, let's make this more closely resemble micropayments: If cell phone usage had always been free, and then somebody wanted to come through and charge 20 cents a minute, but there were still several, smaller companies who still offered free plans, which would you choose? I mean, I realize that the core of this discussion revolves around whether or not people are going to pay at all -- and, assuming that they do, micropayments aren't the worst idea out there, by a long shot. But I'm not sure that it's the best, either.

Besides, like Mark said, the micropayment system will be competing against free and flat-rate systems. I don't see it winning in that arena.

"the telephone system is built on a core of metered usage. Every single call is tracked and billed."

And what are the typical billing plans available? Flat rate pricing for X number of minutes or simply to pay by the call?

A true micropayment system for cell phones would be to only charge you for each call. If you don't use your phone for a month you don't pay anything.

You can see what cell phone plans are evolving towards -- flat rate pricing. As more and more people use them, we'll get to a point where the market leader will be the company that offers unlimited usage for a flat fee. There will be a price point that they can charge that will be profitable even if some customers go nuts and use the cell phone hours every day because there will be many more customers who won't.

Just look at ISPs. What pricing plan won? Micropayments, where you pay by the hour, or flat rate pricing? When you have true competition, the business offering the flat rate seems to beat the business offering metered or micropayment plans.

"Just look at ISPs. What pricing plan won? Micropayments, where you pay by the hour, or flat rate pricing? When you have true competition, the business offering the flat rate seems to beat the business offering metered or micropayment plans."

Without metering, businesses have no choice but to use flat rate. Because they really don't know how much users are actually using.

With metering, businesses can simulate "flat rate" by having users pre-purchase larger and larger blocks of usage. Or they can charge per-unit, "micropayment" style.

Also, I think we're talking about two different concepts here. It's the difference between being charged per UNIT OF TIME and per UNIT OF USAGE.

Being charged per UNIT OF TIME clearly sucks. It's like calling the psychic hotline and waiting on hold for $60 an hour. Am I USING the service? No. But I am being charged for TIME. Worse still, if I'm on a cell phone, I am being charged for air time on the cell phone as well, just to listen to hold music. That is what people object to, and what your new favorite article author completely friggin' missed.

That is not the same as being charged PER UNIT OF USAGE. When I click on the shoot club article, it's like a tiny purchase. I *only* get charged when I actually USE the service. I get to read it an unlimited number of times for one cent. Heck, I could save it to my hard drive and read it again later.

"Besides, like Mark said, the micropayment system will be competing against free and flat-rate systems. I don't see it winning in that arena."

So there will be other websites offering shoot club for free? I can somehow bypass the potential micropayment system here at Quarter To Three? I think we ought to let Tom know about this blatant copyright infringement.

Content is proprietary and protected. If it isn't, the whole system breaks down, napster-style. If you're postulating that, then there's no point to this discussion.

"So there will be other websites offering shoot club for free? I can somehow bypass the potential micropayment system here at Quarter To Three? I think we ought to let Tom know about this blatant copyright infringement."

No, but there will be a network offering something like Shoot Club, or Shoot Club itself, as part of a bundled offering for a flat rate.

Who's going to win? The 10 game sites with micropayment plans or the 10 sites that have become a network offering a flat rate price for their content?

Just one other point - yes beating a dead horse - on why micropayments are nothing like cell phones.

Cell phone - who bills me? The same person who provides the service. Who monitors what to bill? The same person who provides the service.

Micropayments - who bills me? Pretending wumpuss has his way - company a. Who provides the service? company b. Who monitors the service? company c.

Anyone who has had to deal with the problems of multiple companies will tell you the answer to this question. Who will be responsible when there is an error?

D. no one.

No compelling reason for the consumer - even if you pretend to misread the article like wumpuss.
No compelling reason for the ISP.
No compelling reason for the infastructure.
As discussed previously - (wumpuss even brought this up) no compelling reason for smaller sites.

In your own words Wumpuss - the small sites would not benefit - so unique pieces like the shoot club would remain free unless picked up by a bigger syndicator.

And now that I know negroponte predicted it. I will multiply my bet by 1000% if you want.

Chet

'Without metering, businesses have no choice but to use flat rate. Because they really don't know how much users are actually using.'

That's a load of hooey, Jeff. ISPs, specifically, log everything and know exactly how much bandwidth you received, sent, time the connection was up, time the connection had an outstanding TCP request, routing table entries due to you, blah blah blah. It's about five minutes of work with a log analyzer.

"Just one other point - yes beating a dead horse - on why micropayments are nothing like cell phones."

Once again, wumpus loses an argument but probably (definitely?) won't shut up about it.

"That's a load of hooey, Jeff. ISPs, specifically, log everything and know exactly how much bandwidth you received, sent, time the connection was up, time the connection had an outstanding TCP request, routing table entries due to you, blah blah blah. It's about five minutes of work with a log analyzer."

Actually, I do know that-- they essentially throw the collected info away because nobody likes to be billed per hour, as I (and the article) pointed out earlier. However, the article failed to make the VERY important distinction between time-based billing and usage-based billing. I strongly suggest the author call 1-900-PSYCHIC so he can learn the difference for himself.

Anyway. Because the ISPs collect this data, that's another reason why I proposed that the ISPs be used as the billing entities. Which brings me to...

"Micropayments - who bills me? Pretending wumpuss has his way - company a. Who provides the service? company b. Who monitors the service? company c. Anyone who has had to deal with the problems of multiple companies will tell you the answer to this question. Who will be responsible when there is an error?"

Hey, who is your long distance provider on your home telephone? Is it the same company that provides your local service? What happens if you dial 10-10-220 before making a long distance call?That's right, you are billed by company b. through company a. The horror, Chet! The horror!

This is remarkably similar to my proposed micropayment system.

"In your own words Wumpuss - the small sites would not benefit - so unique pieces like the shoot club would remain free unless picked up by a bigger syndicator."

Small sites WOULD benefit from becoming larger with a micropayment system. There would be financial incentive for them to do so. Unlike the current system, where sites pay the "success tax" via bandwidth costs.

If you're a small site, you won't be making money no matter what model you choose, so in the words of Jesse Jackson-- the question is moot. So yes Chet, you can quote me on that.

"When I imagined it, I didn't think of it as a penny but as a buying decision. Do I want to pay for this? The overriding feeling I had was, man, this is really a bother. I don't want to have to decide to buy or not to buy. I was feeling that confusion and anxiety the author predicted."

That sounds like a key reason that micropayments will fail. I sold stuff in retail stores for years. If you want people to buy something, you have to make it more desireable, so that they are thinking in positive terms, with just a small side-effect. Look, I'm getting all of these cool clothes. These are great; I love these! I just have to hand the man my card...it costs HOW much? Uh, well, I've already been fitted for all of this stuff and don't want to look stupid, so yeah, I'll sign the paper.

Now, to use the analogy being thrown around here, I want to read the finally-posted, long-delayed latest installment to Shoot Club that has just finally come out (am I subtle, or what?). The screen pops up and asks me if it's okay to ante up my penny. Then I go to read the groovy 60 second reviews for the Diablo 2 expansion, and it asks it again. Then I go to read the news, and it asks again for money. The entire psychology of the setting is destroyed. Now it's not a babes-in-toyland story, it's a series of requests to get paid over and over again as I try to get my news. By the time I actually get to read that Shoot Club, I'll be thinking "Yes, it is certainly worth a penny. But not the penny-pinching, time-wasting aggravation of accessing information on this site."

Never, EVER bet against people doing things the easy way over a harder alternative, folks.

If micropayments won't help small sites, then small sites won't adopt them. Where is the groundswell of demand for micropayments? There is none. As the article noted, many micropayment systems have been introduced and none have generated any substantial consumer interest.

Micropayments are just a bad tradeoff, as the article notes. They treat pennies as a precious resource and the user's time and mental energy as a worthless resource. That's the opposite of the way it should work. Bundle the content together and charge me for the bundle. So what if it costs me $0.78 more that way than if I'd paid for the articles I'd read one-by-one. I want to make one buying decision instead of nine decisions.

And of course the reality is that the Internet may never move to a fee-based model for content regardless. Micropayments are probably dead in the water if there's not widespread adoption of fee-based models.

Thank you for falling for my example wumpuss. You didn't really think that out did you?

My example was for if you visited one page. But who really bills, who really provides the service? Company a's site, Company b's site, Company d's site, Company x's site, blah blah blah - do you check your itemized bill that is actually coming from 100's of vendors? The phone number you call does not bill you. The site name was oldmanmurray - why am I being billed by Portalofevil.com, inc? Do you really think there will only be one clearing house? Will this be the first time ever in recorded history that all of man agrees to give one company exclusive rights forever on making on profit from a service?

The consumer will never be able to handle an itemized bill for all their browsing for one month.

Also - something you have never discussed. I have a site, its free. All of my links are to the subscription section of my site. Does something popup when you click each link? Does it describe who is billing me? What the amount is for and for what product or service? When I signed up for long distance - I signed up before I used the service and understood who was going to bill me for how much. Go take a look at any agreement for long distance, for credit cards for downloading software - do you see all the fine print? Am i going to be shown this for each click? If you are going to say I can globally click - okay to any link from site x - can site x change the price on the pages anytime they want, a range of prices? How many sites do I have to set this for? There is some price I am willing to pay monthly for the site, so maybe I can cap it - maybe i can set a flat fee - maybe i can subscribe to the site for a monthly or yearly flat fee??? Micropayment?

Should I go on? Do you really think micropayments are so compelling that they will reinvent the ISP, Banking, Commerce and finacial law?

Chet

Why doesn't everyone just shut up until we see how Inside.com does, now that it's charging for articles?

.40 an article? But wait? Did CBS's moving big brother to Thursday affect the ratings or not?!?!?!? OH MY GOD!!!! I HAVE TO KNOW.

Or I could just check the weekly ratings for free.

Bye Bye inside.com

Chet

.40 an article? But wait? Did CBS's moving big brother to Thursday affect the ratings or not?!?!?!? OH MY GOD!!!! I HAVE TO KNOW.

Or I could just check the weekly ratings for free.

or... I could pay the monthly subscription of $3.95 - either way - I don't think this fits the definition of micropayments.

Chet

They are not all .40. Some are .15.

If you're going to use the cell phone as an example, let's pretend that every time you call, you have to choose to pay. You get the dial tone, the number dials, and a voice cuts in:

"Press 9 to complete this call."

Every single time you dialed. How long would you put up with that? Pretend you can't automate it, either--every time you dial, you have to listen, take the phone down from your ear, and press 9 to continue.

Myself, I think the inconvenience of actually making the transaction outweighs any potential benefits charging by the call could possibly have. It's not that micropayments will never work--far from it.

It's that they will never work unless the concept is part of a larger scheme. They cannot and will not work on their own on any sort of large scale.

The "all you can eat site buffet subscription cost" is most likely what'll end up happening... and a third-party company that handles all the administrative functions for such a thing will make bank. Sign up with Consolidation International, and we'll handle all that pesky billing for you--for free! Sure, it'll cost you 10-15-20% more than the sites charge, but hey, they'll give you an easy-to-use "ATM card" for their member sites. Besides, what's 20% of a dime? Two cents? And for two cents a day, I can avoid having to click 40-50 popups?

Hell of a deal, you ask me.

Inside.com is interesting. They give you option of paying $3.95 for a month's access or $0.15 for the individual article. I wish I could see the numbers on how many opt for the flat rate subscription and how many opt for the micropayment.

Regardless, I'd be surprised if they survive.

I don't think it's all too important if the author missed the distinction between usage-based billing and time-based billing; you end up with the same functional result. Exactly how many cases are there where there's a difference, anyway, other than ISPs? Specifically, a current business where they charge you for time, but they're really charging for usage?

As for the 10-10-220 example, that's not that good of a one to use; it's more-or-less AT&T's way to undercutting their own third parties. Basically, a couple of upstart long distance services set up "prefix" operations to get into the long-distance business quickly. So what does AT&T do? They set up their own shell corporation for prefix long-distance to steal the business back.

Not really micropayments related, but amusing.

Anyway, what really confuses me about the whole thing is why something this silly actually has evangelists. I mean, it's like the difference between credit cards and checks: sure, it might be nice, but no one really cares enough to post impassioned arguments about why one is better. Micropayments seems to be a kooky little solution that's attracted a following of people who like it just because they loathe advertising. Maybe.

All of this is mostly moot, I think, until and unless we can establish that consumers will pay for ANYTHING on the web, content-wise. I have yet to see convincing evidence that users will be willing to pay for 99% of the stuff on the 'Net. This is doubly true when you consider that most of the stuff on the 'Net exists in multiple forms, and if one place goes pay there'll be six or sixty or six hundred others that will have it or a reasonable facsimile cheaper or for free, in all likelihood.

Will users pay for some content? Sure. Personally, I think the one stop shopping--"one bill, one payment, one hassle"--system is the only one that will work but even then the potential for a Balkanized Internet, where dozens upon dozens of competing conglomerations of content angle for your $9.95 a month makes my stomach get all queasy.

I agree, Bob. I like to read news on the Internet, but if I have to start paying for it I'll go back to buying newspapers. I'd rather pay for that and get my comics, my local news and sports, ads for stores I can drive to and buy stuff from, etc.

The real advantage of the web over print isn't that it's timely or comprehensive, but that it's free.

That said, I'd be open to some reasonable subscription plans. I don't see myself paying $10 a month, but I might pay $3 a month for access to a network of sites. They'd have to be some pretty good sites, though, and the content would have to be both high quality and unique.

The only thing that will get me to subscribe to gaming type sites is if they have additional game stuff... like mods, addons, new levels.... stuff that you couldnt get anywhere else... otherwise I'd like to have everything free...EVERYDARNTHING!

etc

The thing about mods and new levels is that you can't really charge for them. It would be tricky to have a fee-based site where one of the selling points was mods. You can't make Starcraft maps and sell them. That kind of thing's already been tested in the courts.

"That said, I'd be open to some reasonable subscription plans. I don't see myself paying $10 a month, but I might pay $3 a month for access to a network of sites. They'd have to be some pretty good sites, though, and the content would have to be both high quality and unique. "

Do you have anything particular in mind? I think the Gamespy network (including Fileplanet) may be worth it.

"The real advantage of the web over print isn't that it's timely or comprehensive, but that it's free. "

It's also a lot easier to take a couple minutes at a clip throughout the day to catch up on web news than to unfurl a newspaper and attempt the same thing. You aren't abusing your breaks, but there's certainly an image thing working there.

About web viewing from work -- net traffic would drop substantially if employers policed web access. Seems like people are more likely to surf from work than from home.

My guess on that -- broadband. What, like 12% of the population has broadband at home, right? Do any of you know of a work-place that operates on dial-up. Until I got cable at home, I was rarely online, because it was so frustrating -- especially since I had a T-1 at work.

I'll quote Wumpus for once -- Once you've had broadband, there is no turning back. That's the truth!!

And, on the micropayment vs. subscription -- If I WERE going to pay for content (which is doubtful), it would be on a "Pick any 5 sites, get access for $9.95 a month," or a similar deal. And then, of course, the competition for internet companies come from offering 10 sites for ten bucks a month, versus the five that site x offers, etc. I could see something like this happening. (Isn't that how those AVSs that I keep hearing about porn sites using works? Sounds like a decent business model.)

What's an AVS and how does a porn site work? Sorry to sound so clueless, but I rarely get out since the kids were born and honestly don't know what you're talking about, Murph.

I see. Well, I'm not the best person to ask, either, but I believe that most of them go through an Age Verification System that charges you a monthly (or every six months, or something -- I'm not sure about that part) fee to access a network of sites.

My knowledge of the subject is seriously limited -- as I suspect would be the case of most people around here (you guys just don't seem the porn type to me) -- but it sounds like a good business model. If anyone knows more, I'd love to hear it.

LOL, yeah just click the anonymous button and do tell! ;)

The other thing about web access from work is that at home people are doing other things (games, movies, chores, etc.) and at work they don't have those distractions. Obviously work is a distraction :) but most people are not busy at their jobs all the time.

"but most people are not busy at their jobs all the time."

Yeah, but I think this pegs the value that most people place on websites -- they're ways to pass the time. I doubt you'd see many people who value them enough to pay for access to 'em.

I hate to stear this conversion a little off coarse but why can't I buy games over the internet and download them? I mean really?

Right now if I want a game I have 2 choices:

A) Head down to my local Best Buy and hope the game is in stock and overpriced. If it isn't in stock I then drive father to EB where they will have the game and it will be priced at the MSRP. This has been annoying at times but tollerable. Most of the time the game is out of stock and I get all pissy and depressed since my weekend is shot because I can't play Max Payne like I wanted to.

B) Pre-order the game online or, if it has already came out, buy the game online and then wait atleast 5 working days which usually turns out to like 7 days since it spans a weekend just so that Fed Ex can put a sticky note on my door saying, "We popped by but you were not home (Fucking obviously since i was at work) so we didn't leave the game here on you door step. Instead we are bringing it back with us to our distribution center. You can pick it up there after 6:00pm after you fight your way through traffic and get generally pissy. Or you can wait for tomorrow and then when you aren't home we will stop by again and put another sticky on your door. Or you could just take the day off work and wait for us.

Now why can't I have an option C?

C) Pay for the game with credit card. Go to one of the many mirrors and find my download link. Click the link. Start downloading the compressed file with the key that will decode and uncompress the image file. Burn the image to a disk. Wooooola. Done.

Yeah, yeah.. I have a cable modem. So what? why don't I have this choice yet? Let the 56k losers deal with A and B I want my C!

Jeff

B) I use the USPS shipping option when available, since they are pretty good about leaving packages at my doorstep. If they don't, it helps that the post office is *much* closer than the FedEx or UPS centers.

- Alan

Postal Service is the absolute best way to ship and have things shipped in my experience. You get what you want when you expect it. When they say 2 to 3 days for any package shipped Priority Mail, they mean it. Not only that, most games do not tip the scales high enough for you to be charged more than $3.20 for shipping. Since UPS and the other carriers charge by both weight AND distance, it can go up fast with other shippers.

As for C, there simply aren't enough people like you to make it viable. Give it another ten years and maybe you're there. But then you still have to convince millions of people that they don't need to go to shopping in a store anymore. You also have to educate them that what they download is the product and not the box it comes in and disc it comes on. This will take longer to sink in. Piracy would be even worse. Game over.

--Dave

I agree USPS is the way to go but in most cases I have hardly seen it as an option for shipping. And a general rule is that the online companies just screw you on the shipping and "handling" fee they charge. Utter BS it is... Most monitors they will charge you 60+ dollars to ship but when I shipped one back to them cause it didn't work it barely cost me 30 bucks. The bastards.

As for my C option. There has to be a way to limit piracy with online downloads. But in reality as it stands Piracy is pretty easy right now. I know a few friends who can get thier hands on games long before they are released. Everything is on the web if you know where to look.

In retrospect though if it was that easy to buy games online I would probably buy ALOT of sucky games that I wouldn't buy just because I am too lazy to rush to the store when it comes out. But if all I had to do was click a few times with my mouse and type in my credit card info... uh oh...

Jeff

Piracy would be really hard to fight, but if you got some kind of activation code (I know, activation sucks!) that could help some. I don't know how to fight this -- you can't use an activation code for the download, because people could mirror and not charge (though I don't know why they'd freely share something that they spent money on), but I don't know how easy it would be to make an activation code only good for one copy of the game.

As it stands, you're really paying for the right to USE the software, not the software itself, anyway. If they could find some way to make the authorization code game-specific (i.e. THIS game requires THIS authorization code, not just some general code logarithmically calculated), in such a way that each code could only be used much...

I don't know. There's a reason that I don't fight piracy for a living, I guess. It'd be really, really hard, though, and I'm sure that's why.

My option, though? Go to BestBuy.com, and select the "pick up at store option" after paying for it online. You don't have to pay for shipping OR sales tax, and you're guaranteed that it's in stock, with your name on it, before you leave the house.

Just the thought of trying to download a 1+ gigabyte game in it's entirety gives me a headache.

There's another problem, too. What do you do about hard storage? Where do you keep a permanent copy of your game, in case your hard disk crashes, or you get a new computer? Sure, CD-R drives are getting pretty common these days, but lots of people still don't have 'em. And the game manufacturers might not approve of you using them anyway. They may even design games for download that are next-to-impossible to copy. Then what?

I'm not saying it's a bad idea. I kind of like, myelf, especially if it means real cost-savings to me, the consumer. But I think there's a lot of issues to work out, too.

I saw a crappy CD-R drive at Best Buy for $50 after rebate ($80 before). I am sure it would work for purposes described above. Also, it would be simple to break the games up into multiple chunks and have an auto RAR type program to put them together and install.

-- Xaroc

It would stil take a very, very long time to download. It might also be put into a format that auto-installs once dloaded, preventing you from backing it up to a CD-R. Besides that, I wonder how many of the mainstream market (that big buying pool) are patient enough for the download, or savvy enough to us CD-Rs?

Savvy enough to use CD-Rs? Dunno about that one, man. CD-Rs are pretty simple to use. And more and more computers are coming with them pre-installed. Now, breaking them up and havnig them put back together is a different story. But, just for the sake of copying (relatively small) programs? As long as they fit on one CD, there's not much to it.

True dat, but I'm thinking we aren't looking at small files. I think we're looking at giant games. I also think, in their eternal quest for better copy-protection, that game companies will purposefully sabotage the ability of the consumer to copy the game, even to a CDR.

Try as they might, I'm not as confident that it'll ever happen. I think it'll be shooting themselves in the foot, too, if they do. I don't think they'll sell any more copies -- they'll just have fewer people playing their games. I don't think people pirate games that they would otherwise buy. I think they pirate games that they wouldn't buy, but might play for a little bit.

By the way, it seems that www.egghead.com is still open for business. I've occasionally bought from them and never had problems.

They have a deal to ship any order for $9.95 or less. I think my last set of purchases exploited a similar cheap/free shipping promo (among my items was 1000' of cat 5 cable). It's even worse for them, as my order was then shipped from 3 different fulfillment centers around the country.

As I recall, they had a very good return policy and usually decent pricing so I often ordered from them instead of a 'stranger' with a slightly better offer.