Micropayments are back!
Allow yourself to flashback to the late '90s, when the future of internet media being scrawled on the white eraser board was a battle between a "pay to play" and "information wants to be free." Too bad it wasn't even a close contest: the communists won.
Haha, it was actually an unfair battle. There were too many factors working against micropayments back then: clumsy technology (no AJAX, awkward logins), hefty media pocks (NYT was selling at $40/share, compared to its current $5), and, most importantly, the giddy hope of a free media future.
But here we are today, struggling with a plummeting ad economy and the increased (but necessary) stress of moving everything digital. So micropayments are back on the table -- just ask all of the heavies who announced their support in the past week: Walter Isaacson, David Carr, Henry Blodget, Steven Brill, Stu Bykofsky, and Gawker (sorta).
And surely, an equal number of people came along to trounce the idea, as they should.
So what do I think?
I have no fucking idea. I don't like being on the wrong side of history, and I really don't know if the New York Times should revive some version of Times Select. I don't mind if you call me a chicken on this one.
But here's something I do know: micropayments could be better. With no interest in entering the fray, I would instead like to offer some design/product/business solutions that might influence the debate. My secret belief is that good design and infrastructure could address some of the valid consumer concerns. No one seems to be approaching the problem from the critical perspective of simplicity, searchability, and scalability. In other words, no one seems to design a good product. I have a proposal. Here's my idea...
Click image for full-size view.
And here's how it works...
1) When you click a link to a story -- from Google, from a blog, from NYTimes.com, from whatever -- the article appears as it normally does, except the Subscription Center lightbox appears over it, with the text opaquely visible in the background.
2) You are given a few options to quickly choose from: pay for the single article or buy a weekly/monthly pass.
3) If you already have an account (and if you're a NYTimes.com user, you do), clicking "Buy" will cause the lightbox to disappear. You can begin reading the story. Instantly.
4) You will not be charged for anything until you accumulate $5 of charges. At that point, you will be asked to enter your credit card or PayPal information, if you haven't already.
So what's new with this? What problems have I tried to solve?
1) Search / Conversation. By far the largest concern with adding subscriptions is being left out in the cold when it comes to search. (Google can easily account for half of the traffic on a media site.) This is the common criticism of the Wall Street Journal subscription model: bloggers don't link to it because it's behind a firewall and Google can't find it because most of the text is not indexed. WSJ ends up being left out of the larger conversation online. This solution addresses the problem by making all of the text still available on the page, so search engines can still "see" it. It's not behind a subscription firewall -- it's just slightly shielded. It keeps the stories in conversational circulation.
2) Surcharges / Cost. The other large concern with micropayments is related to the transaction charges incurred. This argument suggests that you can't charge $.20 for something and handle all the surcharges incurred from it. My solution addresses the problem by delaying the charge until the user reaches a certain threshold. As people like Steven Brill have pointed out, even $3/month from users would catapult revenue beyond anything ever seen by the company.
3) Scalability / Business. When NYMag did a story on the digital smarties a couple weeks ago, some voices on the internet claimed that these boys should be set to the task of inventing new business. If executed correctly, this micropayment system could actually be the start of that. This system could be scaled up to become the micropayment system for all news consumption. By becoming the backbone for media micropayments, The New York Times could have an entirely new income model. And then the network effect comes into play: the more media companies that join, the more pervasive the technology becomes, the faster users reach their $5 checkout.
4) Persistence / Features. I've had the same NYtimes.com account since approximately 1998. I'm hoping that somewhere deep in the bowels of the system, it knows every article I've ever viewed with that account. Any articles that I store in my locker are kept forever, so wouldn't it be awesome if all those were automatically added to my Digital Locker? This small personalization feature could be the beginning of an entire new set of features -- search, bookmarks, personalization, etc.
And now, some potential criticisms...
1) Can't I game this? Couldn't I just keep signing up with new accounts once I get close to $5? Answer: Sure, but I think people are willing to deal with the hassle if the payment are small. And to borrow from the Flickr model, if you offer special features with "pro" accounts, the incentive becomes even greater.
2) Couldn't someone come up with a Greasemonkey script that blocks the lightbox overlay? Answer: Sure, but things like Adblock are used by <1% of the users, so I'm not too worried about that.
3) Will Google eventually block this from their search index? Answer: I'm actually not sure, but I suspect no. This is for a variety of reasons, but the most important is that Google doesn't want to look like a bunch of assholes right now.
4) Would other companies actually adopt this micropayment system? Answer: A few years ago, around the time Google introduced Checkout, there was the brief fascination with the notion that Google could become this middleman for media micropayments. Today, there's not a media company alive that would surrender this to Google. However, if this were handled in a way similar to FOX and NBC joining forces for Hulu, maybe they would.
The goal of this exercise was to think about ways to minimize the greatest concern with micropayments: consumer anxiety. I propose that the combination of low cost, simple interface, and clear information display could greatly minimize that concern.