Micropayments for Music Downloads
Posted by Erik Peterson | Filed under business, technology
Like many others these days, I’ve been trying to think of solutions to help the dying music industry; mainly to help indie musicians stay afloat, and hopefully succeed. How can independent and/or unsigned artists still sell their music for profit? With so many bloggers saying music should be given away free and Pirate Bay operators appearing to be winning their case, it’s no wonder the general public thinks it’s perfectly ok to take it for themselves without paying the artists for their work. No matter what your stance is on that subject, I think we all can agree that the artist needs to be compensated in some fashion.
That got me thinking about the proposed ISP tax that would permit surfers to download music (and other media) free, without fear of prosecution, for a small monthly tax or fee paid to their ISP. In turn, the ISP would pay the record and publishing companies. The British dependent, Isle of Man, has already made serious proposals to make this service nation-wide. That sounds like a great idea, but where does that leave the millions of unsigned artists? Especially during a time where it’s becoming increasingly less significant for musicians to even be signed with a record label.
I’ve been marketing online since 2000 and I know how hard it is for web sites to entice a surfer enough to pull out their credit card. If you’re not a well-known, trustworthy web site; it’s even harder. Yet, after all these years the Internet and e-commerce have been in existence, there are still very few billing solutions that don’t require a surfer to hand over all their valuable, personal info. This is one of the main reasons why so many will not use their credit card online. Not only that, but it sucks filling-out all that info each time you want to make an online purchase. Another reason why people do not like to buy online.
I know the idea of micropayments for digital content is nothing new, but most solutions require a surfer to sign-up for yet another service first, or surfers must purchase credits from the site before any goods. What about micropayments being billed through your ISP? Wouldn’t it be nice if you wanted to purchase a download of some sort, and all you had to do was enter your ISP login, approve the charge and it’s all yours? Those charges would just appear on your monthly ISP statement and you would never have to fill-out your payments details or provide so much personal info again.
A billing solution like this could be the answer for many digital media companies that need to generate revenue in order to survive, as well as the original content creators. Can you imagine 1,000 surfers paying YouTube $.005 to watch/download a video? That’s $50 earned and it barely cost the surfer anything. Say YouTube were to split that revenue 50/50 with the content creator? You see where I’m going with this? The same would be possible for music downloads and perhaps even streaming content. Not to mention the economic stimulus it could provide. Free content is great, but it will eventually run out of steam, and then we all lose.
I searched all over trying to find a service that provides this type of micropayment solution for implementation into PLUGOLA, but to no avail. I find it very surprising that nothing like this exists yet, or at least it’s not easily found. The Internet really needs a new way of billing and I, for one, am all for micorpayments being billed through my ISP. What do you think?
If you know of a service, or build one, like this, please let me know.
February 22nd, 2009 at 4:29 pm
What do you think of zong.com? They enable web surfers to pay for content via their mobile phone. Seems like a good opportunity for musicians to easily monetize their content.
February 22nd, 2009 at 5:40 pm
I thought I knew exactly what Zong.com was going to be (which wasn’t exactly what i was talking about), but I was pleasantly surprised after i watch their promo video. It’s definitely a good step in the right direction. Unfortunately, most mobile carriers take a big % chunk of the sale price; more than credit cards. Then there’s still Zong’s transaction fee.
I would think this billing solution would have to be handled by a central, or gateway service. To make it affordable, and profitable (no one likes to work for free), the service would have to handle all transactions and then bill ISPs and pay content creators on a monthly basis.
March 4th, 2009 at 7:43 am
It sounds to me that OneTouch Online Purchasing is exactly the company you are looking for. OneTouch is a Federated Payment System, which provides secure processing of online digital payment without a credit card or risk of identity theft. Users can charge any and all micropayments to their existing phone accounts, ISPs or prepaid cards. The consumer does not need to pull out a credit card or any other sensitive information, all he needs to do is enter his OneTouch username and password and then OneTouch will manage the transaction by billing the consumer’s telco, ISP, prepaid card, or even mobile service provider. For a more in depth explanation check out my blog at skootchkagan.wordpress.com
April 26th, 2009 at 6:55 am
I forgot that i posted a reply here. My blog was moved to http://www.onetouchpurchasing.com/blog/ check it out for more info about OneTouch