SMS Micro Payment Dreams

One thing I have been mulling over lately is micro-payments via SMS. It seems that may be one answer to the old “how do you sell digital content on the web?” quandry.

Currently, the only realistic option you have for purchasing web content is to do a full or trial subscription. But what if you just want to read one article, take a look at one picture? It’s hardly worth the subscription, but well worth a measly $.25-$.49 to have look.

The problem is, you certainly aren’t going to run your credit card for 25 damn cents. What a time consuming hassle that would be. And for the seller, it’s not worth it either. It generally costs 30 cents plus up to 3% of the total transaction amount to process a credit card transaction. No way in hell any content provider is going to sell to the end consumer for a money losing transaction.

What I keep dreaming about is a wireless account that you can add monetary credits to, like turning your phone into a paypal account. And when you want to read a specific article, industry report, or anything else, you simply send an SMS to a predefined number, which in response delivers you a content “unlock” code, you type it into one simple formfield, and download your damn content. The micro amount is deducted from your phone account, and off you go.

This does leave the door open to fraud, as there is very little in the way of verification checks. However, micro-payments kind of nullifies the motive for fraudulent use. A thief will have little interest in stealing a cellphone in order to purchase a 25-99 cent piece of digital content, their interest lies in big ticket items that are easy to resell. Effectively, the risk of fraud to the company processing the SMS transaction is minimized by the very nature of micro-payments.

We’ve seen great success in Micro-Payments for ringtone sales and services such as I-tunes, I’d love to see it go further to include text and visual web based content.

My head hurts thinking about it anymore and I have work to do. Here is some stuff.

Sort of Micro-Payment Providers
Bee Tokens
IndieKarma
Micro Payment Reading
Jakob Nielsen’s 1998 Article (if we knew then…)
BankTech
WikiPedia’s MicroPayment Page

Kyle

Kyle wrote 138 posts

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