Micropayments and the ‘too-small-to-meter economy’ of online content

The problem with mixing money and online publishing, it nowappears with 20-20 hindsight, is that dollars simply represent the wrongeconomic paradigm: they are the medium of impersonal, low-resolutiontransaction economies, not highly personal, high-resolution relationshipeconomies.

– Venkat Rao, Ribbonfarm blog

We have already covered ways publishers are trying to monetize online content with Bitcoinmicropayments or straight up subscription fees payable in Bitcoin. Butwriter and consultant Venkatesh Rao, of Gervais Principle fame, suggestscryptocurrency might offer an entirely different paradigm for contentmonetization.

“‘Charging’ for trueonline-native content is like charging for all of Linux instead of just for thevalue added through packaging and support of the sort Red Hat offers. Or likeconstantly going out for dinner with friends and always free-riding withoutever offering to pick up the check.
From the reader’spoint of view, the fair price is close to zero not just because there are somany excellent free substitutes for any given piece of content. It is also nearzero because paying a more-visible-than-others individual for the output of alarger, invisible and uncredited group of participants in a conversation seemsunfair (as it should).”

This was lifted from his annual post calling forsponsorships (past results of this campaign: “$2250 in 2011, $3750 in 2012,$2625 in 2013”). (That last sentence compels an interesting meta-narrative ofits own, by the way.) This year, Rao has switched to a Coinbase tip jarto experiment with Bitcoin micropayments as a better alternative, which heexplains:

“So far, there’s neverbeen an economic model capable of capturing the complex nature of how all thisworks. Content has been free so far because the right market mechanism for itdid not exist.
Now it does. Bitcoin,and more generally, the underlying technology known as the blockchain, have theexpressivity to accurately reflect the socio-economic structure of creative productionunder conditions of abundance.”

You can read the rest of the post here. Scroll about two-thirds of the way downif you just want to read the section on Bitcoin.