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The Almighty Buck

Micropayment Wars Are Over... PayPal Wins? 377

Posted by CmdrTaco from the it-certainly-is-convenient dept.
Snocone writes "Cringely's latest column asserts that PayPal is now sufficiently dominant that it is pretty well certain to achieve de facto standard for micropayments over the net. Goes into the history of PayPal and why their model works where no one else's has. Even if you don't agree with him, there's some good insights into digital currency infrastructure to be found here." I now use paypal to pay my girlfriend back when she picks up dinner and my roommate pays his share of the rent using PayPal. Its great... although with the $5 they pay in referrals, plus the $5 they pay to new users, ya gotta wonder ... (if anyone wants to use me as their referral, thats cool *grin*). its actually making the Tipping Jar concept practically feasible. I mean, can I tip artists a few bucks when I enjoy their MP3? Can I tip a few bucks when I enjoy reading someone's website? The potential to change a lot of things is within reach.
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Micropayment Wars Are Over... PayPal Wins? More

Micropayment Wars Are Over... PayPal Wins?

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  • I have no problem with needing some kind of verification but I am not going to give them my bank account number (and implicit permission to EFT funds from it at any time "if I approve it.") As of today PayPal has become useless to me forevermoe as I have reached my $500 spending limit, which can ONLY be lifted if I supply my bank account number.

  • While it's not marble and cherry wood.... (Score:2)

    by Anonymous Coward
    about the last place I'd trust for online transactions is a traditional bank with an aging, conservative board of fatcats who think Msft & AOL are state of the art and have to hire some tortured soul of a hack to implement their stodgy idea of what online financial services should be. PayPal sure speeds up my eBay addiction :)) Ch-Chuck on remote assignment
  • A database of 10 million users and their credit card numbers, bank account numbers, etc. all in one place. Sounds like a juicy target for hackers. Credit cards may offer some degree of protection but how responsive would your bank be if you told them that you posted your checking account number on the Internet and someone used it to empty out your account.
  • So how long until Slashdot replaces advertising banners with a PayPal virtual tip jar?

    Come on, if this sort of thing is going to work, then surely the Slashdot crew wouldn't mind taking the first step?

    --

  • Anyone know?

    That was one of the coolest damned things I've seen in a long time - beaming cash between each other's Palmpilots/Visors, and then cashing in on the next Hotsync. Honestly, that was so godamned cool I can hardly even stand it that they cancelled it - we *NEED* more services like this in this world.

    Anyone got any details why they cancelled it exactly? The first thing that comes to mind is some sort of legal issues with regards to banking regulations of some variety, or maybe it just wasn't being used.

    With all the new Palms on the market now, and the growth of that market going the way it is, Paypal should really bring Palm/Payments back...
  • Go talk to Citibank UK and ask to open a US dollar account. They'll then ask you if you want a US dollar cheque/check book and a US dollar credit card to go along with it. They'll also ask whether you want your US dollar account to be based in London or New York (ie, it affects clearing times on cheques).

    These are private accounts.

    No charges for moving money in or out, or moving money between your GBP and US dollar accounts (or AUS, or NZD, or whatever you ask them for).

    Citibank is tres groovy.

    ...j
  • Perhaps money should either be a reward for nothing, or for everything. Anything in the middle, and the decisions people make in their life will be guided by money. If, however, you create something artistically and no matter what the medium is you get paid, then money has not influenced your decision to create what it is you are going to create.

    As someone who is very pressed for time and needs to stay focused, it would be good to throw away all the money making activities and work on the art that I would love to spend all my time on. This is not possible as it doesn't make me any money, currently.
  • "From what I've read a large part of the reason many credit-card accepting sites won't take customers outside the U.S. is the enormous rate of fraud they experience when dealing with non-US customers. Fraud per se wouldn't be so bad if some of these countries had law enforcement and judicial systems that were, to put it bluntly, honest and effective. "

    Wrong! It's nothing to do with law enforcement in those countries. Try blaming the credit card pseudo-monopoly/cartel of Visa, MasterCard, etc. Merchants always foot the bill when a CC charge is questioned. The CC companies have not implemented a consist way to verify a credit card, and thus the merchants cannot check up on CCs. The US uses a system different to elsewhere. I moved to Canada, but I often cannot use my US CCs to buy online from the States. The reason is I have an international address and the US computer systems cannot cope with that. In addition to this, international treaties would be required so that fraud commited in the US (and vice-versa) can be prosecuted overseas.

    "Couple this with the clusterfsck that comprises the banking and currency transaction laws and bureaucracies of many non-US countries and you have some serious barriers to entry. Some of this can be blamed on currency speculators who have in the past used electronic means to clobber currencies which caused the affected countries to enact laws which hinder EFT. "

    This is just crap too. What the hell has the exchange rate, etc got to do with it? I recently did a large cash advance on my British credit card. The amount was over $7,000, so the local bank could not guarantee me the exchange rate (fluctuations would have cost them a significant amount)... instead I had to agree that I would accept the exchange rate at the time the transaction completed, a few days later. Fine. I understood it could cost me more, but that just goes with the territory.

    "Instead of blaming everyone for being anti-{your country here} instead ask yourself what your country could do to make their economy more accessable so the paypals of the world CAN set up shop in your country. "

    As far as Western countries go, everything is pretty accessible. Personally, if I were an overseas customer, I wouldn't want to do business with a US company such as Paypal as the US is rather lacking when it comes to privacy legislation.
  • Now if you come into my restaurant and act like a know it all who doesn't tip, then I will suddenly become incompetent and forget to get your drink refills or anything else.

    Huh? I certainly don't behave any differently in a restaurant to anyone else. I'm polite to the waiters, and expect the same in return. At the end of the evening, I'll decide whether a tip is justified or not. If you haven't been refilling my drinks, the chances are I'll decide not. If you want to lose your tip through such behaviour, there's little I can do to stop you...

  • It's a lousy job. Give 'em a buck or two.

    No! Paying them is their employer's responsibility, not mine. No one is forcing them to do the job. If they don't like the salary, they should find a better paid job. I'll tip if they've given good service, but 15% is way over the top. In fact, the tip shouldn't be related to the value of the meal at all. The waiter hasn't given me better service because I ordered the £50 lobster instead of the £5 burger. At the end of the day, though, it probably just comes down to cultural differences. In the US, you're seen as rude if you don't tip (hell, there's even people in this thread that tip pizza deliveries!). Here in the UK, though, I see it as rude to expect a tip unless they've done something to warrant one.

  • I see this as a good thing for amateur artists. It allows unambigous proof that somebody appreciated your work. The value of this positive feedback is probably more than the monetary value of the micropayments.
  • If you take a look at the site, they only offer the service to people living in the USA. Sounds like it has a really good chance of becoming the de facto standard for micropayments over the net. Right.

    --
    Niklas Nordebo | nino at sonox.com | +46-708-405095

  • What's your experience been like with it (I assume you use it)?

    I'm somewhat interested in messing with e-gold, but to me (reading their site) it looks like you'd eventually get bled to death by storage fees for the metal (your balance slowly goes down as a result), and you also get charged for exchanging currency both to and from e-gold...

    Are the fees really so small in practice that this doesn't matter?

  • (Remotely associated with net micropayments)

    Anyone got any good stories about Internet Banking?

    I'm in love with my bank, [Citizen's Bank of Canada] [citizensbank.ca]. As long as I keep more than $1K in the account, it's free. *FREE*. No service charges on the account. No transaction fees. *No VISA fees*. *No ATM or DirectPay fees*. And they pay higher interest rates than the big banks.

    And every time I use my VISA, ten cents goes to charity. And we bank members get to vote on the charities every year.

    Works for me!

    My sister-in-law banks with "President's Choice," a big-box grocery/superstore chain in Canada. It pays higher interest, but doesn't do the charity thing. She gets discounts on her groceries... and suffers with a smile the taunts and teases about her grovery bank.

    Anyone have experiences to share? Is there anything like this in the USA? Someone from Finland was talking about their country being over 50% e-banking...


    --
  • Only one area.

    You see, PayPal is not credit card dependent. There is absolutely nothing stopping you from setting up an account without a credit card. If you want to transfer money into an account without a credit card, you can do an electronic funds transfer from a bank account or with a personal check.

    Steven E. Ehrbar
  • From what I've read a large part of the reason many credit-card accepting sites won't take customers outside the U.S. is the enormous rate of fraud they experience when dealing with non-US customers. Fraud per se wouldn't be so bad if some of these countries had law enforcement and judicial systems that were, to put it bluntly, honest and effective.

    The US spends billions every year prosecuting credit card fraud. Are you surprised that other countries are unwilling or unable to dump this kind of money into doing the credit card companies' work? Because the US takes care of fraud for credit card companies, they have no incentive to fix their inherently flawed system.

    Credit cards are a bad deal. Period. I won't consider the world to have truly evolved electronic money until the current credit card system isn't involved, or it is massively restructured (and involves cryptographic security). Another requirement isn't that you don't have to "pay" for money. PayPal doesn't qualify because of it's fees (business accounts).

    --Bob

  • Bear in mind, that at the moment, the uses of Paypal money are somewhat limited. So there is almost nothing to be gained by leaving cash in the account. It's primary use at this time, is a pay on demand system. At least that's how I use it. But going back to the network effects, as more people adopt the system, there will be more advantage to keeping a balance ready there. If you can use it for more than the occasional auction payment you will be more disposed to keeping float handy.
  • That's $12 per person, where they are leaving the money there instead of transferring it back to a checking account. I'm suprised that it's that high, based on my experience with it.
  • I know -- they cancel your account, with all the credit in it, if they notice that you've falsified any contact details. I entered my state as "WA" and the system accepted it as Washington, even though it was Western Australia...

    As far as I'm concerned, I don't care if I can get money in or out of the system, I be happy just to have an account to interact with other Pay-Pay users.

  • DigiCash was founded in 1990 by cryptologist David Chaum (site apparently not updated in recent years...) who owned the two (three?) major patents covering completely anonymized digital cash. To my knowledge it still isn't certain whether it's possible to create a truly anonymous digital money scheme without violating these patents.

    David Wagner [berkeley.edu] has done some work on that. Sample code is available in lucre [aldigital.co.uk].

    It appears to avoid Chaum's patents but I don't know if any patent lawyer has had a good look at it. Your "not certain whether it's possible" comment may stand even after reading this (if you haven't read it already).

  • Take for example waiters, they're paid much less than minumum wage. I worked as a waiter and made about $2.10/hr in regular wages. Management knows that you'll get tips and that's why they can get away paying so little. Waiters pay income tax on tips even when they don't actually get them, the government assumes you get a certain amount from tips for every hour you work and they tax you on that. This is why tipping is necessary (with an exception for very bad service, in which case I don't tip much either) and why if you don't tip you won't get good service next time.
  • The problem is that waiters make typically eighty percent or more of their income from tips. If nobody tipped, all the waiters would quit and the price of the meal would have to be raised to pay the waiters properly. With meal prices 20 percent higher, you'd end up "tipping" for good *and* bad service since there'd be no longer be an incentive for good service. Sure, you could just not go out to eat anymore, but you do like to do that right? That's why you do it now?
  • Yes, we should all remember that the easiest way to spot the pioneers is that they're the ones face down on the ground with arrows in their backs...When was the last time that the creator of a given technology or techniqe was the actual one to dominate because of it? I don't know.

    Odds are IE6 and/or MSN will incorporate an online bill paying scheme identical to paypals, and since it will be installed on 60+ million PC's within a year, Microsoft will win out again.
  • Paypal is not a micropayment system. Micropayments are by definition -very- small (ie: much smaller than a penny)

    Look at Mojo Nation [mojonation.net] for a micropayment system. (and a distributed data haven system based upon it!)
  • Actually, there's an easy option. Open an X.com bank account (and, at least a short while ago, get $20 free), and give that number to pay-pal. They have an account, albiet one I don't use, and I have no spending limit. Works out well for me.
  • Anyone got any details why they cancelled it exactly? The first thing that comes to mind is some sort of legal issues with regards to banking regulations of some variety, or maybe it just wasn't being used.
    It wasn't being used. According to the fellow from X.com who posted to the comp.sys.palmtops.pilot thread about it, they were only seeing about 10-20 Palm transactions per day across the entire PayPal user base. That's way too few for them to keep pouring money into supporting it. Sad, but there you go.
    --
  • Does anyone know if there is anything like this already in existance? Would you use it if it were available?
    Actually, there is! Ironically, it's brought to you by the very same people who bring you PayPal!

    It's called X.Com, the Internet bank. They offer a high interest checking account, with free debit card, fifty printed checks to start you out, and allow deposits by EFT or good old-fashioned snailmail. They also allow you to email people money, though the people must have or get an X account (or request them to mail a check) to use it.

    Getting to it is a bit confusing, though--you have to go to X.Com-PayPal's homepage [x.com] then click on the little X Finance link below the login box, then click on the "Where's X Finance?" link at the top of the page.

    Enjoy!
    --

  • And I forgot to mention, they don't charge you for using ATMs, and refund up to $6/mo of other banks' ATM charges.
    --
  • I wonder if they changed this because they thought it would bring in more customers, or because the credit card companies (or the government agencies that regulate them) don't want consumers to waive their right to ask for charge-backs.

    By the way, aside from the charge-backs, PayPal customers now have insurance against unauthorized withdrawals [x.com].
    --

  • Regarding the first point, you don't need to tie your PayPal account to a credit card, you can tie it directly to your bank account.
  • What you don't seem to understand is that you CAN get it back. See that "Withdraw Funds" button? Click it. You can take any money in your account right out again. Once you've given money from your PayPal account _TO_ someone, that's a different story, but it seems to me you're just trying to stir up confusion and an outroar.

    I've been using PayPal for well over 6 months now, and processed a few thousand dollars of incoming cash with them, without the slightest of a problem. They know what they're doing, they've got tons of checks and balances in place, and they don't make a habit of screwing people over.

    ---
    Tim Wilde
    Gimme 42 daemons!
  • where's thanks.php?

    In my head right now. :-) but I'll send you a thank-you email!!

    Kevin Fox

  • Why would anybody create such a system in the first place? You aren't giving them any way to make a profit, so why go through the effort....

    Sure I am. If the system caught on, just think of all the money they could make collecting interest from or re-investing people's still-unspent digital cash. The more money you have access to, the more money you can make with it. Providing a service in exchange for access to people's money is a big part of how most banks, investment companies, etc. stay in business.

  • Agreed. Imagine if Mastercard or Visa decided to create some secure method of "micropaying" directly to someone's credit card balance.

    They could certainly do this. Imagine a system where you just call up Visa and get a micropayment ID number associated with your card. Then, put a link on your web page to allow users to make a transfer directly from their card to your micropayment ID.

    It would be easy for them to implement and, if handled in a non-stupid way, could totally dominate. Or, so I imagine.

    Greg

  • Yeah, but there is a certain network economy to the whole thing. If Visa or Mastercard starts up the same thing now (or Citibank or whoever), who wants to join one of those things in the beginning when they have 100 users and those are the only people you can trade $$$ with?
  • Why would anybody create such a system in the first place? You aren't giving them any way to make a profit, so why go through the effort....
  • Semantically, I said "stored their money in MS products" as kind of a flip way of saying that, really, banks don't store cash. They store data, and your account balance is really just an entry in a database. I'm asking, does anyone really think banks are doing this with SQL Server for their systems of record? Most banks I'm familiar with have old mainframes with old (but reliable) custom apps.

    I don't consider ATMs, Web Front ends, etc... to be critical systems.
  • Exactly, what you are describing is called a bank. There are tons of them. There is no way you could both a) comply with banking law in the US and b) mantain the required anonymity you desire under the system.

    Maybe if someone wants to open First National Bank of Sealand or something...

    Then again, I hate cash... I hate having to carry it around... you can lose it, its (literally) dirty, and if you give it to someone you have no recourse if they don't perform or your product is defective. Having the same thing in digital form only seems to solve the cleanliness problem as far as I can see. Unless you are some huge privacy freak and that's important to you... but if that's the case, are you really going to trust First National Bank of Sealand or whatever?
  • There's another reason why tipping IRL is successful: He's standing right there. You step out of your taxi, and you're looking the guy in the face as he reads off the meter, and you feel obligated to give him a tip, probably mostly because he's looking at you. I mean, since everyone's faceless online, you don't have to look the guy in the eye -- and that's where you may not feel obligated to tip..
  • The main reason PayPal has become so widespread is eBay. And that is because PayPal has, in eBay sellers, and army of people trying to get other people to use PayPal. After all, if I as a seller have a buyer who uses PayPal, I can get my money instantly, and the buyer gets thier stuff shipped right away. As a seller on eBay I put a note into every end of auction notice I put out that mentions I prefer PayPal and how easy it is to use. Many auctions mention taking PayPal explicitly in the limited auction description space, and generally it's a good idea because people are willing to pay more (sometimes a LOT more) for something they can pay with PayPal (and therefore, I'm assuming, a credit card).

    PayPal is also easy to get money out of. After you've collected money for a while, you can have a check cut but you can also have the money directly deposted into a bank account. The speed of doing that will, I'm sure, convince all but the most paranoid of customers to fill out bank account information.

    They now have a pretty good setup for letting anyone handle on-line credit card payments. Zounds! They are also poised to take over micro-eCommerce. That system has fees of course, but fairly small ones that seem pretty reasonable.

    The way they seem to be going to try and earn a bit more is to have business level accounts that have small percentage fees but more features. The web-payment is but one facet of that.
  • Provide 1600x1200 images.

    Ask for $0.50, not $5... A whole used book is much less than $5, a casual reader is pretty unlikley to give you $5 but might just fork over $.50 (or even $.10).

    Images on the web are pretty easy to aquire in general, if you provide any extra value like 1600x1200 images (which are harder to find) people are more likley to give you something for that.
  • Good: I used PayPal to pay the good folks at dyndns.org [dyndns.org] for my hostname.

    Bad: cancelling the Palm service (the only other time I used it).

    Bad: no international customers. I am owed money by a guy in England. I will let you know when I cave in and have him send me a cheque, because that will be the day before PayPal start their overseas service.


    --
  • The understandable desire for privacy at some point must collide with the legal restrictions intended to prevent money laundering, which make anonymous transactions of a certain size all but impossible. These restrictions are pretty much here to stay.(*)

    Likewise, if you're wondering why you can't send money to someone in Colombia with PayPal, it's not because X.com is filled with navel-gazing Americans who couldn't give a whoop for the rest of the world, but because there are serious legal restrictions on international cash transfers, and X.com will need to think long and hard about what kinds of services they can offer without running afoul of these restrictions.

    (* While I'm sure I will get blasted for saying so, the simple truth is that nothing -- nothing -- roots out organized crime like mandatory reporting of large cash transactions.For those who'd rather deal with organized crime than with the government, there are a number of countries in Africa and Latin America that are currently trying that particular experiment.)

  • Mass Market Busking: The Inevitable Economics of Software [boswa.com]

    Basically, if you give money away for anything you like, people will realize this and start trying to make stuff you like. If you don't give out money, nobody will care what you do or don't like. Being generous makes you relevant to the busking industry, much like being gullible makes you relevant to the advertising industry (and think how much better TV would be if it wasn't targeted at people dumb enough to be influenced by advertising, but rather targeted at people bright enough to understand why they should do things that don't have an immediate personal payoff like donating and voting).

    It includes a bit on why shareware doesn't work. Basically, shareware screws things up by trying to set a price, and usually way too high (presumably with the thought "I have to set some price, and I know most people won't pay, so I'll have to set it high enough that the few who do pay will make it worth my while."). The fact that making small payments over the internet only recently became possible, and still isn't well-understood by the general public, probably also had something to do with it. I mean, how far are you going to go out of your way to send $20 to some guy who wrote one cheesy utility you use?

    --------
  • Wouldn't it be great if you could have one distributed system for transferring any fungible commodity?

    Think of buying stuff with gallons of gasoline, standard bricks, or milligrams of antimatter (eventually).

    I don't think we can hang on to any one commodity as money forever. Eventually we'll mine gold out of asteroids and make children's toys, statues, and novelty houses out it. We'll have to keep switching to whatever is valuable. (and, no, levitating legal tender bank notes aren't good long-term money by themselves; they're only as good as their government's economic health)

    --------
  • I agree with your general assessment, except that you have overlooked two crucial details: the ability to make micropayments instantly (I only support e-gold because it the only working international micropayment system), and the advantages for taking payment.

    You can't send small amounts (pennies, nickels, dimes) by credit card. There are minimum credit card charges, somewhere around $0.50, so small payments are mostly transfer fee, and just aren't worth doing. A realistic minimum for cc payment is about $3, and that's really pushing it.

    As for the other half, anyone can be taking e-gold payment as soon as they get an account, which only takes a few minutes. Perhaps most importantly, there are no chargebacks, and no possibility of a payment dispute. For good or for ill, once a payment is made, it is done.

    I'd hate to take credit cards for payment over the internet. As the merchant, you are basically the one taking all the risk. If something goes wrong, it comes out of your pocket. Also, there are a lot of rules in the merchant account agreement that aren't directly related to taking cc payment. For example, you can't charge extra for a cc purchase than a cash purchase: you have to hide that $0.50 or whatever it costs per transaction in your price, so your prices have to go up across the board.

    --------
  • It's worse than that. It used to be that you tipped for excellent service, and a decent tip was around 10%. Now crummy waiters act as if they're entitled to 15% gratuity. You dropped a $30 meal on my table, disappeared for 30 minutes as I choked on a dry steak without access to water, and now you come to me wanting me to pay you $5 for the pleasure of your non-service?

    If your employer isn't paying you enough, quit. I didn't hire you and I'm not going to pay your salary. If a 15% tip is required, it should be printed on the damn menu.

  • One better than that.

    I was just in my local supermarket, getting the usual qunatity of caffenated drinks. The person in front of me was purchasing a pair of onions.

    That's a total cost of 15 pence (About 25 cents).

    He paid by Switch. Switch is a form of electronic fund transfer (A debit card).

    No cash. No cheque. No delay. Who needs PayPal?

    I haven't written a cheque. Actually, I take that back, I wrote one, once. 5 years ago. Switch rocks. Largely.
  • No, it's not a smart card. It's a conventional magnetic card.

    It contains your bank details, and when it's used, the computer in the supermarket contacts the computer in the bank, and the money is transferred from one account to the other.

    No 'cash' is stored on the card.

    My point was that the overhead in direct electronic funds transfer is now so low, you can use it for any amount.

    I know I do.
  • From PayPal Terms of Use [x.com]:

    3. International Use. You must be a resident of the United States to use the Service. International accounts will be available soon.

    How Soon?

    #include "disclaim.h"
    "All the best people in life seem to like LINUX." - Steve Wozniak

  • I heard a few years ago the Microsoft was scheming on a way to get a few millicents on each transaction on the Internet. (There was a joke going around at the time that dollar bills would be replaced by Bill Dollars.)

    I predict that either M$FT will buy PayPal, or they will announce a competing system within a few weeks, introduce Version 1.0 in about 9 months, and actually get something that sort of works within 5 years.

    P.S. You can use PayPal at BadKittyCam [badkittycam.com].

  • You have 825 messages.

    From Subject
    joe@abc.comPaypal only in US
    qwerty@asdf.netPayPal not in Canada
    null@example.comPayPal - What about ROTW?
    ... ad nauseam ...
    ---

  • You can transfer money to and from your online account using your credit card or bank account. Your credit card must have a U.S. billing address, and you must be over 18 years of age. Transaction limits may apply. Useless for us NON americans.
    ---
  • Hi, I'm willing to click anyone from /. a spot of e-gold if they send an account number to me. Yes, we do charge storage fees (and at the moment, dammit, the site is down, by Murphy's Law this story came along when it did instead of next Tuesday). There is an active market for exchange of e-metals (the e-gold family of currencies includes gold, silver, platinum, and palladium, but gold is by far the most popular). The fees are higher than PayPal's 0 fees, but we ARE international, and safe, and (please come back next week, don't slashdot us now!!!) we're about to be very interesting. I'm sorry about the currently swamped state of the site, but I'll click Slashdot readers a bit of gold anytime, as I said, when it's back up, and I'd love to answer any questions if you have them, but basically PLEASE mess with e-gold. It's designed to be a foundation, and other currencies built on top of it will be cheaper and more interesting.

    A good analogy would be a house on a granite foundation. Until the storm, it seems just like the house built on a sand dune. Thanks, and again my apologies for the state of the site, PLEASE come back next week when we can welcome you with new equipment and an interesting change in the system. We WANT free-software types to play with our system.
    JMR
  • Comment removed based on user account deletion
  • Comment removed based on user account deletion
  • I threw up a 50 cent donation link on the AOLiza site a few days ago and I've already gotten a good response. A few people decided to 'buy' multiple donations, upping the donation.
    From the blatant self-promotion department: Might I also suggest checking out the sponsorpool [infamous.net] project that I'm developing? In return for their contribution (processed with PayPal), donors get to place sponsored links on your page, a nice extra incentive.

    BTW, AOLiza is great!

  • Expanding to international markets could be difficult since they've chosen to use the American dollar as their "base" currency.
    This means that international users would have to constantly be converting based on floating exchange rates.
    Yep. There is no way I could possibly handle a micropayment account in the uk - as I found out recently having played with one of those online question/answer sites. I got an accumulated quarter's payment (all 30ukp of it) then found english banks charge a *flat fee* of 8ukp (say 12usd at the time) for handling a US-banked cheque, and *then* give a worse conversion rate than the ones available on the web (they are converted at the holiday-currency exchange rate, which obviously has a built-in profit). of the 30ukp, I saw just over 20ukp - meaning the bank had taken a bigger chunk of the payment than the website had for hosting it (and I didn't *mind* that, given they had to support their own investment of software, net connection and server space).
    I don't know about other countries, but in the uk they seem to believe every other currency should be preconverted and drawn on an english bank before they can accept it, which I suppose is another nail in the coffin of this government's much-advertised "make Britain a home for e-commerce" policy they have already shattered with the RIP bill.

    <sigh>
    --

  • You have to consider that you had a *cheque*. That piece of paper had to be *securely* shipped to the US bank, presumably at the expense of the UK bank.
    It also isn't done much, so there is no economy of scale.
    I would dispute that - given the amount of trade between the US and europe, there must be a fair amount of inter-bank communication (I imagine mostly legal documents much more valuable than my pocket-change cheque). If that wasn't enough, my bank freely admitted that, if the cheque had been written out in UK pounds rather than US dollars, they would have just pushed it into the clearing system as with any other cheque, and it probably would have taken a bit longer to clear, but would not have attracted any special charges (in theory, uk banks charge each other and foreign banks for the service, and are charged in turn by those banks for outbound transactions; in practice, the clearing system assumes that each bank will absorb any fees knowing that, if in the long term things didn't balance out, the bank has bigger problems than a few clearing charges)

    I believe the US does not have such a central system, so presumably any deals would have to be made between the english Central Cheque Clearing System and the US bank concerned.
    --

  • FWIW I have transfered much larger sums between banks in the UK and other european countries, and payed payed about 1gbp for it. It was an *electronic transfer*
    Yep, that would do - or a reverse-transaction onto my credit card. the problem was mostly the site's doing - they hadn't considered having to deal with non-us users, so obviously for them posting out cheques is easier or cheaper, or both.
    --
  • Have you thought about getting a US dollar account? I think it's possible here in the UK might be worth talking to your bank?
    Yep, it's possible - but unfortunately they would then be *business* accounts, with a minimum balance, monthly and per-transaction charges and all the overheads that go with that (it also couldn't be in my name, unless I claimed to be a sole trader using my own name as a business name)
    From one point of view I can see their point - in this case, it was very much a business transaction (I sold knowledge on the net and got back money) but the monthly charges alone would come to more than the 30ukp/quarter I had been paid. They are more geared to international-sales companies than private individuals.
    --
  • Well, just another reason why UK should switch to the Euro currency like the rest of Europe. It's funny how your fellow countrymen can be so chauvinist that they'd rather shoot themselves in the foot rather than cooperate with their neighbours...
    <tone=mildly sarcastic>This would be the one where they had to recently change the entry requirements because so many of the member states hadn't met them?
    As far as I know, the long term plan is to join the Ecu system, once it is stable and our exchange rate is good. At the time the decision had to be made however, it appeared that
    1. The UK would struggle to meet the entry requirements (the idea of just having them changed must not have occurred to our politicians)
    2. The UK would enter the fixed relative value with the pound badly positioned against other european currencies; this isn't a terrible thing in the short term, but not something you want to set in stone
    3. The "common man" as guided and instructed by such educational media as "The Sun" were against it to the extent it would cause political trouble - and it was timed to come up close enough to an election that following the view of the hurd may well get the current set of lizards elected for another term)
    In any case, it wouldn't help the situation much - the uk banks would merely increase the list of currencies to two - and US banks and firms would still expect the rest of the world to accept their currency.
    --
  • Ah, but if you have an account with a US bank you can. I've done business with canadians via PayPal.
    The setup screen expects you/requires you to enter an address in the united states - I don't know how entering a false address would effect the legality of an account with them, however.
    --
  • Sounds cool - do they have any branches outside of london? I could do with someplace within travel of Manchester.
    --
  • ah, found their website here [citibank.com]. I will ask them directly - but thanks for the tip, the US dollar account looks to be spot on...
    --
  • I'm not really shure, but I think that they would just fuck themselves over by recharging you when you reversed the charges. Specifically, the credit card company will just keep charging _them_ $20 per charge back which will fuck them over really quickly if they keep recharging you and you keep getting charge backs. Plus, they may loose their merchant account.
  • The checkbook sits at home, whenever I need to mail a payment and the recipient does not accept credit cards (not too many anymore).

    Hello? That's the whole point. Sure, American citizens have credit cards that can be used in stores and for purchasing stuff online -- but they have no easy, consistent way of sending money to each other.

    That's why a company like PayPal can exist in the US. In many European countries, PayPal is mostly obsolete.

  • What about anonymous payments? (Score:3)

    by Paul Crowley ( 837 ) on Thursday August 31, 2000 @10:14AM (#813340) Homepage Journal
    PayPal has essentially none of the cool features considered desirable for a cryptographic cash protocol, so there's still plenty of room for competition based on better technology. Check out the Lucre home page [aldigital.co.uk] for details of a (seemingly) patent-free system for providing untraceable electronic cash.
    --

  • Re:Tipping (Score:3)

    by jeff.paulsen ( 6195 ) on Thursday August 31, 2000 @11:35AM (#813341)
    The way to deal with Tip Inflation is to opt out of it. I tip 10%-20% at restaurants depending on service, and for service that was actively bad, I leave an insulting trifle.

    I tip for every personal service that I receive. Cab rides, pizza deliveries, restaurant service, lap dances, and full-service fueling. Failure to do so would feel rude - unless my server was incompetent.
  • You mean I can't use pay pal to pay you $.01?

  • Re:e-gold... hrm... (Score:3)

    by RobSweeney ( 19353 ) on Thursday August 31, 2000 @12:01PM (#813343) Homepage
    Gold in this context is a currency, like any other, except that its value relative to other currencies isn't easily under the control of any one government - rather, it's manipulable by _many_ entities (note what happens when, for example, a large central bank announces it's going to be selling part of its gold reserves).

    It's not subject to inflation per se - but in a world of multiple, competing currencies, in which few things people are interested in buying are priced in gold, it's hardly a rock solid store of real-world value. Look at, say, this chart [the-privateer.com], best I could come up with in 10 seconds on Google :-) - finding a comparable chart for USD inflation is left as an exercise for the reader - but note that USD inflation peaked during the periods between points 3 and 5 on the graph - coincident with a spectacular decline in the gold price. Gold was US$296 in 6/1982 (in 1982 dollars). It's slightly under that now I think. That's in 2000 dollars. What was that about inflation again?

    In an environment where gold (or some other designated commodity) were the standard currency that everyone used, e-gold might make sense. But as things stand now, where everything you want to buy is priced in dollars (or Euro or pounds or yen etc.), the friction of buying and selling e-gold and the metal storage costs make e-gold impractical.. and the stuff about gold being a valid inflation hedge and it not being subject to government manipulation is IMO hooey (see above).

    I was talking about this with people at a conference [reason.com] I was at earlier this year... as I recall, I think what I said was e-gold would make more sense if the e-gold marketplace itself were open - so that the buying, selling, and storage or metal was handled by multiple competing companies, rather than the one gold firm that was behind e-gold. I can't check the site to see if the market has been opened up - I doubt it given the absurd spreads they were charging. With real competition spreads (the difference between buy and sell) might go down and using e-gold as an exchange medium behind real-world transactions would start to make sense. I still wouldn't use it unless there was a way to, say, earn interest on my idle cash, er, gold, and do other things I can normally and easily do with dollars. 'Till then, I think it's just for the gold bugs.

    There is, or used to be, a great, and active, discussion section on e-gold over at Free-Market Net [free-market.net].

  • http://www.privatebuy.com/ from ecount.

    This looked great right up until I got to the part where you can only load your account using an existing credit card.

    Somebody else in this thread mentioned that one thing that holds back anonymous payment methods is that they could be used for money laundering, and I have to begrudgingly admit that that's a valid point. Even with limits such as those established by privatebuy ($500 worth of transactions per day, no more than $1000 in your account at one time), somebody could still hack a system where money was chanelled through a large number of accounts under different names. After all, the crime syndicates of the U.S. Government and credit card companies do need to protect their interests against the machinations of lesser crime syndicates.

    For anyone who hasn't seen it, Neal Stephenson's short story The Great Simoleon Caper [uidaho.edu] is an entertaining, thought-provoking look at the topic of anonymous e-cash.

  • What I'd like to see in an online payment system (Score:3)

    by double_h ( 21284 ) on Thursday August 31, 2000 @10:12AM (#813345) Homepage

    So far, all of the online payment systems I've seen, including Paypal and Yahoo's payment service, are lacking in at least two areas:

    • Need for a credit card. I really dislike the business practices of cc companies on too many levels to mention. I don't use them, and while I would like to be able to do more shopping/commerce online, but have no plans on getting a credit card to do so. Yahoo's payment system at least allows payment directly from a bank account, but that still doesn't provide for...
    • Privacy. I like to pay for things with cash whenever possible. I pay my rent and utilities by check, buy a money order for mail order purchases, nearly everything else is the green stuff. Let the people who track buying habits make their living off of somebody else.

    What I would really like to see is a payment system where, as a user, I could set up an anonymous account and send the company a money order along with a note to "please deposit in account XYZ123". I would then have that much money to spend online. The payment company would collect a 1% service charge on everything I purchased, and all transactions are guaranteed to be as anonymous as practically possible (i.e. they would only collect enough data to prevent fraud and abuses, and never to share the data or use it commercially). People who wanted to receive payments through the service would have to identify themselves, of course.

    Does anyone know if there is anything like this already in existance? Would you use it if it were available?

  • Fine, if you live in the USA... (Score:3)

    by AdamJ ( 28538 ) on Thursday August 31, 2000 @09:50AM (#813346) Homepage
    International Use. You must be a resident of the United States to use the Service. International accounts will be available soon.

    "Soon" has been quite a few months now..

    Adam

  • storage fees irrelevant, transaction fees bearable (Score:3)

    by TheDullBlade ( 28998 ) on Thursday August 31, 2000 @12:01PM (#813347)
    Inexchange costs: somewhat painful. As for outexchange, the SOP is to calculate payments as the amount that could be outexchanged, so it makes more sense to look at all the exchange costs as inexchange costs. But re. storage: 1% per year? That's nothing. Your money shouldn't be sitting there that long anyway.

    All in all, if you're careful and willing to wait a while for your deposit to get in, you'll lose maybe 5-7% between putting money in and getting money out. The nice thing is that 5-7% holds no matter whether you're transferring pennies or thousands. Of course, that's assuming the precious metal market doesn't go nuts (of course it could go either way, but in the long term... well, asteroid mining can't help the price of gold much). Also, if you're in a rush, or you're lazy about shopping around, you can expect to lose closer to 15% through the transfer. Ironically, the best combination of price and convenience comes from funding your e-gold account with PayPal!

    I think it's a pretty good deal if you want to send nickels and dimes all over the place, and you never keep more money in it than you are willing to lose. I think a fair assumption of risk is that your account will zero once every 2 years (yes, I pulled that number out of my hat; more below), at least unless they make some major changes to their security model. No big deal for a micropayment account, as long as you keep it in mind.

    Obviously, I don't think much of the security. You have to remember that these people don't know you. With a bank, you go and create an account face-to-face, they have all sorts of nice meatspace backups and redundancies to make sure you are you when you go in to do something with your money. With something like e-gold, if you have the password, you must be the right person, and your account can be emptied, laundered through an anonymous e-cash system like digigold [digigold.net], and safely in the account of the thief in an eyeblink. You might be able to get your money back, but only if you could prove you didn't transfer it.

    I also don't like the way they've eroded the legal foundation of e-gold. They keep talking about replacing the user contract, and they've got a clause which allows them to make any changes if you don't object within a week of them posting it on their website... whether you read it or not within that time. They made a big deal about the "unconditional right of redemption", which was your only last-ditch guarantee: if everything goes wrong, you can always have the metal in your account (having the cash value sent to you is not a guaranteed service; they have no contractual obligation to provide any service but that of returning your gold). In the proposed changes to the contract, they changed it to "conditional right of redemption", and they only have to give you your gold in neat bar-sized increments. Since a gold bar is worth something in the region of a year's pay, obviously this isn't a lot of help to the typical user. In the past, they dealt in coins, right down to silver coins worth under $20, so you could redeem practically any account. If the system ever becomes so insecure that everyone wants out, and nobody wants any e-gold, there's no guarantee that you'll get your money out. Basically, under the new plan, the emergency escape clause only works as long as there isn't any emergency.

    It isn't secure, it isn't terribly convenient, and it isn't really cheap, but it works, it works all over the world, and it works now (that is, at least when the servers are up :) ).

    Here's an e-gold discussion forum that goes way back. [free-market.net] It covers the good, the bad, and the ugly of e-gold, with tasty sprinklings of marketroidese and paranoid ranting.

    --------

  • Comment removed (Score:3)

    by account_deleted ( 4530225 ) on Thursday August 31, 2000 @10:18AM (#813348)
    Comment removed based on user account deletion

  • paydirect.yahoo.com? (Score:3)

    by dynweb ( 69307 ) on Thursday August 31, 2000 @09:48AM (#813349) Homepage
    How about PayDirect.yahoo.com [yahoo.com]? I've been using them to send money between friends for awhile now. I really think they are a superior service...

    ~d

  • PayPal doesn't do Micropayments (Score:3)

    by burris ( 122191 ) on Thursday August 31, 2000 @10:16AM (#813350)
    PayPal doesn't do micropayments. Yes, PayPal provides a convenient peer-to-peer settlement via credit cards but it cannot handle micropayments.

    Micropayments involve incredibly small amounts of value. How much does a single HTTP request for 20K of data cost? We're talking about thousandths to millionths of a cent here. The smallest transaction you can make with PayPal is one cent.

    As others have mentioned, you can't use PayPal outside of the US...

    Mojo Nation is trying to create a mircopayment "barter system" backed in disk space, CPU, and bandwidth. It's bootstrapping the process with a distributed filesystem. You exchange your system resources for "Mojo" which you can exchange with other people consuming their resources (i.e. for downloading data from them). A single Mojo represents an incredibly small amount of value. In the long term we hope that Mojo will float on it's own and people will buy and sell it (possibly by using PayPal for settlement). We also hope people will build other services and charge Mojo.

    Check it out, it's really cool, Mojo Nation [mojonation.net].

    Burris

  • PayPal won't win because... (Score:3)

    by uhlmann ( 139234 ) on Thursday August 31, 2000 @11:01AM (#813351) Homepage
    (from PayPal's website [x.com]):

    The recipient gets an email that says "You've Got Cash!"

    Do they really expect people not to dump such an Email directly to /dev/null ?

  • First mover advantage? (Score:3)

    by Alomex ( 148003 ) on Thursday August 31, 2000 @09:54AM (#813352) Homepage
    PayPal is pretty much unassailable as the de facto Internet payment system.

    The net has over 100 million users, the big three credit card companies have nearly a combined billion cardholders, yet according to Cringely the 3.3 million customers of PayPal makes them "unassailable".

    In fact, I'd say that 3.3 million users is a very small set of net users, and that the real challenge is to reach those who are not geeks nor addicted to online auctions.

  • Re:Tipping (Score:3)

    by baka_boy ( 171146 ) <lennon@@@day-reynolds...com> on Thursday August 31, 2000 @10:58AM (#813353) Homepage
    There may be cultural traditions of tipping in Europe and the US, but in Japan, for exmaple, tipping is not a part of classic etiquette. When in Japan, I actually saw a restarant owner run outside to return the tip I had left automatically on the table.

    This may be changing as their culture becomes increasingly Westernized, but I wonder how many other parts of the world have never really included tipping as a part of their heritage.

  • It sounds like a great service -- except where do I use it? I don't give money to friends that often.

    I mean, I want micropayments for online web sites. It doesn't look like this has made any penetration into that market. According to the PayPal web site, eBay is accepting PayPal, but I haven't seen it anywhere else.

    Apparently there are 3.3 million customers -- that have signed up to get a free $5. The float is $40M. That's only $12/person. That doesn't sound like it's getting a lot of "real" use to me.

    On another subject, I remember that there was a guy in the early digital cash space that was trying to create anonymous digital cash. He considered it important from a privacy standpoint that digital cash should be untraceable, just like regular cash. I would imagine PayPal is not that, but does anyone know what happened to that guy or what happened with his technology?


    --

  • Re:Perhaps, but the United States Alone... (Score:3)

    by Junnonen ( 205988 ) on Thursday August 31, 2000 @12:24PM (#813355)
    Before PayPal goes global, it has to figure out a good way of transferring funds to and from the users. This is a key problem that needs to be solved. Checks are totally out of the question globally, as well as credit cards to some extent. Virtually everyone in the States has a credit card, and they are easy to get. However, this is not the case worldwide, especially among teenagers and young adults, which I suppose are a key group for PayPal.

    Online banking and money transferring in general varies a lot between different countries. Being a Finn, the primitive system of the States sometimes amuses me.

    Here in Finland online banking has been available for over 15 years. Today, over 50 percent of the country's internet users use online banking. Nobody uses checks. I doubt they even exist in this country.

    As far as domestic e-commerce is concerned, nobody uses credit cards. We have several payment options, one of which is an advanced money-transfer system. It basically is a normal online money transfer from one account to another, but allows the retailer to verify the transfer automatically, instantly.

    What I'm trying to say is that PayPal has a long way to go to make it globally.

  • Re:hardly. (Score:3)

    by SecurityGuy ( 217807 ) on Thursday August 31, 2000 @11:36AM (#813356)
    E-gold has a common problem among web sites today: a user agreement that they can change when they want to. There's a provision that you can object within 10 days, but that isn't sufficient. I don't want to do business with people who put me in a position where I have to check every n days to make sure they haven't modified our agreement.

    Give me a payment system, preferably anonymous, which doesn't claim the right to change the terms I've "agreed" to (using that term loosely) whenever they wish to, and I'm interested. Alternatively, how about I make the agreement subject to modifications documented on my web site and e-gold gets 10 days to dispute them.

    My intent isn't to pick on e-gold, but on this practice in general. "I agree to $foo, $bar, and $baz, but you can change them any time you want." Why do you accept this?

  • How Pay Pal Makes $$$ (Score:3)

    by RexRuther ( 221243 ) on Thursday August 31, 2000 @11:49AM (#813357) Homepage Journal
    Just to let everyone know. The reason PayPal is giving away $5 to each new user is because they make more than $5 on the balance left in your PayPal account.

    It very similar to the way American Express makes a fortune on their travelers checks. All those unused travlers checks out there = $$$ in AMEX's pocket which it can invest to make more $$$.

    Not that travelers checks/paypal are bad. They both make it more secure to make transactions in unfamilar environments.

    My advice is to transfer your $$$ out of your account ASAP and for you to make the $$$ not them.

    Cash in those unused travlers checks also!

    That is all -click!-

  • PayPal killed their PalmOS product (Score:3)

    by codeartist ( 223719 ) on Thursday August 31, 2000 @09:55AM (#813358) Homepage
    I had been an avid PayPal user for about the past six months and had been using it fairly regularly. However, about two to three weeks ago I got a very curt letter from them saying that they were no longer supporting their PalmOS product. To quote from their web site [x.com]:
    Now that X.com has launched the world's first wireless payment platform for mobile phones, many of our Palm users have made the transition to the new product. With the growth of wireless Internet applications and the rapid spread of web-enabled PDAs, we feel that we can best serve our customers by focusing on the creation of new features for our wireless payments platform. As a result, we will be discontinuing support for the Palm product.
    Well needless to say I shut down my account about 5 minutes later. I really wished they'd bring this service back to the PalmOS - it is sorely missed.

  • hardly. (Score:4)

    by QuMa ( 19440 ) on Thursday August 31, 2000 @09:49AM (#813359)
    e-gold is still alive and kicking [e-gold.com]. (There's a refer(r)er-id in that link, if you don't want it chop it off. You have been warned.

    But on the subject: e-gold is managing fine, and at least they don't have problems with people not from the US.
  • Coming from Norway, PayPal and assorted services do not make much sense to me. I recently had to explain to a friend why personal checks are more or less obsolete in my country.

    Within Norway, you can wire money to anybody with a bank account, regardless of which bank I, or they, use. To pay bills, I go online to my bank's Internet service, enter the account number of the person to transfer to, the amount, and the date at which the transaction should execute. Setting up recurring payments is also possible. Transferring between countries is also quite simple using the SWIFT system.

    Now, I can appreciate why PayPal appeals to Americans, if only as a temporary stopgap until all your banks allow sending money to each other. In the meantime, my American friends keep "writing checks". Sheesh. Welcome to the future, guys :)

    (I once cashed an American check in my home country. It took one month to clear, and the intermediates took a huge bite out of the total amount. Next time I used SWIFT and it took three days and the money were more or less intact.)

    As an aside, PayPal only works with American credit cards. I am currently in the US, and in a recent eBay payment my Norwegian credit card was rejected because they could not verify the billing address (and there was no country field available for the billing address). I have also totally failed to buy stuff from MassMerchandise, where they consider my Norwegian email address to be "high risk" (duh!) and their billing-address verification system has problems even verifying American cards.

  • Okay, maybe this is a good point. I guess I wouldn't want to pay... say, the caterer for my wedding, with paypal. Because of that "non-performance" thing with credit cards. But, is that really the point of paypal? I mean, it's not exactly phasing credit cards out, last I checked. I would still, for instance, feel utterly comfortable using paypal to buy a $5 set of salt and pepper shakers on eBay, and if they didn't indeed shake salt, well, they're mostly for looks anyway.

    That's what paypal's for. Not the huge stuff where you NEED a non-performance garauntee. There are other safeguards in place to make sure your eBay product works (eg, the eBay feedback system). For the big stuff, I'll still use plastic, ThankYouVeryMuch.

    And about paypal stealing your money once you give it to them: if too many people complained about this (in other words, if they did it often enough to make it worth their while), there would be an uproar and they wouldn't stay the "de facto standard" for very long. There are still alternatives...

  • PayPal is not about micropayments (Score:4)

    by Animats ( 122034 ) on Thursday August 31, 2000 @05:38PM (#813362) Homepage
    PayPal is mostly a settlement system for eBay, where the amounts are reasonably large.

    The interesting thing about PayPal is that it allows you to get cash from a credit card, but the transaction isn't treated as a cash advance. Generally, credit card merchant agreements don't allow the merchant to sell cash charged to a credit card; the potential for fraud is too great. I'm not sure how PayPal got around this.

    Micropayments are a non-starter. All the enthusiasm for micropayments comes from people who want to collect them, not from people who want to pay them. Micropayments are the past; flat-rate is the present. Remember when AOL and Prodigy charged by the hour?

  • Re:Tipping (Score:4)

    by drinkypoo ( 153816 ) <drink@hyperlogos.org> on Thursday August 31, 2000 @02:13PM (#813363) Homepage Journal
    Explain why someone who doesn't tip is a jerk.

    Have you ever worked as a waiter? Well, neither have I, but "lots of my friends" have and do. And let me tell you, they get paid shit for a shit job which very few people appreciate. Like a Systems Administrator, people only notice you when something is wrong (Or when you have a nice ass, granted.) It's a lousy job. Give 'em a buck or two.

    The people are getting paid, and often a service charge is added to the bill anyway.

    You try working for minimum wage, and see how you like it. Especially for a job as thankless as that one. Service charges, BTW, are generally only added when you have a large party. I personally disagree with them, and if I'm with a large party and get bad service, I'll do the math to remove it from the bill. You don't tip someone if they do a bad job. That's totally reasonable.

    Seems like a way to show off, "look at me, I have so much money that I can leave a twenty dollar bill as a tip at fucking Burger King".

    You are such a troll. BK employees aren't even allowed to receive tips. Tipping is a way to show someone who is doing a lousy job that you appreciate their efforts to make your dining experience pleasant and trouble-free.

    Unless your an IPO millionaire, tipping is a luxury that many cannot afford.

    Apparently, so is correct grammar. In any case, there's no law that says you must tip fifteen percent. Tip what you can afford. If you truly cannot afford to tip, then I hereby postulate that you cannot afford to eat out. Stay home and cook something.

  • Palmtops... (Score:4)

    by suwalski ( 176418 ) on Thursday August 31, 2000 @09:53AM (#813364)
    Palmpal was very good. They even used to offer a means of paying other people or transferrinf money to others right through your PalmOS PDA. That was excellent until they cancelled it [palmstation.com]. This was an excellent system. I'm not saying it's not great right now, but the ability to use a PDA for paying was amazing. Can you imagine being at the store, taking out your PDA, aiming at an IR port, and then paying? I for one, would love that.

    It's too bad PayPal got rid of this, because with this they could have continued being at the front of innovative payment technology.

  • Forget about PayPal, what about PayLars.com? (Score:4)

    by Hairy_Potter ( 219096 ) on Thursday August 31, 2000 @09:51AM (#813365) Homepage
    At least, that's where I was putting my money.

  • Perhaps, but the United States Alone... (Score:5)

    by Outlyer ( 1767 ) on Thursday August 31, 2000 @09:49AM (#813366) Homepage
    Paypal is a great system, of course, this is in theory, since it is currently not possible to use it in Canada. So, basically, I can't use it. For that matter neither can a European, Asian, or anyone else. I think it's a little presumptuous to assume that the success of Paypal in the US is any indicator of whether this is actually useful in the real world. By that, I mean, the entire world.

  • I use Paypla on AOLiza (Score:5)

    by KFury ( 19522 ) on Thursday August 31, 2000 @09:56AM (#813367) Homepage
    I threw up a 50 cent donation link on the AOLiza [fury.com] site a few days ago and I've already gotten a good response. A few people decided to 'buy' multiple donations, upping the donation.

    It makes me feel a lot better than throwing up a stupid banner on every page just to get some money. Apparently it makes my visitors feel better too.

    Paypal rocks, though I'm really disappointed that they dropped support for the Palm...

    Kevin Fox

  • eBay's effect on the net. (Score:5)

    by Matt2000 ( 29624 ) on Thursday August 31, 2000 @09:54AM (#813368) Homepage

    It seems to me that the problem with previous micropayment schemes was not the scheme itself, but that there was never a situation in which the convenience of using the system outweighed the risks associated with trusting an outside party with your money and transactions.

    eBay provided the fluid marketplace that created the situation where that convenience overrode the inherent mistrust of a newcomer like PayPal.

    eBay brought the idea of the auction as a sales model to the forefront of the net, they also pioneered community based trust mechanisms that let their model survive even though they don't back transactions directly (something that would have quickly invalidated their business model).

    What was supposed to be a concept that allowed high-brow concepts like online media micropayments seems to have come about largely because of the requirements of some people to sell $5 pens and beany babies.

    Probably important not to forget that no matter how large the venture capital some firm gets to change the internet, most likely it won't succeed unless we decide it will.

  • You lose your rights if you use PayPal (Score:5)

    by Mr. Protocol ( 73424 ) on Thursday August 31, 2000 @10:10AM (#813369)
    I started out to register at PayPal, but because this was actual money we're talking about here, I took the time to read the agreement.

    Bah! Feh!

    If you use a credit card to pay for goods and services, you have the right to withhold payment for non-performance. The issuing bank charges back to the vendor in such cases.

    You give that up with PayPal.

    There's this long paragraph about reversing charges. In the event that you reverse a charge, you authorize them to turn around and re-charge your card. As many times as you reverse the charge, they'll put it back on.

    Once you give money to PayPal you'll never see it again unless and until you sue them.

  • Incorrect; this was changed recently (Score:5)

    by jbs ( 100713 ) on Thursday August 31, 2000 @11:29AM (#813370)
    From the current ToS:
    Charge Backs. The Buyer Protection Guarantee does not obviate any other consumer rights Users may have, including charge back rights that may be granted by the User's credit card issuer.

  • Re:Tipping (Score:5)

    by burris ( 122191 ) on Thursday August 31, 2000 @10:25AM (#813371)
    Tipping works in the real world, ask buskers (street performers) waiters, valet parkers, and the guys at the curb at the airport (talk about the cushiest job at the place...). There are longstanding cultural traditions of tipping. Sure, a few jerks don't tip but the vast majority do. In the virtual world, if some copy is made somewhere and nobody sends in a tip then it isn't any sweat off the artist/publishers back, so to speak.

    The reason why shareware thus far hasn't been wildly successful for generating revenue for the authors (clearly it provides other value, otherwise people wouldn't continue to make share ware or even open source software) is the barrier to payment. It is relatively easy to leave money for a waiter or toss some money in a street performers hat but it is much more difficult to write a check and put it in an envelope and mail it, or call a number and read off a credit card. When tipping becomes as simple as clicking a button on your MP3 player while it's playing a song that you like, tipping will become a viable revenue model for artists and other information publishers on the 'Net.

    Burris

  • I'm going to put on a different hat for a second and ask is this really where we want things to go? Micropayments for everything?

    Sure, I own some CD's that I love so much I would have paid $50 for them. A tip system would be great to show my gratitude to the artist. And as the poster wrote, there are some personal websites that had me ROTFLMAO or greatly influenced me as a web developer and designer. I would love to send them $5 and say "Thanks! Have a beer on me."

    That said, I wonder how long it will go on before things we used to do for pleasure and personal edification are motivated by the prospect of being micropaid for it. Art by the amateur has always been done for the love of producing art - it freaks me out a bit to think that amateur art may now be done for micropayments. Obviously, that's not the sole reason it's done but it could certainly be a motivator now. As an example, most /.ers participate because they enjoy participating but, be honest now, karma is definately a motivator, right? And what is karma? An abstract point system for quality posts - it doesn't really do anything but make you feel good. Now imagine if karma were micropayments - even more incentive right?

    I guess I'm just wondering if micropayments will devalue the intrinsic good of things like art. I pull off and help someone change their flat tire or return a lost wallet to contribute good to the world, not b/c I'm hoping for compensation. A "Thanks a lot" is the only compensation I want. And while this may be extreme, it's possible these things could be motivated by the micropayment.

    "Hey, nice shoes!"
    "Thanks, here's a $1 micropayment!"

    I realize that is a silly example but it helps to illustrate the possible trend towards money being the sole motivator and compensator for everything. I remember reading an article a while back about sites like Epinions and "expert" sites. They explored why people would devote large amounts of time to writing reviews and answering questions for complete strangers. The short answer was "egoboo" or ego boosts that came from being positively rated as a reviewer. But it made me proud that these sites went counter to the idea of the net being a commercial medium, like the corps view it. I was proud to be involved with a medium that is about free exchange of information and assistance with the motivation being the virtue of helping someone else out without compensation. I just wonder if micropayments for everything will threaten that notion.

    Sorry to play devil's advocate but I have only read about how wonderful a micropayment system will be in light of the whole Napster fiasco. I've just been waiting for the other shoe to drop...


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