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Speaker 1: Brought to you by the reinvented two thousand twelve Camray.

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Speaker 1: It's ready. Are you get in touch with technology? With

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Speaker 1: tech Stuff from how stuff Looks dot com. Hello, everyone,

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Speaker 1: welcome to tech Stuff. My name is Chris Pollette, and

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Speaker 1: I am an editor at how Stuff works dot com.

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Speaker 1: Sitting across from me, as he always does on the

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Speaker 1: occasions when we're talking about stuff in the studio is

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Speaker 1: senior writer Jonathan Strickland. You'll find your fortune falling all

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Speaker 1: over town. Be sure that your umbrella is upside down.

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Speaker 1: That's a good one, Thank you. It's that's that's a

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Speaker 1: that's an oldie that I'm going back to you there.

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Speaker 1: But today we wanted to talk a little bit about

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Speaker 1: the concept of micro payments and micro transactions, and they're

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Speaker 1: gonna be some other related topics that fall into this

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Speaker 1: um because we're talking about, you know, spending little amounts

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Speaker 1: of money for something in return, usually some web content.

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Speaker 1: That's really where micro payments kind of came out of.

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Speaker 1: That's what the concept grew out of. So to really

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Speaker 1: understand this um, you know what, I think we're gonna

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Speaker 1: need to do something we haven't done in a very

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Speaker 1: long time. No, we need to get into the way

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Speaker 1: back machine, and I just happened to have it right

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Speaker 1: back here in the corner. It's a little dusty. Um,

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Speaker 1: it looks like Josh Clark has drawn wash Me with

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Speaker 1: his finger on the dust. So that doesn't matter, all right,

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Speaker 1: all right, pile in, let's go. Let's see. I'm just

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Speaker 1: gonna I'm gonna set this to uh. Let's go to

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Speaker 1: ninety two, all right, And here we are in nineteen

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Speaker 1: ninety two. I was still in high school. Back then,

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Speaker 1: I was still in college. Back then. I went to

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Speaker 1: the Governor's Honors program that year. Anyway, But here's two So,

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Speaker 1: so the web is just just a baby now, right,

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Speaker 1: But people don't know really about the web. Yeah. Yeah,

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Speaker 1: people at CERN know about the web, but outside of

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Speaker 1: certain not that many people know. So at this point

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Speaker 1: the web is nothing but potential, right. We have no

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Speaker 1: idea where it's going to go from here. In fact,

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Speaker 1: I can tell a story that back when I was

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Speaker 1: in college, so a couple of years after this moment

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Speaker 1: right now, I thought the Web was just a fad.

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Speaker 1: And I looked at that and I said, who the

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Speaker 1: heck needs that tail? Nick? And yeah, yeah, I was

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Speaker 1: using a Unix shell account. Yeah, yeah, I did. The

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Speaker 1: I would use a similar thing as well, and so yeah,

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Speaker 1: you know you might tell that into another computer. You

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Speaker 1: might use FTP, but you you're like, what the heck?

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Speaker 1: This web thing that's for you know, that's for babies now,

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Speaker 1: Just the way the same way I felt about graphic

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Speaker 1: user interfaces when they finally started popping up. I'm like, oh,

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Speaker 1: come on, you can't memorize forty pages worth of commands

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Speaker 1: to navigate through your operating system. Sure, but why would you? Right? Yeah, no,

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Speaker 1: I eventually came around, but it took a while. So anyway,

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Speaker 1: at this point, no one really knows what's going to

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Speaker 1: happen with the web, even companies that are looking at

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Speaker 1: the web. As the Web is developing, we're just gonna

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Speaker 1: we're just gonna stroll through time here. Well, you know,

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Speaker 1: I'll just put the way back machine on this wagon

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Speaker 1: here and we'll just tug it along behind us until

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Speaker 1: we need to get back to modern day. We're just

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Speaker 1: gonna stroll through time. And as as time goes on

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Speaker 1: in the web develops, companies start to look at the

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Speaker 1: web as a possible place to make money. Right, But

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Speaker 1: how do you make money on this new medium. Yeah,

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Speaker 1: I mean in the early we're talking about government and

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Speaker 1: educational institutions. Big companies weren't really using the internet, right,

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Speaker 1: and even even much private individuals weren't using it very

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Speaker 1: much yet, so there was no need to worry about

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Speaker 1: things like how are you going to monetize your website? Right,

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Speaker 1: But by the time you get to around nine four,

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Speaker 1: you've already got some companies looking to the possibility of

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Speaker 1: using the web in a way to either supplement their

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Speaker 1: advertising on television and newspapers, so they would create a

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Speaker 1: static website. You would go to this website and it

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Speaker 1: might have like a brief information page about the company

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Speaker 1: and its products or services, and it never changed, very

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Speaker 1: very dull for people who wanted to go back and

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Speaker 1: check it out again. In fact, it almost felt like

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Speaker 1: the web was like just gonna be this massive magazine

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Speaker 1: and the articles would never change, you know. But that

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Speaker 1: evolved over time as well. Now, in the beginning, when

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Speaker 1: companies started getting onto the web and people started to think, hey,

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Speaker 1: the web might be away where I could actually you know,

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Speaker 1: leverage this medium to make money, So not just companies

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Speaker 1: but individuals as well, the question came up how do

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Speaker 1: I make money from this? And there were really two

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Speaker 1: main schools of thought on how to make money based

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Speaker 1: on web content. Now, I'm not talking about selling products

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Speaker 1: on the web, because that's essentially using the web as

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Speaker 1: a catalog, right, I'm talking about you are actually selling

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Speaker 1: content on the web, whether that is some sort of experience,

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Speaker 1: or it's a story, or it's you know, a a

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Speaker 1: subscription to a news service, anything along those lines. One

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Speaker 1: way of paying for that is to sell advertising space

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Speaker 1: on your website. And another way of paying for that

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Speaker 1: is to actually charge a fee for those particular little

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Speaker 1: services or pieces of web content on a per instance

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Speaker 1: basis to the user, a direct fee to the user, right,

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Speaker 1: We're sorry fee or a monthly fee, association fee, paywalls

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Speaker 1: another example. And we're seeing that back in the modern day.

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Speaker 1: In fact, I think we've made our point about how

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Speaker 1: the early web like no one knew what to do yet. Yeah,

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Speaker 1: I mean, people aren't offering subscription rates right at that time,

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Speaker 1: really and and you mean you did have people thinking

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Speaker 1: about it, like O'Reilly Media was doing that with the

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Speaker 1: g n N network. They were had a subscription fee,

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Speaker 1: and of course people like a O L the online

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Speaker 1: Uh services that weren't part of the Internet. You're paying

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Speaker 1: a subscription fee to get their content. So I don't

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Speaker 1: want to make it sound like nobody was doing that,

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Speaker 1: but yeah, yeah, for for your average company, it just

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Speaker 1: wasn't a thing yet. But you did have a lot

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Speaker 1: of smart people at this time we're talking about in

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Speaker 1: the mid nineties at this point, coming up with ideas

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Speaker 1: to create a micro payment system, a system where you

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Speaker 1: could pay just a few pennies sometimes depending upon the content.

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Speaker 1: I mean, it might be something as simple as you

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Speaker 1: wanna view this web page that has content on it

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Speaker 1: that you're going to find valuable, it's ten cents to

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Speaker 1: do that. There were a lot of smart people looking

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Speaker 1: at ways to possibly standardize that, and including people at IBM,

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Speaker 1: and you had people at the World Wide Web Conference

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Speaker 1: trying to come up with ways of doing this UM,

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Speaker 1: trying to find a way to standardize this so that

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Speaker 1: people could take that opportunity both on the the side

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Speaker 1: of the provider and the side of the consumer, and

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Speaker 1: to take advantage of that UM because there are some

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Speaker 1: problems right, A lot of transactions online and not even

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Speaker 1: online but in person, have built into them a transaction fee. Well,

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Speaker 1: if you add a transaction fee on top of a

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Speaker 1: micro payment, it seems ridiculous. If you're you're spending fifty

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Speaker 1: cents for the micro payment, right, and there's a let's

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Speaker 1: say twenty cent fee on top of that, You're you're

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Speaker 1: thinking that I'm paying I'm paying nearly a fifty seurcharge

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Speaker 1: on top of what I'm already you know, what the

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Speaker 1: cost of the content. Because the people who are like

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Speaker 1: the credit card fee, for example, know that that's they're

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Speaker 1: trying to make their money too, and on on something

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Speaker 1: that's small, it's a much greater percentage of the actual transaction. Right.

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Speaker 1: That's why a lot of places you go, like a

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Speaker 1: restaurant or something, will say, you know, ten dollar minimum

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Speaker 1: purchase because it's too expensive for them, because they're the

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Speaker 1: ones paying taking care of the fee. Of course, They'm

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Speaker 1: sure they pass it along. You sure they build it.

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Speaker 1: They might build it into the actual price of the

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Speaker 1: whatever the food items are. Yeah, but that I mean,

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Speaker 1: so you may you may have seen exactly what we're

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Speaker 1: talking about in a different context. Ye. So, but yeah,

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Speaker 1: if you were to walk up to a store and

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Speaker 1: you wanted to buy this, um like a something for

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Speaker 1: ten dollars, and they said, all right, well, here's it's

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Speaker 1: ten dollars. That's what's gonna cost you. But we have

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Speaker 1: a transaction fee that we have to put on top

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Speaker 1: of it, which is another five dollars, and so that

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Speaker 1: brings up the tunnel price to fifteen dollars. You might

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Speaker 1: bulk at that, and I've I've actually had that experience

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Speaker 1: through a a a very large company that is a

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Speaker 1: ticket broker. I think we can all guess what I'm

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Speaker 1: talking about here, but I will not name names. But

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Speaker 1: I was going to purchase tickets to go see um

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Speaker 1: Metric because I really wanted to see Metric. I wanted

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Speaker 1: to hear Black Sheep played live. And so I went

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Speaker 1: to UH purchase the ticket and the ticket costs twenty dollars,

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Speaker 1: and I thought twenty dollars, twenty dollars to see Metric play.

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Speaker 1: I'm not really familiar with all their music, but I

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Speaker 1: love the song Black Sheep. I am willing to pay

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Speaker 1: twenty dollars for this experience. The convenience fee and transaction

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Speaker 1: fees UH added up to ten dollars, so it was right, Yeah,

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Speaker 1: it was fIF of the ticket price. Was was at

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Speaker 1: it on top of it. And yeah, that's when I said,

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Speaker 1: you know what, I don't care how convenient it is

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Speaker 1: or how it transacts. I am not going to do that.

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Speaker 1: And so so, yeah, there's this problem. And when you

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Speaker 1: get down to the micropayments, it it sounds like, well,

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Speaker 1: you know, you're just talking about pennies anyway, but people

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Speaker 1: tend to to bulk at that, and companies do too.

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Speaker 1: It's not just the consumers, but the companies as well,

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Speaker 1: because they're you know, they don't want to to give

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Speaker 1: that experience to their consumers. They because it reflects poorly

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Speaker 1: on them. You know, most consumers aren't necessarily gonna take

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Speaker 1: the extra leap and say the the financial institution that

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Speaker 1: is in charge of this transaction fee is the one

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Speaker 1: I'm angry at. What they tend to think is darn

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Speaker 1: you company, A. I can't believe you're adding this fee

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Speaker 1: on top of this this price. I'm met at you now.

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Speaker 1: So it wasn't working out for anybody, um and so

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Speaker 1: eventually these really smart people who were working on standardizing

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Speaker 1: the micro payments kind of let it fall. They you know,

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Speaker 1: just couldn't see a way of making it work. And

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Speaker 1: plus a lot of a lot of companies at that point,

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Speaker 1: we're looking to focus mainly on web advertising. They decided

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Speaker 1: between those two pathways, the web advertising method worked better

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Speaker 1: for the um than trying to charge people a per

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Speaker 1: instance fee on their content. So let's first of all,

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Speaker 1: let's let's jump back in the way back machine, get

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Speaker 1: back to modern day. Okay, okay, So all right, well, um,

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Speaker 1: the people with the big hair staring at us. Yeah, yeah,

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Speaker 1: let's uh let's get out of here. And I'm not

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Speaker 1: you know, before the grunge music starts to play. Okay,

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Speaker 1: back in eleven. That feels better. Um, you know, it's

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Speaker 1: bigger on the inside is on the outside the way

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Speaker 1: back machine. I think it's the chameleon circuit that's doing that.

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Speaker 1: But anyway, uh So, companies started to look at web advertising.

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Speaker 1: It was an easier way in the long run then

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Speaker 1: creating a micropayment system, because since there wasn't a standardized approach,

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Speaker 1: you know, you would have to invent your own, and

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Speaker 1: then you'd have to secure it and encrypt it because

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Speaker 1: you wouldn't want anyone to be able to sniff out

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Speaker 1: transactions and take advantage of uh that and steal from

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Speaker 1: either the company or the customers that would be what

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Speaker 1: we call a bad thing. So, uh, people and companies

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Speaker 1: started looking at at web advertising. And it's not an

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Speaker 1: ideal situation either, because web advertising itself is a little hinky, right.

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Speaker 1: I mean, you know, your you might be getting a

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Speaker 1: fraction of a penny per click on your website depending

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Speaker 1: on how popular your website is and the advertiser that

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Speaker 1: you're able to partner with. Yeah, but the desperation behind that,

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Speaker 1: that the especially to make money on the part of

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Speaker 1: the website creator, um led people to put banner advertising

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Speaker 1: and you know, every nook and cranny they could find

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Speaker 1: and start doing popovers and pop ups and pop unders,

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Speaker 1: and uh, of course that creates a backlash too, right.

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Speaker 1: You know, you get a point where the user experience

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Speaker 1: is affected enough where the users say, hey, I don't

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Speaker 1: like going to your site anymore because I feel like

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Speaker 1: I'm being bombarded with advertising and I can't actually see

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Speaker 1: the content. And so if your content isn't compelling enough,

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Speaker 1: then there's no reason to go to that website. So,

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Speaker 1: I mean, there's there's this delicate balance you have to

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Speaker 1: make and and there's some companies that do this really

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Speaker 1: well in the sense that they have a good reputation.

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Speaker 1: They consistently put out content that people find valuable. However

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Speaker 1: you wanted to find that it doesn't. I might not

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Speaker 1: necessarily find it valuable, like I wouldn't necessarily go to

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Speaker 1: a celebrity gossip site. But a celebrity gossip site might

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Speaker 1: be very, very popular and therefore might be a a

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Speaker 1: a desirable site for advertisers to put their ads on,

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Speaker 1: and you might be able to get a pretty good

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Speaker 1: click rate and a pretty good amount of money per

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Speaker 1: click when you negotiate with that advertiser. Yeah. I was

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Speaker 1: reading a couple of essays by Clay Shirky, who basically

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Speaker 1: in in the early two thousand's was arguing that micropayments

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Speaker 1: just don't work. Um. I think it could be argued

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Speaker 1: that time has proven him right and wrong because it

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Speaker 1: can work in specific instances. Right. Yeah. But that's part

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Speaker 1: of it, though, is that, uh, there's an assigned value. Um.

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Speaker 1: I think for things like luxury goods, like a high

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Speaker 1: end sports car or brand name fashion close, there is

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Speaker 1: a perception of value that this pair of genes is

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Speaker 1: worth more than that pair of genes because it has

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Speaker 1: this label on it. So it means you have money

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Speaker 1: to spend. It means you know, it means something to people.

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Speaker 1: The brand means something to people, um, and so people

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Speaker 1: might be more willing to spend more money for that

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Speaker 1: particular thing than the other. The thing is with micropayments,

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Speaker 1: finding a way to assign a value to this very

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Speaker 1: small thing that costs a very little amount of money.

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Speaker 1: It's it's a matter of perception, and you have to

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Speaker 1: fig you're out, am I willing to pay a dollar

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Speaker 1: fifty for this? Or geez, it's only a dollar fifty,

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Speaker 1: It can't be that good. Yeah, it's a it's a

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Speaker 1: weird circular, it's strange argument, and it yeah, it is strange.

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Speaker 1: It's very psychological and has has almost nothing to do

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Speaker 1: with actual economics or technology. It has more to do

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Speaker 1: with the way we think and the way we ascribe

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Speaker 1: value to something. And another part of the problem is

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Speaker 1: that so much of the content on the web is free, right,

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Speaker 1: So we've conditioned ourselves to expect when we go to

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Speaker 1: the web and we go to a website, we're gonna

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Speaker 1: have free access to that information, and we just that's

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Speaker 1: kind of how we assume it. And then when we

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Speaker 1: encounter something like let's say the Wall Street Journal and

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Speaker 1: you hit an article where you only get that first

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Speaker 1: paragraph and it says, in order to get the rest,

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Speaker 1: you have to subscribe. I'm wondering what the bounce rate

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Speaker 1: is on that website. How many people say, you know what,

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Speaker 1: I can find content about this story? So where else?

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Speaker 1: It's not going to be The Wall Street Journal. So

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Speaker 1: it's not going to be that take on the content.

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Speaker 1: And if that's the take you want, you may end

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Speaker 1: up ultimately disappointed in wherever you go. But I wonder

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Speaker 1: how many people are willing to do that as opposed

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Speaker 1: to breaking down and paying for that paywall experience. UM.

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Speaker 1: I think part of where that comes from it's from

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Speaker 1: the early days of the internet, because, as you what

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Speaker 1: we're called we were just talking about, the early nineteen

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Speaker 1: nineties is when the Internet really started making a transition

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Speaker 1: from government and university UM communications to a commercial entity,

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Speaker 1: at least here in the United States, and UM, you know,

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Speaker 1: at that point, and there were online community splaces like

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Speaker 1: the well um and other UH sites that basically sort

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Speaker 1: of adhered to UM. Those are things that created the

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Speaker 1: concepts like netiket Well, you don't talk to people like

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Speaker 1: this on the Internet. If you're using all capitals, that

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Speaker 1: essentially means you're shouting um articles. Information on the Internet

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Speaker 1: should be free because the Internet is a you know,

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Speaker 1: it's not owned by anybody, So anything that is online

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Speaker 1: should be free to you. As you know, once you

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Speaker 1: pay your subscription fee to your I s P. You know,

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Speaker 1: the information is available to anybody. Uh, you know, because

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Speaker 1: they were using net groups and you know, gopher sites

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Speaker 1: and all sorts of other things where where you could

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Speaker 1: find things like that. UM. And I think that started out.

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Speaker 1: I mean, I think the early people who were there

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Speaker 1: UM really got the sense that this is the way

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Speaker 1: it should be. Uh. The Internet is a place where

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Speaker 1: anybody can talk about anything and it's available for everyone.

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Speaker 1: And companies are saying, well, we have responsibilities to our shareholders.

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Speaker 1: We need to make money on this, and we have

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Speaker 1: to find a way to recoup the investment that we're

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Speaker 1: making in this new medium, and as a result of that,

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Speaker 1: we're gonna put advertising on it, or charge a subscription fee,

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Speaker 1: or charge you her article. UM. But I think that's

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Speaker 1: where the conflict lies is that people who started using

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Speaker 1: the Internet in that transitional period got used to the

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Speaker 1: idea too and that, and and for a long time

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Speaker 1: people on the internet have offered stuff for free to

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Speaker 1: get started. Oh yeah, yeah, yeah, no, no no, no, no no,

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Speaker 1: for the first two months you don't have to pay anything,

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Speaker 1: or the first ten articles or um. And the music

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Speaker 1: subscription services that like mog and audio that just started

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Speaker 1: making a certain amount of time available, you know, to

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Speaker 1: get you hooked on it so you will pay the

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Speaker 1: subscription fee or the per song price or whatever. So

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Speaker 1: now we get into where micropayments and micro transactions actually

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Speaker 1: do work on the web. And well, like we said,

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Speaker 1: they don't work in everything. It's not like, um, I

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Speaker 1: don't think the average web developer when he or she

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Speaker 1: is launching a website is going to necessarily find a

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Speaker 1: lot of success through the micro payment method. Even if

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Speaker 1: you think, hey, this is a fair price for this content,

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Speaker 1: and it's not a lot like it might just be

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Speaker 1: a cents again, because of the psychological barriers we've talked about,

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Speaker 1: both the idea of oh it's if it's twenty five cents,

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Speaker 1: it can't be worth anything. It's it's crazy to think

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Speaker 1: that something that's priced at cents is somehow worth less

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Speaker 1: than something you would find for free. But there's that perception, Um,

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Speaker 1: you know, it's it let's but there are places where

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Speaker 1: it does work, like iTunes for example, or Amazon the

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Speaker 1: Amazon Music Store, the Digital Music store, where you're buying

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Speaker 1: songs on a per song basis, and you're talking about okay,

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Speaker 1: well I'm buying a song for you know, anywhere between

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Speaker 1: sixty nine cents and a dollar twenty nine. Um, that's

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Speaker 1: where it is working. I mean, that's that you would

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Speaker 1: consider that a micro payment. Um. Micropayment, by the way,

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Speaker 1: is one of those terms that doesn't have a firm definition. Yeah,

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Speaker 1: you don't really have a way of saying, well, anything

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Speaker 1: under this price is considered a micropayment. Anything over it

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Speaker 1: is not a micro payment, although depending on the financial

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Speaker 1: institution you're dealing with, that could be defined, you know,

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Speaker 1: like PayPal I think says that anything below twelve dollars

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Speaker 1: is a micro payment. Um, but that's PayPal, you know,

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Speaker 1: It's it's not like that's the the definitive authority on

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Speaker 1: what is and what isn't a micropayment. Anyway, the model

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Speaker 1: of buying per song at nine cents or somewhere around

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Speaker 1: in that area has worked. You know, people have have

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Speaker 1: bought into that, and that's one of the cases where

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Speaker 1: a micro payment approach has actually paid off. And you know,

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Speaker 1: that's kind of interesting to me. It's it makes sense

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Speaker 1: in a way because you know, we're used to buying

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Speaker 1: music albums or even singles, you know, the back in

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Speaker 1: the old days, we used to buy singles all the time,

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Speaker 1: and either on cassette or on vinyls. I do too

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00:21:00,080 --> 00:21:05,879
Speaker 1: up left over from Chris's childhood, but from mine. I

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Speaker 1: will make sure to get Hello Mota, Hello Pata back

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Speaker 1: to you as soon as possible. Please, I'm you know,

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Speaker 1: I'm sorry. I'm sorry. Sometimes I like to you know,

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Speaker 1: Spin Records, and that's one of my favorites. Uh. Anyway,

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Speaker 1: the um the we're used to buying songs, and we're

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Speaker 1: used to buying music, so going to this micropayment model

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Speaker 1: where you can buy individual songs, it appealed to a

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Speaker 1: lot of people, including myself. You know, I had gotten

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Speaker 1: to the point where I was no longer feeling like

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Speaker 1: I was getting the album experience, you know, which is

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Speaker 1: where I would buy an album from a band or

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Speaker 1: artist that I liked and listen all the way through,

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Speaker 1: and that was like the experience I wanted. I wanted

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Speaker 1: to hear the transition from song to song, and sometimes

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Speaker 1: that actually created a more meaning for me, or I

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Speaker 1: just wasn't interesting to hear how they crafted the songs

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Speaker 1: and how they arranged them on the album like that

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Speaker 1: was a big deal. And then eventually it starts sounding

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Speaker 1: to me like there were more and more albums that

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Speaker 1: didn't really convey that experience to me as much, and

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Speaker 1: then it was more like, hey, there are a couple

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Speaker 1: of really good songs on this album. Those also happened

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Speaker 1: to be the singles, and all the other songs are

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00:22:14,600 --> 00:22:17,240
Speaker 1: not that good and or at least I don't enjoy

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Speaker 1: them as much. So that gave me the the ability

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Speaker 1: to buy specific songs from an album without having to

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Speaker 1: get everything else that I may or may not actually like.

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Speaker 1: So I think a lot of people followed that they

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Speaker 1: enjoyed that as well. So we started seeing that actually

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Speaker 1: applied in other areas besides just music. In games, it's

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00:22:36,480 --> 00:22:40,400
Speaker 1: actually fairly it's becoming more and more common yep, and

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00:22:40,560 --> 00:22:44,240
Speaker 1: uh not just and and that actually is very common

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00:22:44,280 --> 00:22:47,600
Speaker 1: on the social network games, yes, the freemium games. Yeah,

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00:22:47,640 --> 00:22:52,960
Speaker 1: like on on Facebook and Google Plus. You see you know, games,

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00:22:53,040 --> 00:22:56,800
Speaker 1: especially Zinga Zingca is well known for doing this. UM.

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Speaker 1: And I've played a couple of those games where I

400
00:22:59,440 --> 00:23:01,840
Speaker 1: still think they're more like software toys than games. But

401
00:23:02,240 --> 00:23:04,000
Speaker 1: you know, I'm not going to argue that in this podcast.

402
00:23:04,040 --> 00:23:07,520
Speaker 1: The thing is, UM, you get to a certain point

403
00:23:07,520 --> 00:23:10,879
Speaker 1: where you it's like, yeah, you can do this and

404
00:23:10,920 --> 00:23:13,959
Speaker 1: it will take all day. Or if you pay us

405
00:23:13,960 --> 00:23:17,720
Speaker 1: a dollar, you can do this now and move ahead

406
00:23:17,760 --> 00:23:20,680
Speaker 1: more quickly, and you can get ahead past your friends.

407
00:23:20,880 --> 00:23:22,960
Speaker 1: Look where they are, you can move ahead of them

408
00:23:23,040 --> 00:23:26,040
Speaker 1: and it gets you this. Um You're like, wow, a dollar?

409
00:23:26,080 --> 00:23:28,160
Speaker 1: Is it worth a dollar to me to move forward?

410
00:23:28,160 --> 00:23:31,359
Speaker 1: Because I'm I'm frustrated now. UM that in and in

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Speaker 1: app purchases for uh Android and iOS, which is the

412
00:23:35,760 --> 00:23:40,600
Speaker 1: operating system for the Apple mobile devices. UM, that's become

413
00:23:40,680 --> 00:23:43,800
Speaker 1: a very common thing. Course advertising in app advertising has

414
00:23:43,840 --> 00:23:47,480
Speaker 1: been also, uh but a lot of not just games,

415
00:23:47,560 --> 00:23:54,200
Speaker 1: but other enhancements and things for your inn app. Uh.

416
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Speaker 1: You know where you don't actually go to the the

417
00:23:56,000 --> 00:24:00,159
Speaker 1: app store to purchase and add on for your game. UM,

418
00:24:00,320 --> 00:24:02,520
Speaker 1: you actually say well, okay, this is a dollar and

419
00:24:02,560 --> 00:24:05,520
Speaker 1: you'll get these extra screens, so you'll get this extra benefit.

420
00:24:05,560 --> 00:24:10,359
Speaker 1: If you do this, Um, yeah, they're there. This model

421
00:24:10,440 --> 00:24:14,480
Speaker 1: has the freemium model has received a lot of criticism

422
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Speaker 1: from gamers UM, particularly freemium games that that spawned out

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00:24:18,960 --> 00:24:23,320
Speaker 1: of South Korea. A lot of those games, UM the

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Speaker 1: the the problem is that gamers will say that the

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00:24:28,720 --> 00:24:32,520
Speaker 1: game is designed so that you pay to win UH.

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Speaker 1: In other words, in other words, the the model, the

427
00:24:35,880 --> 00:24:39,960
Speaker 1: financial model the game is based on UH is a

428
00:24:40,119 --> 00:24:44,600
Speaker 1: moral right. It's not. It's not. It's not immoral. It's

429
00:24:44,640 --> 00:24:47,360
Speaker 1: a moral it's not a good or a bad necessarily,

430
00:24:47,640 --> 00:24:50,400
Speaker 1: it's how you apply it. But that in the way

431
00:24:50,440 --> 00:24:53,000
Speaker 1: that it's applied in these games is that it lets

432
00:24:53,040 --> 00:24:57,240
Speaker 1: people who have discretionary income get an advantage over people

433
00:24:57,280 --> 00:25:00,280
Speaker 1: who are, you know, just playing the game to try

434
00:25:00,400 --> 00:25:03,359
Speaker 1: and you know, use the best strategy that doesn't necessarily

435
00:25:03,400 --> 00:25:07,360
Speaker 1: involve pouring money into it. It's it's not too different

436
00:25:08,240 --> 00:25:10,400
Speaker 1: from using a cheat code in a game in order

437
00:25:10,400 --> 00:25:13,639
Speaker 1: to get advantages, right, It's just instead of instead of

438
00:25:13,920 --> 00:25:16,159
Speaker 1: entering in a cheat code on your computer or in

439
00:25:16,200 --> 00:25:21,080
Speaker 1: your console, you're entering in real money to get that advantage.

440
00:25:21,359 --> 00:25:24,760
Speaker 1: And so some people would argue, hey, this game is

441
00:25:24,760 --> 00:25:29,320
Speaker 1: not really about skill, it's about who's gonna pour enough

442
00:25:29,359 --> 00:25:31,919
Speaker 1: money into it to get the advantage of everyone else,

443
00:25:32,080 --> 00:25:35,080
Speaker 1: and really, where is that? How is that really a

444
00:25:35,119 --> 00:25:38,560
Speaker 1: game at that point? Well, just to clear it up too,

445
00:25:38,680 --> 00:25:42,359
Speaker 1: there will be things where you might be battling an

446
00:25:42,400 --> 00:25:46,320
Speaker 1: adversary in the game, and you can do that all

447
00:25:46,359 --> 00:25:48,840
Speaker 1: you want to, and eventually you may win or you

448
00:25:48,880 --> 00:25:52,480
Speaker 1: may not. But uh, if you're willing to cough up

449
00:25:52,520 --> 00:25:55,679
Speaker 1: a dollar fifty, you can have this weapon added to

450
00:25:55,760 --> 00:25:59,320
Speaker 1: your storehouse and that might be the difference between winning

451
00:25:59,320 --> 00:26:03,359
Speaker 1: and losing. Or you might be able to buy certain

452
00:26:03,440 --> 00:26:05,919
Speaker 1: kinds of buildings for your town which will enable you

453
00:26:05,960 --> 00:26:10,200
Speaker 1: to create more uh fighters or you know, better weapons

454
00:26:10,320 --> 00:26:13,800
Speaker 1: or develop faster technologies. Yeah, yeah, that kind of thing.

455
00:26:13,840 --> 00:26:16,160
Speaker 1: It's not like you're saying if I pay five dollars,

456
00:26:16,240 --> 00:26:18,440
Speaker 1: I'm going to win the game. I just wanted to

457
00:26:18,440 --> 00:26:21,720
Speaker 1: clear that up so that people understood understand. Yeah, yeah,

458
00:26:21,800 --> 00:26:23,920
Speaker 1: A lot of these are multiplayer games as well. When

459
00:26:23,920 --> 00:26:27,280
Speaker 1: you're playing, you're both cooperating with and competing against other

460
00:26:27,359 --> 00:26:31,320
Speaker 1: players and uh and so that gives you the incentive

461
00:26:31,480 --> 00:26:35,040
Speaker 1: to try and uh and out out with your opponents, which,

462
00:26:35,440 --> 00:26:38,240
Speaker 1: you know, why outwit them when you can out buy them. Uh.

463
00:26:38,280 --> 00:26:40,639
Speaker 1: You know, like if if it means that if you

464
00:26:40,720 --> 00:26:44,000
Speaker 1: spend you know, ten bucks on this game, Uh, then

465
00:26:44,400 --> 00:26:46,720
Speaker 1: you get a huge advantage over other people. For some people,

466
00:26:46,760 --> 00:26:49,399
Speaker 1: that's going to be Uh, that's gonna be a compelling reason.

467
00:26:50,000 --> 00:26:53,000
Speaker 1: And you know, I can't say whether that's right or wrong.

468
00:26:53,040 --> 00:26:56,399
Speaker 1: I mean, you're playing the game for free, and there

469
00:26:56,400 --> 00:26:58,840
Speaker 1: are plenty of games out there. I've spent lots and

470
00:26:58,920 --> 00:27:03,199
Speaker 1: lots of money by certain games, right, And I I

471
00:27:03,200 --> 00:27:06,440
Speaker 1: don't blink an eye, you know, I'm I think, Hey,

472
00:27:06,560 --> 00:27:09,359
Speaker 1: I want this new Xbox three six game. It's gonna

473
00:27:09,359 --> 00:27:11,280
Speaker 1: be sixty dollars when it comes out. I'm gonna go

474
00:27:11,280 --> 00:27:13,960
Speaker 1: buy it, and I pay sixty bucks and I come

475
00:27:13,960 --> 00:27:17,240
Speaker 1: home and I play. Now, I'm not being given any

476
00:27:17,240 --> 00:27:21,399
Speaker 1: specific advantages, you know, or disadvantages. Uh, it's just playing

477
00:27:21,400 --> 00:27:25,080
Speaker 1: the game as is. I might eventually buy downloadable content.

478
00:27:25,119 --> 00:27:29,120
Speaker 1: We'll get into that too, which is related to micropayments,

479
00:27:29,160 --> 00:27:32,480
Speaker 1: but I don't you know, that's what I purchase, is

480
00:27:32,480 --> 00:27:35,080
Speaker 1: what I get, and that's the game. Um playing the

481
00:27:35,080 --> 00:27:39,680
Speaker 1: freemium games, you know, it may be that I would

482
00:27:39,720 --> 00:27:42,640
Speaker 1: spend a fraction of that sixty dollars, you know, maybe

483
00:27:42,680 --> 00:27:45,000
Speaker 1: I'd only be spending five bucks just to get this

484
00:27:45,119 --> 00:27:49,080
Speaker 1: one thing. But again, it feels it feels cheap to me.

485
00:27:49,200 --> 00:27:52,040
Speaker 1: Not cheap in the sense of, hey, that's a great value,

486
00:27:52,160 --> 00:27:55,440
Speaker 1: but cheap in the sense of I feel like I'm cheating.

487
00:27:56,480 --> 00:28:01,720
Speaker 1: Well here, here's okay. I've seen people complain about the

488
00:28:02,119 --> 00:28:05,040
Speaker 1: freemium type games, you know, because they say, well, they're free.

489
00:28:05,960 --> 00:28:08,880
Speaker 1: And the thing is, though, that the companies behind them

490
00:28:09,000 --> 00:28:13,760
Speaker 1: are in the business to make money. Um, so I

491
00:28:13,800 --> 00:28:17,919
Speaker 1: have a difficult time to begrudging the freemium game creators

492
00:28:18,040 --> 00:28:21,840
Speaker 1: from restricting some content to people who pay for it

493
00:28:21,880 --> 00:28:24,440
Speaker 1: because simply because they're in it for the money. Now,

494
00:28:24,440 --> 00:28:26,639
Speaker 1: if Henry wants to build a game in his spare

495
00:28:26,680 --> 00:28:29,080
Speaker 1: time that he just wants to share with the world

496
00:28:29,280 --> 00:28:32,720
Speaker 1: and wants to make it free, doesn't have any like

497
00:28:32,800 --> 00:28:34,880
Speaker 1: the paid content in there at all. Yeah, I mean

498
00:28:34,920 --> 00:28:36,639
Speaker 1: it's then that's the thing I mean. Or if he

499
00:28:36,680 --> 00:28:38,280
Speaker 1: wants to make a few bucks, But the thing is,

500
00:28:38,320 --> 00:28:39,880
Speaker 1: I mean, you have to. I think it's one of

501
00:28:39,880 --> 00:28:42,520
Speaker 1: those things that's important to look at both sides of. Now,

502
00:28:42,520 --> 00:28:46,000
Speaker 1: on the other hand, um, I feel like I'd rather

503
00:28:46,040 --> 00:28:48,000
Speaker 1: go ahead and I'd like to know what it is

504
00:28:48,080 --> 00:28:50,440
Speaker 1: up front, It's like, well, you know, if you spent

505
00:28:50,920 --> 00:28:55,000
Speaker 1: let's say, thirty dollars, you could have everything that's useful

506
00:28:55,040 --> 00:28:57,360
Speaker 1: in this game. I'd kind of rather pay for it upfront,

507
00:28:58,240 --> 00:29:00,440
Speaker 1: you know, I'd rather, you know, spend the fifty dollars

508
00:29:00,560 --> 00:29:05,720
Speaker 1: on uh say, Age of Empires and get all the

509
00:29:05,760 --> 00:29:07,600
Speaker 1: weapons and all the buildings and all the stuff that

510
00:29:07,640 --> 00:29:09,680
Speaker 1: I'm gonna need to play the game against anybody. I'm

511
00:29:09,680 --> 00:29:12,120
Speaker 1: gonna play it against uh and have it come down

512
00:29:12,160 --> 00:29:15,400
Speaker 1: to my strategy in the end. UH. And the reason

513
00:29:15,440 --> 00:29:17,920
Speaker 1: I'm getting pulverized rather than going, well, if I just

514
00:29:17,960 --> 00:29:21,760
Speaker 1: spent the other three dollars, I could get that thing.

515
00:29:21,800 --> 00:29:23,800
Speaker 1: But I really don't want to spend that three dollars.

516
00:29:23,920 --> 00:29:28,320
Speaker 1: And there are ways of implementing this that feel less

517
00:29:29,280 --> 00:29:34,040
Speaker 1: less like a cheap cheat to me than others. So

518
00:29:34,040 --> 00:29:36,760
Speaker 1: so the games that I'm specifically yeah, the games I'm

519
00:29:36,760 --> 00:29:40,440
Speaker 1: specifically talking about are the games that are kind of

520
00:29:40,480 --> 00:29:43,840
Speaker 1: like real time strategy games. So things that fall into

521
00:29:43,880 --> 00:29:46,920
Speaker 1: that category include, By the way, I'm going to mention

522
00:29:46,960 --> 00:29:49,600
Speaker 1: a few game names here, UH, and all of them

523
00:29:49,680 --> 00:29:54,920
Speaker 1: are essentially identical. The concept behind the game is the

524
00:29:54,960 --> 00:29:59,120
Speaker 1: same concept the graphics are different, some of the gameplay

525
00:29:59,160 --> 00:30:01,480
Speaker 1: elements are a little different, but the basic idea is

526
00:30:01,520 --> 00:30:06,080
Speaker 1: exactly the same. So things like Evany, Dragons of Atlantis,

527
00:30:06,480 --> 00:30:10,280
Speaker 1: Global Warfare, all of these games have the same basic concept.

528
00:30:10,360 --> 00:30:14,040
Speaker 1: You create a city, you create buildings in that city

529
00:30:14,080 --> 00:30:17,120
Speaker 1: that give you certain abilities, and some of the things

530
00:30:17,200 --> 00:30:20,040
Speaker 1: you need to build depend upon you having other buildings

531
00:30:20,280 --> 00:30:23,200
Speaker 1: or our research or whatever in place before you can

532
00:30:23,240 --> 00:30:27,560
Speaker 1: actually start on them, like especially military units, because there's

533
00:30:27,560 --> 00:30:30,400
Speaker 1: a military component to and you have to build mining

534
00:30:31,520 --> 00:30:35,560
Speaker 1: buildings like stuff, stuff that's farming out resources and you

535
00:30:35,640 --> 00:30:38,720
Speaker 1: use those resources when you're building other stuff. There are

536
00:30:39,160 --> 00:30:42,240
Speaker 1: hundreds of these type of games, and their model tends

537
00:30:42,280 --> 00:30:44,760
Speaker 1: to be, Hey, if you want to speed up building

538
00:30:44,760 --> 00:30:47,920
Speaker 1: this building, pay us you know this amount of money

539
00:30:47,960 --> 00:30:49,960
Speaker 1: and then it will instantly be finished. Or if you

540
00:30:50,000 --> 00:30:53,200
Speaker 1: want to speed your troops so that they attack your

541
00:30:53,200 --> 00:30:56,640
Speaker 1: opponent before your opponent can react, spend this much money

542
00:30:56,640 --> 00:30:59,520
Speaker 1: and your troops will instantly get there. You know that

543
00:30:59,600 --> 00:31:02,120
Speaker 1: kind of thing heating exactly. That feels like you're playing

544
00:31:02,200 --> 00:31:05,600
Speaker 1: the god mode in a in a in a video game.

545
00:31:06,000 --> 00:31:10,760
Speaker 1: Now there's another way of doing this, where there's another

546
00:31:10,760 --> 00:31:12,720
Speaker 1: way of doing this where it's like role playing games

547
00:31:13,080 --> 00:31:15,440
Speaker 1: where you know, you can play the role playing game

548
00:31:15,440 --> 00:31:17,600
Speaker 1: for free and there may not even be a cap

549
00:31:17,880 --> 00:31:20,720
Speaker 1: on your character's level, um, so that you can play

550
00:31:20,720 --> 00:31:24,520
Speaker 1: it until you hit whatever the maximum level is for everybody,

551
00:31:24,560 --> 00:31:27,520
Speaker 1: and you can play that game for free, but you're

552
00:31:27,560 --> 00:31:30,560
Speaker 1: not going to get access to certain areas of the

553
00:31:30,600 --> 00:31:34,080
Speaker 1: game unless you pay money. And I don't have as

554
00:31:34,120 --> 00:31:36,200
Speaker 1: big a problem with that because to me, that's saying, hey,

555
00:31:36,240 --> 00:31:39,000
Speaker 1: you know what, if you're willing to go through this

556
00:31:39,040 --> 00:31:41,440
Speaker 1: experience and you know you're not getting everything in the game,

557
00:31:41,520 --> 00:31:46,040
Speaker 1: but you're not also, um, it's not like when you

558
00:31:46,080 --> 00:31:48,240
Speaker 1: pay money you're getting an advantage, you just get access

559
00:31:48,280 --> 00:31:53,480
Speaker 1: to a different area. That seems less of a problem

560
00:31:53,520 --> 00:31:56,360
Speaker 1: to me. And uh, the game that I'm thinking of

561
00:31:56,400 --> 00:32:00,800
Speaker 1: immediately from this was Dungeons and Dragons Online. In d Online,

562
00:32:00,840 --> 00:32:03,480
Speaker 1: it started out as a subscription based game, so sort

563
00:32:03,520 --> 00:32:05,800
Speaker 1: of like you know a lot of other multiplayer games

564
00:32:05,920 --> 00:32:08,880
Speaker 1: that you'll find, um, but then it moved to free

565
00:32:08,920 --> 00:32:12,280
Speaker 1: online play and just areas of the game were restricted

566
00:32:12,280 --> 00:32:14,360
Speaker 1: and if you wanted to be able to play a

567
00:32:14,400 --> 00:32:17,880
Speaker 1: certain quest, you might have to actually purchase that quest,

568
00:32:18,360 --> 00:32:20,720
Speaker 1: and if you couldn't purchase the quest, well, then you

569
00:32:20,720 --> 00:32:22,680
Speaker 1: could play other parts of the game. You just that

570
00:32:22,800 --> 00:32:26,520
Speaker 1: area was off limits to you. And uh, that didn't

571
00:32:26,520 --> 00:32:28,280
Speaker 1: seem as big a deal to me, And it seemed

572
00:32:28,320 --> 00:32:30,920
Speaker 1: like I thought, that's a pretty cool way to try

573
00:32:30,960 --> 00:32:32,480
Speaker 1: and do it, because if you like the game enough,

574
00:32:32,600 --> 00:32:34,200
Speaker 1: you're gonna say, hey, you know what, I really want

575
00:32:34,240 --> 00:32:36,880
Speaker 1: to see what's back there, because this is an entertaining

576
00:32:36,880 --> 00:32:38,400
Speaker 1: game to me, and I'm willing to pay for it.

577
00:32:39,480 --> 00:32:42,480
Speaker 1: And if you're not, then you know, you just you

578
00:32:42,640 --> 00:32:45,840
Speaker 1: move on to do something else. Uh. So that you know,

579
00:32:47,000 --> 00:32:49,600
Speaker 1: that kind of leads us into the downloadable content area.

580
00:32:49,640 --> 00:32:52,920
Speaker 1: It's it's related. It's not necessarily a micropayment, because sometimes

581
00:32:53,000 --> 00:32:55,479
Speaker 1: a downloadable content game can be as much as a regular,

582
00:32:56,280 --> 00:33:00,920
Speaker 1: maybe mid tier game. I've spent probably around I don't know,

583
00:33:01,240 --> 00:33:03,680
Speaker 1: twenty dollars for a piece of downloadable content to in

584
00:33:03,720 --> 00:33:08,280
Speaker 1: a game I already had purchased. But that's also a

585
00:33:08,280 --> 00:33:11,920
Speaker 1: way that that companies are finding, uh works when you're

586
00:33:11,960 --> 00:33:17,760
Speaker 1: trying to sell um sells content on the web. And uh,

587
00:33:17,920 --> 00:33:19,600
Speaker 1: you know, there are a lot of Xbox games that

588
00:33:19,680 --> 00:33:22,600
Speaker 1: do this where you can purchase downloadable content. Actually Xbox

589
00:33:22,640 --> 00:33:27,200
Speaker 1: even adds another layer of complex uh analysis on top

590
00:33:27,240 --> 00:33:30,120
Speaker 1: of this, because in Xbox you purchase games through the

591
00:33:30,320 --> 00:33:34,160
Speaker 1: Xbox Point system, which means first you transfer your money,

592
00:33:34,240 --> 00:33:37,800
Speaker 1: your dollars into Xbox points, and then you use the

593
00:33:37,960 --> 00:33:41,440
Speaker 1: Xbox points to buy stuff, so that that actually, you know,

594
00:33:41,520 --> 00:33:44,480
Speaker 1: if you're buying something for eight hundred points, let's say

595
00:33:44,960 --> 00:33:49,040
Speaker 1: your mind doesn't necessarily automatically make the transaction of oh,

596
00:33:49,160 --> 00:33:53,240
Speaker 1: that means a hundred points, that equals this many dollars.

597
00:33:53,280 --> 00:33:55,800
Speaker 1: So it's a little different, right that that might be

598
00:33:55,880 --> 00:33:58,400
Speaker 1: a way of trying to get away from that psychological barrier.

599
00:33:59,160 --> 00:34:02,239
Speaker 1: It is, yeah, because it's not easy to make that

600
00:34:02,280 --> 00:34:05,320
Speaker 1: translation in your head. Right. So you're so you're ending up,

601
00:34:05,320 --> 00:34:07,960
Speaker 1: you're ending up purchasing stuff, but you're not having you're

602
00:34:08,000 --> 00:34:10,680
Speaker 1: not hitting that wall where you're thinking, hey, wait a minute,

603
00:34:11,120 --> 00:34:13,120
Speaker 1: this is ten dollars. I'm not going to spend ten

604
00:34:13,120 --> 00:34:15,040
Speaker 1: dollars on this. No, it's not ten dollars, it's a

605
00:34:15,080 --> 00:34:18,279
Speaker 1: hundred points oh andhred points. Yeah, I'll spend inhred points

606
00:34:18,280 --> 00:34:24,120
Speaker 1: on that. Um. Yeah, So there's that level of complexity. Two. Uh.

607
00:34:24,160 --> 00:34:27,760
Speaker 1: Downloadable content I think has been a pretty successful method

608
00:34:27,880 --> 00:34:32,279
Speaker 1: of of doing the micropayment model. UH. And you see

609
00:34:32,280 --> 00:34:35,160
Speaker 1: that also in games like the multi massive multiplayer games

610
00:34:35,160 --> 00:34:38,799
Speaker 1: where you can pay to get specific items that don't

611
00:34:38,840 --> 00:34:41,440
Speaker 1: necessarily give you an advantage, but they give you your

612
00:34:41,520 --> 00:34:44,640
Speaker 1: character a certain look. Like. I've seen a lot of

613
00:34:44,680 --> 00:34:49,080
Speaker 1: that on both on computer games and console games, and

614
00:34:49,120 --> 00:34:51,640
Speaker 1: that seems to be working pretty well too. So micropayments

615
00:34:51,760 --> 00:34:54,839
Speaker 1: can work. It's just that it's interesting that if you

616
00:34:54,880 --> 00:34:56,719
Speaker 1: look all the way back to the beginning of the web,

617
00:34:56,960 --> 00:35:00,360
Speaker 1: there are thoughts about micro payments from the star. It

618
00:35:00,520 --> 00:35:03,880
Speaker 1: just didn't you know, it didn't work on a broad

619
00:35:03,960 --> 00:35:07,000
Speaker 1: spectrum approach. Yeah, well there were there were. There were

620
00:35:07,000 --> 00:35:09,840
Speaker 1: the two pieces which we which we really covered but

621
00:35:09,920 --> 00:35:14,239
Speaker 1: in in a nutshell, the two pieces being the UH

622
00:35:14,280 --> 00:35:17,840
Speaker 1: infrastructure needed to make it work, UH, to make a

623
00:35:17,920 --> 00:35:20,120
Speaker 1: secure transaction. And in the beginning, there were a lot

624
00:35:20,120 --> 00:35:22,439
Speaker 1: of different models for that and they didn't all work

625
00:35:22,480 --> 00:35:25,120
Speaker 1: the same. UH. And you have to make sure things

626
00:35:25,280 --> 00:35:30,720
Speaker 1: are are UM are squared away. UM. I was actually

627
00:35:31,200 --> 00:35:34,560
Speaker 1: reading an article went doing my research for the for

628
00:35:34,600 --> 00:35:39,359
Speaker 1: the podcast UM by Max zeladon Itt UH Bloomberg Business Week,

629
00:35:39,360 --> 00:35:41,600
Speaker 1: who was saying that you have to watch out for

630
00:35:41,640 --> 00:35:46,239
Speaker 1: things like UM security risks, you know, stolen passwords, break

631
00:35:46,320 --> 00:35:49,200
Speaker 1: ins like we've seen in the last year, um you know,

632
00:35:49,280 --> 00:35:52,600
Speaker 1: for other types of sites UM and once. And that

633
00:35:52,680 --> 00:35:55,880
Speaker 1: leads to the other part, which is the the mental

634
00:35:56,760 --> 00:36:03,240
Speaker 1: acceptance of micropayments. Once established a value, a relative value

635
00:36:03,280 --> 00:36:07,960
Speaker 1: for these these very small transactions, and you've established that

636
00:36:08,040 --> 00:36:09,799
Speaker 1: it's my money is going to be safe, it's gonna

637
00:36:09,800 --> 00:36:11,440
Speaker 1: get where it's supposed to go, and nobody else is

638
00:36:11,440 --> 00:36:14,680
Speaker 1: gonna hit my credit card for something else, then you know,

639
00:36:14,760 --> 00:36:18,080
Speaker 1: it's just taken a while for the models, uh to

640
00:36:18,200 --> 00:36:20,840
Speaker 1: catch on. I mean, I remember when iTunes the idea

641
00:36:20,840 --> 00:36:25,120
Speaker 1: of paying a dollar for a song per song UM

642
00:36:25,360 --> 00:36:29,920
Speaker 1: bothered a lot of people, primarily the recording industry. UM,

643
00:36:29,960 --> 00:36:32,000
Speaker 1: you know, because suddenly it was it was broken down

644
00:36:32,000 --> 00:36:34,960
Speaker 1: from the album you could just buy individual songs. Uh.

645
00:36:35,120 --> 00:36:39,920
Speaker 1: Now it's pretty straightforward. People don't really question a dollar

646
00:36:39,960 --> 00:36:43,120
Speaker 1: twenty nine. Of course, the price is going up um

647
00:36:43,280 --> 00:36:45,799
Speaker 1: or or whatever. You know, an older album, Hey, you

648
00:36:45,800 --> 00:36:49,279
Speaker 1: know it's it's fifty years old. Let's say it's you know,

649
00:36:49,360 --> 00:36:53,160
Speaker 1: five dollars. Um. You know, those kinds of things are

650
00:36:53,160 --> 00:36:56,760
Speaker 1: not uncommon anymore. It's interesting, though, we do still find

651
00:36:56,840 --> 00:37:01,000
Speaker 1: bands that resist their problems, broke it up into individual

652
00:37:01,080 --> 00:37:05,400
Speaker 1: songs A C, D, C UM and uh, you know,

653
00:37:05,480 --> 00:37:08,680
Speaker 1: and then it's it's you could see this, I think

654
00:37:08,760 --> 00:37:12,960
Speaker 1: in uh publishing for e books, because people are still resisting, Well,

655
00:37:13,000 --> 00:37:16,920
Speaker 1: if I have to pay the hard back, why do

656
00:37:17,000 --> 00:37:20,239
Speaker 1: I have to pay uh, you know the book or

657
00:37:20,400 --> 00:37:23,080
Speaker 1: sevent it's not a book. You didn't print it, you

658
00:37:23,120 --> 00:37:26,839
Speaker 1: didn't find it, you didn't ship it to me money,

659
00:37:27,160 --> 00:37:29,960
Speaker 1: you didn't incur those costs. Why should I incur them? Yeah?

660
00:37:30,040 --> 00:37:32,000
Speaker 1: And that's and that again we well we've touched on

661
00:37:32,040 --> 00:37:34,160
Speaker 1: that before, but but that's I think you could see that.

662
00:37:34,200 --> 00:37:36,839
Speaker 1: Though for music it's established if you know, you've got

663
00:37:36,880 --> 00:37:38,640
Speaker 1: a price point, you have an idea of what's going on,

664
00:37:38,680 --> 00:37:42,480
Speaker 1: and you're comfortable with it. This is newer and they're

665
00:37:42,480 --> 00:37:45,440
Speaker 1: still fiddling with the prices on the exactly. And because

666
00:37:45,480 --> 00:37:47,640
Speaker 1: they're fiddling with prices, and because you could have a

667
00:37:47,640 --> 00:37:51,359
Speaker 1: company come in and undercut everyone else, it's still very

668
00:37:51,440 --> 00:37:53,719
Speaker 1: much the wild West in that in that realm. Yeah,

669
00:37:53,760 --> 00:37:56,920
Speaker 1: but I think that's an example of uh, sort of

670
00:37:56,920 --> 00:38:01,600
Speaker 1: how online transactions and the idea of micropayments, like, yes,

671
00:38:01,640 --> 00:38:03,640
Speaker 1: you have to an establish and a value. You have

672
00:38:03,680 --> 00:38:06,200
Speaker 1: to establish a value for these things, and people have

673
00:38:06,239 --> 00:38:09,319
Speaker 1: to become accustomed to, you know, the prices and the

674
00:38:09,320 --> 00:38:12,080
Speaker 1: payment system. Yeah, and there's a lot more to this

675
00:38:12,120 --> 00:38:14,080
Speaker 1: topic that we could cover. We didn't even talk about

676
00:38:14,080 --> 00:38:18,160
Speaker 1: micro lending, which is related to this UM And actually

677
00:38:18,200 --> 00:38:23,040
Speaker 1: micro lending is another example of sort of a micropayments

678
00:38:23,160 --> 00:38:27,840
Speaker 1: like system that has been fairly successful. And Uh, Stuff

679
00:38:27,880 --> 00:38:30,520
Speaker 1: you should Know did a great episode about micro lending.

680
00:38:30,680 --> 00:38:33,640
Speaker 1: It's an older episode if you guys have not heard that.

681
00:38:33,680 --> 00:38:35,080
Speaker 1: First of all, you should be listening to Stuff you

682
00:38:35,080 --> 00:38:37,640
Speaker 1: Should Know anyway, because it's a great show. But that

683
00:38:37,680 --> 00:38:41,920
Speaker 1: particular episode is is very UM particular episode in particular

684
00:38:42,560 --> 00:38:46,600
Speaker 1: that it's both repetitive and redundant um that. Let me reiterate,

685
00:38:46,960 --> 00:38:50,239
Speaker 1: the episode is very very good. And and Stuff you

686
00:38:50,239 --> 00:38:54,759
Speaker 1: should Know even has their own Kiva project charity that

687
00:38:55,200 --> 00:38:59,839
Speaker 1: or micro lendings uh project that that was incredibly successful

688
00:39:00,160 --> 00:39:03,360
Speaker 1: and continues to be very successful. So I suggest you

689
00:39:03,400 --> 00:39:06,040
Speaker 1: listen to that episode and we'll probably do an episode

690
00:39:06,040 --> 00:39:08,279
Speaker 1: of micro lending ourselves at some point talk about kind

691
00:39:08,320 --> 00:39:11,800
Speaker 1: of the technological aspect of it and how that whole

692
00:39:11,840 --> 00:39:15,600
Speaker 1: model developed and how technology has really enabled that model

693
00:39:15,640 --> 00:39:18,200
Speaker 1: to to flourish, because it's one of those things that's

694
00:39:18,800 --> 00:39:23,120
Speaker 1: much more difficult to do without the aid of the Internet. Yeah. Well,

695
00:39:23,160 --> 00:39:25,120
Speaker 1: I mean even in the political campaign for the two

696
00:39:25,120 --> 00:39:28,600
Speaker 1: thousand and eight elections and and forward and more recent

697
00:39:28,719 --> 00:39:31,520
Speaker 1: in the United States, a lot of the candidates were

698
00:39:31,560 --> 00:39:35,240
Speaker 1: raising dollars and twenty dollars at a time, which wouldn't

699
00:39:35,280 --> 00:39:38,200
Speaker 1: make a big deal to a candidate who needs millions

700
00:39:38,200 --> 00:39:41,000
Speaker 1: of dollars to in in their his or her war

701
00:39:41,120 --> 00:39:45,960
Speaker 1: chest to attract voters. But when you have millions of

702
00:39:46,000 --> 00:39:49,680
Speaker 1: people donating ten or twenty dollars, that makes a huge difference.

703
00:39:50,719 --> 00:39:52,960
Speaker 1: That's going to be the norm now. But you know,

704
00:39:53,040 --> 00:39:55,560
Speaker 1: that's really when it kicked in, and that's kind of

705
00:39:55,560 --> 00:39:58,160
Speaker 1: a micropayment. It's not you know, in the cents to

706
00:39:58,239 --> 00:40:01,520
Speaker 1: two dollars to three dollars realm. Right. Still, in terms

707
00:40:01,520 --> 00:40:04,600
Speaker 1: of the big picture, it is, yeah, considering that you're

708
00:40:04,600 --> 00:40:06,760
Speaker 1: talking about you know, and when you think about political

709
00:40:06,800 --> 00:40:09,960
Speaker 1: donations or or contributions to a campaign, you're usually talking

710
00:40:09,960 --> 00:40:12,839
Speaker 1: about thousands of dollars. So yeah, it's it's and you know,

711
00:40:12,920 --> 00:40:17,520
Speaker 1: it's it's difficult to implement that on a non technological basis.

712
00:40:17,520 --> 00:40:20,480
Speaker 1: I mean, you have to have an army of volunteers

713
00:40:20,480 --> 00:40:24,120
Speaker 1: marching door to door and uh and you know risk

714
00:40:24,239 --> 00:40:27,480
Speaker 1: being yelled at, but you never know who are who

715
00:40:27,520 --> 00:40:30,080
Speaker 1: are who are supporting the other party. Well, we're gonna

716
00:40:30,080 --> 00:40:33,319
Speaker 1: wrap this up, but if you guys have any suggestions

717
00:40:33,320 --> 00:40:35,160
Speaker 1: for topics we should tackle, or if you have your

718
00:40:35,160 --> 00:40:38,759
Speaker 1: own thoughts about micropayments, micro transactions, micro lending, that kind

719
00:40:38,760 --> 00:40:41,000
Speaker 1: of thing. Um, you know how it works or maybe

720
00:40:41,040 --> 00:40:43,319
Speaker 1: how it doesn't work, let us know. You can drop

721
00:40:43,400 --> 00:40:46,240
Speaker 1: us an email that addresses tech stuff at how stuff

722
00:40:46,280 --> 00:40:48,440
Speaker 1: Works dot com, or let us know on Facebook and

723
00:40:48,480 --> 00:40:52,120
Speaker 1: Twitter are handled. There is tech stuff each sw and

724
00:40:52,200 --> 00:40:54,480
Speaker 1: Chris and I will talk to you again really soon.

725
00:40:56,440 --> 00:40:59,000
Speaker 1: Be sure to check out our new video podcast, Stuff

726
00:40:59,040 --> 00:41:02,080
Speaker 1: from the Future Joint House Stuffork Staff, as we explore

727
00:41:02,120 --> 00:41:06,759
Speaker 1: the most promising and perplexing possibilities of tomorrow. The House

728
00:41:06,840 --> 00:41:10,520
Speaker 1: of Works iPhone app has arrived. Download it today on iTunes,

729
00:41:15,080 --> 00:41:17,640
Speaker 1: brought to you by the reinvented two thousand twelve camera.

730
00:41:17,960 --> 00:41:19,120
Speaker 1: It's ready, are you