The Idea Of Micropayments

The idea of micropayments — charging Web users tiny amounts of money for single pieces of online content — was essentially put to sleep toward the end of the dot-com boom.

In December 2000, Clay Shirky, an adjunct professor in New York University’s interactive telecommunications program, wrote a manifesto that people still cite whenever someone suggests resurrecting the idea. Micropayments will never work, he wrote, mainly because “users hate them.”

But wait. Amid the disdain, and without many people noticing, micropayments have arrived — just not in the way they were originally envisioned.

The 99 cents you pay for a song on iTunes is a micropayment. So are the tiny amounts that some operators of small Web sites earn whenever someone clicks on the ads on their pages. Some stock-photography companies sell pictures for as little as $1 each.

Consumers were reluctant to pay even a tenth of a cent for something they believed should be free. “There is a certain amount of anxiety involved in any decision to buy, no matter how small,” Mr. Shirky wrote in 2000.

It turns out, however, that consumers are more than willing to pay for certain types of content in certain situations. Consumers “expect to pay for music and movies, but not so much for the printed word,” said George Peabody, an analyst with Mercator Advisory Group, which serves the payments industry.