Here's another non-starter: Micropayments. Extensive obits have been written. I won't go into that here. See clay Shirky's piece Fame vs Fortune: Micropayments and Free Content for background.

There IS value in micropayments. They might work some day. But not any time soon. The problem isn't technology. It's the marketplace. You must have adoption by many different groups with different interests - sellers, distributors, consumers, developers, aggregators, etc. The market is so fragmented that reaching critical mass with enough of these parties will take a long time. It needs a killer service to kickstart it, which we haven't seen yet.

What seems silly is the push for micropayments into P2P. The lure is clear. Billons of files with low marginal value. If I could collect a dime per William Shatner song or Paris Hilton sex video, I'd be rich, Rich, RICH! But it's a mirage. The recording industry created a market where consumers expect marginal content to be free. You can't (easily) change consumer behavior. Even by suing your fans. P2P is a promotional channel, not a commerce channel.

My 2 cents:

• VCs - Stay far away.


• Micropayment providers: Find strategic partners who can deliver unique niches where there are clear buyers and sellers. Aggregate niches. Forget P2P where it's hard to market (unless you go the BrandedP2P or P2P Street Team route) and stick to the web.

Marc Freedman
RazorPop, developer of TrustyFiles, the leading multiple network P2P file sharing software
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