Again With the Micro-Payments

16 February 2009 Dan McGarry

Rex Sorgatz posted a quick and dirty re-think of how micro-payments could be made to work in a present-day web-browsing scenario. Again, I question the premise of the problem micro-payment purports to solve.

My fundamental objection to online payment is that most people won’t pay for something of unknown value. Speaking for myself (and a few others I know), the moment a website starts putting obstacles between me and the content I want to access, it’s easier for me to move on than it is to leap whatever interface hurdles are barring my path.

That’s because:

I refuse to buy something sight unseen. In the material world, I can at least take a look at the package and compare with a few competing products before I pull out my wallet. On the Web, I can’t really know whether something is worthwhile until I’ve had a look. For a bit of writing of less than 5000 words, that means I need to see most – if not all – of it before I decide what it’s worth to me. For a short video, that means all of it. (The mere idea of a trailer for a 15 minute video makes me shudder.)
The whole point of micro-payment is that the amount is ‘throw-away’ money. Increments so small that we don’t even have to think about it. Forcing someone through the UI equivalent of a toll booth creates an impediment that’s out of scale with the benefit.
As I mentioned before: Online payment is not really payment, it’s reward. So much comes free with the price of admission (i.e. an Internet connection) that the only way we can assess the value of content is in the context of a gift economy. Think of it as a pay-as-you-exit performance, or busking, if you like. Modulo a few stingy, poorly socialised freeloaders, anyone who really enjoyed the show will happily toss a few coins into the hat. But not before they’ve seen the show.

To sum up: It’s best to leave interface and program flow issues alone until we’ve established the proper intellectual framework. Conceptualising a rewards system generates very diffierent results than a payment system. Given that reward and payment systems are both easily circumvented, the only thing we can rely on is the visitor’s goodwill. Place a little box at the exit, allow people to click right past it if they want, and you’ll never have any complaints about access to data.

More to the point, everyone who gives, gives gladly. This is more than just a moral point. The importance of goodwill from one’s website visitors cannot be understated. Remember: karma comes first, reward later, when it comes to online success. In fact, karma is the primary reward. Cash is just a symbolic representation of the goodwill people feel toward you.

P.S. If we’re honest with ourselves, we can accept that others’ failure to give us money is not an interface failure, nor is it a failure in their judgement. For better or for worse, if people aren’t willing to give money of their free will, then the failing is ours, not theirs.

I suspect that some manifestation of the Endowment Effect underlies most efforts to control access to online content. It’s irrational in the online context, but it’s human nonetheless to say, “I worked hard to produce this. I have a right to be paid for it.”

Those of us who have more or less grown up online have fewer reservations about the benefits of sharing content without precondition, and I suspect such expectations will become the norm for at least a significant subset of society before too very long.

Boom or Bust?

13 February 2009 Dan McGarry

The economic benefits of a fiber-optic connection to the outside world cannot be overstated. But it’s got to be seen as a labour of love. The benefits to be derived from the operation of the cable itself might never be great. If it’s not managed properly, the cost of failure could be high indeed. That said, the knock-on benefits to the community are numerous.

Call center services for European customers, online education, interactive tourism resources (video feed from the Nangol, anyone?), live video lectures from universities overseas, online consultations by medical specialists, offshore financial transaction processing… the list goes on and on. All of this becomes possible if we improve our basic infrastructure.

[This week’s Communications column for the Vanuatu Independent.]

We need fiber, and we need it soon.

No, I’m not talking about changing the nation’s diet. I’m talking about fiber-optic cable. Made of very long strands of glass fiber, this kind of cable has the unique ability to allow light to turn corners. This means that we can shoot tiny laser pulses into one end of it and have them emerge intact from the other end, even if it’s thousands of kilometers away.

The result? Fast, very high-capacity communications become possible. In laboratory experiments, researchers have achieved rates of up to 14 trillion bits of data per second. Current commercial implementations don’t go nearly that fast, but even a single thread of fiber a few millimeters wide can carry billions of bits every second. Just a few strands would be enough to increase Vanuatu’s total available bandwidth to a large multiple of its current capacity.

So what’s the catch? Why haven’t we invested in a fiber connection yet? Fiji has it, and so does New Caledonia. Why not Vanuatu?

The Numbers Game

9 February 2009 Dan McGarry

A single tidbit of information is nice to have, and useful, too. But when we can plot numerous points on a graph, we can begin discussing trends. And trend analysis is critical when we’re trying to understand long-running processes like the spread of communications throughout the islands.

It’s clear that Vanuatu is undergoing a historic change where communications are concerned. Our next steps will depend largely on how we understand the effects of our actions. Everyone in Vanuatu is best served by an environment of equal and open access to information.

[This week’s Communications column for the Vanuatu Independent.]

At a public meeting recently held in Port Vila, Digicel Pacific General Counsel David Dillon estimated that Digicel and TVL combined have about 100,000 active mobile subscriptions in Vanuatu. If that number is correct – and I believe it is – it means that the number of subscriptions has increased by a stunning 400% in less than a year.

100,000. Let’s think about that for a second.

In the big cities of the world, selling 80,000 new subscriptions is a modest achievement. But here in Vanuatu, simply finding that many is a herculean feat. Extrapolating from the 2001 census numbers, we can estimate that there are roughly 55,000 people living in Port Vila and Santo today. Pick any reasonable percentage of people actually using mobile phone services, and it quickly becomes evident that reaching the reported subscription level requires pretty significant penetration into places that had never had mobile services before.

Digicel, TVL and the government of Vanuatu have achieved a truly remarkable thing. This is nothing short of a communications revolution.

Nobody doubts that the effect of opening the telecoms market is a fundamental transformation in the way Vanuatu society interacts. But it’s difficult to characterise the exact nature and scope of the impact.

It would be nice to quote statistical chapter and verse, but we don’t have enough publicly available information to do so.

Nice Work if You Can Get It

8 February 2009 Dan McGarry

I put all my columns and photos online simply out of a desire to communicate. The fact that I’ve been able to parlay this output into a consultancy that is earning me more now than my previous salaried position is more than a happy accident, that’s true. My web presence is my calling card. But I would publish my material online regardless. The bottom line is that I love the act of creation, and I feel gratified when people derive some value from it.

Andrew Sullivan links to a few posts about the continual struggle to make the Internet pay. Personally, I find both sides of this online payment argument silly. Neither Felix Salmon nor Seth Roberts are on the mark, and neither of them really understand what motivates people to make payments for non-material goods delivered over the Internet.

Micro-payment for Internet content is not flawed in and of itself. Like so many nice ideas, though, it has few decent exemplars at this stage of the development of the Internet.

People will find a way to manage micro-payments, and some people will profit thereby. Why? Because people are willing to reward people for their contributions. Radiohead made significant profits from the online release of their album ‘In Rainbows’. Many people paid more than the recommended minimum contribution Radiohead requested. President Obama’s online campaign was premised not on sales but on the moral argument that people should participate in the process of change. The monetary exchange in each case was symbolic; it was not payment for services rendered but reward for exemplary behaviour.

This really is the crux of the issue: Internet content is part of a gift economy, an economy of plenitude that bears a stronger resemblance to the West Coast native practice of potlatch than anything Adam Smith might have envisioned.

Simply put, people don’t pay for things on the Internet; they don’t have to. So we create content as a labour of love, and if people value it, they reward us, first with their attention, then, in certain circumstances, with their material support.

Some people have recognised my expertise in my particular niche of the online world – and its applicability to their needs – and that provides enough income enough to keep me working online. Their rewards make my online work possible.

Lastly: Seth’s response is based on a false premise. The vast majority of Open Source developers are well remunerated for their efforts. This is a perfect case in point: Those who benefit from an improved environment (in this case, commoditised, easily customised software) are usually willing to reward those whose work improves it.

None of us have a well-developed understanding of how things will play out in online content creation. But we have to stop thinking about it in terms of product and sale. It’s reward for services rendered.

Two Boards and a Passion

6 February 2009 Dan McGarry

It is this natural flair for drama, performed as directly and viscerally as any Hollywood star could ever hope to do, that sparked Smolbag’s incredible growth. For two decades now, they’ve taken on contentious and difficult topics, many of them directly confronting uncomfortable tabus. Without fail, they’ve managed to engage with people, to educate them and inspire them to action.

In light of the often intransigent, conservative nature of Vanuatu culture and society, I find their consistent success at once mystifying and inspiring.

[Originally published in the Vanuatu Daily Post’s Weekender Edition.]

Before William Shakespeare penned his first words, Spanish culture was ignited by a soldier, adventurer and scholar named Lope de Vega. Considered one of the great playwrights of all time, he transformed Spanish culture by creating simple character-driven plays, written for the first time in colloquial Spanish.

One of his most enduring pronouncements was that theatre consisted of nothing more than two boards and a passion. All that is required, he said, is a platform to stand on, and a script that evokes passion – in the character and in the minds of the audience.

Vanuatu’s own Wan Smolbag theatre shows us just how true this is.

In the late eighties, a young British couple arrived in Vanuatu. With nothing more than a bag of costumes and a few passionate companions, they created a revolution. What started as a dynamic troupe of players is now a national – and regional – institution, one of Vanuatu’s cultural crown jewels.

Read more “Two Boards and a Passion”

No Communications Column this Week

1 February 2009 Dan McGarry

I’m so darn busy working with technology that I don’t have time to write about it.

I should be back on track in time for next week’s column.

Walk a Mile in These Shoes

1 February 2009 Dan McGarry

Attendees of this year’s World Economic Forum in Davos, Switzerland, received an invitation from the UN High Commissioner for Refugees to ‘an event you will never forget’. The event, called the Refugee Run , is a Disneyland-style re-enactment of life in a refugee camp.

I can’t speak for the guests, but the image of champagne-and-caviar billionaires spending a couple of hours scuffing their loafers with designer dust behind artfully laid out barbed wire before returning to their luxury hotels – well, that is something I won’t soon forget. No matter how hard I try.

[Originally published in shorter form in the Vanuatu Daily Post’s Weekender Edition.]

Not that we needed any reminder of just how out of touch the majority of those living in privilege really are, but this event starkly illustrates just how great the chasm between rich and poor really is. It is an object lesson on how easy it is for even the most high-minded among us to mistakenly confuse poverty with a lack of physical wealth.

According to apologists, the Davos refugee sideshow is really an exercise in visualisation. By simulating the experience of powerlessness and intimidation most refugees feel, our captains of industry will be brought closer to them, making it easier for them to bestow their largesse on the dispossessed.

That idea isn’t utterly without merit, but I can say from experience that even a visit to a real refugee camp does very little indeed to convey the refugee experience. It’s one thing to see patience, resignation and demoralisation in the eyes of another; it’s another thing entirely to live it over a space of months, often years.

Read more “Walk a Mile in These Shoes”

Regulating Telecommunications

24 January 2009 Dan McGarry

The proposed new Telecommunications Bill is not a perfect document. But Vanuatu is not a perfect place. Considering the limited resources it can bring to bear, the great gains it’s made in improving communications nationwide are truly commendable.

[This week’s Communications column for the Vanuatu Independent.]

Last Thursday, members of the IT industry, researchers and interested members of the public got together with Ministry of Infrastructure and Public Utilities to discuss proposed new laws governing Vanuatu’s burgeoning telecommunications sector.

At issue was a Bill to define the precise role of the Telecommunications Regulator. Designed to supplement the existing Telecommunications Act of 1989, it outlines in detail the extent of the Regulator’s mandate to influence the newly-liberalised telecoms market.

The draft Bill describes an environment wherein the Regulator has wide latitude to impose his will on telecoms operators if they misbehave. Among other things, he can enforce fair and equitable access to rare or unique infrastructure (known as bottleneck resources), he can intervene if telecoms operators are deemed to be offering preferential or prejudicial prices to others and if necessary he can enforce tariff or pricing regimes on carriers if they don’t play fair.

Viewed in the light of their exemplary track record, the draft Bill reflects well on both the Ministry and the Regulator. To date, their attitude has been to let market forces work with little if any intervention. They have nonetheless made sure that the regulatory stick they hold in reserve holds real clout. The proposed Bill gives this all the force of law. Rather than relying in the language of various negotiated agreements, they’ve outlined a set of rules that applies to anyone and everyone operating in the telecoms sector.

Others aren’t so sure that a big regulatory stick is such a good thing….