The past few months have seen a bloodbath in tech stocks coupled with a frantic redefinition of the web and all of the players that make it up (content-wise).
This effort has three aspects:
Some companies bet on the distribution of content and the possession of the corresponding digital infrastructure. MightyWords, for example, quietly transformed from a “free to all and welcome” e-publisher to a distribution channel for select works (mostly from middle-of-the-road authors). It now aims to feed its content to content-hungry websites. In the process, he got rid of thousands of unlucky authors who didn’t meet his (never stated) criteria for sale.
Others bet the farm for content creation and packaging. Bn.com invaded the digital publishing and POD (Print on Demand) businesses in a series of lightning buyouts. It is now the largest e-book store by a wide margin.
But Amazon seemed to have got it right once again. The web’s own virtual mall and former darling of Wall Street has branched out into micropayments.
The Internet began as a free medium for free spirits. E-commerce was once considered a dirty word. Internet users got used to free content. Hence the (very low) glass ceiling in the price of content available through the web, and the need to charge customers less than US$1 at a few dollars per transaction (“micropayments”). Various service providers (such as Pay-Pal) emerged, none becoming dominant and ubiquitous enough to constitute a standard. The ability of web merchants to accept micropayments is crucial. Ecommerce (let alone mobile commerce) will never take off without it.
Get on Amazon. Your “Honor System” is licensed to third party websites (such as Bartleby.com and SatireWire). It allows people to donate money or make micropayments, apparently through its proprietary one-click system. As far as the websites are concerned, there are two main drawbacks: all donations and payments are refundable within 30 days, and Amazon charges them 15 cents per transaction plus 15 (!) percent. By far the worst deal in town.
So why all the fuss?
Due to the Amazon customer list. This development underscores the growing understanding that one’s customer list, properly mined from data, is one’s greatest asset, greater even than original content and more important than distribution channels and digital rights management or streaming applications. asset Management. Merchants are willing to pay for access to this ever-expanding virtual neighborhood (even if they don’t go private for customer information collected by Amazon).
The honor system looks suspiciously like the payment system designed by Amazon for Stephen King’s serialized e-novel “The Plant.” It is interesting to note how the needs of authors and publishers are now in the driver’s seat, helping to drive innovations in business methods.