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Zer Netmouse
March 3rd, 2005
12:04 am

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Paradigms of commerce in the digital age
I wrote up a lot of babble in an email just now about how commerce should restructure to pay content and value producers directly instead of (or in addition to) being based on distribution of copies (as replication of information has little inherent cost)...



...That reminds me of a long-ago campaign that got set aside for other projects. I've been meaning to partner with Paypal to set up a system that lets people easily send money to content providers. hmmm... maybe I'll get on that again. This fall if I'm not burned out on conventions I'll go to Windycon and meet Bill Holbrook, the author of the online strip "Kevin and Kell". I remember way back when I first convinced Bill that he had to make it possible for people to give him money without buying any *stuff*. Since then online comics have developed an established sponsorship format (see www.kevinandkell.com/support/ for example). It would be fun to walk up to Bill and introduce myself and see if he remembered when I did that (we were talking about it in email and then to prove my point I sent him money through paypal. Ah the heady early days of paypal before they diversified account definitions)

I remember a while ago my friend Pete Abrams was finding it hard to keep going doing Sluggy Freelance full time and he sent out an appeal on his web site and got a year's income in a week or so in donations. That works best, of course, if you have a site with a dedicated following. But you might be surprised how many people give donations at various times if word gets around. Not that you necessarily want to broadcast your problems to the world but... *shrug*. A friend of mine raised $1,800.00 last year in order to afford surgery for her cat who had cancer, a third of it through a paypal donation site. Neil posted that "Omaha the Cat Dancer" author Kate Worley was sick, and the donations before and following her death were so great that her partner finally asked for a follow-up post to request that donations stop (or get redirected to a specific charity).

In general (and this is part of what I was arguing to Bill Holbrook way back when) I think society needs to transition to a commercial model of supporting the producers/sources of stuff rather than (or in addition to) paying for copies of stuff. In the digital age, multiplying copies of things and distributing them has a minimal real cost or value associated with it. Society continues to attach an enforced cost because that's our only structure by which the people in the system get paid. But what if you got paid every time someone read something by you and liked it enough to pay you for it, in addition to every time someone purchased a brand new copy of it? or perhaps instead? the existing paradigm for things like books and music is to pay for them pre-consumption. This is changing due to people like Cory Doctorow and Janis Ian and online distribution of content. People are able to try things out, find out if they're actually worthwhile, and then go get a copy if they want a copy.

I think it should also be very easy to pay money to an author or artist *whether or not* you acquire a copy of the thing they produced. This is part of why it's great that tools are developing that make it easy to scan an isbn # and input it to a website - you don't have to own an ebook of something in order to have a computer interface be associated with it - you can take advantage of existing scanning technology to interface your book with your existing home computer. People are using this to catalogue their book and DVD collections right now, and keep track of loaning them out to people and such. What if a person who had borrowed a book could with one click indicate that they enjoyed it and thus send you (and perhaps the publishers) some money? If it was easy, and if the paradigm shifts the way I think it's shifting, I think a lot of people would. Just like people currently buy books new in order to encourage the production of more books. It should be possible to encourage the production of the content over and above encouraging the production and distribution of a particular medium.

Some of us have enough *stuff* and don't necessarily want more. The other day at a concom meeting Susan was promoting her kid's school fundraiser - a great deal on some tupperware. Roxanne said "can I just support them and *not* get anything?" and there was a murmur of agreement and amusement that went around the room.

Also, note that when someone can't afford the whole cost of something new, they often avoid the cost all together by getting it from the library or from a friend. But they might be able and willing to pay some fraction of the cost. linking payment to *you* to purchases of something new produces a unit threshold below which people can't pay *you* for having written something. This is part of why the paperback book industry exists, to provide a lower threshold later. But in the digital age, where money is just numbers in the information network, people should be able to pay you any amount, any time. No threshold.


And when I read a book I love for the tenth or eleventh time, I really do wish I had an easy way to drop the author a note and some money and say "Hey, this means a lot to me." Admitedly, doing so is probably possible through the publisher, assuming the publisher is still in business, by sending a check, I guess. But that costs money and materials in addition to time, and it involves uncertainty. Maybe I should suggest to Tor that they should set up a section on their website for people to give money to their authors and editors... that would be cool. It would have administrative and especially start-up costs. But it would be cool.

Current Mood: thoughtfulthoughtful

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From:rmeidaking
Date:March 3rd, 2005 03:27 am (UTC)
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There are problems with this format.

First, the author already knows that he's partly a marketer, but this puts him on the front line.

Second, the established model has people other than the author getting paid - the publisher, the editor, the author's agent, etc. All of those people have essentially been hired by the author to do distribution and marketing so that he (the author) doesn't have to. If you cut them out of the pay picture (which direct selling would do) then you also give them no incentive to do the marketing and distribution.

I agree that the whole publishing paradigm is in a state of flux. We're going from a state where few books were widely distributed (less than 100 years ago) to where I now have instant access to literally millions of works via the internet. Not long ago, it cost quite a bit of money to produce the equivalent of a fanzine or APA; today that's essentially free (I can get a year's subscription to LJ for less than the cost of producing one fanzine - and I get a much wider distribution, and people actually read what I write [what a concept]).

One hundred years ago, a person would save up and buy one copy of one book, and then share it with his whole family, and probably the neighbors, too. Even now, my family members who are hard-core romance junkies trade books around by the grocery-sack-full. That was the norm. Now publishers want to crack down on that: they see those multiple readings of one copy of a work as theft. IMO, that's too far over to the other side.

The thing is, the technology is changing so fast that publishing can't keep up. We have gone from having lots of small bookstores twenty years ago, to them being replaced by the Big Box stores, and those Big Box stores are now in jeopardy themselves thanks to online purchasing. Does anyone order a book through their local brick-and-mortar store anymore?

I expect that the next development, which Tor and others are pursuing, is replacement of actual books with files for one's PDA. My husband already reads his books that way, and he's gone from reading maybe one book a month to reading one or more per week, because his book is *right there*. Fortunately that is close enough to the traditional paradigm that the current marketing scheme works, and so it's being supported.

It's really hard to buy and sell directly with the producer, because the producer then has to be marketer as well as producer, and they don't generally do both things well.
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From:netmouse
Date:March 3rd, 2005 05:05 am (UTC)
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>First, the author already knows that he's partly a marketer, but this puts him on the front line.

Not at all. That's assuming the author produces or manages the system that sends money back to him. I'm arguing it should become intrinsic to the system. You might have seen proposals for ebooks that charge a certain amount of money (a few cents) per view of portion of download. I'm arguing that this is the wrong way to go - let people have the content, and swap it, as they inevitably will, but create a transaction trigger or key that travels with it that makes it effectively a one-click process (though watch out - is the one click process still patented?) or rather a two-click process to send an *arbitrary* amount of money back through the system.

You're right that authors (and painters, musicians, etc) often don't have the skills for production, distribution, and marketing. At the very least with books the editing and layout process needs to happen. And I like physical books, I'm not saying they should go away, so I want us to produce a system that sends money to the ... I guess you could call them the secondary network that adds value to the product. But the rest of the distribution system *for the most part* doesn't add value to the product.

I hope Bookstores continue to exist, because I like browsing and there's nothing like walking into a store last-minute to grab the first thing that catches your eye, or to realize you totally lost track of things and this series is *finished*! And you need the rest of it right now! And I do order things from my local store, yes I do.

But I think the ammount of money, as a percentage of GNP, that goes to the publishing industry back below the level of distribution is less than it ought to be to reflect the value added to society. And I think there are too many parts of that process that are *really* dependent on the middle man. The publishers mainly have to market to the big bookstores because they have a lock on distribution of new material and selling copies of new material is the only point in time when money passes up to the content producers (I'm including the editors and copyeditors and illustrators in the term content producers here). THAT is what I think needs to change.

You see these situations where a book comes out that doesn't get picked up by the big distributors, it has a small print run, and copies start going for $100 or more on Ebay - they are getting swapped around at that point, at a price that reflects relative value, and none of that money is going back to the producers of the actual value. Or you look at these art auctions or estate auctions - heck, you can see people dropping millions on a statuette that belonged to some hollywood bigshot - does any of that money go to the artist or his family? How would it? Why shouldn't it? Sometimes the true value of something is only appreciated over time. The first transaction involving something should not be the only one that reflects value back to the producer in the form of currency.

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From:omnifarious
Date:March 3rd, 2005 12:32 pm (UTC)
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Not at all. That's assuming the author produces or manages the system that sends money back to him. I'm arguing it should become intrinsic to the system. You might have seen proposals for ebooks that charge a certain amount of money (a few cents) per view of portion of download. I'm arguing that this is the wrong way to go - let people have the content, and swap it, as they inevitably will, but create a transaction trigger or key that travels with it that makes it effectively a one-click process (though watch out - is the one click process still patented?) or rather a two-click process to send an *arbitrary* amount of money back through the system.

This is exactly what I've thought, and I've thought of building such a system as well.

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From:netmouse
Date:March 3rd, 2005 05:06 am (UTC)

(continued because I hit the max comment length)

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Now, we do have art grants and such, which fund in large part the production of some things, or cover living expenses for our treasured artists or poets. But think about public art for a minute. My sister just sent me an An article about a library mural by artist Kelli Bickman. Now, I'm very proud of my sister, who as Director of public art for the city of jacksonville is helping make beautiful art happen. But Kelli is getting the grand sum of $5000 for something that is going to affect *generations*. If people want to pass back some appreciation of her work, they could write down her name, maybe look into buying her book, which is really *much* different from that mural, or maybe get a print of something. If there's a system for distributing these things when the time comes - but libraries don't have them. But imagine for a minute you're standing in front of such a mural. And you love it. you love the thought that it's there, in the library, for everyone to see. You go by it often throughout your life. And every so often, when it really touches you, when you spend 15 minutes exploring the stories in it with a child or grandchild, you tell your wearable computer (perhaps a pda, as we know it, perhaps just your watch) to pass value back to the artist. Maybe there's a unit next to the mural - could look like a pretty tile, or a jewel or an icon, who knows - that will transmit to your wearable sufficient information so that it can send Kelli a token of your appreciation. or a barcode you can scan. All you need to add into the transaction is an indication of the amount you wish to give her. You don't need to send money to a foundation to support artists you may or may not like - you've got an artist right here whom you like, and you can support her directly.

This hasn't turned the artist into a marketer. It has turned appreciation of the value of her work into a process that easily passes some of society's main currency of value (money) back to the creator. That would be a great system to put in museums as well.

You would of course have to have some way for the artist to indicate a target for those funds in the event of their death, but I'm sure people wouldn't mind. If someone passes away without giving such an indication, and has no estate, the money could start to go to a foundation for the arts after all.

If someone, an artist or a writer, hasn't produced something *lately* and/or has nothing in the market, society has very few ways to encourage them to produce their next thing, or to pay for them to live until they do so. I think that's a serious lack. It also means it's especially hard for our producers of value to retire. It would be cool if the publishing industry could produce a system that lets people pay money that goes pre-tax into a retirement program for writers and illustrators, like the matching portion of a 401K. Authors and Artists are largely freelance or independent. Who matches their retirement contributions? Maybe the readers and viewers should.
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From:scalzi
Date:March 3rd, 2005 05:06 am (UTC)
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"And when I read a book I love for the tenth or eleventh time, I really do wish I had an easy way to drop the author a note and some money and say 'Hey, this means a lot to me.'"

Why couldn't you do this now via PayPal? Presuming your author in question has an e-mail address (and most do now, trending toward inevitability as time goes on), this is a viable option, with no additional infrastructure required.
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From:netmouse
Date:March 3rd, 2005 05:13 am (UTC)
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As a smof, I know the email addresses of a lot of authors. But many of them aren't public. Also, paypal only lets you receive money for free if the money came from an online paypal account. I have one of those, but a lot of my friends just use credit cards through paypal. There's a transaction feee for that and in order to pay it the recipient has to set up a commercial account. Last I knew anyway. I don't really want to change my account to being commercial in order for a friend to pay me five bucks.

Paypal is the logical transfer mechanism right now, but the system shouldn't require finding an email address.

But you do remind me that last year I received the (*highly private*) email address of the author of one of my absolute favorite books. I might send her some money next time I read it...

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From:stardustgirl
Date:March 3rd, 2005 09:54 am (UTC)
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That's one of my main beefs with paypal and why I don't use them. It's always the recipient that pays. If I wanted to send someone $10 I'd like to see them get $10, not less due to fees. And paypal is tangled up in the goods-for-money business, so they have to have tons of rules, regulations and the resulting costs from that, that make them fairly expensive. If someone could set up a donor system, where you send money but don't expect anything in return, and therefore can't cry to the big company that you didn't get your widget, this would probably work better.

Snailmail to a PO Box is still a fine thing too. I mail cat food/care coupons to one of my favorite authors since they do me no good (no cats), and she regularly takes in many, many strays. I get to show support for her despite my utter lack of cash - it helps her save some money - and the four legged critters benefit too. She's also received other gifts such as restaurant coupons (for one of her favorite place to eat) from other readers. It makes for a nice and useful "thank you", and is a way around the cash stigma for those who feel odd about sending cash.

Amazon wish lists are another potential source of "Thank you"s. A person need only make their wish list and announce its presence. Their address is never disclosed to the person sending the item. I don't know if other online stores have wish lists, but they are truly useful things.

Your idea sounds like a "tip jar"... which is cool. :-)
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From:netmouse
Date:March 3rd, 2005 11:33 am (UTC)
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Your idea sounds like a "tip jar"... which is cool. :-)

yes... a ubiquitous electronic tip jar...
From:cherylmorgan
Date:March 3rd, 2005 03:38 pm (UTC)
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Quick comments on PayPal.

Firstly, I don't think you have to pay to have a PayPal account that can receive credit card payments. That is, there is no standing charge for having such an account. What you do have to do is pay a fee for each credit card transaction processed.

But this is not unusual. Any commercial operation (including a Worldcon, of which I know a little) that is able to receive payments by credit card is required to pay a transaction free to the credit card company. You never get the full amount of what the customer pays. What PayPal is doing is passing on that charge. Admittedly they are adding a mark-up, but then they have also gone through the process of applying to be able to receive credit card payments. That takes time and effort, and in addition the fees you pay are related to your volume of traffic, so much of PayPal's profit may come from getting bulk discount from the credit card company but charging us the sort of fees we'd have to pay if we went direct.
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From:stardustgirl
Date:March 3rd, 2005 04:16 pm (UTC)
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I understand this. I just feel there should be an option for the person using the CC to absorb the costs if they so desire. Granted, no one in a shopping situation is likely to do that, but with a donation it's different.

It's not legal in the US for a commercial operation to charge customers extra to use a credit card, but many skirt this by offering a "cash discount" which amounts to the same. I suspect the CC companies have that rule from back when card usage was new... in an effort to get customers hooked on using them... but don't see any real reason for it now. I doubt many customers would opt for that, but those donating to a cause might.
From:cherylmorgan
Date:March 3rd, 2005 04:47 pm (UTC)
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I'm not sure it is an important difference. The reader pays $100. The author gets $98 and the credit card company $2. What is the difference between that being a $98 donation with the reader paying the CC bill, and a $100 donation with the author paying the CC bill? In the end it is the reader who pays out the money.
[User Picture]
From:netmouse
Date:March 3rd, 2005 05:52 am (UTC)

Another thought

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Paying an author directly, while I advocate it, does fail to support the other people Roxanne brought up who do final production on the book.

If I wanted to support everyone involved, just through paypal, that would involve a lot of individual transactions. Imagine you wanted to say thanks to Patrick, Emma, Lorraine, and Steven for the great free concert they gave at ConFusion, maybe cover some of their costs of coming out to the con. (Patrick especially wasn't having any of his costs covered by the convention, though I'm sure that Tor ate some of them.) You could look up and use four email addresses. To get them, you could ask me. I know them all. Or you could look on the web. They're all out there somewhere. pnh at panix, fabbulouselorraine at gaiman.net, emmabull at gmail, skzb at dreamcafe.com. And then you could make 4 separate transactions, each of which has, I don't know, four or five steps? Not bloody likely something you'd do. And that concert had fewer people involved than the average book.

And part of the reason you wouldn't do it is that it would feel weird. These are your friends. You hung out with them. The concert was a cool part of the community event. What are you paying them for?

How can it be okay for me to give you money spontaneously for something that was an experience, not a thing I can hold, and moreover an experience I *already had*? I'm not buying a ticket. I'm not buying a copy. I'm just passing you appreciative currency of value. Society's paradigms have to change for that to be okay.

[User Picture]
From:matt_arnold
Date:March 3rd, 2005 07:48 am (UTC)

Re: Another thought

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Sounds like you're not just suggesting a new piece of software and a new type of business, you're starting a social movement. What will you name it?
[User Picture]
From:netmouse
Date:March 3rd, 2005 08:05 am (UTC)

Re: Another thought

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*grin* I don't know. Suggestions?

Really, I think the movement is already in process. It just needs to be recognized and institutionalized with functional support systems and mechanisms and lessons in elementary school. or is that process what a social movement is? :)
[User Picture]
From:matt_arnold
Date:March 3rd, 2005 08:22 am (UTC)

Re: Another thought

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That's the outcome a social movement seeks. An actual social movement is one or more websites with a manifesto to add one's signature to, a messageboard, a chat room with live debates with opponents, funds collection, PDF flyers, representatives going on talk shows with talking points, meetings in homes and coffee shops, a logo on t-shirts and hats, taking credit for who started it and who's the leader, bitterly divisive politics, one or more cults of personality, schism groups that won't talk to the other groups, and maybe embezzlement.

On better thought, let's not form a social movement.
(Deleted comment)
[User Picture]
From:netmouse
Date:March 8th, 2005 03:04 pm (UTC)

Re: Another thought

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*bonks you on the head*

[User Picture]
From:netmouse
Date:March 3rd, 2005 08:03 am (UTC)

Re: Another thought

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erg, that's fabulouslorraine of course. I wish you could edit comments.
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From:mplscorwin
Date:March 3rd, 2005 06:03 pm (UTC)
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(catching up after not reading LJ for several days)

Woah. I was pretty supprised when I came across this. For obvious reasons I can't too much about specifics but I'm involved with a startup building a system for that hopes to accomplish much of what your talking about.

I'm going to try to get permission to give you the details (next meeting is Tuesday next), since I'd love to have your input. At least.

But I don't have an email for you. Mine is my LJ name with the prefix to my given name as the domain and .CX as the TLD. If that makes sense.
[User Picture]
From:netmouse
Date:March 8th, 2005 03:07 pm (UTC)

I sent you email...

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But I haven't seen a reply... could be you're busy and that's fine, but I've also confirmed all mail sent to my gmail account is not getting to me. my email addresses are netmouse at netmouse.com -really anything at netmouse.com goes to me - akgmurphy at gmail and soartech and netmouse at cyberspace.org

If you have sent something please re-send.

thanks.

--Anne
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