Scott McCloud, a very smart comic book artist and author of the fantastic book "Understanding Comics" has been trying for a number of years to both reinvent comics but also has been experimenting with how the medium of the Web transforms the comic medium. In addition, he has been an advocate for exploring new business models for comic book artists.
A few years ago he strongly advocated micropayments, however, none of the many attempts at micropayments in the 90s have taken off. In his latest comic The Right Number he has teamed up with BitPass, a new micropayment company that opened just this month.
Review: I deposited $10 for BitPass cash, paid through PayPal which pulled it through my Amex as BitPass doesn't itself accept Amex (quite convoluted, but it worked). Nothing very intrusive was asked of me. I paid $0.25 to Scott to view his comic, and again, nothing too intrusive was asked of me, and getting to the paid comic site was painless.
The online comic "The Right Number" itself was not bad -- Scott McCloud continues to stretch what can be done with the online medium. Not quite as good or innovative as Broken Saints but interesting. The story was provocative, and I look forward to the rest of the chapters of the comic before I can really give the story a complete review. But so far it is certainly worth $0.25!
Commentary: I've been closely involved but not quite an "insider" in the micropayments area for quite some time. I did consulting for David Chaum of DigiCash fame, and one of my former board members (and now a blogger) Scott Loftesness later took over that company as CEO and sold it, and as far as I can tell it has been dead since. Cybercash was one of my first SSL-Plus customers, and though they still exist, they are no longer in the micropayments arena. First Virtual who could have been a competitor of PayPal died because they didn't embrace SSL tried to buy my firm, but later went bankrupt. Quite a few interesting micropayment cryptographic protocols and business models have crossed my desk when I was CTO of Certicom, and later as an angel investor.
Thus I think I really understand how a difficult a business micropayments is to be in.
I figured that PayPal effectively now owned the low end of payments, primarily because they were business-model centric first, security centric second, and not at all cryptographic centric (they use SSL). I think many of the other companies were too cryptographically purist and this was the source of their downfall. In particular DigiCash, which had real promise but killed it by over hyping anonymous transactions when that wasn't really wasn't what the consumers wanted. PayPal succeeded because they were not purist -- they just made the business model work.
BitPass is doing the right thing so far -- their process is simple, and bootstraps of the trust that people already have for PayPal and credit cards. I don't know how difficult it is to set up for if you are an information provider -- I've got some ideas on how to make this easer, but it will never be simple. But I don't know what approach they are taking -- are they hosting? Do they provide scripts? Do the scripts run on both Linux and Windows servers? The BitPass website has nothing on these topics yet.
I think the biggest risk for BitPass is that the barriers of entry for companies like PayPal to enter this market are very low, so if BitPass can prove that the need for micropayments has finally arrived, it will be very easy for PayPal to drive BitPass out of business.