Back in 2000, Clay Shirky wrote a seminal piece against micropayments.

The original thesis for the need for micro payments goes something like this . . .

P2P creates two problems that micropayments seem ideally suited to solve. The first is the need to reward creators of text, graphics, music or video without the overhead of publishing middlemen or the necessity to charge high prices. The success of music-sharing systems such as Napster and Audiogalaxy, and the growth of more general platforms for file sharing such as Gnutella, Freenet and AIMster, make this problem urgent.

However, Shirky argues that

The Short Answer for Why Micropayments Fail

Users hate them.
The Long Answer for Why Micropayments Fail

Why does it matter that users hate micropayments? Because users are the ones with the money, and micropayments do not take user preferences into account.

In particular, users want predictable and simple pricing. Micropayments, meanwhile, waste the users’ mental effort in order to conserve cheap resources, by creating many tiny, unpredictable transactions. Micropayments thus create in the mind of the user both anxiety and confusion, characteristics that users have not heretofore been known to actively seek out. Embedding the micropayment into the link would seem to take the intrusiveness of the micropayment to an absolute minimum, but in fact it creates a double-standard. A transaction can’t be worth so much as to require a decision but worth so little that that decision is automatic. There is a certain amount of anxiety involved in any decision to buy, no matter how small, and it derives not from the interface used or the time required, but from the very act of deciding.

Micropayments, like all payments, require a comparison: “Is this much of X worth that much of Y?” There is a minimum mental transaction cost created by this fact that cannot be optimized away, because the only transaction a user will be willing to approve with no thought will be one that costs them nothing, which is no transaction at all.

Thus the anxiety of buying is a permanent feature of micropayment systems, since economic decisions are made on the margin - not, “Is a drink worth a dollar?” but, “Is the next drink worth the next dollar?” Anything that requires the user to approve a transaction creates this anxiety, no matter what the mechanism for deciding or paying is.

Of course Shirky is arguing this from the buyer angle. Will I pay 10c for viewing/reading this article? If its a pain in the ass to pay than I will not. . . and thus his argument holds completely.

Time have changed however. The hottest topic right now is revenue share with content providers. Pete Cashmore has the latest on the Shoposphere rev share story - with inspirations from Kevin Burton and TechCrunch. This time it is no longer about will READERS pay for content. They are free to read whatever they want for nothing. The advertisers themselves are not paying in micro-chunks either. . . no they are spending colletively billions on search advertising. . . so who are the ones getting paid in a few cent or dollar at a time? The so called “slaves” who graciously fill blogs and whatever social networks full of content will get paid based on ad clicks they generate.

So then, the better question Shirk would have asked today is. . . Will these content generators want to get recieve $.96 a month from 15 different sites on 15 different checks? Of course not. I rather you pay me one large check. . . better yet . . . I hate going to the bank so acrue it till its atleast $20 before sending it to me. . . or even better yet. . . ACH it to my bank account directly. . . As a blogger I know how LITTLE google is actually paying me. So if I actually have one of these random “pick lists” that should be about the amount I am expecting, so I think the use case is completely reasonable.

To do everything above, you need a micropayment micro-commission system. If I was paypal (which I kinda am ) I’m licking my chops right now for a chance to dominate this market. . . and for bitpass, yahoo wallet (eek), or google wallet (forgone conclusion it coming out), I’m thanking god for the latest turn of the events. . .

If I was an entrepreneur (I think I am ), I’m letting the newsvines, shopospheres, fotolia (sp?) of the world work on their little niches. . . I’m gonna go sell pans and shovels to the gold rushers instead. . . ie provide the infrastructure to make this all happen. My pre-money starts at $12M . . .just like 4info