So how will the Web survive? If there's no money to be made, is the Internet doomed to join the eight-track tape and the beta video format? How will state agencies recoup the costs of putting their services online if no one is willing to pay?
Well, there is money to be made. Quite a lot of it, really. And you don't have to annoy anyone to get at it.
Currently, one of the most common ways to do business on the Web is through subscription fees. The problem with subscription fees is they tend to be an all-or-nothing proposition. You pay for all the services under that fee; or you don't, and you get, well, nothing. Users usually aren't allowed to sample the product, and the investment process can often be too intimidating to warrant what a user may get in return. Subscription fees are also the exact opposite of what the Web is all about: freedom of information. Subscription fees limit one's access to information the same way a roadblock limits access to a road. If you aren't willing to pay a large fee up front, you aren't going anywhere.
Another recent trend in trying to squeeze money out of the Web is charging convenience fees for government services. This appeals to government agencies because not only do they save money, but they make a little extra in the process. However in most cases, users again find themselves annoyed, especially once they become more Internet-savvy and realize an agency saves money by Web-enabling its services. Why pay more to save the agency money? Granted, there are a few situations where being able to do business with the state from the comfort of the home is worth an extra dollar, but these exceptions are few and depend heavily on the state's demographics and infrastructure.
Painless Payments
How much? Let's take my favorite state government site as an example, the commonwealth of Virginia portal
Instead of a few people paying for it in huge and painful chunks, thousands of users pay for it in miniscule pinpricks they hardly notice. It's better than taxes: You may never use the services your
Micropayment Mechanics
The basic concept is fairly simple. The complicated part is in the mechanics. A payment gateway is needed to handle the transactions, which is tricky because credit card processing fees currently make charges that would qualify as micropayments cost-prohibitive. What state could make money charging 1 cent for something that cost it $10 to process?
Beyond the payment gateway, one must decide what format to use, and what sites will be part of the micropayment network. Furthermore, jurisdictions must determine exactly which pages are valuable enough to charge for, and which pages should be free as a means of getting users to the valuable pages.
An extra hurdle for the government sector is the politics behind what the public should or should not be charged for, even in miniscule amounts. The Virginia home page example mentioned earlier fits this scenario as well. It could be argued that a state's home page - no matter how valuable the content - should be free just as walking into a library is free. Of course, there's also the counter argument that even free government services aren't free; we pay for them one way or another. Settling issues such as this could eat up quite a bit of discussion time before anyone even addresses the technical issues.
Pioneering Players
This is not all pie-in-the-sky dreaming, though. Pioneers are already blazing the trail for the rest of the world. A Virginia-based company called microCreditCard
It's a rapidly changing business out there on the Web, and you have to stay one step ahead at all times. Otherwise, while you're deciding if your brochures should say "cutting edge" or "bleeding edge," some other company will roll over your bottom line with the next big thing, and you'll find your $100 million IT investment netting nothing but dust. You'll be left standing confused and battered, holding your unplugged Atari 5200 joystick and wondering where your stock options went.
Chris O'Kennon