Another downside to the sale of electronic information over the Net is that most
information on the Net today is free. Intellectual
property owners have little incentive to make valuable information
accessible via the Internet because of the relational costs of accepting credit
cards and other means of billing that result in costs for the merchant. The cost
of processing a transaction via the credit card system would
destroy any profit margin on inexpensive items.
Early newletters aimed at physicians tried to sell individual articles and reports,
but lost out to more ambitious Web sites that posted lots of this information
for free, meanwhile being underwritten by pharmaceutical companies and
instrument manufacturers. The true leaders in online pay-per-view have been
pornography sites. Teasers -- very graphic pictures which promise more -- are provided
for nothing. However, sales are made by using the "what''s behind the curtain" gimmick.
You get "access", as long as you provide your credit card number.J
Charges can be for access to certain areas on the site or for "timed viewing"
(pay per minute, for example). Naturally, most of these sites sell magazines
and products, too.
How the Big Boys Do It
Currently, the most common means of selling digital content has been
through subscriptions. Ordinarily, an account is established with a vendor such
that the customer is billed periodically at a fixed rate.
For example, The New York Times gives free Internet access to customers who
subscribe to the physical paper on a regular basis. The Wall Street Journal
charges a monthly fee ($4.98) to customers that want access to their site but
don''t want to buy the paper on a regular basis. Payment is made via your credit
card, which is automatically charged each month. (In both cases, access is
controlled by log-on name and password.)
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