So what exactly are micropayments then?  As ever Wikipedia is bang on the money.  “Micropayments are means for transferring very small amounts of money i.e. 1/1000th of a dollar.  They are typically payments that are too small to be affordably processed by credit card or other electronic transaction processing mechanisms”.

So why am I writing about micropayments then?  Well would you be reading this article if it cost you £0.10 for the privilege.  Probably not, but I won’t hold that against you.  Micropayments are getting a fair bit of coverage at the moment for a number of reasons.  The main one is that we are in a global recession, marketing budgets are in free-fall and as such quality content providers (especially journalism – great article by Freakonomics, and news) are seeing their ad revenues drying up.  This brings us back to the debate over the free vs subscription model for online news providers which was reignited by Rupert Murdoch and the WSJ recently.

In a nutshell the WSJ is one of the only online news provider out there that has successfully maintained a subscription model ($100 p/year) and Murdoch wants a piece of this.  In an article with the Guardian last week Rupert Murdoch stated that he expects to start charging for access to News Corporation’s newspaper websites within a year as he strives to fix a “malfunctioning” business model. He also added “The current days of the internet will soon be over.”  Now Rupert Murdoch is a guy you have to respect, but ultimately he knows that if he starts charging £10 per month to get our daily dose of The Sun and The Times then we will migrate to alternatives in our droves.  This is where the idea of micropayments comes in.  By charging miniscule amounts per article News Corp’s scale would mean all those fractions of a dollar would eventually start adding up.  The WSJ also announced last week that they will be bringing in micropayments for users that don’t want to pay the $100 upfront for the year, so this is a very real prospect.

It seems that Murdoch clearly has a vested interest in micropayments but who else does.  Well predictably it’s Facebook.  Facebook have been working on a payment platform since late 2007 which is rumoured to be close to launching.  The possibilities for Micropayments on Facebook are huge.  Obviously they have at a basic level gifting, ranging through to their app platform.  The crucial thing about Facebook is that micropayments obviously work best on a large scale, so when you add in Facebook’s 200m+ audience you have a very interesting revenue model.

As we read down the list of who else could have a vested interest in micropayments it reads like a who’s who in silicon alley, Google with Google Checkout, Ebay with Paypal, Apple with iTunes / iPhone, but it could actually be none of these guys that come out on top.  Perhaps one of the biggest opportunities lies with mobile network operators.  As the mobile internet starts to gain critical mass through smartphones we could see mobile networks acting as a single billing point for online micropayments.  Techcrunch wrote a pretty cutting article on micropayments a few days ago, their idea was that you would deposit money into a Google account and it slowly depletes as you go around the web consuming content.

Thus far everyone seems to be pointing towards the future, but there are a couple of success stories for micropayments floating around already.  The first is a company called Zynga who are making a good living according to Techcrunch out of micrpayments around their gaming apps on Facebook, charging for time spent on the game or for chips in their poker game.  Gaming lends itself to being one of the biggest possibilities for micropayments.  Computer games are a premium product that people are happy to pay for.  World of Warcraft is a great example of people changing up real money for the game based currency which is sort of like a micropayment.  Habbo Hotel also have been utilizing micropayments of a kind for quite a while now to great effect.

So what are the barriers, well the main one is probably going to getting people to pay for something that they used to get for free.  The web has completely changed consumer expectations of content delivery especially with regards to how much they are willing to pay for content or rather how much they aren’t willing to pay for it.  People expect news and social networking for free now and that isn’t going to change anytime soon.  In terms of a world where we pay for news on a per article basis, micropayments might gain some traction in certain niche’s like the WSJ but I don’t think they have a future in the mainstream as people will always migrate to free alternatives.  However, micropayments may well have a bright future in gaming and mobile where additional services can be provided for a nominal fee.

I’ll leave you with something I read last week.  Apparently Twitter co-founder and current Chairman Jack Dorsey seems interested in a payment platform also so expect to hear a lot more about micropayments in the near future.

Twitter is the now quite rightfully the new kid on the block and why not?  It’s about time we had a new poster child for the so-called social web.  Like many startups it has a lot of users, is growing rapidly, and has a lot of VC funding.  What’s more it’s also has a distinct lack of a business model.  So that’s all the boxes checked then!

It was big news in the online world last week when a comment by one of the founders Biz Stone, to Marketing Magazine, in the UK, caused a lot of people to start speculating that Twitter would be charging users to have commercial account.  To be fair Biz moved quickly to confirm that Twitter will never charge users or companies for an account.  So just how are they planning to monetise all that traffic then?

Well, it’s probably worthwhile look ing at Google.  Back in 2001 they had a great search engine but no business model and look at them now.  Now I don’t for one minute think that Twitter is going to find a business model like Adwords or Adsense.  In fact they will probably be looking more to the Facebook model.  To some extend I think Facebook would have been the ideal partner for Twitter, and so did Facebook.  Mark Zuckerburg himself called Twitter “an elegant model”.  So why did talks break down between Twitter and Facebook. Well Facebook were offering $500m in Facebook stock, which is essentially paper money at the moment, and also over-values Facebook.  In addition the Twitter founders feel they have unfinished business with Twitter.

Below I’ve jotted down a few ideas for how Twitter could monetise the traffic and service they provide without charging users a subscription fee.

1) Sponsored Tweets in your feed – Similar to Facebook sponsored feed ads.  This would be relatively easy to do but without the level of demographic data FB have Twitter would need to target it based upon what users are Tweeting / Favouriting.  Would advertisers like this, time will tell. Likelihood = 8 (out of 10)

2) Google Adsense / Banners – Easy win, convert all that traffic into revenue.  Only problem is it will be low yield and also many people use an App to bypass Twitter.com.  Might make an appreance but would be worrying if this was their best attempt at a business model. Likelihood = 8 (out of 10)

3) Self service contextual ad system.  Google Adwords is the best, Facebook ads it getting some traction.  This might require a redesign of the layout but there could be room for some kind of engagement ad as Facebook like to call it whereby people can engage with the content and retweet the advertiser message to their friends. Likelihood = 6 (out of 10)

4) Research tool – There’s a whole load of information floating about on Twitter as to people’s thoughts, experiences and perceptions of a companies products and services.  What if Twitter could charge companies for advanced statistics and analytics on what people are saying about them, on Twitter, in realtime. Check out my post on the real time web.  This is along the lines of the TechCrunch article, mining the thought stream. Likelihood = 2 (out of 10)

5) Facebook Connect / Google Friend Connect - Linking either of these systems into Google Friend Connect or Facebook Connect ID system’s will give both parties another level or targeting to tap into.  i.e. they would know what you are twittering and what you are searching for / what your demographics and interests are.  Advertisers would then pay a premium for this targeting.  Ultimately this relies on Google / Facebook selling the inventory. Likelihood = 2 (out of 10)

6) Classifieds – We all know what hashtags are right? Well we could have a slightly more user friendly system where people tweet their classified ads (would work great with geo-location), i.e. “looking for a housemate in Clapham, London, £600pcm, non-smoker”. You then pay a small fee for a listing in certain categories, or Twitter gets a small % share of the sale item if you were selling something ebay style. Likelihood = 4 (out of 10)

7) Get bought - Last option, is to sell up, take the money and run. Leave it to Facebook, Google or Microsoft. Likelihood = 6 (out of 10).

So there are some examples, but I guess we are all going to have to wait and see what Twitter come up with.  If you want some further reading Business Insider have run a competition with their users to create the best 11 commercial business model for Twitter.

If a huge news story breaks, where are you going to go first? Switch on the TV, try BBC News, CNN, maybe. But what if you are at work…….? Ok, let’s say a plane crashes into New York’s Hudson River? Like many the first port of call for such an event is the web. Now we all know that 90% of people are probably going to start at Google. The problem is Google has on average a 1-72hr spidering lag depending on the site in question and it’s links / authority. So, if Google hasn’t got anything, what next, Google News, BBC, CNN online versions. Fair enough, there might be a holding page with minimal details. Now consider this, if you had navigated to search.twitter.com on 15th January 2009, you would have seen this picture come up.

Hudson River Crash Photo From Twitter

Ladies and gentlemen welcome to the real-time web.  Not only this, there were actual tweets from passengers on board the plane. A first hand account of what happened. Twitter is one of those things that polarizes opinion but it’s undoubtedly hit the news big time thanks in part to its popularity amongst celebrities. However some of the more clever applications have also demonstrated the real time web in action. In London last month we had about a foot of snow, which brought the country to a standstill, including the National Rail website. Fear not though, the Twitter account @uksnow was on hand to send through real time updates depending on your region and train service. Not just that but some clever folks used Twitters famously open API to build a snow map based upon people geo tagging snow reports. Now I’m not going to argue that Twitter is very much the premise of the early adopter / tech geek but it’s certainly ruffled a few feathers, enough to make Facebook try and buy them and to even open up their own Status Update API.

It’s not just Twitter taking advantage of the real time web though. Look at the Facebook / CNN tie up for Barack Obama’s inauguration. This was a great example of empowering me the user and my friends to watch a historic event and have a shared experience in an online environment. Now consider the iPhone, Flickr, Friendfeed, Google Latitude, Loopt. All great examples of the real time web.

So what next, is Google doomed, well clearly not. A good article by Read Write Web surmised it “Google cannot be real-time. It indexes the historical web, and it does it better and faster than anyone else. It finds me after-the-fact reporting on major stories from major media companies. But it misses the real-time story. And that matters today”. I’m not sure about the last quote, “Google cannot, be real time”. Google’s mission is to index the world’s content no matter what that may be. However, they do at last seem to have a challenger on their hands.

What is clear is that Google is missing a trick at the moment, and Twitter is going to go from strength to strength for the time being. Simon Waldman wrote a good article in NMA magazine saying why should we all bash Twitter anyway, isn’t it a good thing that there’s a new kid on the block, something new to get excited about?

I’ll leave you with a quote from Robert Scoble, a long-time advocate of the real-time web, “there’s a new expectation that we’re having thanks to Twitter. We want everything now in real time. I want to see everything that was published now and respond to it now and I want to have conversations about all that in real time”. Take a look at Scoble’s live Friendfeed to see what he means.