Flattr or how to finance web content

[2011-01-16] flattr, dev, business, blogging, computers
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One of the greatest challenges of the web has been how to pay the people who produce (freely accessible) content for it. For example, you find an article you like and would love to support the author, but don’t know how. Or, it’s paid content that usually costs too much and does not allow you to see in advance if it is worth its money. Until recently, there was no middle ground between free and too expensive. And it hurts publishers. Ideally, a publisher would write a free article that, thanks to it costing nothing, is read by, say, one million people. If each of those people paid one cent, the author would earn $10,000. To make small donations viable, there has to be a company that aggregates the money that is spent and the money that is earned. But it is not easy to get such a company going, because you need both publishers and consumers on board. Flattr, a Swedish company, is currently giving micro-financing web content (text, software, music, etc.) a shot.
Quotation from their website:
Flattr was founded to help people share money, not just content. Before Flattr, the only reasonable way to donate has been to use Paypal or other systems to send money to people. The threshold for this is quite high.
Here is how it works for people who would like to donate:
  • You set a monthly sum that you would like to donate.
  • Many websites (especially blogs) have Flattr buttons. If you want to make a small donation, you click on one of those buttons.
  • At the end of the month, your allowance is divided by the amount of clicks you have made and paid to the button owners.
  • If you don’t click, your money will be given to charity.
This system makes a lot of sense. People are lazy and this system gives an incentive for donating by making it as easy as possible. The publisher side of Flattr looks as follows:
  • If you join Flattr as a publisher, you have to “give in order to get”, that is, you have to allot at least €2 a month (other currencies can be used, but are converted to Euros). This makes sense, because it gets the system started. Otherwise, there is a chicken and egg problem.
  • You need to install buttons if you want things to be “flattred”.
  • Flattr uses button clicks to gauge the popularity of flattrable things. This gives the operation an interesting social side. It is not just about empty “likes”, you literally put your money where your mouth is. Accordingly, there are ranked lists on the website. Social plus money, it must make marketers excited...
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