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August 13, 2004

Nickel and Dime

Micro payments. Supersized. Traveling to Seattle this week, I was surprised at how many opportunities I was presented with purchase opportunities - not nickel and dimes, but $5's and $10's (and $15's).

First, apparently wifi access is commanding anywhere from $6 - 10 bucks per 24 hours - in airports and hotels specifically, but other venues like Starbucks and more.

I was not aware of this at all. Part of it is that I've not had a wifi enabled device until recently. A few weeks ago I purchased a very cool Acer TravelMate Tablet PC. It has Intel Centrino built in. One of the enjoyments I've had in using the machine has been the ability to just walk within range of open wireless access points and be instantly connected.

Of course this happens primarily in two places, my home on my own network, and my office - where in both cases I'm an authorized network user.

Recently, at a friends house, I found myself connected to a wireless access point - and he has no wireless network. With the help of NetStumbler, a wireless signal sensing application, I could see that there were 7 different home networks available to me from this one location. Sweet! We're in!

I guess at this point I expect wireless piggy-back access to be free wherever I go, but again - as I found on this one trip, I was presented with payment barriers from using wireless access points.

First in DIA, upon opening a browser, I was abruptly redirected to an AT&T wireless access purchase page. You can browse no where else. The payment option included billing directly to my wireless phone account (though I entered my number and was told that method was not available at the moment). I think it was $9.95 for a 24 hour session at DIA - like I'm going to sit there for 24 hours - it is really more like $10 formaybe an hour. Power travelers could pay $49 per month.

Next, at the W hotel in downtown Seattle. Here I thought I would be instantly hooked up at no additional cost. I spent time last month at a Holiday Inn with free wifi access. At the W I'm paying $200 a night for my room, but upon connecting wirelessly at the W, again, the payment barrier appears in my browser - $15 a day. Yowch. Still, to most business folks with a critical need for access, this is a drop in the bucket. Probably a pretty good revenue stream for hotels.

Next, on the way home, at Seattle's SeaTac airport, I hook up and get the same thing - so I shell out and pay $6.95 for about 30 minutes of use.

Lastly, on my Frontier Airlines flight home, being mentally fried from the business day, I gleefully swiped $5 onto my Visa for the priveledge of zoning out on inflight DirecTv service. Very cool. I would have paid more.

A couple of thoughts. First, was it valuable to me when I paid for each? Yes. Even in the airport for wifi Internet - at the calculated rate of $14 per hour relative to the actual time I used - with just a few emails I saved alot of time that is much more valuable to me than 14 bucks.

Micro-payments - where are they? I'm not sure where the technology and need for payments online for values in the low cents for fractions of a cent stand. It seems like over the past few years, I've read about efforts in this space, but it has not been introduced - lack of demand I suppose? Not enough financial opportunity for providers?

Maybe the future of micro-payments are just not at the near infinitesimal level - maybe the future has us ubiquitously debiting our accounts at the $5, $10 or $15 dollar level. Maybe the new test in payments on the internet is facilitating payments in the $1 to $5 range. It sounds like this is just PayPal and existing credit card merchanting. Regardless, I expect to be peppered further with purchase opportunities at this level, wherever I go. I'm sure there is more happening that I'm not aware of.

What have you been "nickel and dimes" with lately?

Posted by gcrgcr at August 13, 2004 11:50 AM

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