Seattle's News Elixir

Nearly every person or group that has a Web site with useful content, from the New York Times down to Aunt Ethel's Elderly Cat Continence Tips, would like to make money off their operations, ideally with minimal friction between readers' wallets and site owners' pockets.

Hasn't worked so far, but that hasn't kept companies from trying. The latest to try to get in on the action is Kachingle. Kachingle's idea is to get a very large number of people who want to support sites that they regularly visit to pay the company $5 a month, clicking on a "medallion" on the site to enable Kachingle to track which sites users are viewing.

Each month, the company collects $5.00 from each subscriber via PayPal billing; PayPal keeps 10 percent, Kachingle shaves off 10 percent for its fee, and the remaining $4.00 is divvied up based on which of the subscribed sites get the most visits. When a given site passes $50 in payments, Kachingle deposits that into a site's PayPal account.

Kachingle is collecting, dividing, and aggregating tiny payments, but it's not technically a "micropayment" service. The notion of micropayments is that users could either automatically or with a simple click pay a web site a small amount, typically well under a dollar, to view an article or to reward the site.

Micropayments went out of vogue when it became clear that the costs associated with handling credit card payments of pennies at a time were more than pennies, and that most users didn't have an interest in signing up among multiple systems. (PayPal allows a kind of micropayment between PayPal users by not charging fees when the money remains in the PayPal system.)

I've officially been on the Internet for so long that I can't remember everything I've forgotten. I was digging around in my email archives to find some of the systems that have disappeared  here, and discovered I had written the following in 2000 to an editor to pitch a story on Internet-based payment methods:
Several technology companies are working to provide the necessary software with products such as The Brodia Group's (formerly Transactor Networks) Shopping Console and Remote, Cybercash's Instabuy, Microsoft's Passport, Qpass' PowerWallet, and Trintech's ezCard. Plus, there's Yahoo Wallet, AOL's wallet, the Amex Blue Card, and the Entrypoint software (eWallet + PointCast).

What in God's name was I talking about? It reads like an explosion in an abandoned Internet naming factory. But it shows how much churn there's been in this particular area of commerce and finance.

What will keep Kachingle from landing in the scrap heap of Internet payment history? The company thinks it can build a large enough user base to make the concept work.

Cynthia Typaldos, founder and president of Kachingle, told me the firm is focused on readers, not sites, and relies on a sense of social identification to make it work. That starts with the fact that sites display, on the Kachingle medallion, how many members are directing some of their monthly cash to the site.

Typaldos says that research on tipping and related behavior shows that people who observe signals even in passing modify their behavior to mimic those signals. "The thing people do on this site is make contributions, so we think this will encourage contributions," she said.

A related part is that Typaldos says the site is designed to not be "work" for subscribers. The fee is a flat rate, billed monthly; you don't have decide how much to give nor to whom. Once you subscribe, there's no additional effort. If you stop visiting a site, it stops getting a portion of your Kachingle fee; you don't have to follow links to unsubscribe or revisit the site you're no longer interested in.

Typaldos also emphasizes the site's transparency. As a subscriber, you see precisely how many dollars and cents go to which sites, and each site's page reveals where the money came from.

There are bars for Kachingle. Amazon and PayPal enable payments using their system on other sites, based on whatever payment methods you'd stored with them. (See the excellent Wired article that explains this, "The Future of Money: It's Flexible, Frictionless and (Almost) Free.")

With Kachingle, however, the company has to build a critical mass of users. Without perhaps hundreds of thousands of users in the system, pushing substantial money into sites each month, it's hard to imagine Kachingle being widespread enough to provide any real value to any individual site.

But there's a boot-strapping phase. If Kachingle convinces enough big sites to promote Kachingle, and those sites' readers sign up, then the audience becomes large enough to encourage other sites to join, which then leads to more users, and an ever bigger pie. (I'd rather have a sliver of an enormous pie than a whole tiny one.)

"Every Kachingler that's brought into the system by any site is then Kachingle enabled for every site," said Typaldos. (Sorry, that's the firm's term for its subscribers.) Kachingle will also enable ties into Twitter and Facebook to allow more sharing of what subscribers are doing, and leverage those social networks without having to build its own.

I'm putting my Kachingle where my mouth is by including a Kachingle medallion on Wi-Fi Networking News. I've run WNN for nine years, mostly on my lonesome, as a reporting outlet about wireless data. I receive ad revenue, which has declined as Wi-Fi has become simpler to figure out and install.

I'll report back on how it goes. So far, a couple weeks in, I have 12 Kachinglers (including two company staffers and myself), and have already earned $5.23.
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