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How Penny Per Page Might Work


Q & A

Is a penny per page the right amount?

The penny per page approach is extremely easy for everyone to understand. A penny per page does not present a large barrier to the payer, and it pays a nice amount to the Web site. It could be argued that half a penny would work, and so would two pennies. The Internet community can play around with the numbers and decide.

Under a flat-rate pricing model, users would likely pay a flat fee of $10 to $20 per month.

Is charging by the page impression the right unit? Why not charge by the byte?

If you pick bytes, then you will see people bloating images and doing all sorts of other crazy things to inflate their pages.

Won't Web sites chop up their content into a zillion pages if they get a penny per page?

Probably not. Banner ads have already caused as much chopping as we will ever see. If sites chop things up too much, they won't resonate and they'll die out.

Why should pricing be uniform? Shouldn't each site be able to set how much it charges per page?

Maybe, but it complicates things. Say you are looking at a list of pages in Google and you want to click on one. Before you click on it, you have to remember to look closely to make sure that the Web site is not going to charge $100 per page instead of a penny per page. If it's a uniform pricing model, then you can click on any page without worrying about it, just like you do today.

What do we do about streaming audio and video, and things like MP3 files?

Streaming video is unique because it consumes significant bandwidth. A 10-minute streaming video at 300Kbps consumes upwards of 20 megabytes of bandwidth and might cost the Web site 10 to 20 cents to send it to the viewer. A pay-per-view model might be the right approach. Or maybe it's a dime per stream. With MP3 files, if artists automatically and directly received a dime every time someone downloaded one of their songs, it would create an unbelievable musical revolution.

What would prevent a site from having a page that pops up 100 new pages when you land on it to ream the unsuspecting visitor out of a dollar?

The billing mechanism should track for and eliminate charges for that, as well as for pages that auto-refresh themselves, error and non-existant pages, pages arrived at by pressing the back button, duplicate pages and so on.

People in the U.S. tend to prefer a flat-rate model to a pay-per-unit model. Could there be a flat-rate model with penny per page?

As discussed on this page, flat rate pricing would be extremely easy to implement and would eliminate one big objection that many people have to the "penny per page" concept.

Answering Objections

Readers have voiced a number of objections to the penny-per-page idea. Here is a list of the most common objections, with responses to each one.

Objection #1 - Penny Per Page is impossible to implement

There are variations on this objection that range from, "there is no way to track the traffic" to "there is no way to create a bill" to "there is no way to collect the money." Right now ISPs, as well as the Web sites, have comprehensive tools that let them track each page viewed by each visitor. Third party companies can track traffic as well -- see, for example, Hitbox.com. ISPs are already billing tens of millions of people on a monthly basis. Implementation is straightforward.

Objection #2 - Penny Per Page is an invasion of privacy

Many people voice the objection that the penny per page billing company will have a complete list of every site visited by every user, and that is a violation of privacy. The penny-per-page situation is no different than your phone company having a complete list of every phone call you have made, or your credit card company having a complete list of every store from which you have purchased goods. Right now, chances are that your ISP and your employer/school already have a complete record of every page you visit.

Objection #3 - Penny Per Page will make it impossible for search engines to spider sites

The objection here is that, even though Google will make lots of money from the penny per page idea, it will have to pay even more to spider all the Web sites it keeps track of. There are two possible answers to this objection:

  • Google spiders something on the order of 2 billion pages, but it does not do that every day. Let's say Google spiders its way through all 2 billion pages four times a year. That means that Google will spend $80 million per year to spider the Web, which is a small price compared to earnings of $350 million per year (google's earnings are described in the example on this page).
  • Google can charge sites to spider them. The sites will immediately get the money back when the spider comes through and pays a penny per page.

Objection #4 - Third-world countries and other disadvantaged populations will no longer be able to access the free Internet

This is one of the more surprising objections. The gist is, "poor people and people in third-world countries will be unable to view the Web if they have to pay for it." This objection neglects the fact that, to access the Web:

  • People have to pay for their computers to view Web pages
  • People have to pay the power company to turn on their computers
  • People have to pay their ISPs to connect their computers to the Internet

If it is OK for poor people to pay for all of these other items, why should it be bad for them to pay for the content?

The common solution used to give disadvantaged individuals access to the Internet is free public access. Libraries, schools and other public organizations pay for computers, power and Internet access, and offer them to the public free of charge. These same organizations can also pay for content.

Objection #5 - Penny Per Page is too open-ended

The concern is that a heavy Web user might receive a bill for $100 after a month of extremely intense surfing. $100 implies 10,000 pages. If someone is accessing 10,000 pages of content, it seems appropriate to charge for it -- 10,000 pages is roughly 20 to 30 books, which might cost anywhere from $200 to $600 depending on the price of the books.

Another solution is a flat-rate pricing model as discussed earlier, or a cap on the monthly bill. Either eliminates this objection completely.

Objection #6 - Many Web pages are not worth a penny

A big concern is the pages that show up in search engines that contain junk. "Why should I have to pay for junk sites?" is the objection. One easy solution would be to allow a user one page view (or three or five, whatever) on a given domain for free, with the option to block that site in the future. In that case, the user would not be charged for visiting that site.

Objection #7 - It will be impossible to get the top 1,000 sites to act in unison, and without them penny per page will not work

This is a valid point. It seems like it would be difficult for second-tier sites to charge for content if top-tier sites did not.

Objection #7a - If you do get all of the top sites to cooperate, I will not visit them after they start charging for their content. I will visit other sites instead.

A small but vocal minority mentions the "I will NEVER pay for content!" threat constantly. Here are two important facts to keep in mind about this minority:

  • If the top 1,000 sites started charging for content, then nearly every other content and service Web site would jump on the bandwagon to get a piece of the pie. At that point, the never-paying minority would have no Web sites to visit. New free sites could then arise. However, these new sites would not be able to generate any revenue to support themselves, so their contribution to the Web would be minimal. And as soon as they reached critical mass, they too would join the penny per page system to support operations.
  • There is always a small minority of people who refuse to pay. They are the same folks who do without cable services (or steal them), and who do not have telephones in their homes. If you look at the penetration that the cable industry and telecommunications industries have been able to achieve, however, you realize how small the "I will never pay" minority is.

Objection #8 - Penny Per Page is too expensive for businesses and schools

Let's take schools as an example. Elementary schools and high schools are currently spending billions of dollars on text books for their students. A single college text book typically costs $50, and students must pay for them each semester. In that context, $10 to $20 per month per student is a bargain.

Objection #9 - Penny Per Page will cause huge media companies to buy all the good sites

A typical comment: "Most worrying is the possibility that Murdoch, Turner and a few other big media moguls will buy all the good sites as soon as they can make money from them." If that were a concern, Murdoch, Turner, etc. could buy the entire Web right now, because Web sites have little or no value -- it is impossible to make money from them. If the sites could generate revenue, it would give their creators a way to keep them on the air. If large media companies then wanted to buy the sites, at least the creators would have a bargaining position and a way to compete.

Objection #10 - Sites that need to make money can simply charge their readers using a normal subscription model

This is a valid approach, and it is happening more and more. For example, you can get subscriptions to:

Let's say that Yahoo, CNN, Google and hundreds of other sites went this route. Just the 5 sites listed above would cost about $500 per year, and you have to take the time to sign up for each one individually. The cost of subscribing to several dozen sites would potentially run thousands of dollars per year. In the process, it would make general research on the Web impossible.

It makes far more sense to have a generic model, like a penny per page, where there is one bill for all Web surfing.

At this moment, the "free Web" approach is backfiring on those who advocate it. It is stifling new sites and causing existing sites to go out of business.