How Do I Pay Thee? Let's Count The Ways

DigiCash, the company that invented e-cash, has gone bankrupt. And true electronic cash has died along with it.

Recently, I attended a panel discussion on electronic payments hosted by the Silicon Alley Breakfast Club. The discussion titled, “How Many Ways Do I Pay Thee?” included George Pappas of CyberCash, Kevin Brown of QPass, Nina Helm of Beenz, and new CEO of Cha! Technologies, Heidi Goff. The talk was hosted by Alan Brody.

Brody’s introductory comments opened tired eyes when he told the audience that 60 percent of all online shopping interactions are abandoned. Wow! Beyond the image of shopping carts stranded in the desert, Brody had the audience imagining one-click purchasing from our interactive television sets.

The panelists were much more in the here and now. Especially Pappas and Brown, whose companies have real products to tout. CyberCash is the industry veteran. When I went to work for DigiCash in the summer of 1996, CyberCash was working on the CyberCoin. They had already introduced a credit card based stored-value product and the CyberWallet. Now CyberCash is broadening its offering even further. They just announced an investment in CommissionJunction that will bring them into the affiliate marketing business. “Affiliates on steroids” was how Pappas described the deal. They also offer transactional banner ads and bill payment technology.

Brown was full of announcements, too. He was excited about the company’s launch last March, and about its brand new PowerWallet technology that lets consumers automatically fill out forms on any web site. PowerWallet promises that its form will be the last one you ever need to fill out. The company’s goal is to reduce the friction in purchasing. (No more abandoned shopping carts.) According to Brown, the company is working hard to “accumulate mass and momentum” and plans yet another announcement in the fall. This one will be related to services for e-tailers.

Goff clearly (and repeatedly) promised that Cha!’s 1ClickCharge service would guarantee payment and guarantee delivery. She further boasted one-day integration for merchants and convenience for the consumer. This new service debuted at PC Forum in the spring and is set to launch in the fall. Overall, her comments were much more vague — perhaps due to the fact that she’s only been with the company for seven weeks. Or maybe because their product hasn’t yet launched.

Beenz’ Helm talked about the UK firm’s point program, although she never called it that, continued to confuse the audience all morning. Finally, in the question and answer session, someone asked if Beenz was a payment system or promotional tool to clarify things for the entire audience. Nothing really seemed novel here. Merchants purchase points from Beenz and distribute them to consumers in exchange for certain behaviors — filling out forms, purchasing products, etc. It’s much like your American Airlines frequent flyer program, but on the Net and very international. More like MyPoints.com.

The most interesting discussion during the question and answer session was whether there would be a single Internet payment service provider, or whether there would be several providers, like credit cards. Goff’s answer was that so long as each of the providers bring paying customers to merchant checkout counters, there will be more than one provider. Greed wins.

The final interesting comment was by Brown. The discussion turned to why Amazon.com has its own 1Click payment system. Brown’s response was that if Amazon innovated the technology, they might partner if the technology existed since it costs much more to build it than it would to partner with QPass or the like. This “silo” approach won’t work in the long run.

E-tailers are concerned about who owns the customer. But the Internet is about networks. Payment services form yet another Internet network. Once these services gain critical mass, all retailers will want to participate.

Payment services have evolved with the web. They are more network oriented, emphasize convenience, and there is more suitable content to take advantage of the technology. But I’m still left with the feeling that some change in the technology has not been for the good: Where is a true “cash” solution? A currency where the consumer keeps the float that is anonymous, and one that I can use to pay back my sister the five dollars I borrowed last week.

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