This post is to introduce the FairPay framework and its larger context in The Relationship Economy to those involved with Web Monetization, Web Payments, Interledger, Coil, Grant for the Web, and related efforts to bring monetization directly into open Web standards. It positions FairPay as an architectural framework for important higher-level functions that can leverage the lower-level foundation of these standards and infrastructure that do not track user identity or even sessions.
The FairPay framework provides a perspective on why and how provision for a higher-level of relationship-based features will be important to achieving the full potential of Web Monetization and payments. That perspective suggests that the ability to layer on a persistent identity (even if only an opaque identity) is needed to enable Web Monetization use cases to extend beyond a narrow niche.
FairPay creates a new, holistic framework for economic relationships in the digital world that bridges many worlds, including for-profit, non-profit, and the Creator/Passion Economy, and many perspectives, including transactions, micropayments, subscriptions, memberships, and tipping/donation models. FairPay was first conceived as a specific and radically new strategy for monetizing digital services in a way that is not only effective and efficient, but also fair and win-win. It has grown into a multi-dimensional framework that bridges most forms of human economic relationships through a holistic understanding of value.
That led me to being introduced to the Web Monetization, Interledger, Grant for the Web and Coil community -- and seeing the time may be ripe for a fruitful bridging of silos. This became apparent after a series of conversations with two Mozilla Fellows looking at the broader context of those new initiatives (Matt Mankins and Amber Case), and with an advisor to Coil and the Grant for the Web (Desigan Chinniah). (Some good background is in the W3C interview of Stefan Thomas by Ian Jacobs Link.) Much of the messaging of these initiatives refers (implicitly or explicitly) to "micropayments," a fundamental but fraught concept. Here are my suggestions for building on and broadening that vision to realize the potential of this important development more fully.
This is a discussion draft, intended to open dialog on these broader considerations and how to address them.
Only the introduction is reposted here -- the full article, with diagrams, is on my FairPayZone blog Link. Please read it there.
When an earlier draft was nearly complete, Stephanie Rieger posted a very complementary analysis, "Three futures, Exploring the future of web monetization" Link. She provides an excellent tutorial on Web Monetization, three future scenarios on how it might be extended to support a variety of specific monetization models that have likely appeal to potential Web Monetization users, and specific thoughts and recommendations. We both seem to be very aligned in suggesting that while absolute privacy might be ideal in some respects and some use cases, “What’s not yet clear, is whether this binary approach to privacy will serve their users as well as they believe” (as she put it). She provides a section suggesting a structure for “layered privacy” that provides for controlled reductions in privacy in order to gain functional benefits.
Stephanie’s section on “three glimpses of the future” outlines possible futures that translate various business models and examples of current businesses into a Web Monetization context, leading to her recommendations. My presentation here of the FairPay framework steps back to undertake a more fundamental rethinking of our logic for value exchange -- how effective value exchange depends on relationships and the nuanced nature of value and outcomes, and how a new logic for those relationships can enable far more win-win exchanges.
The FairPay framework suggests that a selective and controlled relaxing privacy constraints -- in business contexts in which a necessary level of trust and cooperation can be established -- can not only enable added function, but can enable a far more win-win level of value co-creation, to the benefit of all involved parties. Some brief updates tying to Stephanie’s article have been added below. (A deeper synthesis is left as future work.)
The greatest danger in times of turbulence is not the turbulence,
it is to act with yesterday’s logic. (--Peter Drucker)
Web Monetization seeks a new logic that allows any Web service to be monetized directly from its users, without significant friction or dependence on intermediaries who may extract unfair costs (in both money and privacy). It does that by enabling direct streams of "small payments" within the browsing process (or simple direct payments or voluntary "tipping" payments), without revealing the identity of the paying user. My concern is not with this as a low-level service to build on, but that the protocols should be designed to allow for higher-level services that provide richer functionality.
FairPay offers a new logic for monetizing services particularly suited to the world of digital content and other digital services. It also illuminates new perspectives on the familiar older logics that we commonly fail to see. As I understand it, Web Monetization currently assumes that monetization can be divorced from relationships, and limits awareness of relationships to maintain high levels of privacy. But the FairPay perspective suggests that there is only a limited class of use cases in which monetization can be effective, efficient, and fair without consideration of relationship -- and that often requires some relaxation of privacy constraints, at least among some actors.
You may already know most of the facts I will cover here, but FairPay assembles those facts to provide a new perspective. The first time we ever try to drive a car, we learn that we cannot steer effectively by looking just a few feet ahead. To steer in a way that will get us where we want to go, we must look down the road. To drive well, we must be glancing in many directions. We need to understand and make predictions about many aspects of our environment.
Monetization is based on predictions of value that occur in a similarly rich and highly context-dependent environment. FairPay offers a framework for understanding value in its full richness and context dependency. Even if you do not buy in to all the ideas I present, the hope is you will find new insights and a deeper understanding.
● Some form of persistent identity is essential to many of the most fair and efficient models for value exchange, including not only subscriptions and memberships (whether flat-rate or value/usage-based), but advanced forms of voluntary or incentivized donation/tipping/patronship/PWYW (pay what you want) models.
● A simple protocol for building on top of Web Monetization might provide that a publisher could ask as part of its initiation of an access request a “Do I know you?" Replies could be (1) "Yes, here is the reference to our relationship agreement." (2) "No, I wish to remain anonymous.” or (3) "No, but let’s negotiate a relationship agreement."
● Those who opt in could negotiate what data is tracked, for how long, and with what constraints on use by that publisher, and on any allowable sharing with others. They could also negotiate what level of personal identification is enabled (in a layered structure such as Rieger suggests and with possible opaqueness of identity). Such agreements could be with individual publishers, or with an aggregator/bundler (with terms that could vary for defined publishers).
● This could empower users and publishers to maximize privacy and independence from one another, and from any third parties, while affording the option to relax those constraints to negotiated levels that may offer better pricing as well as other more win-win relationship features and perks.
● Such protocols could also allow for an “infomediary” with a fiduciary duty to serve the user as their agent, and to reveal only summary or limited data to publishers under defined conditions. Such infomediaries might also be delegated authority to conduct negotiations on behalf of the user, thus reducing the cognitive load that such nuance might otherwise place on the user.
● Consider adding support in the low-level Web Monetization protocol for features such as instant refunds (full and/or partial) that can enable greater user control to improve pricing fairness, even without any identification.
● Consider how Web Monetization and services built upon it relate to parallel issues of identity and relationship in Web advertising, such as in the Requirements for a Healthy Ecosystem in Advertising (RHEA) proposal.
● Consider to what extent The Elements of FairPay can be supported, individually and in key combinations, at the protocol level, independent of any software platform.
● Consider whether many of the above capabilities can be enabled by an “enhanced” WM provider (EWMP) offering separate “relationship” monetization services that depart from the strict WM requirement to not track site identity, to act in part as an infomediary user agent in doing so.
These are addressed in PART 2, after laying the foundations of this new logic in PART 1.
Please read the remainder of this post as published with diagrams at FairPayZone blog Link...
The FairPay framework is the subject of my highly praised 2016 book, FairPay: Adaptively Win-Win Customer Relationships, as well as articles coauthored with eminent marketing scholars in Harvard Business Review, The Journal of Revenue and Pricing Management, and an invited paper in the Australasian Marketing Journal. It has been refined based on discussions with hundreds of creators, publishers, and related businesses of all sizes.