Ericsson hosts online payment system as 91% say no to paid online content

Posted by Nestor Bailly on October 21, 2009 at 4:16 PM

Mobile giant Ericsson has moved to fill the void between publishers' desires to charge for online content and the infrastructure to actually do so with its Internet Payment Exchange system.

The IPX is a mobile-based payment system. Whenever a user encounters a paywall, they would enter their mobile number into the site and then receive an SMS with a code. This code when entered into the site would grant access to the desired content, and the user's phone bill would be charged for the cost of the content accessed. This system is supposed to work for micropayments and subscriptions.

"We believe this has the least barriers to entry," says Ericsson IPX's UK and Ireland country manager Peter Garside. "There's no pre-registration of banking details or anything, the only information you need to give is your mobile number."

Ericsson is planning to charge publishers up to £1,000 a month for IPX and wants a share of payment revenue.

Meanwhile Lightspeed Research has found that of 2,000 UK internet users polled, 91% responded that they 'would never pay' for online news, while around 50% would pay for music online. This confirms my view that those who compare different media industries, specifically publishing and music (i.e. comparisons and discussion of 'the itunes model') are committing a category mistake.

The poll also found that older folks (45-65) are less likely to pay for online content than their juniors (16-24).

This is yet another piece of evidence that Murdoch's plans to charge for all the online content of his media empire will go awry. In general publishers however remain optimistic that charging will work, usually citing their own research.

Sources: paidContent 1

paidContent 2