"no longer should you ask the question, will people pay for content online? They will pay--that is a known fact," says Yvonne Ruggles, vice president of operations at Needham, MA-based WebCredit, an online collection company. "There's no question at all about that," agrees Tricia Rothschild, product manager for Morningstar.com, a financial information provider that offers Internet visitors a mix of free and premium content. "We see no hesitation on the part of consumers. Offer them valuable content and they will pay." Face this reality: many factors are conspiring to create growing enthusiasm for calling a close to the "all free, all the time" Internet era. Online ad revenues are in steep decline, more coveted content is going digital, and more users are spending more time online. All that translates into a universe where pay-per-view makes sense. Good as that sounds, there is a hitch: It has been very difficult to implement schemes for collecting small payments from online consumers of content. Current solutions just don't work. "Content providers certainly have content they want to sell, but the difficulty has been that there is no simple mechanism for processing these transactions," says Dennis Woronuk, president of Calgary-based Wmode, a start-up that aims to become a clearinghouse for mobile commerce. "The costs of transactions are way too high," says Neil Cameron, a consultant with Accenture. "We need new solutions to make all of this work. That's going to be critical." JUST SAY NO TO PLASTIC The big hitch: Mastercard and Visa won't work as the primary tools for profitably collecting payments from Internet users. Their transaction fees are too high--pretty much on any purchase below dollar 10, using standard Mastercard and Visa merchantarrangements gets downright nasty. On a dollar 10 tab, for instance, the vendor probably pays a flat 50-cent transaction fee plus 2.5 to 3.
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