In recent years the online publishing business has faced serious disruptions. With a business model heavily reliant on targeted ads, which pay per click or per eyeball, the spread of ad blockers wrought havoc on many websites and required the industry to think up new and innovative ways to make money without scaring away users.
Finance Magnates talked with Meinhard Benn, the founder of SatoshiPay, about his company’s approach to the matter and how it compares with the competition.
How did you get to your position in the cryptocurrency scene?
I discovered Bitcoin in 2011 through a news article following its $27 price spike. I became immediately excited because I had researched alternative currencies for many years and started mining it on my work computer’s GPU straight away.
Two years later, after bitcoin’s second big price spike I got more involved with the underlying blockchain technology and started working with early startups in the space. In 2014 I started SatoshiPay, aiming to make bitcoin payment integration as easy as possible.
Why did you decide to refocus SatoshiPay on online nanopayments?
Our initial product was a white-label bitcoin payment processing service for traditional payment companies. The initial surge in merchant adoption of bitcoin as a payment method quickly plateaued, so we looked for different applications of our technology.
With the help of Coinsilium, our new investor at the time, we identified nanopayments as an exciting field to focus on.
Can the bitcoin blockchain handle millions of paid pageviews a day across the world?
No, Bitcoin was not designed to handle nanopayments. That’s why we are using payment channels, which are simple smart contracts that allow off-chain payments in a trustless way.
We see payment channel technology as a potential solution to scaling issues, because they allow a transaction through-put similar to and higher than credit card networks, without bloating the blockchain. The lightning network adds a layer for even higher scalability and we are keeping a keen eye on it.
How do you see the field of online publishing developing in light of new trends?
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With an adblocker rate of up to 66% (Indonesia) and growing, it becomes evident that publishers need to quickly think of other ways of monetisation in order to generate profits.
We don’t believe individual subscriptions are the best way for this, because web users don’t usually feel comfortable with making many parallel commitments. The only options remaining are micropayments or cross-website subscriptions.
Do you anticipate that in a few years all websites will be supported by nanopayments?
The demise of web ads hits all sites, so yes, we’ll see more paid content. Hopefully with our help the payment process will be transparent and automatic, not disturbing the user’s attention.
I also imagine a wider acceptance of freemium models, where a news article is available for free, but bonus material like videos or high-res images cost a small fee.
How would you compare your service and that of Brave browser?
We work closely with publishers and allow them to control prices and what content they want to monetize. So their income becomes relatively predictable. Brave at this point is an ad blocker with a donation function, similar to Flattr Plus. Brave requires users to install a new browser with a completely new browsing experience, which I think is a high ask.
We have a low friction approach, work across all browsers and devices, don’t require a login or download. In future we expect to be more of a universal infrastructure for nanopayments, and not so much a content paywall.
What is your take on the approach of Steem.it?
Generally, the idea of rewarding authors of social media content directly is fantastic. I’m not sure however if this requires yet another cryptocurrency, which in this case is largely owned by the creators of Steem.
Their system is currently focused on one central platform or website, but we believe to create a sustainable impact on value transfer on the web, it needs a technology available across all public websites and closed systems.
You have recently started collaborating with Visa Europe, how did that come about?
Towards the end of 2015 Visa’s innovation department “Collab” actively reached out to startups working on bitcoin payment solutions, and after our first meeting with Collab in Berlin we realized that there is a lot of potential for cooperation. Also the personal chemistry was right, which I think is very important for an ongoing partnership.
We expect to make our technology available to a mainstream audience soon, by adding card payments to the top-up options for SatoshiPay. Also having one of the biggest consumer brands on our side opens a lot of doors, now and in the years to come.