Monday, September 24, 2001

Clickshare moves toward large-scale micro-transacting

Published in Interface Tech News

WILLIAMSTOWN, Mass. ‹ Stepping up its support of Internet micro-transactions, Clickshare has brought a financial-services helper to the table: Multi Service Corporation, headquartered in Overland Park, Kan.

Clickshare's business is centered on micro-transactions, in which Internet users pay small amounts for specific pieces of content, such as an archived newspaper article or video clip. While many companies handle the transactions themselves, Clickshare not only moves the money, but also allows a user's registration at one member site to be valid at all other Clickshare member sites.

After the transactions, Clickshare makes sure the money gets funneled appropriately. Now Multi Service, a handler of private-label credit cards, will take care of the actual movement of money, in exchange for a cut of the transaction amount.

Forrester Research analyst James Crawford is skeptical about micro-transactions in the near term. "It's a technology in search of an audience," he said. "It's been an area that's seen a lot of activity and not a lot of success."

Name recognition is a big deal to consumers, Crawford said. He expects a micro-transaction standard to emerge, but not from small startups like Clickshare.

"It's going to come from a financial services provider," Crawford said. "Consumers just don't trust Internet startups."

ClickShare needs to process more than the $10,000 in daily transactions the company has cited as representative, Crawford added, noting that the company only retains a small percentage of each transaction.

"To be profitable, they're going to have to get orders of magnitude, more customers," Crawford said.

ClickShare CTO Richard Lerner said that is the company's major focus. "Mostly what we're doing is building up our network of clients," he said, adding that each client is a Web site with many regular viewers.

Lerner said the company has "about a dozen" live clients and is in talks with "a couple of dozen" more companies, serving what he called "potentially millions of registered users." He said the company does not have many registered users at the moment.

He hopes Multi Service's strengths will meet Clickshare's needs as it expands.

"They have a lot of expertise in handling financial matters and handling customer service," Lerner said.