Subject: Re: GiftNet, distributed credit card processing
From: Adam Theo <adamtheo@theoretic.com>
Date: Sun, 07 Oct 2001 15:44:26 -0400

Seth Gordon <sethg@ropine.com> wrote:

> Anyone who wants to reward the authors of a particular open-source
> program can usually find out their email addresses, and use PayPal or
> e-gold to send them money.  If the authors want to make this job
> easier, they can put a PayPal or Amazon Honor System link on the front
> page of the program's Web site, or they can use something like Cafe
> Press to make associated T-shirts, coffee mugs, etc.  If a third party
> wants to encourage its clients to support a certain project, they can
> put the appropriate PayPal/e-gold links on their own site (crediting
> directly to the accounts of the program's authors).
>

It is true that some infrastructures for monetary transactions exists on
the internet, but they are incredibly basic, inflexible, and 'passive'.
PayPal requires givers of money register an account with them, deterring
many potential gifts. PayPal, Amazon, and Billpoint (and possibly others I
am not aware of) do not provide for much flexability in either presentation
(interface customization and branding) or functionality (displaying total
amount given to date, etc.). And most important, and the thing that GiftNet
really solves for, is the promotion of the programmer to the public.

PayPal, Amazon, and everything else i've come accross leaves all promotion
up to the programmer.  This attitude is comnpletely understandable, but it
does not solve the programmer's dillema. The programmer is left as their
own marketing agent. They could hire their own, but this is very costly.
GiftNet could instead provide the promotion services without the processing
ones, but that would not solve the earlier problems of extra registrations
and steps the giver must take with PayPal and other systems.

These are why I'm starting GiftNet, and why I think it is a good idea. But
thank you very much for your criticism. It helped me clarify why I believe
existing systems are insufficient. I've taken this opportunity to update
the GiftNet website with this clarified, expanded position
[http://www.theoretic.com/giftnet].

Seth Gordon <sethg@ropine.com> wrote:

> The hidden assumption behind the GiftNet proposal is that many people
> don't give money to support open-source programs because *it's too
> hard for them to do it*.  I don't think this is a significant reason.
> The most significant reason, I think, that many people don't give
> money to popular open-source products is that *they can get away with
> it*.
>

This is a very good point, and the one I was most afraid of when I began
work on the GiftNet idea. However, GiftNet's target audience is not
end-users, but mostly businesses that use and are grateful for free
software. the 'gifts' they could make through GiftNet could still be
miniscule in comparison to the fees they would have to pay to proprietary
software providers. Another point GiftNet will have to keep in mind is that
it will not be going after the businesses and people that don't want to
give back, it is going afetr the people who do, but are just intimidated by
the large amount of work required to do it. GiftNet makes giving easy.

"Giles" <giles@oz.net> wrote:

> Especially difficult seems to be the 1-20K "donation" range.  Generally
> its to large for a credit card transaction and too small in other
> senses.  Ie, likely its not a full project for a company so it maybe
> difficult to get the time/signatures required to make it happen.  But to
> an open source project this level of donations can be greatly appreciated.
>

hm... very interesting. i had not been thinking of GiftNet taking on such
huge sums. in my mind, when forming this GiftNet idea, transactions over
giftnet would be in the $50 - $500 range, since it would try to get many
companies to contribute relatively small sums to create sufficient
compensation. do you think there is a demand for handling of such large
sums in a secure, convenient manner? it would be something to look into for
GiftNet to expand into.

Ben_Tilly@trepp.com wrote:

> I am a satisfied user of Linux, Perl and Samba.  If I wanted to give a
> hundred dollars to any of these three projects, and have the feeling
> that it was somehow fairly divided among the contributers, that would
> be rather hard.  Oh, I can give money to, say, Larry Wall.  But he
> said that until last summer he would have no idea where he should send
> money for the overall benefit of Perl.  (The appropriate place to
> donate is now an organization called YAS.  Strangely enough this does
> not appear in the list of contributers to Perl.)
>

yes, you've hit the nail right on the head. this is the secondary purpose
of GiftNet: "to make giving easy". the primary purpose is "promoting for
the programmer", but that is beside the point.

Ben_Tilly@trepp.com wrote:

> If I followed your suggestion with Perl, the transaction cost of
> trying to track people down, and then deciding (for instance) what
> portion to give to Simon Cozens, would be nontrivial.  In the US it
> would also be possible to set up a registered charity.  As a charity,
> people would get tax benefits on donations, and it would get tax
> benefits on its awards.  Plus if you have a charity, employees of
> many large companies would be able to take avantage of matching
> donations to donate much more efficiently.
>

this is something i've looked into, and plan to do a more thourough
investigation of soon. but my initial research leads me to think tax
deductions and other such benefits would not be possible with this GiftNet
idea, or even your perl-specific one. the key word you use there is
"donations", and to donate (according to US Federal law as i am
understanding it), you have to give to a registered charity that will use
it in a general sense. what that means is you cannot give $$ to help out a
specific person or organization and have it be tax deductible. you have to
give to a charity that will use your $$ to help out *anyone* that they
cover.

example: the red cross is a tax-deductible charity because the giver does
not specify who they are giving to. no "i will give the red cross $20 to
give to Jim Schmidt of Jew Jersey", it has to be simply "i give to the red
cross". now, your above example with YAS may still be a charity, since
although you are specifying "to the perl developers", you are treating them
like a group, not a complete entity unto themself. i'd have to look into it
more to know for sure, though. hope that made sense.

Ben_Tilly@trepp.com wrote:

> For the record the proposal that I had thought of looks like this.
> Set up a charity with a list of key projects, organizations, and
> individuals who are influential in free software.  Each person who
> registers themselves as being involved in free software should
> indicate roughly what portion of free software related activities that
> they are involved in depend on which other people who are "lower
> profile" than they are.  Then any person who wants can donate to this
> society and mark the key person they want their donation to start at.
> 1/4 (picking numbers out of the hat) of the donation goes to that
> person, and the remaining 3/4 works down to the people that person
> named.  Those people each get 1/4 of that, and the rest continues to
> trickle out.  And so on until the donations become too small to bother
> tracking.  So that way a single donation to, say, Linus Torvalds would
> result in a web of donations that roughly corresponds to "The Linux
> Kernel".
>

hm... an interesting idea. it could be something to look into as an
expansion to GiftNet. i have been thinking of a "mutual fund" like feature
with giving in it. perhaps your idea could be worked in somehow?

but to wrap this up: i've revised the GiftNet website to include most of
what I respond with here, and will be adding the rest tomorrow. please take
another look, it's been greatly clarified and expanded, and provides a much
better picture of what GiftNet will be.
http://www.theoretic.com/giftnet

Adam Theo wrote:

> Hello, all.
>
> I would like to announce an idea I have been working on for the past
> month, and am finally releasing, 'GiftNet'. I would also like any
> feedback you could give. Thoughts, comments, questions are all helpful.
>
> GiftNet is the first product of my Cauldron Initiative, which aims to
> develop methods for creators of open source and free software to fairly
> profit from their work. GiftNet specifically tackles the voluntary
> 'donations' angle, making it very easy and safe to give monetary 'gifts'
> to the developers of specific open source projects.
>
>  From the GiftNet website < http://www.theoretic.com/giftnet/ >:
>
> "Many open source developers work very hard on their software projects,
> and usually end up giving their work away, due to the nature of open
> source. I firmly believe that because they are social-minded and
> generous is not a reason they shouldn't be fairly compensated for their
> work. Forcing fees for buying or using the software is against the
> principle of open source, so a voluntary solution has to be found.
> Namely, giving. However, existing systems are insufficient, as they
> place all burden of promotion and soliciting upon the already
> resource-strapped programmer."
>
> "The GiftNet Project is a framework that will benefit individual authors
> and inventors who give their creative works to the public by helping the
> public give back to them. Such a project must be flexible,
> member-oriented, low-cost, and of course secure, and rely on and target
> the wealth-lucrative corporate world instead of the cash-strapped 'end
> user' market for these gifts. In GiftNet, corporations, celebrities, and
> other websites solicit monetary gifts from other individuals and
> businesses that use open source software on behalf of the programmers."
>
> Details are at the website < http://www.theoretic.com/giftnet/ >. I hope
>   this is an interesting project to everyone, and I appreciate any
> feedback before I advance to working out legal and technical details.
>
> Thank you for your time.
>
> --
>    /\   Adam Theo, Age 22, Tallahassee FL USA.
>   //\\    Theoretic Solutions (http://www.theoretic.com)
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