RMM Briefing: Flattr – from piracy to payment

This post was written by RMM’s intern, Rob Meiklejohn with some editing by Shona Ghosh.

What is it?

Flattr is a new take on voluntary micropayments for online content – the textbook web 2.0 name combines flattery and flat rate. It is a standalone platform which allows users to reward creators for specific content they really value.

We think it’s useful to note that the platform was in part created by Peter Sunde. That’s right – the man who was sued for supposedly aiding millions of people to download films and music illegally has…now created a platform to reward creators financially.

How does it work?

Think micropayment, tip jar and Digg all rolled into one. Users signed up to Flattr set a monetary amount which they can spend each month. They browse web content as usual, but can click on any article or content which has a Flattr icon – if they like it enough to pay for it.

At the end of the month their monthly amount will be divided equally amongst everything they have Flattrd (so a €10 monthly spend and 20 icon clicks distributes €0.50 to each piece of content). Users with their own content add a Flattr icon to nestle alongside the Digg, Facebook Like, and Tweet buttons and hopefully watch the money roll in. Meanwhile, Flattr itself skims a tidy ten percent off this incoming revenue clients receive from other users.

At the moment Flattr is available via an invite-only Beta test, with most signups happening in northern Europe. Nonetheless, in Germany one blogger has already seen revenue of €208.54 in May and €875.89 in June whilst a newspaper earned almost €1000 out of the system last month.

Who’s going to use this?

We’ve defined an audience and some examples of how they might use Foursquare’s layers using Forrester’s social technographics.

Creators:

• May lead to more career bloggers who fund themselves through micropayments as well as advertising.
• Some creators will tailor their content to result in the highest number of Flattrs.
• Will circumnavigate the awkward issue of charging for something created for personal interest or artistic purposes. (Perennial alt. rock innovators Radiohead were, as ever, way ahead of the curve on this one, when in 2007 they digitally offered album ‘In Rainbows’ on a voluntary payment basis).

Conversationalist

• Will flag what they have Flattrd and encourage others on their networks to do the same.
• May expect some non-financial return from the creator in return for Flattring, e.g. an acknowledgement or link
• Though the necessary functionality is not currently available, there is potential for conversationalists to take advantage of Flattr as a new form of social currency, whereby a Flattr serves as an indicator of a user’s authority in the same way a Twitter retweet might.
• A conversationalist might enhance their own standing within their networks on the basis of how many Flattrs (a kind of enhanced social recommendation) they have received.

Critic

• Will use as a more emphatic way of endorsing content.
• Again, there is potential for a social currency function where a critic is rewarded for their curation skills in linking their own followers to good content.

Collector

• Will locate, follow and then collate the most Flattrd content.
• Will organise RSS feeds around Flattr stats e.g. Most Flattrs or Flattred by certain demographics in topic areas.
• Would use as a means of voting for/keeping track of favourite content.

Joiner/Spectator

• May herald a cultural shift  back to a mentality where consumers actually pay for written content.
• Will function in the same way as Digg or Facebook Like but with the knowledge that Flattr recommendations have monetary value.

Quick thoughts: charities and media

• There is the potential for companies to enhance their social media profile here. A good example would be charities fundraising on their online content: ‘Did you like this recipe? Why not Flattr it, all proceeds go the Rainforest Alliance’.
• As demonstrated above, Flattr has already proven useful in providing revenue to newspapers. Is this – or a model which is similar –  the alternative to the paywall, whereby users choose to reward individual creators rather than the newspaper brand itself with their money and their custom?

We think an obvious way for Flattr to spread rapidly would be giving users the ability to register interest in Flattring any content creator (not just one registered to Flattr) and then mailing the content’s creator about the waiting micro-payment. So far there is no mention of such functionality but it would be surprising if something along these lines didn’t appear around Flattr’s full release.

(Hey look – you can Flattr this post!)