Swati Prasad reports in BusinessWeek that India's retail e-payment market is likely to grow by nearly 70% in the next two years.

The value of retail e-payments should reach between US$150 billion and US$180 billion by 2010, according to a report by Celent.

Nilaya Varma, PricewaterhouseCoopers, says, "Indians were circumspect about using e-payment as they were comfortable paying in cash and through checks. Today, the proliferation of telecommunications networks and mobile phones has filled this gap."

According to Celent, the Indian debit and credit card market grew at a compounded annual rate of 128.7 percent between 2004 and 2008 and is expected to reach 210 million cards by 2010.

The report expects:

1. Debit card circulation to increase to 169 million by 2010, up from 102.4 million

2. Credit cards should increase from 27.5 million to 40 million

PayPal popularity in India

PayPal is gaining popularity in India for cross-border trade for the sale of gemstones, jewelry, electronics and household items and for services such as Web design, travel and digital content.

"Young consumers who grew up with technology are coming of age and have their own bank accounts and mobile devices," Shiliashki said. These young consumers expect services to be mobile, 24-by-7 and at their fingertips. "It is this expectation that is driving businesses to enter the online space."

PayPal's Shiliashki believes that if the Indian government achieves its goal of having 20 million broadband users by 2010, a greater usage of the Internet and increased familiarity with the opportunities it brings along will result in wider local adoption of e-commerce in India.

More: http://www.ivanwalsh.com/category/digital-downloads/

PayPal’s UK Online Retail Report expects that online shopping with double to almost $40 (£22 STG) billion by the end of 2011.

Experian, who performed that research, believe that online shopping will be a key driver in getting UK retail out of the recession.

Looking at the numbers:

1. 137% growth in online spending

2. UK web shoppers in 2011 will spend £430 each, double the current figure.

3. 24% of UK consumers believe online shopping will overtake the high street

The research highlights that the rise in internet shopping is partly due to shoppers’ sense of empowerment, for example, reading up on items before making a purchase and interacting with others online before buying big ticket items.

Carl Scheible, managing director of PayPal UK, said: “As we all try to make our budgets work harder during the recession it is hardly surprising many of us have headed online to seek a better deal. In fact almost nine million of us now shop online at least once a week.

Other stats show that:

40% of online shoppers find it easier to budget by purchasing items online rather offline

47% believe their money goes further online.

By 2012m one in every 14 pounds spent shopping will be online.

Ivan Walsh

Matt Peckham reports on PCWorld that GameStop is playing with numbers as it tries to play down the relevance of downloadable games.
It cites the IndustryGamers reports which says that ‘GameStop doesn't expect digital distribution to be a threat to stucco-and-rebar-retail until 2014.’

GameStop "has been monitoring and studying the capabilities of digital downloading and its potential adoption over the last several years" and that the company recently "conducted the most thorough study to-date on its capability."
Matt takes a pretty hard look at the figures.
GameStop believe that an "addressable market" for digital downloads won't exist for another five years; only 25% of the population will have access to the technology necessary to download full games.
As I write, I have Second Life on my 4 year-old laptop and have streaming music coming down the wires.
Why the 5 years?
Costs are another issue.
It reckons ‘service costs ($100/month), storage limitations, and consumer price intolerance will offset digital's chances of supplanting retail anytime soon.’
According to the study, consumers will pay up to $39 per downloadable game, an expectation GameStop thinks will act as a ‘disincentive for publishers facing escalating production costs’.
This is rubbish.
I have high speed broadband for less than 10 USD per month, almost unlimited storage with Gmail and my web hosting ($5 per month) give me GBs of space/traffic.
Math points out that ‘download portals don't charge a usage or monthly/annual membership fee, and as the broadband market grows, competitive pressure should keep even the fastest consumer services from moving up much past $50 a month, while legal obstacles should prevent companies from enforcing usage caps or engaging in traffic shaping or bandwidth throttling.’
Sterne Agee analyst Arvind Bhatia, who wrote the report, notes that GameStop's “Management.... feels that digital growth and brick and mortar growth can co-exist,” said Bhatia. “Through their brick and mortar locations, the company can help facilitate and capitalize off digital. Overall, management did not seem at all concerned about the near-term threat but instead is looking at ways to potentially profit from digital.”
Read that line again - management did not seem at all concerned about the near-term threat.
James Brightman, over on IndustryGamers, thinks that GameStop will be hurt by the digital revolution in the games industry, as video games move away from the boxed product model and towards the games as a service model.
He warns that ‘If GameStop doesn't want to see its stock tank, the company will have to start thinking about how to transform its business for the near future.’
Here's the bottom line.
Matt again – ‘In a thriving digital distribution market, GameStop loses. They're late to the game, and not doing much to distinguish themselves from their more evolved and intrepid competition.’
Their revenue model depends on dominating the high street. On the web, they’ve missed the boat and are flapping around trying to avoid the inevitable.
Update: a post on IndustryGamers make the point that ‘a download-only game (XBLA Magic the Gathering) was in the top 5 most played X360 games this week… points to the fact that the Age of Download is coming faster than many may expect or desire.

I've used Clickbank to sell digital products for 10 years. In that time I have seen other competitors, such as eJunkie.com and PayLaodz.com arrive and give Clickbank a run for its (digital) money. What disappoints me about Clickbank is that its failure to address its weakness and improve product designs that would make it a truly remarkable product.

With a little tweaking, Clickbank could be in the industry standard for selling digital products.

So, if anyone from Clickbank is listening here are five areas you could improve.

1. Digital Delivery

When you buy a product on Clickbank, it sends you to a download page on the customer’s site where you save the file. This has a few problems.

1. This web-page can be bookmarked and sent to others, who can then download the product.

2. This webpage must be created by the seller for every product. Time is money and this takes a lot of time.

3. This download page must be available 24*7. So, if your hosting company goes down, your customers cannot download their product.

As far as I know, Clickbank is the only leading e-tailer that uses this (old-fashioned) system.

What’s the alternative?

When you buy with Payloadz.com, the customer is sent an email with a link to the download. This removes the need/time to create unique web-pages for each product ala Clickbank.

Ghacks.net also takes up this point, “take a look at their requirements for pages, or better thank you pages that sell Clickbank products.”

It points out that the “requirement is that a thank you page has to be created on the website that is selling the product which will be displayed after the purchase has been made. Many Clickbank webmasters put download information of their products on this page to make it as easy as possible for their customers to download the product once the purchase has been made.”

Ghacks.net adds some tips on securing the pages. Most Clickbank Thank You pages contain the following or a similar sentence:

‘Please Note: Your credit card will be billed by “CLKBANK*COM”. The name “CLKBANK*COM”will appear on your credit card statement.’

Searching for ‘clkbank right click’ reveals hundreds of product pages that offer the product as a download after making the purchase.

Read more here http://www.ghacks.net/2007/12/22/clickbank-we-have-a-problem/

Going back to Payloadz.com, it also means that the delivery is quicker.

The customer is not sent from

1) your site to

2) Clickbank and then

3) back to your site.

Also, the customer gets 5 attempts to download the product with Payloadz e.g. http://store.payloadz.com/detail_html.asp?Id=196478 and then the link expires.

Does Payloadz.com work?

I have used Payloadz.com since April. Not one complaint. Read that again. Not one complaint.

Why use Clickbank?

I still use Clickbank as I have designed the whole site around it and to change the code would take weeks.

Sadly, every morning I get emails from customers saying they didn’t get the product, the link doesn’t work, where is the link…

Over the course of a week, this takes several hours of customer support to address, which is proving to be very time-consuming and expensive.

Next week, I’ll discuss another area where Clickbank can improve - hoplinks!

Let me know what you think.

PS: my shop on Payloadz.com is here: http://store.payloadz.com/results/results.asp?m=33579

Ivan

Twitter: http://www.twitter.com/ivanwalsh

Developers of epayment systems and virtual currencies should take a look at this CNN report in the transition of virtual currencies into the retail banking sector.

 CNN report that in March, MindArk, creator of the massively multiplayer online role-playing game, Entropia, saw its wholly owned subsidiary Mind Bank granted a banking license from the Swedish Financial Supervisory Authority.

This license allows Mind Bank to be the first bank to directly incorporate real-money transactions with virtual-world activities.

Selling virtual assets directly between players for real-world cash has been strictly prohibited by most game publishers, which find themselves looped out of the profits.

This takes the exchange of virtual currencies into real monies to a new level.

While World of Warcraft and EverQuest users have engaged in "gold farming", i.e. gathering weapons and other status symbols, and then auctioning these off, usually on EBay.

Games publishers have started to monitor with mixed results. In response, PlayerAuctions have adopted a PayPal-like approach where it brokers the deals, acting as an open marketplace for player-to-player exchange of digital assets.

CNN interviewed Simon Newstead who explained: "The idea with dual currencies is that there is a paid currency [Gold Coins], which is paid for using real money and exchanged between sellers and buyers. In addition, there is a second currency -- a free or so-called 'earned' currency [Silver Coins] -- which is gained through activity and progression in the world or game."

"In this way," he continues, "the economy can recognize different forms of contribution, and in newer economies these can also be traded between each other. For example, people earning currency and selling it to people who have less time but have real money."

Virtual currencies in Second Life

Second Life's marketplace includes objects and services for sale, including real estate.

In 2008, over $100 million worth of Linden dollars (Second Life's currency) were bought and sold on its LindeX exchange.

"In Linden Exchange, the U.S. dollar part of the transaction is via PayPal, a well-known entity, so there's a certain amount of trust that comes with it," says Darrly Chang, co-founder of D&D Dogs, who sells virtual dog pets and avatars to Second Life residents.

CNN’s reports also discusses, GoldMoney, who launched a dedicated iPhone application allowing account holders to exchange gold and silver units within minutes.

This iPhone application let you manage your own digital gold like on other banking applications.

GoldMoney is firmly anchored to real-world assets, forbidding anonymous accounts.

This contrasts with E-Gold, whose founder pleading guilty to money laundering-related crimes..

How realistic is the prospect of a digital currency?

"It all comes down to trust," says senior economist Frederic Neumann. "We trust the government to guarantee our 'virtual' money for real currency. [With digital gold] the gold standard is guaranteed by a private company. Governments already have several hundred years of sovereignty engrained in people's minds, so that trust is very difficult to establish."

Learn more at http://goldmoney.com/ and http://secondlife.com/whatis/currency.php

What’s been your experience buying and selling digital goods, especially if it involved virtual currencies?

PayPal has published a report on why a large percentage of customers abandon their shopping carts during ecommerce transactions, especially when close to the Checkout phase.

‘You point and click your way to buying something you're sure will somehow enrich your life, but then at the last moment before completing the purchase, something scares you off.’

PayPal looks at what makes internet shoppers "abandon" their items before moving to the checkout.

You can listen and download the PayPal reports at:

http://inr.mediaseed.tv/oneClip_C/?feed=5R0_z1Oofk4lkdIFCB_bgOSXcRZUTH5t