emerging business models

John Perry Barlow, EFF co-founder: I am still optimistic. I didn't expect that the entire wealth of the industrial period would gracefully allow us to render them irrelevant. They're putting up a spirited fight, but I don't think they'll win. Victory comes to the patient. The content industry used to call me the devil, now the same people come to me for advice on how to make it work for them, they're abandoning their King Canute strategy. I don't think there's proof that downloading has cost the record industry billions, for the same reason that hearing a song on the radio doesn't cost a sale. There are lots of studies, but no one can say for sure. Last year I asked Cary Sherman if he'd co-design a study with EFF to give fair insight into what the losses or gains are from downloading. He said, "I don't think we can do that. I don't believe my constituents would allow that because it might turn out that you're right." Wouldn't they want to know? "No, I don't think it's like that with them." It's a matter of religious belief. They're near retirement, they can have any religion they want. They'll be replaced by the electronic Hisbollah they've created with their Draconian strategies, the wild-eyed 17-year-olds who hack DRM will beat the 55 year olds in posh cars in Bel Air.

Can we come up with a regime for regulating the economy of ideas and the way of getting paid for work you do with your mind that doesn't treat thought as a noun and therefore subject to being treated as property. The IP system is a gigantic kludge of patches that have been laid on in different regimes, as it all goes to bits, it needs to be harmonized with a regime that recognizes that this regulates the relationship of the creator and the audience.

So, no, I don't think I'll be moving back to Nebraska to start a company. But at this point, that's, firstly, a lifestyle choice. I love it here. Just being around the creative energy, the action, and the ambitious, smart people is reason enough for me, business advantages aside. If you're young and hungry and want to learn as much as possible about the industry, I'd encourage you to come out. (There's lots of startups hiring!) But if you're married to where you are and want to start something outside Silicon Valley, I say go for it. Use your location to your advantage by sucking up great local talent and thinking differently than everyone out here.

Here is our Mercury News story today (free registration) about Prosper, the online loan marketplace that seems almost too good to be true.

People can borrow money at lower rates than they can at the bank. And lenders can get higher rates than they can get elsewhere too. It works because it cuts out the middlemen, or the banks that have until now claimed a big percentage cut of the loan.

To write a check to any person costs me nothing. (Well, I have to pay for the checks, but that itself can not be circumvented; checks are a tangible and those always cost money.) To go to the bank, take money out and give it to someone costs me nothing. But to send someone money directly from my bank to theirs costs money. The de facto standard for sending money between parties has been PayPal. However, since a de facto standard is almost always a de facto monopoly, they really haven't had much incentive to lower rates. What kills me is that banks already have the infrastructure to handle this sort of thing, yet are totally unaware of it. And since they would cut out the middle man (in this case, PayPal) they could have slightly better rates and still make a profit.

Whatever, they're clueless and won't catch on for at least another decade.

But as of late, other payment processors have started to set up shop (though amid rumors of scandal and scam). While I'm not giving either of them anything beyond basic contact information, I'd like to see how they pan out. Competition is always a good thing for the consumer. If you would like to try them out, let me refer you so maybe I get some money out of it. So far I've signed up for:

• AlertPay
• GreenZap

Christina told me about GreeZap a while ago and I just signed up for AlertPay now.

I wouldn't give them anything beyond basic contact information yet. I'd wait until some trust sets in. I'd also use a password different from what you normally use. I generate a 15 character password for every account I sign up for, however, I know a lot of people use the same password over and over again. If either of these new paymeny processors aren't legit, they will then have your email address and password that you use for PayPal and proceed to empty your bank account.

I'd like to note that GreenZap Scam has a link to AlertPay with a referral ID of 2.