My goal with this blog

I write about relevant changes in the way that people use the web and how startups are built to provide services and products for this ever changing wonderful thing we still know as "the web." As a former entrepreneur turned early-stage investor, my greatest hope is for this to be useful to other folks that are like me in the hopes that they can avoid some of the mistakes I've made.

From:
Antonio Rodriguez

On Twitter's business model (or why we finally need OpenID to work)

tech
by Antonio on

Something I've heard recently was that Twitter's silver bullet when it comes to a business model will be a sort of Paypal 2.0 that blends universal login with a payments system that they can skim pennies off of. And while I think Paypal is more ready for a 2.0 disruption than any other legacy web service (it is appalling how bad it still is), I think it would be a dumb and dangerous thing for us as users to expect to rely on another vendor— and specifically a startup that has had trouble scaling from day 1— for something as critical to the next phase of the evolution of the consumer Internet as a payment system.

Ideally I'd love to see OpenID (which finally seems to be gaining traction) extended to allow many providers to offer payment clearing services on top of many providers already providing authentication services. Now I know this may be a bit of a pipe dream— after all, it has taken OpenID more than 5 years to come close to the required ease-of-use for a simple username/password challenge, but when it comes to payments, it is much much more critical to keep it open.

Think of the power of an open ecosystem like this: first and foremost, the payment handlers that could migrate to it like the merchant account folks or credit card companies already have tons of experience reliably clearing payments, maintaining security, etc (and sure while they have an innovator's dilemma type of issue, I am confident they would eventually see the light of day). And more importantly, competition would be a very good thing indeed if our goal is to avoid the stagnation that Paypal has suffered at the hands of eBay.

A related example: today Facebook opened up its public page user registration system for picking usernames and people rushed to make sure to get their favorite handles. To me this makes Facebook smell a lot like a DNS registrar— which again, seems like a really dumb responsibility to hand over to startup that has yet to make money, no matter how many users they have (here is a nice suggestion for avoiding the Facebook as the people's DNS problem, a least a little bit).

Finally if the open standards approach doesn't work with payments, I sure hope we standardize on a vendor like Amazon or even Apple that already has proven experience running billions of transactions through their shopping cart.

But another Paypal? No thanks.