Bitpass Gone Without Much Warning
One of my many other projects is an e-commerce web site called Patent Fetcher, which provides a way for folks to download complete PDF files of published patents and patent applications. One of the early challenges I faced was finding an easy way to accept payments for these downloads, for which I wanted to charge less than $1 per document. Enter Bitpass.
That was in July of 2003. Since then Patent Fetcher has used the Bitpass payment platform, which worked much like a prepaid phone card, but for on-line purchases, exclusively for the Pay-As-You-Go Patent Fetcher PDF download service, at 65 cents a download. And while the 15% cut that Bitpass took on all purchases was a bit steep, they tended to be very responsive to my unique requirements, adding numerous features to Bitpass for corporate use (as a large percentage of Patent Fetcher users are law firms and large corporations).
However, they were either before their time, or had grander aspirations (and expenditures) than their revenue stream could support. Plus, as their focus was media, they found themselves in competition first with Apple’s iTunes, and then later a bevy of other services which sold content for small amounts of money.
Regardless of the of cause of their demise, last night at 5:52pm EST, I got the following e-mail from Bitpass:
Dear Valued Bitpass Merchant,
We want to thank you for your past business, however due to circumstances beyond our control, we are discontinuing our operations.
We have partnered with Digital River to provide operational support during the period prior to shut down. As of today, January 19, 2007, all Bitpass Buyers with US dollar denominated accounts are being notified that they will have seven (7) days to spend any amounts that currently exist in their Bitpass Account.
During this seven day period, US Buyers will not be able to add additional funds into their account.
On January 26, all US Bitpass Buyer accounts will be closed and we will begin the process of refunding all unspent monies to the accountholder.
Bitpass Merchant Accounts will be available for viewing until February 28, 2007. At that time any funds that you have on account or owed to you will be refunded or paid. All account records and materials will be retained for 60 days and available upon request.
Again we would like to thank you for your business and support.
Matthew Graves
Chief Operating Officer
Bitpass Inc.
Our long time customers got the same message at approximately the same time. Talk about a Friday night surprise for all of us. Bitpass was a good thing while it lasted, but giving merchants more notice than consumers would have been greatly appreciated and desired. Instead, Bitpass merchants like myself have to scramble to communicate with our customers and deal with a sudden and near instant loss of revenue until alternatives can be found.
I ended up spending much of Friday evening trying to come up with a stopgap measure that would still allow my customers to use Patent Fetcher, and be able to continue to charge them for the downloads. Most important was to ensure minimal problems for Patent Fetcher users, so I made the service free of charge until I can develop an alternate payment platform. And this time I will bite the bullet and just do my own credit card processing instead of relying on an expensive, yet convenient, proprietary third party solution. On the bright side, this failure of Bitpass forces me to develop and complete some long overdue functionality for Patent Fetcher and should make it a much better service in the coming months.
Lesson learned: Don’t rely exclusively on proprietary technology, no matter how cool.
