PayPal, the global online payment service, today
announced new micro-payment processing fees for high volume online digital music
companies.
An extension of PayPal's existing payment service
for online merchants, PayPal's new micro-payment fees are designed to give the
digital music industry a more cost-effective payment solution for downloadable
music. The new fees will allow these merchants to process payments at a rate of
2.5% plus $0.09 for each transaction. The reduced fixed fee represents a 30-50%
savings compared to the industry's current payment processing rates of
approximately 2% plus $0.20-$0.30, which encompasses interchange, processor and
gateway fees.
PayPal's new fees enhance the convenience of
downloadable music purchases. Customers can buy as many or as few songs as they
choose using any payment type -- including credit cards, bank accounts and
stored balance. Because of the lower fixed fees, online music merchants can
profitably sell music without requiring customers to preload funds to an
account, wait for transaction aggregation or subscribe to a service.
"By offering PayPal on their sites, online music
merchants will have access to millions of PayPal customers who are experienced
and comfortable shopping online," said Todd Pearson, managing director of
PayPal's Merchant Services. "And, these buyers benefit from PayPal's standard
wallet-like service that gives them the choice, convenience and safety that
PayPal brings to online music shopping."
Typically, online music companies license songs
from publishers for approximately $0.65-$0.80 and pay fixed payment processing
fees of $0.20 to $0.30. But because songs have been sold to consumers for as
little as $0.79 or $0.99, online music companies face a challenging economic
model. With a fixed fee of $0.09, PayPal reduces transaction costs by as much as
30-50%, making digital music sales much more profitable.
About PayPal
Founded in 1998, PayPal, an eBay Company, enables
any individual or business with an email address to send and receive payments
online securely, easily and quickly. PayPal's service builds on the existing
financial infrastructure of bank accounts and credit cards and uses the world's
most advanced proprietary fraud prevention systems to create a safe, global,
real-time payment solution. PayPal has more than 35 million account members and
is available to users in 38 countries around the world. More information about
the company can be found at https://www.paypal.com/.
Source: Yahoo.com
