Author Topic: eevBLAB #42 - Patreon FAIL!  (Read 4363 times)

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Offline NiHaoMike

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eevBLAB #42 - Patreon FAIL!
« on: December 09, 2017, 04:57:14 pm »
I have looked into Patreon many months back and did not like it for multiple reasons. The ones that stand out are insistence on monthly payments (high transaction fees for small donations, would be better if there was an option to do it in 6 month batches) and apparently it needs the Paypal account to have a linked credit card, which I don't like since I prefer to keep the two separate. (The Paypal account itself is supplied by cryptocurrency miners via an exchange.)

I ended up using Bitcoin and (direct) Paypal to support the creators I really like.
Cryptocurrency has taught me to love math and at the same time be baffled by it.

Cryptocurrency lesson 0: Altcoins and Bitcoin are not the same thing.
 

Offline thmjpr

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #1 on: December 09, 2017, 07:14:07 pm »
The ones that stand out are insistence on monthly payments (high transaction fees for small donations, would be better if there was an option to do it in 6 month batches)

For me 35c per month is not a big deal on ~$25 of donations (1.4%). If you have <$5 per month it does become significant. But I agree an option for longer term would be nice.

Scanlime sent out an email for liberapay, https://liberapay.com/scanlime Which from what I see, uses a single large deposit and then you can use that money to donate weekly or monthly.
Patreon could certainly have offered a similar solution, automatically "reload" your account with $20+ whenever it runs out. This could be completely transparent to the user. Of course the downside is you are paying up-front which some people don't like.

I think for now I will remove all my $1 donations and try to do bulk donations every 6 months or hope more people sign up for liberapay.
 

Offline NANDBlog

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #2 on: December 09, 2017, 07:39:33 pm »
Ah, yeah, also this:
http://www.eevblog.com/forum/chat/vat-on-patreon-donation/
So, if I want to send 1 dollar a month, Patreon is adding 35 cent, tax is adding 21 cent. Though probably more, probably 0.21*(1+0.35) because, you know...
This high flat fee is just ridiculous. So more than 60% of the donations are 1 dollar. They are essentially jacking up their price from 5% to 35% for half of their customers. Way to go.

Dave, please mark a preferred donation method.
 

Offline Terry01

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #3 on: December 09, 2017, 07:55:00 pm »
I am new to all this so am guessing you are talking about donations to something on the web (YouTube?).

The same thing happened to me a while back.
Someone chapped my door looking for donations to something or other,had all the proper identification badges and stuff.
Anyways I was going to donate a score £20) but "no".....has to be a "sign up today for a monthly donation from my bank account"!!
No way I said,it's the £20 I want to donate now and that's it......or nothing....I aint signing up to that....I'll donate what I can afford now and that's it!
The guy said "we can't accept cash,just  your bank details for a monthly donation".......oh so not my £20 just a thing for access to ALL my cash....aye ok Neeb....trot on. See ya!
The long and short is this charity that is so in need of my cash can't accept my 20 quid!
They ended up getting a score dangled in front of them then told to nash because they wanted my bank details.
Sick as hell waste of everyone's time if you ask me.....
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Offline Chipguy

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #4 on: December 10, 2017, 01:19:59 am »
Hi !

After Dave posted  a picutre on Twitter, showing that Patreon takes a survey upon pledge deletion where you can actually tick a box "I am not satisfied with Patreon's services" and you can even leave a short comment I decided to do exactly what Dave did and deleted all my pledges.
Before that I wrote a little message to each creator eplainung why I did that and asked them to set up Paypal Donation or something else as an alternative methode.

So far Techmoan has already reacted and implemented a donate button on www.techmoan.com
Now I have my pledges for EEVBlog and Techmoan moved over to automated montly recurring Paypal donations.
I know that it is not as fancy and controllable as Patreon is but it has to do for now until Patreon come to their senses or creators find another better alternative.

Just to explain why:
A $1 donation costs in Germany:
($1 + $0.35 + $0.03)* 1.19 = $1.64
There is a 19% VAT rate in Germany for Patreon.
The creator gets about $0.95 minus whatever fees apply for the transfer Patreon -> Creator.
With a Paypal Plus account this would be $0.91 if I am not mistaken.
So only 55% of the paid money make  it to the creator, the rest is fees and VAT.  :rant:

So with Paypal only that would come down to the same on the creator's side (right?) but no additional fees and taxes on the patron's side.
The patron pledges $1 and pays $1.

That's what I am sticking with for now. Let's see how it goes.
Where is that smoke coming from?
 

Online wraper

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #5 on: December 10, 2017, 01:46:26 am »
Ah, yeah, also this:
http://www.eevblog.com/forum/chat/vat-on-patreon-donation/
So, if I want to send 1 dollar a month, Patreon is adding 35 cent, tax is adding 21 cent. Though probably more, probably 0.21*(1+0.35) because, you know...
This high flat fee is just ridiculous. So more than 60% of the donations are 1 dollar. They are essentially jacking up their price from 5% to 35% for half of their customers. Way to go.

Dave, please mark a preferred donation method.
Actually it's not that ridiculous at all. Previously those 35 cents were not reaching creator as well. Just look into paypal transaction fees, they have this fixed transaction fee +% of the transfer
So if people were donating $1 each month, they were just feeding paypal, Visa, Mastercard  :palm:. Now donators can see that donating small sums feeds money processors. I guess creators usually did not notice this as well because they see quiet large average processing fee (around 6.2% in Dave's video). And it was large because 1$ donations got more than 30% eaten by transaction fee.
Quote
There is a fee to send money as a personal payment using a debit or credit card. The fee in the U.S. is 2.9% plus $0.30 USD of the amount you send. For example, if you send $100.00 USD by credit card, the fee would be $3.20 USD ($2.90 + $0.30).
« Last Edit: December 10, 2017, 01:52:47 am by wraper »
 

Offline Towger

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #6 on: December 10, 2017, 02:52:57 am »
Basic fail.  Probably run by young ones with no real world experience.  If they wanted to change the system it should have been an option.  Same as PayPal, with all existing donations defaulting to the existing system.  Donate $1 and receiver pays the fees or donate $1 to the receiver and donate pays the fees.  In all cases, all fees and charges should be clearly visible.
 

Offline NANDBlog

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #7 on: December 10, 2017, 03:36:49 am »
Ah, yeah, also this:
http://www.eevblog.com/forum/chat/vat-on-patreon-donation/
So, if I want to send 1 dollar a month, Patreon is adding 35 cent, tax is adding 21 cent. Though probably more, probably 0.21*(1+0.35) because, you know...
This high flat fee is just ridiculous. So more than 60% of the donations are 1 dollar. They are essentially jacking up their price from 5% to 35% for half of their customers. Way to go.

Dave, please mark a preferred donation method.
Actually it's not that ridiculous at all. Previously those 35 cents were not reaching creator as well. Just look into paypal transaction fees, they have this fixed transaction fee +% of the transfer
So if people were donating $1 each month, they were just feeding paypal, Visa, Mastercard  :palm:. Now donators can see that donating small sums feeds money processors. I guess creators usually did not notice this as well because they see quiet large average processing fee (around 6.2% in Dave's video). And it was large because 1$ donations got more than 30% eaten by transaction fee.
Quote
There is a fee to send money as a personal payment using a debit or credit card. The fee in the U.S. is 2.9% plus $0.30 USD of the amount you send. For example, if you send $100.00 USD by credit card, the fee would be $3.20 USD ($2.90 + $0.30).
Good point.
Last years, I was making yearly donation, around Christmas time. I guess I'll keep doing it this way.
IMHO, taking a huge cut from charity is just immoral.
 

Online HwAoRrDk

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #8 on: December 10, 2017, 04:06:56 am »
Here's an interesting article I just read:

https://subfictional.com/my-theory-patreon-doesnt-want-to-be-a-money-services-business/

The author speculates that Patreon have made these changes to avoid being classified as a Money Services Business, where they would be subject to a lot of additional laws and regulations. They would be classified as such because until now they were storing and redistributing funds.
 

Online Cerebus

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #9 on: December 10, 2017, 04:08:30 am »
Scanlime sent out an email for liberapay, https://liberapay.com/scanlime Which from what I see, uses a single large deposit and then you can use that money to donate weekly or monthly.
Patreon could certainly have offered a similar solution, automatically "reload" your account with $20+ whenever it runs out. This could be completely transparent to the user. Of course the downside is you are paying up-front which some people don't like.

That certainly works for Liberapay, who from a quick look around their website seem to be unusually well organized when it comes to legal compliance and similar issues - I smell that rare thing, a competent, humanistic lawyer.

It might be a problem in some jurisdictions; taking a deposit is often one of the crucial defining characteristics of a bank (you may have seen the phrase licensed deposit taker) and incurs with it all the regulatory issues associated with running a fully fledged bank. So in some places that may not be an option.
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Online Cerebus

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #10 on: December 10, 2017, 04:15:09 am »
Good point.
Last years, I was making yearly donation, around Christmas time. I guess I'll keep doing it this way.
IMHO, taking a huge cut from charity is just immoral.

The problem with that is that is makes the income stream for the recipient very 'lumpy' and unpredictable. Imagine how you would plan your finances if you knew that 50% or so of your income was coming as (effectively) an annual lump sum, but you didn't know quite how much or exactly when.

That is perhaps tolerable for a large charity with plenty of experience and understanding bankers, less so for someone like Dave.
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Offline NickS

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #11 on: December 10, 2017, 06:00:58 am »
One thing I'm missing is the fee is 2.9% + 35c.

The 35c is normal. It makes it rubbish for $1 pledges but hey that's the payment industry for you.
They don't want or care about microtransactions.

But 2.9% is very high as Stripe fees go!
Our company uses Stripe, nowhere near the volume Patreon must be at and we just asked them nicely and our rate is way less than that (under half).

They do have to do Paypal as well, but why slug the credit card people with Paypal fees?
And if their credit card fee is significantly lower then who is getting all the profit?
 

Offline thmjpr

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #12 on: December 10, 2017, 08:40:11 am »
Actually it's not that ridiculous at all. Previously those 35 cents were not reaching creator as well. Just look into paypal transaction fees, they have this fixed transaction fee +% of the transfer
So if people were donating $1 each month, they were just feeding paypal, Visa, Mastercard  :palm:. Now donators can see that donating small sums feeds money processors. I guess creators usually did not notice this as well because they see quiet large average processing fee (around 6.2% in Dave's video). And it was large because 1$ donations got more than 30% eaten by transaction fee.

The whole point of patreon was to combine payments so fees would not eat away at donations.
If I donate to 10 people per month then my CC/paypal gets charged once, the 35c fee once, so it is spread across all of my donations (35c/10 = 3.5c for example, or 3.5%).

If they wanted people to see actual fees, they could have added a single 35c/month charge, regardless of the number of people you donate to.
If you had a single $1/month donation, you'd see its a significant portion. If you had $50/month you wouldn't notice it.
 

Online Brumby

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #13 on: December 10, 2017, 10:53:56 am »
I was curious about the 'bottom line' in all this.  For patrons and the people they support, the numbers go up.  Patrons pay more and recipients get more - right across the board.

However, with a change in the fee structure something is going to be different - and I believe it is the fee revenue to Patreon.

From the sums I've done, it seems that - under the new structure - Patreon will collect a greater percentage on fees from donations that are up to $3.60 (the nominal pledge amount).  Over that, their percentage is less than the old scheme.  The lower the pledge amount, the higher the percentage.  The $1 pledge used to score them around 11% which was taken off the pledge.  Now that's almost 38% and is added onto the pledge (or about 27.5% of the forced higher amount).  At $3.60, it's about 12.5% for either.  This assumes that Patreon will have the exact same cost of processing transactions after, as before - which I have no indications to the contrary.

While amounts over $3.60 are will generate a smaller revenue in percentage terms, what is important is the actual dollar amount.  Set this against the larger percentage, but of smaller amounts, for pledges under $3.60 and you must wonder whether Patreon have created a net gain in fee income or not.


There are a few ways to play with the numbers here - and I've just followed one track.  Whether it's the best or not....
 
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Online Cerebus

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #14 on: December 10, 2017, 10:57:15 am »
And look, Patreon's average payment for December 2017 was $3.43 - source: https://graphtreon.com/patreon-stats.
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Offline Macbeth

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #15 on: December 10, 2017, 11:11:29 am »
The long and short is this charity that is so in need of my cash can't accept my 20 quid!
They ended up getting a score dangled in front of them then told to nash because they wanted my bank details.
Sick as hell waste of everyone's time if you ask me.....
They can't because the Chuggers (Charity Muggers) are employed by contractors on commission from all those MBA CEO's of big charities that have also aligned their pay with corporate pay, golden handshakes, pensions, etc.

If you do sign up with a Chugger then at the very least your first year of payments goes directly to the doorstop "salesman" and his boss. The direct debits are finally released to the headline charity after 12 months or more.
 

Online rs20

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #16 on: December 10, 2017, 01:34:20 pm »
Actually it's not that ridiculous at all. Previously those 35 cents were not reaching creator as well. Just look into paypal transaction fees, they have this fixed transaction fee +% of the transfer

Everyone is missing the point here -- the real change that Patreon are making is changing from a monthly batching of charges to charging patrons each little donation as a separate event. This means that a huge amount more money is wasted on the fixed transaction fees (the ones that you mentioned), and rather than just continuing to charge a single lump sum on a monthly basis; they are instead going ahead with that stupid decision and confusing the issue by transferring the cost from Creator to Patron at the same time.

In particular, it is incorrect to assert that "previously those 35 cents were not reaching the creator" -- a large number of patrons donate a small amount to many creators; with this change, the fixed fee is applied multiple times for each creator per month, instead of the one lump sum per month. Patreon even openly admit this, quoting from their blog post: "That’s a lot of fees for creators to pay. We had three options: Have creators deal with a huge increase in fees...."

(Shameless self-promotion:)

 
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Offline Corporate666

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #17 on: December 10, 2017, 03:48:02 pm »

Everyone is missing the point here -- the real change that Patreon are making is changing from a monthly batching of charges to charging patrons each little donation as a separate event. This means that a huge amount more money is wasted on the fixed transaction fees (the ones that you mentioned), and rather than just continuing to charge a single lump sum on a monthly basis; they are instead going ahead with that stupid decision and confusing the issue by transferring the cost from Creator to Patron at the same time.



Yes, exactly this - and EXCELLENT video!

I am surprised nobody noticed Patreon's sleight of hand here.... they are outright lying in their charts about how much money goes to the creators, they ignore the cost increase to the only people who are actually paying anything - the patrons!  Shame on them.

As for what prompted this, I would guess it could have been a few things..

-As all companies do, they may have just been looking at their books wondering how they can make more money and thought "hey, we can shift those transaction fees to the payers". 

-If you watch Dave's video, he mentions something like 800 people who donate $1.  Presumably, many or perhaps most of them may donate to multiple creators and those payments would be batched, but if you look at the percentage that Patreon takes, it's certainly far less than 35% or so, which is what it would be if all those $1 pledges were processed individually.  So there are ratios in there regarding the number of people pledging multiple creators, the average pledge amount, whether they are paying monthly or per-video and numerous other factors.  It could be that things are trending such that Patreon is noticing an increase in fees and a reduction in profit due to this trend.  Shifting the processing fees to the patrons eliminates all of the aggregation of data and batching of payments necessary to realize efficiencies of processing payments they need to realize a profit.  It also insulates them from losses due to shifting trends in the way patrons choose to support creators.

-It could be that as Patreon has grown, the credit card companies have chosen to take a bite out of them.  Patreon isn't a tiny fish, but they are a microscopically irrelevant fish compared to the transaction volume of Visa/MC/Amex/Discover/etc.  I can see them doing enough volume to pop up on the radars of the processing companies and come under closer scrutiny, and either be deemed ripe for additional fleecing, or possibly be deemed to be a risk due to the service they are selling.  Perhaps when they were smaller, they were categorized somehow with their processors but as they have grown, their payment processors want to adjust their rates.  Whatever the reason, if their rates change even a little (a few cents more per transaction), that can radically change the business model under Patreon's old system.

-And it could be that they have been seeing a fair amount of fraud.  Who knows - but there is no tangible good exchanged, so perhaps there is some way Patreon has been abused for money laundering or trading in illicit goods and this has caused the hammer to come down and required additional financial scrutiny.

Whatever it is, Patreon isn't telling and I wouldn't expect them to.  I am disappointed that they were so disingenuous in their chart as pointed out in the video linked above.  It makes me want to cancel my pledges, but I've supported Dave for a couple of years or more now, and I don't want the creators to the ones to suffer.
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Offline EEVblog

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #18 on: December 10, 2017, 04:42:04 pm »
 

Offline Muttley Snickers

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #19 on: December 10, 2017, 04:58:06 pm »
I'm not a Patreon supporter and never had any intentions to be, can I not just arrange to pay anyone or do a funds transfer directly to someone on a scheduled basis via my online linked bank accounts ?. Is the Patreon thing just so lazy people can keep tabs and graphs on who paid, how much and when, perhaps and more than likely I am missing something in the transaction. Surely a donation recipient could simply set up a dedicated bank account to keep tabs on the total received for tax or other purposes and from whence it came.


« Last Edit: December 11, 2017, 09:16:33 am by Muttley Snickers »
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Online wilfred

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #20 on: December 10, 2017, 05:05:27 pm »
Surely the barrier to entry for a subscription payment service is lower than for most other services on the Internet. As long as the creator you want to support has multiple options then fee hikes must be limited to below the level of inertia to switch.

Is there no Patreon alternative?
 
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Online rs20

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #21 on: December 10, 2017, 05:08:56 pm »


Nicely produced video, but he is just perpetuating the red herring of "should the creator or the patron pay" when the only one paying money here is the patron so it's always been the patrons paying, and he speculates as to whether the fixed fee is applied once per month when the answer is clearly precisely given as "no, it's applied for every individual pledge you make" as explained in Patreon's updated blog post, and again speculates as to the impact of the change on the percentage loss from patron to creator when that same blog post clearly says "That’s a lot of fees for creators to pay. We had three options: Have creators deal with a huge increase in fees...."

I'm flabbergasted that everyone's being fooled by the dummy that Patreon is playing here. They clearly state that they are making each donation a separate credit card transaction, therefore incurring way more fees. Why are we allowing ourselves to be distracted by the "who's paying for it" red herring?

I'm not a Patreon supporter and never had any intentions to be, can I not just arrange to pay anyone or do a funds transfer directly to someone on a scheduled basis via my online linked bank accounts ?. Is the Patreon thing just so lazy people can keep tabs and graphs on who paid, how much and when, perhaps and more than likely I am missing something in the transaction. Surely a donation recipient could simply set up a dedicated bank account to keep tabs on the total received for tax or other purposes and from whence it came.

You're forgetting international transfer, and the fees that go along with that, and the rewards that Patrons get.

Surely the barrier to entry for a subscription payment service is lower than for most other services on the Internet. As long as the creator you want to support has multiple options then fee hikes must be limited to below the level of inertia to switch.

Is there no Patreon alternative?

Again, the benefit here is having all your creators supported on a single platform. There's a significant hurdle to getting a Creator to fill out all the tax forms etc associated with sending money about the place, and a Patreon alternative that had, for example, only EEVBlog on it would be much less attractive because that'd be more credit card transactions and more fixed fees being accrued if I had to support via several different platforms.
 

Offline Mr. Scram

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #22 on: December 10, 2017, 05:15:30 pm »
This isn't totally clear to me, but is Patreon actually getting more money per whatever metric you use?
 

Online rs20

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #23 on: December 10, 2017, 05:23:07 pm »
This isn't totally clear to me, but is Patreon actually getting more money per whatever metric you use?

It depends on whether the Patrons adjust their pledge (which they can't do if they're already at the minimum of $1.00, in which case they might quit entirely) and what proportion of the fee money goes to Patreon vs Credit Card Processing Companies. But franky, I don't care whether Credit Card Processing Companies or Patreon are winning here; what's perfectly clear is that the percentage of the Patron's money that makes it to the Creator's wallet is getting worse, so the Creator + Patron team is definitely losing overall.
 

Offline Towger

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #24 on: December 10, 2017, 05:49:59 pm »
Can anyone confirm what they are charged by their credit card company, if they only make a small $1~3 donation a month and their card's account is not in USD?
I think you will find the exchange rate will be far worse than normal, to cover VISA/Mastercard minimum cost of doing business.
 

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #25 on: December 10, 2017, 06:02:23 pm »
Good point.
Last years, I was making yearly donation, around Christmas time. I guess I'll keep doing it this way.
IMHO, taking a huge cut from charity is just immoral.

The problem with that is that is makes the income stream for the recipient very 'lumpy' and unpredictable. Imagine how you would plan your finances if you knew that 50% or so of your income was coming as (effectively) an annual lump sum, but you didn't know quite how much or exactly when.

That is perhaps tolerable for a large charity with plenty of experience and understanding bankers, less so for someone like Dave.
You have the choice of receiving $60 now, then $60 again in 6 months, etc. or $10 now, then another $10 next month, etc. I would pick the $60 every 6 months option since you can always throw it into savings and then restrict to making only $10 available to use every month (plus a tiny amount of interest). That's especially true if the income source could vanish any time. With the $60 every 6 months option, you'll more or less know ahead of time that the entire batch of 6 months has been paid. With the $10/month option, every month you'll wonder if it will still be there.
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Offline Mr. Scram

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #26 on: December 10, 2017, 06:03:20 pm »
Can anyone confirm what they are charged by their credit card company, if they only make a small $1~3 donation a month and their card's account is not in USD?
I think you will find the exchange rate will be far worse than normal, to cover VISA/Mastercard minimum cost of doing business.
I know Paypal forces you to pay in your local currency, and therefore forces conversion on any other currency, at a terrible rate. It often amounts to something like 5 cents a dollar more than the regular conversion rate, which is a lot.
 

Offline station240

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #27 on: December 10, 2017, 06:41:48 pm »
Another video I was recommended.
Talks about the usual issues (supporters with multiple creators) plus he looks at the Venture Capital companies behind Patreon.


Perhaps instead of heaping all the blame on Patreon, we should start asking questions of these Venture Capitalists.
https://www.crunchbase.com/organization/patreon
Someone must have forced this sudden change onto the company.
« Last Edit: December 10, 2017, 06:43:19 pm by station240 »
 

Online wilfred

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #28 on: December 10, 2017, 08:07:49 pm »
This isn't totally clear to me, but is Patreon actually getting more money per whatever metric you use?

Do you, or anyone else, really doubt this wasn't the intention. What were the chances Patreon would introduce changes where they got less?

Precisely zero.
 

Offline NANDBlog

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #29 on: December 10, 2017, 08:16:01 pm »
Can anyone confirm what they are charged by their credit card company, if they only make a small $1~3 donation a month and their card's account is not in USD?
I think you will find the exchange rate will be far worse than normal, to cover VISA/Mastercard minimum cost of doing business.
I know Paypal forces you to pay in your local currency, and therefore forces conversion on any other currency, at a terrible rate. It often amounts to something like 5 cents a dollar more than the regular conversion rate, which is a lot.
It doesnt force you. You can set it up, so your bank takes care of it.
It is important for me, because my account linked to paypal is actually in HUF, not EUR or USD.

Good point.
Last years, I was making yearly donation, around Christmas time. I guess I'll keep doing it this way.
IMHO, taking a huge cut from charity is just immoral.

The problem with that is that is makes the income stream for the recipient very 'lumpy' and unpredictable. Imagine how you would plan your finances if you knew that 50% or so of your income was coming as (effectively) an annual lump sum, but you didn't know quite how much or exactly when.

That is perhaps tolerable for a large charity with plenty of experience and understanding bankers, less so for someone like Dave.
They just have to live with it. If I automatically transfer money every month, it feels like a subscription.
 

Offline Mr. Scram

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #30 on: December 10, 2017, 08:17:10 pm »

Do you, or anyone else, really doubt this wasn't the intention. What were the chances Patreon would introduce changes where they got less?

Precisely zero.
Providing a better service isn't a fictional goal.
 

Offline Mr. Scram

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #31 on: December 10, 2017, 08:20:15 pm »

It doesnt force you. You can set it up, so your bank takes care of it.
It is important for me, because my account linked to paypal is actually in HUF, not EUR or USD.


They just have to live with it. If I automatically transfer money every month, it feels like a subscription.
You used to be able to do that, but I looked into it the other day and the internet tells me that's no longer the case. You're forced to take the unfavourable exchange rate.
 

Offline SeanB

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #32 on: December 10, 2017, 08:32:04 pm »
Alternative is to do what the late Jerry Pournelle ( RIP Jerry, you are missed!) did, and have an annual pledge drive, which did cover his costs for running the website, and which did pay him enough to cover his subscriptions to journals and such for there, though he did of course have other income sources that covered his actual living and care, from the residuals on his book sales and the advances for his books. Advantage that the pledge payers got was a copy of his book, and a code to put in email for the mail filter to put it in a section he would mostly read.
 

Online wilfred

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #33 on: December 10, 2017, 08:32:42 pm »

Do you, or anyone else, really doubt this wasn't the intention. What were the chances Patreon would introduce changes where they got less?

Precisely zero.
Providing a better service isn't a fictional goal.
We shall see. Maybe Dave will provide an update in due course.

But nevertheless, only a threat of competition will make Patreon reduce its cut. I'm OK with that. If their first reponse is to improve service then I'm OK with that too.
 

Offline Grapsus

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #34 on: December 11, 2017, 04:11:44 am »
Dave, I'm really sorry but I had to suspend my patreon account when I saw this bullshit. They really need to get a message and reverse this thing. But whatever new platform you choose just let us know and I'll renew my support.

In my opinion Patreon is getting ready for a buy-out. A few months ago they banned erotic content creators and their revenue probably took a hit from that move so they either trying to compensate for that or trying to modify their cash flows / accounts in some way.
I haven't been so disappointed in a while by a company. I know in the end it's all about money but they working for a really noble cause and I was expecting better from them.
 

Offline Mr. Scram

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #35 on: December 11, 2017, 10:32:41 am »
Dave, I'm really sorry but I had to suspend my patreon account when I saw this bullshit. They really need to get a message and reverse this thing. But whatever new platform you choose just let us know and I'll renew my support.

In my opinion Patreon is getting ready for a buy-out. A few months ago they banned erotic content creators and their revenue probably took a hit from that move so they either trying to compensate for that or trying to modify their cash flows / accounts in some way.
I haven't been so disappointed in a while by a company. I know in the end it's all about money but they working for a really noble cause and I was expecting better from them.
The moral of the story is that the vast majority of the companies are working for their bottom line. People tend to attach all sorts of moral qualities to things, but in the end, they're just trying to manoeuvre themselves into the most profitable position.
 

Online Brumby

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #36 on: December 11, 2017, 11:15:32 am »
After watching those videos, the first one made the most succinct point that dismissed most of my **math exercise....

All that matters is two things:
1. How much the patron has taken from their account  ... and ...
2. How much of that the recipient gets
... everything else is just smoke and mirrors.


In my $1 monthly donation, I was first miffed at the fact that it was $1 US so, depending on exchange rate, I could get something like AU$1.34 taken each month.  I soon got comfortable with that knowing that Dave would be getting more.  (I know $1 isn't much - but there are hundreds of us doing that ... and it all adds up.)

A couple of days later I noticed another 3 cent debit for a foreign currency transaction fee.  Yay to my bank.  :--  This just seems absurd when I'm less than half an hour's drive from dropping it into his hand.

And now we're jacking it up - to an expected $1.85.  Sure, Dave will get more, but Patreon will be carving out an even bigger chunk percentage wise.  Makes me start to "itch" - on principle - and scratching the itch will mean scratching my Patreon pledge.  I'd be happier setting up a monthly direct debit to an account of Dave's.  Sure I'd miss out on the communications - but it would be a fee free process.


(** and I didn't even touch on the multiple donation patrons!)


The moral of the story is that the vast majority of the companies are working for their bottom line. People tend to attach all sorts of moral qualities to things, but in the end, they're just trying to manoeuvre themselves into the most profitable position.
I have no qualms about a business looking after its bottom line - just as long as they do so with honesty and fairness.

If we just look at the multiple support patron situation (as I understand it)... If we have 100 patrons, each supporting a group of 100 creators, then collecting the funds should need only take 100 transactions... but now we are going to see 10,000?  Madness - unless you're a greedy payment processor.

The only "positive" out of such an approach is that, if a patron only has $50 to cover his $100 of pledges, then under the old scheme, the whole debit would be declined, whereas under the new scheme, half of them would go through.  Hardly a compelling argument.
 
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Offline tri-be

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #37 on: December 11, 2017, 12:05:14 pm »
I'm someone else who has stopped all Patreon payments for now. I am really sorry about that.

I've been thinking about the problem. My Google-fu is failing me so haven't spotted anything similar (I'm probably not trying hard enough).

Is there currently a system that itself doesn't handle any payments, but superficially behaves similarly to the patron thing (perhaps more socially useful) where many people can pledge small regular amounts to several creatives they are interested in? Instead of giving your money to the system which then doles it out to the creatives, the system suggests you pay the total amount of all your pledges to just one (or at least a smaller number) of your creatives (directly or perhaps even through the patron thing or similar) and suggests to other people that they pay your other creatives in common so they still get an amount that includes what you would have paid of you paid directly.

I can think of many problems around this. A lot to do with trust and payment verification, and unreliable/lazy supporters (obviously that would not apply to anybody here). However, if enough people used it and the individual payments were not allowed to get too big, even if some of the flakier elements were involved, I think creatives with even a moderate number of supporters could expect a reasonably reliable income.
 

Offline thmjpr

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #38 on: December 11, 2017, 05:24:43 pm »
You used to be able to do that, but I looked into it the other day and the internet tells me that's no longer the case. You're forced to take the unfavourable exchange rate.

If you are talking about paying with a credit card in any currency its certainly still possible:
Quote
I changed it by going to: Settings Gear Icon > Payments > Manage Payments > My Preapproved Payments > Set Available Funding Sources > Conversion Options

For a bank I don't think that would have been an option, but could be wrong.
 

Offline savageautomate

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #39 on: December 12, 2017, 12:23:22 pm »
This video clearly points out some of the deceptive marketing wank Patreon wants us to believe:

 

Offline Moe

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #40 on: December 12, 2017, 01:41:34 pm »
MakerSupport seems to be good. Here are their guidelines https://www.makersupport.com/guidelines They seems to be big supporters of free speech :-+
 

Online Cerebus

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #41 on: December 14, 2017, 06:02:47 am »
Patreon have now backed down, and are not going ahead with the planned fee changes.

https://blog.patreon.com/not-rolling-out-fees-change/
Anybody got a syringe I can use to squeeze the magic smoke back into this?
 
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Offline Grapsus

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #42 on: December 14, 2017, 07:57:00 am »
Patreon have now backed down, and are not going ahead with the planned fee changes.

https://blog.patreon.com/not-rolling-out-fees-change/

Wow ! I guess the loss of patrons must have been exceeding the monetary gain from the new system. But the damage is done, it's exactly the same feeling as being cheated on. Fuck you Jack Conte
 

Offline Corporate666

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #43 on: December 14, 2017, 08:22:34 am »
Surely the barrier to entry for a subscription payment service is lower than for most other services on the Internet. As long as the creator you want to support has multiple options then fee hikes must be limited to below the level of inertia to switch.

Is there no Patreon alternative?

I think it's more complicated that it seems, at first.

When a credit card is charged, the credit card issuer (Visa, Mastercard, American Express, Discover, etc) impose a percentage fee, plus a fixed transaction fee.  The percentage fee is usually around 3% and the fixed transaction fee is usually around $0.30 - rough numbers.  Then there's international currency conversion fees and all other sorts of fees.

If you look at Dave's video, he has say 1,000 people pledging, of which 800 are pleding $1/month.  For those pledging $1, if the card processor takes the fees out, that means Dave will net about $0.55 or less.  So it's massively inefficient to process a lot of small charges.  All those people think they are giving him $1, but he's getting about half that.  Take out Patreon's cut and he would get even less.

Patreon batches charges, so if you are pledging $1 to 20 people, they would charge you $20 one time - thus incurring a single $0.30 transaction fee and 3% of that $20.  That lets them deliver almost the full $1 pledge to each creator.  From Dave's standpoint, as a percentage, it is a HUGE difference - he is getting 88% of the money vs maybe 40%.  When you see that Patreon is processing $10 million+ per month, that is a LOT of money.

If someone else wanted to start up, they have to figure that problem out... it's not as simple as just processing payments.  If they don't have the creators, then they can't batch the charges, which means they can't give anywhere near the same percentages to the creators - hence the creators wouldn't want to go with them.

Patreon shifting the transaction fees to the Patrons does open them up to that competition, however... so we shall see how things change from now on.
It's not always the most popular person who gets the job done.
 

Online wilfred

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #44 on: December 14, 2017, 10:01:06 am »
Patreon shifting the transaction fees to the Patrons does open them up to that competition, however... so we shall see how things change from now on.

Maybe the $1/month supporters should just post a cheque once a year with a postcard so they might get their name mentioned on a mailbag or make an annual Paypal donation.

Would it be a good joke to play on Dave to send him a 1000 $20 cheques and make him stand in a bank for hours depositing them. I know it would piss me off. ;D

 

Online Bud

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #45 on: December 14, 2017, 10:10:58 am »
Seems you think Australian personal checks are accepted worldwide.

Edit: sorry, the other way around: That Australia honors foreign personal checks.
« Last Edit: December 14, 2017, 10:12:51 am by Bud »
 

Online Cerebus

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #46 on: December 14, 2017, 10:15:23 am »
Seems you think Australian personal checks are accepted worldwide.

Edit: sorry, the other way around: That Australia honors foreign personal checks.

Seems like you don't bother to actually read what is written.

... should just post a cheque once a year ... or make an annual Paypal donation.
Anybody got a syringe I can use to squeeze the magic smoke back into this?
 
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Offline NANDBlog

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #47 on: December 14, 2017, 10:31:01 am »
Surely the barrier to entry for a subscription payment service is lower than for most other services on the Internet. As long as the creator you want to support has multiple options then fee hikes must be limited to below the level of inertia to switch.

Is there no Patreon alternative?

I think it's more complicated that it seems, at first.

When a credit card is charged, the credit card issuer (Visa, Mastercard, American Express, Discover, etc) impose a percentage fee, plus a fixed transaction fee.  The percentage fee is usually around 3% and the fixed transaction fee is usually around $0.30 - rough numbers.  Then there's international currency conversion fees and all other sorts of fees.

If you look at Dave's video, he has say 1,000 people pledging, of which 800 are pleding $1/month.  For those pledging $1, if the card processor takes the fees out, that means Dave will net about $0.55 or less.  So it's massively inefficient to process a lot of small charges.  All those people think they are giving him $1, but he's getting about half that.  Take out Patreon's cut and he would get even less.
Meanwhile, other non-american credit card issuers have online payment systems, which charge as much as 0.05EUR for a transaction. And it is progressive, small payments charge even less.

It is funny to see sometimes, that things can be done in different ways. People need to travel around a bit, and open their perspective to realize, that they are being ripped off.
 

Offline SparkyFX

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #48 on: December 14, 2017, 10:31:34 am »
Is there no Patreon alternative?
There is flattr (discontinued donations in 2013), paypal donations, maybe even a classical fund would work (whatever the tax consultant has to say about it). The point is that payment processing, international contracts and matching those payments to features is what patreon is good in. Coding a half decent secure payment processor is not a one man show, not if you want international audience to be able to participate and not create a huge mess by security mishaps.

When a credit card is charged, the credit card issuer (Visa, Mastercard, American Express, Discover, etc) impose a percentage fee, plus a fixed transaction fee.  The percentage fee is usually around 3% and the fixed transaction fee is usually around $0.30 - rough numbers.  Then there's international currency conversion fees and all other sorts of fees.
Paying by credit card ruins the whole idea of micro-transactions - or makes some people quite rich. I mean i got electronic payment options that are free for the store in which i buy using my debit card alone by granting them an electronic debit (with signature). But that would be horrible and hard to secure in an international transaction as neither the bank nor me could get the money back outside of this jurisdiction. Even the other options are 0,3%... a huge gap to the 2-4% a payment via credit card takes as a cut. (Data from a site in foreign language)

I thought patreon could actually work around credit cards and offer more payment options by going local and averaging out which payment goes where (minimizing currency exchange fees, tax, keeping money spent in one country instead of double exchanges) and by offering the lowest rate payments options available. There could be a huge incentive if they have a problem with that. I think paypal does it that way anyhow, plus it offers such payment options. Of course they also charge for their service.

2-4% is quite a number in the world of electronic processing, which practically costs next to nothing (a few processor clocks and the rest for financial security of the system). Except of course you feel social and are happy to pay for everyone who does not pay his/her bill, which is then kind of double-dipped by selling the right to collect the debt.

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Comes with: More Parts! Complications™! Physics! English! Pulled out Hairs! Batteries included!
 

Offline bson

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #49 on: December 14, 2017, 10:35:58 am »
Patreon just backed down and abandoned this whole idea.
<This space intentionally left blank>
 

Online wilfred

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #50 on: December 14, 2017, 10:47:49 am »
Seems you think Australian personal checks are accepted worldwide.

Edit: sorry, the other way around: That Australia honors foreign personal checks.

Maybe years ago Dave made a comment about wasting time in a bank trying to deposit a foreign cheque. If my memory is correct.

You can be sure I did not think it through to the extent you mention. Or at all.
 

Offline retiredcaps

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #51 on: December 14, 2017, 12:28:45 pm »
But the damage is done
Patreon hasn't been around for 20 years, but still the same sentiment.

Warren Buffet once said that 'it takes 20 years to build a reputation and five minutes to ruin it'
 
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Offline Mr. Scram

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #52 on: December 14, 2017, 08:49:24 pm »
Wow ! I guess the loss of patrons must have been exceeding the monetary gain from the new system. But the damage is done, it's exactly the same feeling as being cheated on. Fuck you Jack Conte
I feel consumers can sometimes be completely oblivious, but also incredibly harsh. Let's face it, everyone is going to make mistakes, as is every company. It's how you deal with those mistakes that should be judged.
 

Offline prof

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #53 on: December 15, 2017, 10:54:59 pm »
Patreon have now backed down, and are not going ahead with the planned fee changes.

Yeah, and sure enough they offer to reinstantiate cancelled payments. However for me this was just the nail in the coffin since I'm very much displeased with the slapped on local VAT, especially since the provided VAT number (EU826426378) is not a valid VAT number so I cannot even verify that they're a correctly registered business and actually forward the slapped on taxes... Oh, failing to provide a valid VAT number is considered fraud in the EU so if anyone wants to report them, please feel free...
 

Offline outofmbufs

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #54 on: December 16, 2017, 03:59:09 am »
I feel consumers can sometimes be completely oblivious, but also incredibly harsh. Let's face it, everyone is going to make mistakes, as is every company. It's how you deal with those mistakes that should be judged.

To me, the issue is as much about their disingenuous "we did it for YOU!" explanations of the proposed change, including the double-down when first challenged on it. Symptom of internal leadership and process problems, and complete contempt for the intelligence of their user base.

I agree that how a company responds to a mistake is important and expecting no mistakes ever is unreasonable. I give Patreon credit for aborting the change. But - that a change this big could cause such an immediate and severe backlash as a "surprise" to the company (ummm, hello, have you ever heard of focus testing?) is symptomatic of something far more wrong than Jack's "oops, our bad" covers at the moment.

I'll come back as a Patreon. But no, not immediately, because giving a freeroll on something this bad is an insufficient feedback signal. Patreon does not deserve the chance to pretend it never happened; it DID happen. It's unfortunate that my only signal mechanism is to withhold Patreon-based support of creators I like for some period of time.
 
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Offline all_repair

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #55 on: December 16, 2017, 04:20:11 am »
Patreon has all the data, and to screw up so big is not possible.  But they likely under  estimated the damage it can cost them.  After the first 2 days, they know that if they don't change back, Patreon shall be dead very fast.  I am not going to support through Patreon any more as I am very sure they shall try something again when they are in a stronger position.
 

Offline Macbeth

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #56 on: December 16, 2017, 06:29:07 am »
Yeah, and sure enough they offer to reinstantiate cancelled payments. However for me this was just the nail in the coffin since I'm very much displeased with the slapped on local VAT, especially since the provided VAT number (EU826426378) is not a valid VAT number so I cannot even verify that they're a correctly registered business and actually forward the slapped on taxes... Oh, failing to provide a valid VAT number is considered fraud in the EU so if anyone wants to report them, please feel free...
You pay VAT on Patreon? Seriously? WTF is wrong with Germany?
 

Online Brumby

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #57 on: December 16, 2017, 10:10:27 am »
Yeah, and sure enough they offer to reinstantiate cancelled payments. However for me this was just the nail in the coffin since I'm very much displeased with the slapped on local VAT, especially since the provided VAT number (EU826426378) is not a valid VAT number so I cannot even verify that they're a correctly registered business and actually forward the slapped on taxes... Oh, failing to provide a valid VAT number is considered fraud in the EU so if anyone wants to report them, please feel free...
You pay VAT on Patreon? Seriously? WTF is wrong with Germany?

It was my understanding that Germany had the strongest economy in the EU.

I further understand that this has resulted in Germany putting in the lion's share when it comes to "supporting" other member countries ... and that Germans are (unsurprisingly) somewhat unhappy about that.
 

Offline JPortici

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #58 on: December 19, 2017, 08:46:11 am »
Yeah, and sure enough they offer to reinstantiate cancelled payments. However for me this was just the nail in the coffin since I'm very much displeased with the slapped on local VAT, especially since the provided VAT number (EU826426378) is not a valid VAT number so I cannot even verify that they're a correctly registered business and actually forward the slapped on taxes... Oh, failing to provide a valid VAT number is considered fraud in the EU so if anyone wants to report them, please feel free...
You pay VAT on Patreon? Seriously? WTF is wrong with Germany?

we do it as well. not sure it counts as donation
 

Offline kaz911

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #59 on: December 19, 2017, 09:03:41 am »
Yeah, and sure enough they offer to reinstantiate cancelled payments. However for me this was just the nail in the coffin since I'm very much displeased with the slapped on local VAT, especially since the provided VAT number (EU826426378) is not a valid VAT number so I cannot even verify that they're a correctly registered business and actually forward the slapped on taxes... Oh, failing to provide a valid VAT number is considered fraud in the EU so if anyone wants to report them, please feel free...
You pay VAT on Patreon? Seriously? WTF is wrong with Germany?

It was my understanding that Germany had the strongest economy in the EU.

I further understand that this has resulted in Germany putting in the lion's share when it comes to "supporting" other member countries ... and that Germans are (unsurprisingly) somewhat unhappy about that.

Germany should not complain.

Had Germany still had German Marks - and not Euro - their currency would have been through the roof and exports would be really hard. Now all the "low income" Euro countries are working as scales - with strong economies on one side and weak on the other -and it is  making Germany hyper competitive compared to where Germany would have been with their own currency.

Germany benefits greatly from an artificially low Euro (for them) and the other countries in the financially "bad" regions do bad because THEIR Euro is artificially HIGH compared to where their currency would have been if it was not for the Euro (Spain, Italy, Greece etc)

When a country converts to the Euro - the local National Bank loose an important tool-set - namely the ability to adjust interest rate on their currency and the ability to devalue hard in a crises situation. Now all countries are cooked up in one pot only the very strong economies benefit from using Euro. The less fortunate economies suffer when exports are hard.

The Euro is a complete failure from that perspective. The only "salvation" is converting the different national economies into one - where nobody talks about the financial issues in Spain, Italy or Greece because it is all just "Euroland" and then Euroland parts have to help out each other.
 

Offline Mr. Scram

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #60 on: December 19, 2017, 02:05:44 pm »
It was my understanding that Germany had the strongest economy in the EU.

I further understand that this has resulted in Germany putting in the lion's share when it comes to "supporting" other member countries ... and that Germans are (unsurprisingly) somewhat unhappy about that.
The general public is notoriously quick to point out the bits that don't benefit them, while forgetting the part that does. Evidence points towards the German economy getting a nice and consistent boost from joining the euro. As one of the main manufacturing countries of Europe, the fixed euro has brought Germany a lot of good where it might have been a struggle otherwise.

http://www.minyanville.com/business-news/the-economy/articles/euro-trade-export-exchange-rates-trade/7/19/2012/id/42549
 


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