Author Topic: eevBLAB #42 - Patreon FAIL!  (Read 19087 times)

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Offline Mr. Scram

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #25 on: December 10, 2017, 07:03:20 am »
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 #26 on: December 10, 2017, 07:41:48 am »
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, 07:43:19 am by station240 »
 

Online tszaboo

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #27 on: December 10, 2017, 09:16:01 am »
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 #28 on: December 10, 2017, 09:17:10 am »

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 #29 on: December 10, 2017, 09:20:15 am »

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 #30 on: December 10, 2017, 09:32:04 am »
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.
 

Offline Grapsus

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #31 on: December 10, 2017, 05:11:44 pm »
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 #32 on: December 10, 2017, 11:32:41 pm »
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.
 

Offline Brumby

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #33 on: December 11, 2017, 12:15:32 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 #34 on: December 11, 2017, 01:05:14 am »
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 #35 on: December 11, 2017, 06:24:43 am »
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 #36 on: December 12, 2017, 01:23:22 am »
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 #37 on: December 12, 2017, 02:41:34 am »
 c
« Last Edit: February 01, 2020, 04:32:52 pm by Moe »
 

Offline Cerebus

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #38 on: December 13, 2017, 07:02:47 pm »
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 #39 on: December 13, 2017, 08:57:00 pm »
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 #40 on: December 13, 2017, 09:22:34 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?

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.
 

Offline Bud

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #41 on: December 13, 2017, 11:10:58 pm »
Seems you think Australian personal checks are accepted worldwide.

Edit: sorry, the other way around: That Australia honors foreign personal checks.
« Last Edit: December 13, 2017, 11:12:51 pm by Bud »
Facebook-free life and Rigol-free shack.
 

Offline Cerebus

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #42 on: December 13, 2017, 11:15:23 pm »
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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Online tszaboo

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #43 on: December 13, 2017, 11:31:01 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?

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 #44 on: December 13, 2017, 11:31:34 pm »
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.

Support your local planet.
 

Offline bson

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #45 on: December 13, 2017, 11:35:58 pm »
Patreon just backed down and abandoned this whole idea.
 

Offline retiredcaps

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Re: eevBLAB #42 - Patreon FAIL!
« Reply #46 on: December 14, 2017, 01:28:45 am »
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 #47 on: December 14, 2017, 09:49:24 am »
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 #48 on: December 15, 2017, 11:54:59 am »
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 #49 on: December 15, 2017, 04:59:09 pm »
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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