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Rights Management and
Payment Technologies
126
Automated Payment Systems
The phrase `automated payment system' is not entirely accurate because the process
of purchasing goods over the Internet is not truly automated; rather it is assisted. Many
Internet users will have some experience of online purchasing.
200
While numerous
vendors provide automated payment services they all use very similar mechanisms. In
many ways the online automated payment process is similar to the purchase transaction
that takes place in a conventional shop except that in a shop where a credit or debit
card is used the card is physically presented and the clerk usually reads its magnetic strip
automatically.
The automated payment process is likely to take the following shape:
1.The customer browses or searches the seller's Web site and, once a product has been
selected for purchase, proceeds to initiate payment.
2.The seller's Web site then collects some information about the customer to enable
them to verify (or track) the customer's identity.
3.The seller's Web site passes the customer to a secure payment gateway which enables
the customer to enter her credit or debit card details.
4.The Payment Gateway requests authorisation from the customer's bank or credit
card. If funds are available the transaction is approved and if not it is declined.
Confirmation of the outcome only is passed back through the Payment Gateway
to the seller's server.
5. If the seller's server receives a positive response, then the transaction is approved and
the seller releases the goods, whether this involves a physical shipment or a virtual
one (e.g. an airline reservation number is sent as an e-mail, or an ID and password
needed to open a file or site are passed to the consumer).
In transactions where the credit card is not present, the costs of fraudulent purchases
are met by the selling party.Vendors must ensure that the card is not stolen (via a verifi-
cation process using a home address or similar information) before agreeing to honour
the transaction.This is a service that the Payment Gateway provider should perform as
standard, and organisations should ensure that the provider they select routinely carries
out this verification. Major suppliers of Payment Gateway services and systems include
VeriSign
, Rodopi Payment Gateway, Authorize.Net, and eWAY.
201
Micropayments
One automatic payment system in which there is growing interest is micropayments,
very small charges incurred each time a chargeable Web page is viewed or interacted
with.These payments perhaps in the region of a fraction of a cent are too small to be
200 See Indie Film Spot (http://www.striketheset.com/), which allows users to download for a fee
independently made movies in the format of their choice, for a good example of a site which achieves a
balance between cultural worthiness and economic realism.
201 http://www.verisign.com/; http://www.r-p-g.com/; http://www.authorizenet.com/;
http://www.eway.com.au/
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