In 2010 Peter Sunde, one of the men behind The Pirate Bay, launched a micro-payment venture called Flattr. While people could illegally download music and movies for free on his other venture, Sunde said Flattr would give them an option to voluntarily make micro-donations for any material they liked.
The way it would work is that the user sets up a Flattr account to which he/she pays a monthly fee of their choice, at a minimum of $2. They then could click the Flattr button, anywhere it exists, next to the content to reward the person who created it.
Having now connected with Twitter, SoundCloud, Instagram, Flickr, Github, Vimeo, 500px and App.net, Flattr will divide the user’s monthly budget into equal parts based on the number of clicks (likes, favourites and stars) the user made throughout the month.
The founders say they will send the creators of the content 90% of the revenue their content accumulates, the following month. But if the artists haven’t signed up to Flattr, the company will hold on to the money until they do.
As you can see, just like with The Pirate Bay, the artist’s choice is yet again taken away from them – their creations are entered into the moneymaking scheme whether they agree to it or not.
It’s also unclear how those that sign up will prove that they are, indeed, the owner of the content. Do the people behind Flattr understand the complexity of ownership of much creative work? Consider that 95% of the UK top 100 singles last year were not written solely by the performer. And what about the producer of the record?
Co-founder Martin Thörnkvist compares Flattr to Kickstarter. “Just as Kickstarter revolutionized the way we pay creators before something is created, we’ve now made it easy and natural to support and back someone after and because of what they’ve already created – right when it’s being consumed,” Thörnkvist told Hypebot.
But while Kickstarter connects the creators with their fans, enabling them to be part of the process, Flattr does nothing of the sort. To that extent, it’s perhaps fairer to compare it to PayPal – a way of transferring money. And looking at it from that perspective, taking 10% is quite steep.
And here is also where we come across the most worrying aspect of the business model: with Flattr, unlike PayPal, transparency is almost completely impossible.
On its website we can see the top unclaimed Flattrs. But the How Flattr Works page, as well as the FAQ page, seems largely focused on bringing in donors and not receivers of the donations (perhaps a reason why there are quite a few unclaimed donations).
The FAQ page says that Flattr will send a report “together with your money” once a month (but only once the revenue balance reaches €10) via PayPal or Skrill (Moneybookers). But will this report detail what the payment is based on? After all, each micro-donation is based on how much money each donor put into his/her account that month and how many Flattrs they made that month.
Even Spotify can’t do such specific accounting – and it doesn’t have to, as it has a set amount of users paying a set amount of money for subscriptions each month (or a set amount of advertising revenue that has to be divided by the total amount of streams on the free service).