From: Jim Hart <hart@chaos.bsu.edu>
Date: Sun, 21 Aug 94 15:15:14 PDT
To: cypherpunks@toad.com
Subject: Digital cash market
Message-ID: <199408212216.RAA15216@chaos.bsu.edu>
MIME-Version: 1.0
Content-Type: text/plain



L. Todd Masco:
> The american people keep claiming in polls that they want better privacy
>  protection, but the fact is that most aren't willing to do anything
>  about it: it's just a preference, not a solid imperative. 

Most customers want more privacy, but when you think about it, there 
is not a whole hell of a lot they can do about it right now.  If
they want to get the status and flexibility of a credit card,
they need to give up their privacy.  Nobody has tried to give them
a private alternative.  For that matter, no one has shown people
at a gut level, as a good ad could do, what the consequences
of loss of privacy are.

At this point Duncan Frissel will regail us with some wonderful
scheme, understandable only to lawyers, that can be used to
get credit cards under aliases, perfectly legal if you
use a doubly nested corporate structure going through Aruba
and the Caymans, and the IRS and FBI don't decide to get
to get you on some technicality Duncan failed to mention.
I won't comment on why most consumers have neglected that option.
What I'm talking about is a digital cash system that is as
easy for the consumer as an identified debit card.  We can do that
with today's technology.

The traffic level on this list is proof that there are plenty 
of people who care about privacy.  The surprisingly large number 
of folks who actually do go to Frissell style lengths is proof 
that there are plenty of peope who care about privacy.  Once we 
have learned what the problems and solutions are, we are willing 
to go to a significant amount of effort or inconvenience to get it.

The real problem is, these polls are not well publicized,
are geared towards political rather than business solutions,
and haven't sunk through to the people in the product R&D and 
marketing departments.  Exacerbating this, some organizations 
(such as American Express) make a lot of money off their free 
treasure trove of transaction information, and are using lots 
of FUD to keep privacy enhanced alternatives off the market. 

A dramatic, Apple-style ad portraying Visa and MasterCard as
Big Brother may be what is needed to get over the apathy
hurdle.   There are plenty of credit card privacy horror stories
we could publicize.  Think of what could be accomplished these days
with an infomercial.  But this takes at least one excited 
organization with marketing clout to do it.

Meanwhile, smart card based digital cash trials, supported
by a large bank, are going on in Britain.   There are major
markets for both customers and vendors that don't have access
to the credit card system, as well as customers who care about
privacy.  This is not a fringe technology; its possibilities 
just haven't sunk in yet.


Jim Hart
hart@chaos.bsu.edu