Reasons for Lowering Fees

[Samupaha]

In payment business: As many kinds of user as  possible, because the most important key of payment service is ecosystem. I haven't heard about the premium payment service of Chase or Paypal.

Something for everybody is very risky way of doing business. We can do that in the long run, but it has to be done with one market segment at a time.

I agree with jakub, you have to define the customers first and then look what kind of fee structures they find accetable.

And I think we should focus on developing Bitshares so good that people will pay gladly 0.20 cents per transfer. It is already better than Paypal, because it is fast global network, where payments can't be cancelled, and where anybody can make an account (no KYC) and start to use it instantly. Also stealth transfers!

You have to also take into account the business models when comparing to other cryptocurrencies. Bitcoin is very expensive when you look the real cost per transaction, lately it has been around 8-10 dollars. It is clearly very bad business, so why we should compete with it? Let's just wait and have it lose it's market share because people do not want to pay so much for service that isn't nearly as good as many altcoins (like Bitshares).

[jakub]

So this is your strategy: "as many kinds of user as  possible".
OK, cool.

I agree with fav, this discussion has become irrational so for me it's a waste of time.

[clayop]

What I'm doing here is to adjust the fee level to acceptable level for customers.

...and I'm questioning your competence to know what level is "acceptable for customers" if you are not even able to define who your customer is.

In payment business: As many kinds of user as  possible, because the most important key of payment service is ecosystem. I haven't heard about the premium payment service of Chase or Paypal.

In exchange business: Crypto traders for the first.

[clayop]

(4) This presents your full ignorance of BTS2 decision-making system. See the committee voting result. If you want to keep fees high, create a committee member and get higher votes than Bitcrab.

No, it proves your ignorance about marketing.
If you want to keep transfer fees low it's you who needs to create a committee member and get the votes.

Don't tell me you already looked at the voting result...
http://cryptofresh.com/

[jakub]

What I'm doing here is to adjust the fee level to acceptable level for customers.

...and I'm questioning your competence to know what level is "acceptable for customers" if you are not even able to define who your customer is.

[jakub]

Did you carefully read my op? I mentioned both transfer and trading fee and talking about them, but you seems that you stuck in your own thoughts.

It only shows your ignorance as you treat them equally.

Anyway, (1) customers don't much care about them. This means you can fully differentiate our service. BTC already sustained 5 years and expected to be alive in the future too. This is the reality unfortunately.

What customers do you mean? Define your customer or stop using this word.
Where is the distinction between online merchants and online consumers? Your ignorance is just amazing.

If your online consumer is someone who does not care about "financial independence" he should stick to PayPal or debit card and we cannot win him over at this stage even if we had zero transfer fees.
If your online merchant is stupid enough not to include BTC volatility (or the cost of eliminating this volatility) - yes, he should stick to BTC and find out what it really costs to use BTC.

(2) Do customers care? Maybe not. But shareholders and investors care.

Are you selling your product to shareholders and investors?
Or online merchants and online consumers?

(3) So what is your the optimal fee level and why? $0.2? $0.1? $0.3? You're just saying high fee is good for businesses without specific numbers.

Something around $0.15-$0.20 is optimal.
And I support this level because it makes my referral business sustainable and because it makes it attractive for a merchant to join our selling efforts.

(4) This presents your full ignorance of BTS2 decision-making system. See the committee voting result. If you want to keep fees high, create a committee member and get higher votes than Bitcrab.

No, it proves your ignorance about marketing.
If you want to keep transfer fees low it's you who needs to create a committee member and get the votes.

You may want to increase fee to 60 BTS. Yes it's $0.2 now.

I'd support that.
And if people to whom I present BTS keep telling me "I like the product but it's a bit too expensive to use" I will offer to prefund them to get them started.

[clayop]

this whole fee debate is starting to go out of control. we're wasting too much time for this, and it's holding back many people. Just look how much time each and everoyne of you wasted in the threads in the last weeks.

I will stop watching / reading this and will vote to keep the status quo until bitshares is stable and we can measure our business.

some of you are too obsessed with 15 cent in my opinion.

People already voted to the change, but no one who argue for "keep the fees high" is listening the voice. That's why I'm raising my tone here.

If you want to stop this, edit your committee proposal (don't say "lower fee" in any place) and get the votes higher than bitcrab or me.

[clayop]

IMHO, all we need to get more liquidity is an API that compares to Poloniex's API. Our current API is not really useful to traders. That's why we don't see many bots etc ..
Once, the API is "nice", I would be happy to provide the infrastrucure similar to poloniex's api implementations to make bot writing as easy as running a webpage.
Actually, once the Api is more powerfull, we could easily add a bot infrastructure into the wallet and let people shop and execute 3rd party bots within the client.

Anyway.. in the short term, once the API is powerfull enough, providing liquidity for OPENBTC:bitBTC should be so easy that every community member can provide liquidity and earn some profit!

Our current problem is not the pricing policy but lack of liquidity & fiat gateways.
So those who advocate lowering transfer fees at this stage are barking at the wrong tree.

We had the pricing strategy announced back in June.
Everybody seemed to be happy about it at that time and the current campaign for lowering transfer fees started AFTER the Oct 13 launch and BEFORE we had a working product to sell.

I appreciate your advice @clayop not to be "obsessed" with the referral business but it is a bit hard to implement because actually I am the referral business.
And I've invested my time and resources to build my business model around the June announcement.

Do you recommend to follow this path of constantly changing rules so that no business can treat us seriously?
And to change those rules even BEFORE they had a chance to prove their viability?
Or do you believe that BitShares can become viral WITHOUT retail shops (i.e. people like @bitmarket or @fav) advertising & selling the product?

I'm not trying to break referral system, if so I will tell "let's decrease the referral percentage"

What I'm doing here is to adjust the fee level to acceptable level for customers. If we charge too high fees than our competitors, customers never come and our total system will be broken.

And till some points, we'd better run the business at loss. Now, the most important things are the number of users and the price. You may not agree with the price. But you can remember that bitasset pegging worked better during the price increases.

[fav]

this whole fee debate is starting to go out of control. we're wasting too much time for this, and it's holding back many people. Just look how much time each and everoyne of you wasted in the threads in the last weeks.

I will stop watching / reading this and will vote to keep the status quo until bitshares is stable and we can measure our business.

some of you are too obsessed with 15 cent in my opinion.

[clayop]

IMHO, all we need to get more liquidity is an API that compares to Poloniex's API. Our current API is not really useful to traders. That's why we don't see many bots etc ..
Once, the API is "nice", I would be happy to provide the infrastrucure similar to poloniex's api implementations to make bot writing as easy as running a webpage.
Actually, once the Api is more powerfull, we could easily add a bot infrastructure into the wallet and let people shop and execute 3rd party bots within the client.

Anyway.. in the short term, once the API is powerfull enough, providing liquidity for OPENBTC:bitBTC should be so easy that every community member can provide liquidity and earn some profit!

Yes, API is important, and we need more trader friendly infrastructure.

However, high fee still matter. If I have to pay additional $0.2 for filled or "partially" filled orders, do I really want to run market making bots?

Lowered fees are not the pulling factors. However, high fees obviously are the pushing factors that drive out customers and 3rd party services.

[jakub]

IMHO, all we need to get more liquidity is an API that compares to Poloniex's API. Our current API is not really useful to traders. That's why we don't see many bots etc ..
Once, the API is "nice", I would be happy to provide the infrastrucure similar to poloniex's api implementations to make bot writing as easy as running a webpage.
Actually, once the Api is more powerfull, we could easily add a bot infrastructure into the wallet and let people shop and execute 3rd party bots within the client.

Anyway.. in the short term, once the API is powerfull enough, providing liquidity for OPENBTC:bitBTC should be so easy that every community member can provide liquidity and earn some profit!

Our current problem is not the pricing policy but lack of liquidity & fiat gateways.
So those who advocate lowering transfer fees at this stage are barking at the wrong tree.

We had the pricing strategy announced back in June.
Everybody seemed to be happy about it at that time and the current campaign for lowering transfer fees started AFTER the Oct 13 launch and BEFORE we had a working product to sell.

I appreciate your advice @clayop not to be "obsessed" with the referral business but it is a bit hard to implement because actually I am the referral business.
And I've invested my time and resources to build my business model around the June announcement.

Do you recommend to follow this path of constantly changing rules so that no business can treat us seriously?
And to change those rules even BEFORE they had a chance to prove their viability?
Or do you believe that BitShares can become viral WITHOUT retail shops (i.e. people like @bitmarket or @fav) advertising & selling the product?

[clayop]

You're distorting my arguments in some points (actually b is correct)

OK, let's see.

(1) Our competitors are providing much lower fees than us (as you mentioned)

Makes no sense for two reasons:
- our competitors do not offer the product that we have: price-stable & counterparty-risk-free currencies
- our competitors are not running a sustainable DAC (the real cost of producing a BTC transaction is something like $5-$7)

(2) Fee is relatively high compared to our market cap. You may want the number. We have 4,000 times higher fee relative to market cap than BTC

None of our customers (i.e. online merchants or online consumers) cares about things like "market cap".

(3) If high fee drives out customers, referral program won't work

Once again you seem to know better about the business model of a referral entity than the referral entity itself.

(4) Voting result suggests that shareholders want lower fees

Are you really treating poll results among our shareholders on this forum as a valid replacement for a market research regarding our customers?

If you truly believe high fees are better, why don't you complaining about currently lowered fee (now transfer fee is only $0.13)? Let's increase the fee

You are mixing transfer fees with trading fees. They are entirely different as they affect different customer groups. We are discussing transfer fees here.

Add: @jakub I think high-fee advocates are also based on their own feelings. If not, can you provide reasonable numbers and statistics?

None of us is able to provide "reasonable numbers and statistics" as this would require very costly market research.
What I can offer is a referral business point of view and a viable marketing plan.
And I put my money where my mouth is as I am going to invest my resources to execute this plan.

And once again I've challenged you to present a marketing plan and/or a description of our target customers - and you come with nothing.
You strategy boils down to this: let's target everyone and let's have the prices low enough to match the lowest offer on the market.

Did you carefully read my op? I mentioned both transfer and trading fee and talking about them, but you seems that you stuck in your own thoughts.

Anyway, (1) customers don't much care about them. This means you can fully differentiate our service. BTC already sustained 5 years and expected to be alive in the future too. This is the reality unfortunately.

(2) Do customers care? Maybe not. But shareholders and investors care.

(3) So what is your the optimal fee level and why? $0.2? $0.1? $0.3? You're just saying high fee is good for businesses without specific numbers.

(4) This presents your full ignorance of BTS2 decision-making system. See the committee voting result. If you want to keep fees high, create a committee member and get higher votes than Bitcrab.

You may want to increase fee to 60 BTS. Yes it's $0.2 now.

[xeroc]

IMHO, all we need to get more liquidity is an API that compares to Poloniex's API. Our current API is not really useful to traders. That's why we don't see many bots etc ..
Once, the API is "nice", I would be happy to provide the infrastrucure similar to poloniex's api implementations to make bot writing as easy as running a webpage.
Actually, once the Api is more powerfull, we could easily add a bot infrastructure into the wallet and let people shop and execute 3rd party bots within the client.

Anyway.. in the short term, once the API is powerfull enough, providing liquidity for OPENBTC:bitBTC should be so easy that every community member can provide liquidity and earn some profit!

[jakub]

I find that you continually distort responses and use subjective arguments to forward your point of view. I've already countered the majority of your points here and often had to repeat myself, so I would advise referencing my position there... 

@Empirical1.2 , I have a similar feeling: I've already countered all of your points so I won't repeat myself.
And I am not distorting your responses, I am just rephrasing them to expose their weakness.

[jakub]

You're distorting my arguments in some points (actually b is correct)

OK, let's see.

(1) Our competitors are providing much lower fees than us (as you mentioned)

Makes no sense for two reasons:
- our competitors do not offer the product that we have: price-stable & counterparty-risk-free currencies
- our competitors are not running a sustainable DAC (the real cost of producing a BTC transaction is something like $5-$7)

(2) Fee is relatively high compared to our market cap. You may want the number. We have 4,000 times higher fee relative to market cap than BTC

None of our customers (i.e. online merchants or online consumers) cares about things like "market cap".

(3) If high fee drives out customers, referral program won't work

Once again you seem to know better about the business model of a referral entity than the referral entity itself.

(4) Voting result suggests that shareholders want lower fees

Are you really treating poll results among our shareholders on this forum as a valid replacement for a market research regarding our customers?

If you truly believe high fees are better, why don't you complaining about currently lowered fee (now transfer fee is only $0.13)? Let's increase the fee

You are mixing transfer fees with trading fees. They are entirely different as they affect different customer groups. We are discussing transfer fees here.

Add: @jakub I think high-fee advocates are also based on their own feelings. If not, can you provide reasonable numbers and statistics?

None of us is able to provide "reasonable numbers and statistics" as this would require very costly market research.
What I can offer is a referral business point of view and a viable marketing plan.
And I put my money where my mouth is as I am going to invest my resources to execute this plan.

And once again I've challenged you to present a marketing plan and/or a description of our target customers - and you come with nothing.
You strategy boils down to this: let's target everyone and let's have the prices low enough to match the lowest offer on the market.