Their Reasoning
Here is Patreon's post explaining their reasoning for the change, for whatever its worth.
We're Updating Patreon's Fee Structure. Here's Why. - The Patreon Blog (The Patreon Blog)
Comments (21)
I've enjoyed your comics for more than a decade, not going to stress if I pay a little extra.. Not happy with how this is impacting all of you creators out there though, and I'm hoping they change course.
What about the deductions that creators will no longer be able to claim? How will that affect you?
What deductions are those?
This will be interesting, my credit card can sometimes block payments if the same merchant (in this case Patreon, in the past Amazon) charges me a couple of times in quick succession. Then I (sometimes) get a call to verify that I actually authorised those charges... Man, this will suck greatly.
Well, I for one won't stop because of that, mainly 'cause you are currently the only creator I'm supporting...but what I'm not sure about now: do I have to change anything? Or does this new pledge adjust automatically? Currently paying via PayPal...
This doesn't sound like they plan to back down. Bugger it.
A simple option when subscribing to a monthly page of "activate at the beginning of the next month, no payment or content until then" or "activate now, paying full price for the current month, and then full price on the first of every following month" would solve the whole creators wanting up-front payment, patrons dodging fees, and the confusion/outrage at being "double billed" (since you'd have to explicitly agree to it). I don't see how separating payments and charging ridiculous fees, when the platform is based off of aggregating payments to AVOID fees should have ever even been considered.
One of the biggest open problems of UI design is getting people to ACTUALLY agree to something they may deem to be unpleasant; people who work in customer service invariably have loads of stories of angry customers demanding refunds claiming they didn't understand something that was clearly labeled in giant red lettering. If you have a foolproof way of getting people to not be confused/outraged at being "double billed", you should patent it, because literally every individual-facing company would immediately buy it from you.
I find it really, really hard to believe that they did as much research and testing as they claim to have done and the best solution they could come up with was “let’s charge people’s credit cards 8 times a month.” Also they actually say that they could have charged us more but decided not to - because they’re supposed to be the good guys I presume? This is a bad rollout of a bad plan all the way ‘round.
They are killing the one reason for Patreon to exist: bundling bundling all charges form all different creators into one credit card charge to minimise processing fees, then distributing it to the different creators and finally paying all creators in a single transaction, again minimising fees. That is patreons sole purpose. If a creator wanted to charge classical subscribe, they can just use PayPal and a blog with access restrictions based on user accounts. No need for Patreon anymore in that scenario.
The uproar and their response are doing more to kill my desire to use this service than the initial announcement ever did. I'd love to just write a [virtual] check to each of my favorite creators as an Xmas present and call it a year, but I'd certainly miss the interaction and connection the service provides.
Eric that's the first thing I thought of when reading that too, prorated billing is easy and simple and would solve all problems. That's why your cellular service, cable, internet, and many others do when you change your plan around. On the 29th you get charged the full amount then on the first you are charged 2/30th of the full amount and then the full amount at the beginning of every month. Just make it clear when people are signing up and they will know and it'll be ok. It's really simple.
That's true, I forgot that they did the reverse strategy at least sometimes, where you bill the full amount immediately, then make the next payment less to compensate. That would cover this issue perfectly.
*sigh* I find it fairly ridiculous that they explicitly say in the blog post that they combine pledges to avoid processing fees, but now will cease doing so. Did they seriously not understand the concept of prorated billing??? Then the worst that would happen is that supporters would eat an additional fee *when first subscribing* but then would only get a single fee for all combined pledges otherwise. They say they are doing this to match "all other subscription services", never mind the fact that the most basic and universal subscriptions in existence - housing and utilities - are all done on a 1st-of-the-month basis with prorating... Also @Michael Cotton: You can insert line breaks. The universal standard for doing so is shift-enter. That said, you may be on mobile?
To be fair, creators have in the past cited that they wanted charge-up-front to deal with people who sign up, get access to all previously posted content, and then cancel before the first charge, so prorating the subscription doesn't quite fix the issue, as those people will instead just sign up on the 30th to get the minimum possible charge.
The other thing that is offensive is that they show on their fee page that Paypal charges a fee of 5% + $0.05, and Stripe charges 1.9% + $0.30. They are passing on a much higher fee than 'actual' to patrons. If I was just being charged the Paypal fee each time, I wouldn't be *quite* as outraged. Same if I could choose to do a single charge per month at the Stripe rate.
Wow, I see what they did. They took their initial intelligent plan of combining all pledges into one lump sum to minimize credit card processing fees, and are throwing it out the window. That was literally THE reason why I felt compelled to start supporting my favorite creators with Patreon. It benefited them by sending them money, and It didn't hurt me OR them by charging me 50% more to send them a dollar each month. By taking away the one benefit that Patreon supplied over any other donation method, they've basically ruined Patreon for patrons. If this is really how they plan on doing it in the future, then it's definitely not something I will continue to take part in. Tim, I'm all for a new 3rd party tool for sending you money monthly, but please don't make it PayPal. :)
Dang, I just did some math. My $10/mo distribution will go up to $13.09 by charging those fees separately for each creator and that extra $3.09 ALL goes to credit card companies and not to Patreon nor creators. That's a bummer.
It's worth nothing to me. I'm not a creator, I'm just a patron who now has to go back through his pledges and decide which creators to leave my pledge alone for, which creators to reduce my pledge for, and which creators to stop pledging to altogether. I wish I had infinite money and could keep giving to every creator the way I currently am, but I'm not.
Also I wish that blog post from them had a comment section so I could say that directly to them more easily. Now I have to find an e-mail address or social media account. Also I wish the Return button did a line break like it's supposed to instead of posting a half-finished comment.
The problem is, now the fees penalize two classes of people. People who want to give small donations to a large number of creators, and people supporting creators with content charged weekly (or similarly). When they show an example of fees charged increasing from 3 to 8, they fail to point out that that means that payment processing fees for that example customer have shifted to the payer, and have also increased by +167%.