The Amazon Honor System, 2001-2008
The "tip jar" system that provided a donation option for thousands of small sites in the early 2000s and raised millions for survivors of Hurricane Katrina and other disasters will turn off the lights on Thursday.
The Amazon Honor System launched after the implosion of the first dot-com era, offering small sites a means by which visitors could offer their support for the costs of furnishing well-liked content.
Some people, encouraged by the new ease of donation, launched sites specifically to separate passersby and their money. Perhaps the best-known among those is SaveKaryn.com, in which a blonde with a fondness for designer clothes and expensive coffee convinced the Web to pay off her $20,000 credit-card debt. Karyn Bosnak retired that debt, got a book deal, and introduced a generation to the concept of moral hazard. (Yes, once upon a time a $20,000 handout looked like moral hazard. $700 billion was a long way off back then.)
Other sites offered more. Matt Haughey launched MetaFilter in 1999, and by 2001 it was successful enough to require more powerful servers and more bandwidth, all of which cost money. In an era before Google Ad Words, he signed on for an Amazon Honor System account.
"It was only really active in the first six months," he recalls. Initial donations reached around $1,500 in a few months' time, and let him buy a new server and other site necessities.
Over time, the novelty wore off, and by the end revenues from the "tip jar" were limited to occasional small surprises in Haughey's bank account. (The system uses direct deposit.) "I'd look at my bank account and see an extra $10 -- 'what's that?'," he recalls.
"The turnaround is really slow," he added, with the result being that it became more difficult over time to trace acts of kindness back to their origins.
In addition, many participants were underwhelmed with the rather high fees the company charged for service -- 2.9% of the payment plus a 30-cent fee. But Amazon was known to waive that fee in extraordinary circumstances, specifically in support of the Red Cross's efforts after 9/11, Hurricane Katrina, and the 2004 tsunami in Southeast Asia. Those efforts -- the service's finest hour, and one of Amazon's best as well -- raised millions rapidly and safely, just when thousands of online scamsters were looking to profit off misery, fear and concern.
Over the course of seven years, Haughey's MetaFilter tip jar garnered $6,254.62 from 444 donations. Figures for the total raised by AHS participants over the years can only be guessed at. No regrets at the end of the era, though -- "I understand them closing it," says Haughey. "It had its day in the sun."