Tag: Internet History

Categories
Micropayments

The Wrong Who

I was in the room for most of the early micropayments conversations. The working-level conversations, where people were genuinely convinced they had finally solved the problem. The demos were always compelling. The unit economics made sense on a whiteboard. And then they died.

They died so many times, and in so many similar ways, that the failure started to feel like a law of nature.

Clay Shirky wrote the autopsy that most people remember: micropayments fail because every transaction requires a decision, and decisions have a cognitive cost that swamps any payment below some psychological threshold. A dollar feels like real money. A dime feels like a question you have to answer. A fraction of a cent feels like being nickeled-and-dimed at sub-human speeds. The advertising model won because it asked users to consent once, peripherally, and then never bother them again.

So I noticed something when I read the transcript of Cloudflare CEO Matthew Prince’s earnings call remarks this afternoon.

He’s predicting that the internet’s business model — advertising and subscriptions, the twin structures that have governed everything since the late nineties — is about to change. He thinks some part of what replaces it will be micropayments for agentic traffic. Fractions of pennies. Fractions of fractions. At volumes that dwarf anything existing financial infrastructure can handle.

My first instinct was the old skepticism. We’ve been here before.

But I kept reading, and I think something is actually different this time. And the difference is the one thing all the earlier schemes never had.

The payer isn’t human.

This sounds obvious once you say it, but it collapses most of the objections that killed every prior attempt. Cognitive load isn’t a factor when there’s no cognition happening. Decision fatigue doesn’t apply to a process with no feelings about fatigue. The agent making the request doesn’t hesitate at a fraction of a penny, doesn’t resent the transaction, doesn’t abandon the session because it’s annoyed at being charged.

All the early micropayments architectures were built on an implicit assumption: that humans could be trained to behave like rational microeconomic actors at browsing speed. They can’t. Nobody does. But agents are rational microeconomic actors by design. That’s not a metaphor — it’s literally what they are.

The schemes we watched fail in the early 2000s weren’t wrong about the destination. They were wrong about the who. The internet of human readers and human attention was never a natural fit for per-transaction pricing. The internet of autonomous agents — making API calls, scraping data, assembling answers from dozens of sources in a single second — is a different thing entirely. And it’s arriving faster than most people realize.

Prince mentioned that Cloudflare thinks non-human traffic will surpass human traffic somewhere around 2027. That number stopped me. We are, apparently, closer to a majority-machine internet than to the one we think we’re living in.

The hard part isn’t the concept anymore. It’s the infrastructure. Prince was candid about this: the transaction volumes the industry gets excited about — a million per second — aren’t remotely sufficient for what’s actually coming. Cloudflare needs something an order of magnitude larger, and they’re looking for partners because nothing that fits the spec exists yet.

This is where it gets interesting for those of us who watched the earlier rounds. The original micropayments failures were partly psychological, but they were also partly infrastructural — the payment rails of the early internet weren’t built for high-frequency small transactions either. What’s different now is that the need is undeniable and imminent in a way it never quite was before. The traffic is real. The scale is measurable. The pressure to figure this out is coming from something other than optimism.

I don’t know what the solution looks like. Probably not one thing. Prince doesn’t know either — he said as much. Crypto infrastructure is an obvious candidate for parts of it, though crypto’s history of promising to solve problems and then creating different ones deserves some respect. Whatever emerges will probably be unrecognizable from here.

What I keep coming back to is the simpler observation. We were right that micropayments were the future. We just imagined the wrong future, populated by the wrong kind of payer.

The agents were always going to solve this. We just had to wait for the them to arrive.

Categories
Business History Memories Radio

Permissionless Airwaves: The Legacy of FCC Part 15

Right now, as you read this, the air around you is thick with invisible conversations. Your phone is whispering to your router, your wireless headphones are singing to your laptop, and the smartwatch on your wrist is syncing quietly in the background.

We take this symphonic digital ecosystem completely for granted. But this panoply of wireless magic wasn’t just an inevitable product of technological march. It exists because of a profound, remarkably philosophical decision made by a bureaucracy in 1985.

It traces back to a seemingly mundane piece of regulatory code: the Federal Communications Commission’s Part 15 rules.

Historically, the airwaves were treated like highly exclusive real estate. If you wanted to broadcast a signal, you needed a license, a specific frequency, and a strict, government-approved mandate for what you were doing.

But within the radio spectrum, there were segments known as the ISM bands (Industrial, Scientific, and Medical). These were essentially the “garbage bands” of the airwaves. Microwave ovens, for instance, operated here, blasting out radio noise at 2.4 GHz. The interference was so heavy that the spectrum was considered practically useless for traditional communications.

Enter an FCC engineer named Michael Marcus. Marcus possessed a visionary understanding of a World War II-era technology called “spread spectrum” (famously co-invented by actress Hedy Lamarr). Spread spectrum didn’t rely on a single, clean channel; instead, it scattered a signal across a wide swath of frequencies, easily dodging interference.

Marcus argued for something radical: what if we opened up these “junk” bands to the public, allowing anyone to use spread-spectrum devices without asking for a license, so long as they adhered to basic power limits and didn’t cause harmful interference to primary users?

Incumbents fought it bitterly. Broadcasters and traditional telecommunications companies warned of absolute chaos. But in 1985, the FCC adopted the new Part 15 rules.

“We often talk about the great technological breakthroughs of our time as hardware or software triumphs. But sometimes, the most important enabling technology is just a clearing in the woods.”

Think about the nature of most regulation. It usually prescribes behavior. It looks at the future and says, “You may do exactly X, under condition Y.” But the Part 15 ruling did the opposite. It created a sandbox. The FCC didn’t try to predict Wi-Fi, Bluetooth, cordless phones, baby monitors, or the Internet of Things. In fact, they couldn’t have. They simply set the structural ground rules for how devices should coexist without stepping on each other’s toes, and then they stepped back.

This is the beauty of permissionless innovation. When you don’t have to ask a gatekeeper for access, a massive, uncoordinated burst of creativity happens.

A small company in the Netherlands could start working on what would eventually become Wi-Fi. Ericsson could invent Bluetooth. Innovators didn’t need to petition the government to launch a new product; the space was already cleared for them to play.

Part 15 was an admission of humility by a regulatory body—an acknowledgment that the most profound inventions are the ones we cannot yet foresee.

The greatest legacy of Part 15 isn’t Wi-Fi or Bluetooth. It is the enduring lesson that when you give brilliant minds a blank canvas and the freedom to experiment without asking permission, they will build a world more connected than you ever dared to imagine.

Note: this post was triggered by my reading of David Pogue’s new book Apple: The First 50 Years in which he describes the development of the Apple III and how its design met the requirements of the FCC’s Part 15 in terms of reduced RF interference.

Categories
AI

The Second Fire: From Finding to Forming

There is a specific kind of vertigo that comes with a paradigm shift. It’s the feeling of standing on the edge of a map that has just been unrolled to reveal twice as much territory as you thought existed. Lately, as I navigate the vast, generative landscape of AI, that old vertigo has returned. It’s a hauntingly familiar resonance, a structural echo of the late nineties and early 2000s when we first encountered the Google search bar.

Back then, the world was a series of closed doors. Information was siloed in physical libraries, expensive encyclopedias, or the unreliable oral histories of our social circles. Then came that clean, white interface with a single blinking cursor. Suddenly, the friction of “not knowing” began to evaporate. We weren’t just browsing the web; we were suddenly endowed with a collective memory. It felt like a superpower—the ability to summon any fact from the digital ether in milliseconds.

“Google is not just a search engine; it is a way of life. It is the way we find out who we are, where we are going, and what we are doing.”

Today, the sensation is different in texture but identical in weight. If Google gave us the power to find, AI is giving us the power to form.

The “Aha!” moment of 2026 isn’t about locating a PDF or a Wikipedia entry; it’s the realization that the distance between a thought and its realization has shrunk to almost nothing. When I prompt a model to synthesize a complex theory or visualize a dream, I feel that same electric jolt I felt twenty years ago when I realized I’d never have to wonder about a trivia fact ever again.

But there is a philosophical weight to this new “awesome.” With Google, the challenge was discernment—filtering the flood of information to find the truth. With AI, the challenge is intent. When the “how” becomes effortless, the “why” becomes the only thing that matters. We are moving from the era of the Librarian to the era of the Architect.

We are once again holding a new kind of fire. It’s warm, it’s brilliant, and just like the first time we saw that search bar, we know that the world we lived in yesterday is gone, replaced by a version where our reach finally matches our imagination.