TIME EUROPE
June 5, 2000 VOL. 155 NO. 22
Beenz Counters
An upstart firm tries to make its new product the first legal tender of the World Wide Web
By LEV GROSSMAN
If you don't have a beenz in your virtual pocket, maybe you should. beenz (the trademarked word is both singular and plural) are a new kind of money that circulates exclusively on the Internet. There are no beenz coins or beenz bills. The only place you can earn beenz is on the Web, and, until now, the Web was the only place you could spend them. beenz are the product of a company called Beenz.com that hopes to make them the currency of the Internet, and they may be the future of cash as we know it. In five years, says Beenz.com founder Charles Cohen, "I believe we'll start to see beenz listed against other major currencies." This vision moved closer to reality this month with the launch of a debit card which will allow consumers to convert beenz for local currency — spendable in real or online stores.
beenz aren't a currency in the strictest sense. But beenz are one of the more successful attempts to solve a problem that's as old as the Web — that of finding an easy and safe way for people to spend money online in small amounts. "Right now there isn't really a viable way for consumers to pay for something that costs 50¢, because that's about how much a credit-card transaction costs the merchant," says Ken Cassar, an analyst with the e-commerce research firm Jupiter Communications. Early attempts to create a practical alternative to credit cards for online financial transactions have been slow to gain consumer confidence.
Here's how beenz work. First, you open a free account with Beenz.com, a New YorkÐbased outfit that's been in business since 1998. You earn beenz by visiting certain websites that give beenz away to reward customer loyalty, in exchange for personal information or as a reward to surfers for just showing up. Hence the name — "You get something just for having Ôbeen' there," explains Beenz.com chairman and ceo Philip Letts. Among the sites that offer beenz are Excite UK, Dash and FortuneCity. Then, once your virtual wallet is bulging, you can spend beenz at any of some 200 e-commerce sites that accept beenz as a form of payment, including Flooz, ishop, Jellybeenz Gifts and MP3.com.
Alternatively you could use your beenz rewardzcard MasterCard to spend your credit on- or off-line in any store or restaurant worldwide which accepts MasterCard, giving customers the choice which previously limited the service. The card will be issued by Columbus Bank and Trust and will be available in the U.S. this month and the U.K. and Australia later this year. This deal is not exclusive and Beenz.com could issue co-branded cards with other banks.
Cohen founded Beenz.com because he was fed up with existing customer-incentive programs. He saw an opportunity to give consumers more of a choice in how companies rewarded them for purchases, and to grease the wheels of the burgeoning Internet economy. Beenz.com launched in March 1999, and by August 150 companies were signed up to accept the new tokens.
beenz is now a global operation, with offices from New York to Stockholm to Sydney to Hong Kong. And it's getting to be a significant business: its technology partners include Oracle, Sun Microsystems and Web-hosting giant Exodus. Almost 750 million beenz are in circulation — roughly equivalent to the currency float of a small country.
No major e-commerce site has signed on yet, though Letts says that will change. "We are engaging with most of the Top 10 players," he says. "We have verbal agreements with a couple of them." The new rewardzcard will ease this problem, since customers are no longer limited to e-commerce sites that accept beenz. The competition is also heating up. Dozens of other Web-based customer-incentive programs are out there, like ClickRewards, which distributes frequent-flyer miles. The online gateway RocketCash has a currency exchange where beenz, Cybergold and InfoPost currencies can be traded. There are also competing micropayment schemes in the works, like Trivnet, which automatically lumps your e-commerce bill into your phone or Internet service provider bill on a monthly basis.
But don't count beenz out. No other company offers customer rewards redeemable off-line, and no other company is aiming quite so high. Before the year is out, Letts plans to see beenz exchanging on Internet-enabled devices such as cell phones, games consoles and interactive television and Mondex smartcards. Beenz.com recently logged its 17 millionth beenz transaction, and Letts predicts — "without a shadow of a doubt" — that this year the company will sign up its 5 millionth customer. By then, who knows how much a hill of beenz might be worth?
For more on the Internet in Europe, watch for Time's e-Europe special report later this month
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June 5, 2000
COVER
Baby, It's Cold Outside
Tony Blair gave birth to a new Labour Party, but the Prime Minister's promise of a "modern Britain" is going to take much longer to deliver
New Kid on the Block
An open letter to Leo Blair, Britain's youngest celebrity
EUROPE
A Difficult Performance
David Trimble squeezes a close vote from his party to rejoin Northern Ireland's government
All Quiet on the Eastern Front
A decade after the end of the cold war, Germany plans to revamp its army
Guilt by Association
In an apparent postwar payback, a Serbian court jails a group of Kosovo Albanians for "terrorism"
MIDDLE EAST
Courage under Fire
In a defining moment, Prime Minister Ehud Barak makes good on his promise to withdraw Israeli troops from southern Lebanon
The Time Had Come To End a Tragedy
Israel's Prime Minister insists that withdrawing from Lebanon will not harm security, and he warns against a unilateral declaration of a Palestinian state
AFRICA
Showdown to Savagery
After Ethiopian forces blitz their way into Eritrea, a bloody two-year war may be closer to its conclusion
Hope Springs Internal
African women may be the key to saving the chaotic continent
BUSINESS
The Money Game
Even as football's cup runneth over, there is a growing sense of unease among fans that riches may ruin their sport
For Love and Money
Why shouldn't a top-level footballer earn as much as an actor does?
Fertile Fields
Movers and takers
Beenz Counters
An upstart firm tries to make its new product the first legal tender of the World Wide Web
The New European Challenge
E.U. firms must grasp the opportunities of an expanding home market
THE ARTS
Dark Victory
At Cannes this year, the jury danced with Björk, but some fine Asian films made a lasting impression
The Art of Science
The eclectic but elegant Musée des arts et métiers reopens in Paris after a decade-long restoration
DEPARTMENTS
Techwatch
World Watch
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