It looks like Microsoft is going ahead and creating a virtual currency as I described in my previous post:
http://www.xbox.com/en-US/live/features/microsoftpoints.htm
These points will be the currency of choice for buying Zune songs, and also for buying maps and extras for Xbox live.
If anyone has the power to pull this off, it's Microsoft. My prediction is that this is the start of an era in which the corporation eclipses the power of the state in a variety of formal ways such as currency, virtual and non-virtual security, market making, etc. Indeed, due to the trans-national nature of internet transactions, its allready private companies that are providing transaction security, rather than the court system of a state. Interesting stuff IMHO.
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Bill Gates (or Ray Ozzie) is like an Italian doge of the city-state era, printing coins with his face on them!
I wonder what the eventual shake-out will be. It would appear to me that each mega-corporation having its own currency would only be a permanent solution so long as they are doing a function that banks themselves couldn't do better.
So I think it's likely that in the long term banks take over this function for the companies, which continue to have "branded money."
Upon deeper reflection, it looks like they are trying to keep too much control over the currency: no secondary market etc.
I would be greatly amused if the Zune flops but this concept endures.
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