I did not mean to imply an insurance company would be involved. You would not need or want one to insure the DVDs for the users. To be more clear, I refer to an insurance policy that tells users that they will be made good if they get a bad DVD. How much it costs to insure this (to the company, not some insurance company) depends on the fraud frequency. My judgement is that while clearly based on your report people in peerflix are sending bad DVDs, the overall percentage is low or I would be hearing a lot more about it. If it’s low, then the cost of making it right is low.

As a user, the things are want are: * Low cost * Low hassle * Wide selection of DVDs * Quick delivery of the next DVD after I’m done with one.

Now netflix offers everything but the first — low cost, and they tend to be quick on delivery, though I have seen Peerflix be faster (ie. get a DVD the very next day after turning one in.) Peerflix is low cost but more hassle, and suffers in selection. On quick delivery, they are entirely erratic. As noted, it can be one day, or it can be 8 months from the time you are done with a low-demand DVD to the time somebody takes it and gives you the peerbux to get the next one.

This is a renter’s perspective more than a trader’s. Of course, there is demand for both those perspectives.

Your system appears to offer low cost, possibly similar hassle but possibly lower, somewhat slower delivery, more complex web interface.

If I wanted to put a modestly computer savvy person into a system, it would probalby have to be netflix for now. Peerflix is really only good for people who are at their computer all the time. Your system I can’t yet judge, but I fear the bid/ask system is more than such users would want to hassle with. They just want to pick movies, watch them, send them back and get new ones, not worry about prices.