Can paywalls become an even larger factor in moving online content away from a dependency on advertising? Los Angeles-based MediaPass, which offers customizable paywalls, is betting they can.

The company, founded in 2010, said its paywalls are being used by thousands of online publishers and that a freemium or subscription-based approach can return five to twenty times the revenue that advertising can. It pointed to one of the most famous paywalls, the New York Times’, which reportedly has generated US$ 91 million in the past year, although it took US$ 40 million to develop over two years.

Options for Prompting

By contrast, MediaPass’ paywalls are available to any publisher with no upfront fee. A site can choose from a variety of metered paywalls, pick the number of articles to be viewed for free, and choose options to set up subscriptions.

Participating sites copy MediaPass’ Javascript code into their site and then use a dashboard to control which new content is free or requires payment. The company also provides plugins and extensions for some kinds of content management systems, and, for complex sites, customized solutions are available. MediaPass handles subscriptions, payment collection, subscriber support, fraud protection and security compliance.

Several options are offered to prompt users to become subscribers, including page overlay, a pop-up window, an in-page prompt or, to charge for video content, a video overlay. There’s no setup fee or commitment, and the company said no technical expertise is required.

MediaPass' prompt options include page overlay and click-to-launch.

MediaPass takes a cut of the revenue generated through its paywall, which it says is 20 percent “for most publishers.” The company said about half of its current customers are newspapers, and the rest are blogs, magazines or other content providers.

Andrew Sullivan

Other e-commerce platforms for content include Tinypass, Press+, Cleeng, and micropayments vendor MuCash.

Tinypass is used by one of most visible converters to a paywall. Earlier this month, columnist Andrew Sullivan decided to end his relationship with the Daily Beast site and, instead, to offer his Daily Dish site on a freemium basis. He told the Times that, in the first week, the revenue of the five-person site approached $400,000.

In the first twenty-four hours, Sullivan wrote, his site received “a third of a million dollars,” with nearly 12,000 paid subscribers. But his readership appears to be particularly devoted, with subscribers paying, on overage, $8 more than what was requested.