A tipping point occurred last year in the debate over paywalls as publishers large and small followed the lead of the New York Times and began charging readers to view digital content. These evolving attitudes are benefiting companies like Tinypass that provide publishers with the tools to bill online readers.
On Tuesday, AllThingsD’s Peter Kafka reported that the startup has hired longtime ad vet Trevor Kaufman as CEO and pulled in $1.25 million in seed funding.
Startup Tinypass’s core customers have been hundreds of small-fry news and music publishers who use its services to provide “metered browsing” or ad-free upgrades to readers. In January, however, the company got a big boost when star blogger Andrew Sullivan said he was using the platform to charge readers for his $19.99 annual subscription service.
The new funding and Sullivan’s star power could help Tinypass nip at the heels of the big player in the paywall space – Press+, which was launched by publishing vets Gordon Crovitz and Steve Brill.
Like Press+, Tinypass takes a cut of the paywall revenue (two to ten percent, depending on volume) but also differs as it does not charge a start-up fee.
Although increased competition could lower the prices that Tinypass and Press+ can charge, the good news for the companies is that the overall paywall pie is getting bigger. According to a recent report by news analyst Ken Doctor, it will soon be rare to find a news outlet in North America or northern Europe that doesn’t charge for content in one form or another. Others, like my colleague Mathew Ingram, remain skeptical that restricting reader access is a good idea (see a recent debate over the issue here).