While Rand Pate doesn't publicly discuss the number of clients that are processed at Paycom — also known as Epoch Systems — he notes that it's hard to find a sponsor these days that doesn't use them as its primary or secondary processing solution.
"Although I don't have statistics on the percentage of our business that is gay-themed, a substantial number of gay sites have used Epoch from the beginning, and new sites are added nearly every day," says Pate, director of communications.
"It probably comes as a shock to some readers to learn that Epoch has its roots in being a webmaster for one of the Internet's first gay sites, which goes to show you we've been a part of the gay market since the very beginning."
Founded in 1996 by Clay Andrews and Joel Hall, Epoch began as a paysite company with one of the first live cam feeds online. SexCinema.com and GayCinema.com marked the beginning of the duo's interests on the Web, but the shortcomings of online subscription-based billing inspired them to build a better billing model, notes Pate.
The result was that the company became the largest online processor in adult entertainment.
In early 1997, Epoch decided to offer its billing services to other established websites. Within weeks, it also launched the adult industry's first affiliate tracking, reporting, and payment program, adds Pate. The success of Epoch's affiliate program was so substantial that it required upgrades to its systems in order to consistently handle the volume.
"After experiencing tremendous growth in 1998 and 1999, Epoch started to feel the effects of competition as several other billing companies emerged," Pate says. "Credit card associations also began to make sweeping changes to the ways in which third-party billing companies could conduct business. After a brief period of adjusting its focus and relationships, Epoch soon regained the success it had experienced previously."
Since then, Pate says, the majority of domestic Internet Payment Service Providers in the adult space have disappeared. In July 2004, Epoch acquired the third-party credit card processing portfolio of Jettis, and in February 2005 Paycom became the first major adult billing company to add Switch and Solo. Last August, Epoch added its European Union division, Paycom EU.
While Epoch is focused in the adult entertainment market specializing in subscription-based billing for digital content — and its policies and relationships are designed to cater to those types of clients — Pate says that the services are flexible enough to accommodate other billing models.
Epoch maintains a tech support team accessible 24 hours a day, and recently added a 24/7 site submission support staff to help get sites up faster. It also offers an emergency "Call Me Now" feature if clients ever experience an interruption in processing, a personal account representative for every client and a host of free premium features designed to help boost conversions and retention, and reduce credits and chargeback ratios.
"It is the job of an IPSP to maximize revenue from the volume of submissions your site provides, as well as to minimize credit and chargeback ratios," Pate says. "It's been the lifeblood of Epoch throughout the years to manage the processing for the biggest and best programs in the business, but there is truly something to be said for catering to the needs of the smaller-to-medium-sized programs which many times are more innovative."
The relationship with the adult entertainment industry has proved to be beneficial for the industry — and technology.
"It is a commonly accepted fact that the adult entertainment industry contributes greatly to the success of new technology," Pate says. "Adult clients are constantly looking to introduce new technologies or push the boundaries of existing ones and usually have the resources in which to do that. Epoch has designed payment form interfaces for the amateur/beginner all the way to the experienced programmer, allowing the most flexibility in integration and data collection."
Pate says that Epoch will always look toward developing technologies, but it is more important to focus on the established solutions for its clients.
"I believe that we will start to see the ability to accept foreign transactions in a more secure and seamless fashion. The ability to process international transactions will evolve as the Internet prompts banks to become more uniform in the way they conduct their electronic business," Pate says. "Billing technology will continue to evolve and will, hopefully, make online transactions safer. These types of changes, however, will be slow and each one will present its own unique challenges."
As for the future, Pate says that Epoch will be releasing new features in mid-2006 and will provide enhancements to Paycom EU. He notes that as there will almost certainly be a proliferation of new content distribution methods, there will be an increase on the demand for bandwidth and a refined billing method.
"Epoch stands ready to develop new billing models and technologies as the demands created by new trends present themselves. We remain committed to staying in the forefront and providing state-of-the-art billing processes that our clients can use to further their businesses."
Contact info: Paycom/Epoch Systems: (800) 893-8871; Paycom.net.
