Porn Valley [www.xbiz.com] – It has been about five years since Victor Harwood, [pictured right] organizer of the Digital Hollywood series of high-level corporate conferences, agreed to place an adult entertainment industry panel in the line-up of the October show.

Because it is the only seminar that addresses adult entertainment issues, by definition there is a lot of territory to cover in just over an hour, but Thursday’s panel managed to do just that with aplomb and utter professionalism, and along the way some core themes emerged that spoke directly to the significant opportunities that have and will only continue to be made available to adult and mainstream businesses.

The panel consisted of Gregory Clayman, president of VS Media Inc.; Jay Grdina, CEO of Club Jenna Inc.; P. Holt Gardiner, managing director of Eclipse Entertainment Capital, LLC; Farley Cahen, publisher of AVN Online; and Marc A. Brown, head of mobile TV for Waat Media. Tom Hymes, publisher of XBIZ, was the moderator.

A seminal topic concerned the manner in which the trend toward social networking on the Internet has impacted the speakers’ businesses and the industry as a whole, and what they thought its long-term significance would be. Answers were indicative of the general theme developed throughout the hour; namely, that there is a world of opportunity inherent in social networking but there are also great risks that demand attention by businesses entering that space, with special focus on encouraging and demanding responsible behavior by all parties. Of obvious concern were the issues of copyright infringement and access by minors to inappropriate content.

“In mobile, there are huge opportunities and huge risks,” Waat Media’s Marc Brown said. “Whether it is peer-to-peer chat or dating services, applications are being developed and rolled out for mobile [platforms], so that part of social networking is going to take off. [But] user-generated content is a phenomenally difficult issue because of 2257 legislation and age verification issues.”

Brown added that consumers would expect to all the social networking options they have become accustomed to having on the Internet on mobile platforms. But the industry will face all the same issues now being faced by corporate spaces like MySpace.

Jay Grdina added, “At Club Jenna we are cognizant of all the social networks that are out there, but they are beneficial and also a headache from a marketing perspective. They are a hindrance because people are going online now just to look at MySpace and YouTube pages, looking for adult content … so how do we target that audience? It’s something that you always have to be conscious of, and we look at everything from a viral perspective, especially when we want to launch something.”

He added that Jenna Jameson’s MySpace page attracts 100,000 unique visitors a day, and they are always exploring new ways to use and monetize that traffic.

“We’ve seen some significant examples of companies trying to generate their own traffic,” AVN’s Farley Cahen said. “Instead of using the traditional affiliate program, a lot of companies are generating traffic by utilizing social networks. As an example, when the Kid Rock sex tape was about to be released, I was given a clip of it and put it up on YouTube – very soft stuff – and within about three week it had generated over a million views. So the power of social networking is immense, but how to harness it is the goal.”

Holt Gardiner made the point that all of his clients – whether mainstream or adult – are very well aware of the social networking phenomenon, but that most are “utilizing components of the social networking platform,” rather than offering complete products, in order to reduce consumer “stickiness.” He added, however, that the next generation of adult products would fully involve social networking elements “in everything you see.”

The discussion then moved on to the implications of the Playboy-Club Jenna deal, and what it means for future corporate deals spanning adult and mainstream, the next generation of technologies that adult businesses will be embracing and the ways in which each of the extremely ambitious and forward-looking companies represented on the panel would be positioning themselves.

The panel discussion was followed up with a Q&A, during which several people not in the adult industry wanted to know more about how affiliate networks work. They were encouraged to attend industry trade shows such as January’s Internext Convention and the XBIZ Hollywood Conference in February 2007.

Toward the end of the seminar, VS Media’s Greg Clayman made some highly relevant remarks regarding the responsibilities of those in the industry, or thinking about getting in.

“This industry does do a very good job of policing itself,” he said. “Despite the high revenues, it is a tight-knit industry, no matter what people think. If people in the industry do not feel that a website is doing the right thing, they basically get cut off and taken out of the loop. So, if you are going to be in this industry, you have to back the people that are protecting your industry or yourself. We spend a lot of money backing the Free Speech Coalition and ASACP, and do everything we can to be a part of that.”