From AEE: Why’s the adult business in dire straits? Sasha Grey and other stars answer the question

Richard Abowitz reports from – Every January, the Adult Entertainment Expo in Las Vegas is the biggest annual gathering of the adult film industry. But the biggest is suddenly a lot smaller. The 2010 AEE convention, which ran Thursday through Sunday, had shrunk from packing two floors of the Venetian’s Sands Expo Center last year down to one floor (and that one with lots of empty space).

“The AEE show is an example of what the business faces. There are fewer fans, less foot traffic, and less companies exhibiting,” said Steve Javors, editor in chief of industry trade publication XBIZ. “During the 2000s, porn kept expanding outward. We thought there was an insatiable appetite for porn, and there would keep being more companies and more porn stars. Now, we are finding out that is not true.”

“People used to be ashamed to say their girlfriends did porn. That is gone. Anyone can afford a Web site now,” said Pete Housley, who aggregates porn on Twitter.

As for the concurrent, AVN Awards—AVN being another adult industry trade publication—which the porn world bills as their Oscars, it moved from the arena-size Mandalay Bay Events Center to the few-thousand-seats theater at The Palms. AVN head Paul Fishbein sounded like he was echoing the words of Spinal Tap’s manager when he described the venue switch as not so much to a smaller space, but one more “selective and intimate.”

So, what happened to the porn business, which had been magnificently profitable since the arrival of the VCR? The attendees at this year’s Adult Entertainment Expo gave a number of reasons for its problems.

Here are the Top 5 reasons why it is harder than ever before to make a living selling porn:

1. Piracy.

According to porn star Dana DeArmond: “If people don’t realize it is stealing and start paying for their porn then performers are going to stop performing.”

Among the acts DeArmond performs (solo or in group sex with men and/or women) are anal sex and double penetration. “I don’t think people are just going to do what porn stars do for free and put it on the Internet,” she said.

“It is stealing, and unfortunately it is hitting the adult industry hard right now,” said Sasha Grey, the current porn It Girl.

According to XBIZ’s Javors, thanks to illegal downloading and “Tube” sites like YouPorn, sales of porn’s most profitable product, DVDs, have taken a huge hit this past year. Javors said: “Piracy is the biggest single factor contributing to the economic malaise we are in. How can you compete with free?”

Dan O’Connell, president of Girlfriends Films, explained how his company has been among the few to claim an increase in DVD sales from 2009. “We’ve been able to grow our DVD sales, because we have been aggressive going after piracy. In the past eight months, we have taken down 17,000 pirated videos of ours by just sending out letters warning them that we will sue.”

But Girlfriends Films is just one company that averages about five movies a month. And even Grey does not see DVDs sticking around much longer. “I think DVDs are going to be a collectors’ medium like vinyl,” she said.

2. Video on Demand Meets the Masturbating Fan

Paying online hasn’t worked out so well for porn. Unlike conventional movies, the other Hollywood has a serious Achilles’ heel. “People look at VOD as the salvation that is going to be this huge revenue generator. But it is expensive to shoot a feature,” said Pete Housley of Candid Tweet. His company sits between fans and the industry by aggregating porn stars on Twitter. His perspective: “If you think about the costs of making a movie, and then selling it for 6 or 7 cents a minute, well, that is great for Hollywood. The problem for porn is that a guy watches 4 or 5 minutes, jerks off and is done. So, residual payouts are becoming less and less.”

AVN’s Fishbein said: “A lot of the studios that depended on DVDs are trying to make it up through video-on-demand. That is where you have people struggling, because they haven’t figured out how to fully monetize that content.”

John Stagliano, owner of Evil Angel, one of the largest DVD distribution companies in porn said: “We make money on VOD, just not nearly as much as comes from DVD sales. But we are making money on VOD. It isn’t the newspaper business yet.”

3. The Taboo Is Gone

“People used to be ashamed to say their girlfriends did porn. That is gone. Anyone can afford a Web site now,” said Housley.

So, Housley has developed criteria for his various feeds. For example, PornStarTweet requires that the performer has appeared in at least one DVD. Still, there are close to 500 qualified porn stars on this feed.

Mark Spiegler has been an adult talent agent for almost 20 years. His clients include some of the biggest names in the industry, like Dana DeArmond and Belladonna. But he no longer has to look for his talent: Aspiring porn stars email him in droves: “I send away at least two girls a week who think they can do porn,” he said.

Not everyone gets sent away. Spiegler likes to tell of the email he got in 2006 from the then recently turned 18 Sasha Grey. He immediately put Grey in her debut, a John Stagliano film.

Though Spiegler no longer reps her, he nostalgically keeps Grey’s first email on his phone. This weekend, reporters on the red carpet at AVN Awards asked to see this initial email. It appeared that it wasn’t the first time he had performed this ritual. He read the email aloud like a proud father, omitting only her real name, and ended by turning the phone around to display the long, long list of all the sex acts Grey was willing to perform on camera. The reporters turned totally silent as Spiegler scrolled down the list.

“Very few people are cut out for this business. Almost all of the girls who contact me, I send away. In my entire time doing this, there has only been one person who was perfect in every way for the porn business and that is Sasha Grey.”

At that point Grey, walking the carpet, came up behind Spiegler and the two warmly greeted each other.

4. Online Gaming

One of the strangest challenges porn faces is competition from online games like World of Warcraft, though the connection may at first seem random. “It is all entertainment that you are getting involved in the same way as porn is entertainment,” said Aiden. “I won’t say everyone, but a lot of people in the industry play videogames. The games are competition for porn. Fans jerk off to porn and are done, but you can keep playing a game.”

Aiden (no last name, this is porn!) should know, as he is also Webmaster for his wife Belladonna’s successful site As for his online gaming, his wife wants him to cut back. “Yeah, my wife and I occasionally argue about the amount of time I spend playing.”

5. Porn Star Hookers

Why fight for the diminishing supply of work in the porn business, doing those double penetrations, when you have fans who will pay you more for basic missionary-style sex with them? It is a logic that is increasingly making sense to some porn stars as fans are able to connect ever more directly with them via Facebook and Twitter.

Few will talk about this, but one well-known veteran put it this way: “A lot of hookers make a few movies just so they can put ‘porn star’ on their escort Web site. That did not used to happen and still doesn’t with the top girls. But a lot has changed in the past few years. It used to be girls in porn were unattainable fantasies. But they also used to be able to work five days a week if they wanted to. Now, very few of the younger girls can get that much work.”

Perhaps the clearest sign of this efficiency was the booth at AEE occupied by the legal brothel Mustang Ranch, located over 400 miles from Vegas. The brothel is starting a porn production company using their hookers as stars. They hope to have their first release, One Night at the Mustang Ranch, out by spring. But don’t look for it on DVD. It will be Internet only.

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