Chicago- Playboy Enterprises Inc. and Penthouse Media Group Inc., publishers of men’s magazines, may make adult movies for portable video players such as Apple Computer Inc.’s new iPod to capitalize on soaring demand for the devices.
Penthouse is in talks with “a number” of companies that build the players to provide adult videos, Chief Executive Officer Marc Bell [pictured] said in an interview yesterday. Chicago-based Playboy also is in talks with new developers, CEO Christie Hefner said.
Playboy and Penthouse, both suffering from slumping revenue at their magazines, are ramping up video production to bolster profit. Apple sold more than 1 million music videos and television shows for its new video iPod, with a 2.5-inch color screen, within three weeks of its Oct. 12 debut. Adding adult content is a natural extension for mobile video players.
“When you look at what has driven the emerging technology for media distribution over the last 50 years, it’s music and adult content,” said David Bank, an analyst for RBC Capital Markets in New York. “It seems like a natural fit.”
Apple had no comment, according to spokesman Steve Dowling. Apple does have content that is rated “explicit” on its iTunes Web site and offers parental controls to iTunes users who want to limit which content their children can access, Dowling said.
“Anyone who has developed and is rolling out a platform for the delivery of content is a company we are interested in doing business with, so you can count we will be in discussions with them,” Hefner said on a conference call with analysts yesterday, when asked if Playboy is in talks with Apple.
The potential for Playboy from new content delivery devices prompted RBC’s Bank to upgrade the company to “outperform” from “sector perform.”
“There is substantial potential for Playboy,” Bank said. “Playboy content is the kind that is a natural to be able to exploit the new distribution channel. It lends itself to a shorter viewing experience.”
New York-based Penthouse was in bankruptcy when the CEO’s buyout firm acquired it in October 2004. Bell in September raised $48 million to finance an adult entertainment broadcast network to compete with Playboy’s Spice and New Frontier Media Inc.’s Erotic.
“There are a number of portable video players and we are very excited and enthused about working with them,” Bell said in an interview. “We are talking to a number of them.”
Playboy yesterday said its magazines posted a loss of $700,000 and fourth-quarter advertising sales will fall 23 percent.
Playboy is most likely to reach content agreements with manufacturers including Apple, according to Banks.
“Playboy has the Good Housekeeping seal of approval,” Banks said. “Their image is more positive than simply pornography. That’s part of why they become the partner of choice. They are reputable in billing management and age verification of their talent. There aren’t many brands that share that stature.”
Playboy was founded by Hefner’s father, Hugh Hefner, in 1953 with Marilyn Monroe as “sweetheart of the month.” In the second issue Hefner, now 79, introduced the bunny logo, designed by Arthur Paul. The logo went on to underpin the Playboy brand, which made the company licensing revenue of $5.9 million in the third- quarter