WWW- [blogs.pcworld.com]- It's generally assumed that the where technology leads, the adult entertainment industry will follow, probably before anyone else. Oh, and that the adult entertainment industry is invariably a growth industry. While that's true in the global sense, I was a bit startled to read that, much like mainstream media organizations, the "traditional" porn media industry is under threat by, of all things, the Internet.
There are several levels of irony here, but when you think about it the lessons were already there for anyone who paid attention. It's generally said that porn built the home-video industry, which is kind of true. But let's look at what that shift really meant. People avoided having to sneak into adult movie houses, which was good for them; it became easier for people to see adult movies, which was good for the porn industry; but what's usually left out of the discussion is that the movie houses themselves disappeared, superseded by the new media of video.
For that matter, the notion of a "porn movie" -- that is, shot on film for theatrical distribution -- disappeared as well. so the porn industry as a whole benefited, but that meant part of it had to collapse while another expanded.
What we have now is an acceleration of the same trends and the amplification of the aforementioned advantages to consumer and industry. A broadband Internet connection is even more private, in the community sense, than going to the video store or getting a plain brown package in the mail. But this is happening at the expense of the home video market (DVD sales and rentals), which according to AVN Online dropped from $4.3 billion to $3.6 billion between 2005 and 2006. Meanwhile, Internet sales have been going up, from $2.5 billion to $2.8 billion. Vivid Entertainment Group, arguably the most successful of the porn media companies, saw its revenue from DVD sales drop from 80% to 40% over the last three years.
But focusing just on the industry groups tells only part of the story. Had the discussion focused only on the established comnpanies in the mid 1980s, we would have seen the companies making porn for cinemas adapting to video distribution, noted that the video sales were rising while theater rentals were diminishing -- but companies like Vivid, who now dominate the industry, were yet to come or were just starting out.
The same thing is happening now. The new threat to Vivid are the companies that started out offering X-rated content over broadband, rather than switching to it. They're also facing increasing competition from the indies: individuals who start their own websites (some, literally "mom and pop" operations) and build their own brands independent of the established system. And they're paying already working Web 2.0 -- not just the MySpaces and YouTubes, but the adult equivalents that have sprung up just for them.
It's not all about smut, though. The porn industry is so tightly bound up with technology that watching what's happened there is like looking at the mainstream music, TV and movie industries in fast-forward. It's easy to see why the majors are scared; it's also easy to see why they're going to be eaten alive by today's smaller, brasher companies if they don't adapt, and soon.
