Porn business optimistic despite piracy, condom battles

The porn industry got in a lot of fights in 2014, and from the look of things, 2015 is going to be a brawler of a year as well.

Piracy and condoms continue to be the porn business' chief battlegrounds. While the push for a controversial bill that would have criminalized the production of porn without condoms anywhere in California died in committee last year, a circuit court upheld an existing, similar law in Los Angeles County (where 60 to 70 percent of U.S. porn films are shot).

And piracy, which costs the industry millions of dollars per year continues to run rampant. In 2014, Nate Glass, owner of Takedown Piracy, a copyright enforcement service, estimates he sent out 24,716 copyright law notices to sites—and expects to send more this year.

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"It's hard to say exactly how much piracy costs the adult industry, since companies aren't required to make yearly revenues public," said Glass. "However, you can see the decline in production where fewer companies are shooting new content and there's less work for performers. ... I know back in 2009 when I was working for studios we saw about a 50 percent drop in DVD sales over the course of the year; that's when the slide really began."

Globally, porn is a $97 billion industry, according to Kassia Wosick, assistant professor of sociology at New Mexico State University. At present, between $10 and $12 billion of that comes from the United States.

Revenue from traditional porn films has been shrinking for the past several years, though. Businesses like live webcam models and adult novelties have helped fill that gap—but Wosick notes that most of the industry's financial information is less concrete numbers and more estimates.

Despite the legal and piracy challenges, porn has arguably never been such a visible part of the pop culture landscape. Sex toys are sold in corner drugstores. Several adult actresses appeared on popular television series, such as "Sons of Anarchy." And later this year the cinematic version of "50 Shades of Grey"—with a strong focus on the bondage fetish—will hit theaters—and is expected to be one of 2015's big hits.

"The industry's stabilizing, but still on the rocks," said Chauntelle Tibbals, an independent sociologist (and former visiting scholar at the University of Southern California) who studies the adult entertainment industry. "The huge purges we were seeing in terms of ... lots of companies closing seems—from a far distance—to be leveling off—and that's a good thing, but one rocky thing that's happening is the issue of expression. And I think that's going to be a continuing issue in 2015."

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Expression became a red flag in December when the 9th Circuit Court of Appeals upheld the Los Angeles condom law. In its ruling, Judge Susan P. Graber, writing for the three-member panel's majority, noted "The condom mandate survives intermediate scrutiny because it has only a [trivial] effect on expression ... and leaves open adequate alternative means of expression".

"The idea of controlling sexual expression that way is absolutely frightening," said Tibbals. "It shows the court is more interested in controlling the adult industry in terms of expression than it is with STI transmissions."

The ongoing legal battle over condom usage in LA and the threat that the AIDS Healthcare Foundation, which led the charge on Measure B, will once again push for a statewide law has renewed speculation that some companies may move from California—with Nevada often mentioned as a possible new home (despite the fact that filming porn in that state remains illegal).

Despite the potential struggles, many industry insiders are upbeat about the year to come, saying they feel adult entertainment is getting a new beginning of sorts.

"There's a greater sense of optimism," said Alec Helmy, founder and publisher of industry trade Xbiz. "I believe the companies that have stood the test of time are no longer dwelling on the past and have figured out a way to stay viable. I would say it's a new era for the industry."

Chanel Preston, one of porn's top stars, agrees.

"When I got into the industry in 2010, I feel like that was the lowest point," she said. "People were struggling with the Internet and companies were getting pushed out. It was the true test of the industry. Now, four to five years later, the companies are starting to adapt to the new technology and figuring out how to use it to their benefit. The companies that aren't willing or couldn't do that got weeded out."