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Porn Industry Is No Longer Recession-Proof
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Special to CNBC.com
With hotel room pay-per-view a big growth area for the industry in recent years, many adult companies are looking to expand into the living room—though a bit less aggressively than Digital Playground. Vudu, which streams films via an Internet connection (and is a competitor to Netflix [NFLX
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], focuses primarily on major cinematic releases, but also has an optional porn channel, with content from several adult studios, including Vivid, Hustler and Wicked. Rentals cost between $7-$9. Purchasing a film runs from $20-$30.
It’s a notable partnership, since Vudu will ship on millions of HDTVs and Blu-ray players this year from companies including Mitsubishi [MIELY
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], Samsung [SSNNF
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], Toshiba [TOSBF
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], Sanyo and Vizio. (The company, it should be noted, has strict parental controls.)
Online streaming is another growing field for porn—but one with limitations. While it helps reduce piracy, since all of the material rests on hosted servers, users only pay by the minute. With the average viewer only watching porn for 8 minutes, that’s not exactly a formula for substantial revenues.
Sites like Clips4Sale are trying to work around this by selling short clips for up to $1.25 per minute. To attract the largest possible audience, the company offers film segments from virtually every imaginable sexual activity or category (and a few—such as “bubble gum” and “burping”—that might leave you scratching your head).
Not surprisingly, the iPhone is seen as a growth area as well. And while Apple [AAPL
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] won’t sell any app with adult content through its app store, companies are finding away around that hurdle.
Sex App Shop, for example, uses a mobile Safari feature to sell XXX slideshows and video that can be accessed both online and offline. The company claims its product has been downloaded over 2.8 million times since its Dec. 1 opening.
It’s another example of the creative thinking of porn companies. But viewers may find the best part of the service isn’t the content: It’s the fact that when you turn your iPhone horizontally, a faux newspaper that looks an awful lot like the New York Times front page pops onto the screen, hiding the more prurient content.
Will any of these initiatives convince customers to start paying for porn again?
“I think the real threat faced by the industry … is going to be market driven,” Christian Mann of Evil Angel Productions. “To paraphrase Pogo: We have met the enemy and he is us.”
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