No porn please, we're British
As U.K. Internet surfers prepare for major changes to the availability of online porn, U.S. adult entertainment companies are scrambling to determine the potential consequences on their bottom lines.
British Prime Minister David Cameron announced Monday that the U.K.'s four biggest Internet service providers will automatically block access to porn sites for both new and existing connections, unless users specifically request that the filters be disabled. The new measures are expected to be in place before the end of the year.
"Young people have always been curious about pornography and they have always sought it out," Cameron said in a speech. "But it used to be that society could protect children by enforcing age restrictions on the ground whether that was setting a minimum age for buying top-shelf magazines, putting watersheds on the TV, or age rating films and DVDs. But the explosion of pornography on the Internet—and the explosion of the Internet into children's lives—has changed all that profoundly. It's made it much harder to enforce age restrictions and much more difficult for parents to know what's going on."
Forecasting the economic impact of the action on the porn industry isn't proving easy. Globally, porn is a $97 billion industry, according to Kassia Wosick, assistant professor of sociology at New Mexico State University. At present, $10 billion to $12 billion comes from the United States, but it's harder to determine how big a percentage the U.K. represents.
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A 2006 study by Nielsen NetRatings, however, found Britain to be the world's fastest growing pornography market—with almost 40 percent of the country's male population visiting porn sites at least once a year.
That's due in part to the country's already stringent policies on adult content. (Television is restrictive about what can be shown and adult DVDs sold are often censored versions.) For people wanting to see hardcore porn, the Web is often the best option.
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"It's going to hurt the big boys," said Ogi Ogas, author of "A Billion Wicked Thoughts," a pop psychology book. "They're going to feel it. It will probably help places like Tumblr and such, where amateurs are free to publish whatever they want. Corporations are going to suffer."
While no one is willing to project specific financial losses, most agree that the company most likely to be affected by these restrictions is Manwin, which controls the Brazzers and RealityKings collection of websites as well as several adult "tube" sites (think Youtube for porn).
"It will be very easy to block these tube sites," said Ogas. "Those account for the vast majority of people's online porn use."
U.S.-based porn companies say they're bracing for a potential hit, but won't know how big a disruption it will be until a few details about the opt-in process for viewing adult content online are made clear.
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"I'm not sure what you're going to see when you go to those sites now," said Michael Klein, president of LFP Inc., which owns and oversees the Hustler empire. "The only sites you're affecting are the ones who already have [age verification] precautions in place. ... When you type in Hustler.com, are you going to see a page saying 'enter your credit card'? [If so,] that's going to have an impact because people have no idea what they're buying. ... The U.K. is just one portion of our business, but I'm sure it will have some impact."
Adult holders of existing accounts will be asked directly by the ISPs if they'd like the filters added to their accounts over the next 18 months, the government said. That, essentially, will require customers to not only verify their age, but also confirm that they'd like the ability to watch porn online.
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And having to make that declaration could be costly for the industry.
"Obviously people are not going to want to do that," said Robert Rosen, a porn publishing veteran and author of "Beaver Street: A History of Modern Pornography". "People just don't want to come out in public and say 'I want to look at porn'. A lot of people who do look at porn are inhibited, shy people."
The U.K. is hardly the first country to ban online porn. Last year, an Egyptian court ordered that all X-rated websites be blocked. China and Saudi Arabia also have mandated filters on their Internet connections. Officials in Iceland, a largely liberal country, proposed a ban earlier this year—though the movement seems to have lost steam after the country's ruling party lost control in recent elections.
And in India, ISPs were ordered to block 39 websites serving up porn earlier this month—following a petition from the country's Supreme Court to establish a ban on online porn. (Government officials stopped short of a complete ban, saying they didn't believe such a thing was possible.)
That may, in fact, be an accurate assessment. Porn, like nature, tends to find a way.
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While Cameron warns that access to online porn is "corroding childhood," Rosen notes that children have always found a way to circumvent rules meant for their protection.
"If kids want to look at pornography, they usually figure out how to do it," he said.
Ogas agrees. For "A Billion Wicked Thoughts," he and co-author and fellow neuroscientist Sai Gaddam did an extensive study of online pornography to determine how the area of the brain that generates sexual desire and arousal worked—and were amazed at how widespread it was.
"I can tell you from our research, we went through and tried to identify every piece of porn online—and it is an impossible task to try to filter it all out," he said.
—By Chris Morris, for CNBC.com.