The Porn Industry, Free And Basic Economics

from the a-primer dept

Someone who apparently disagrees with our stance on using free within a business model submitted a recent LA Times article about struggles in the porn industry as proof that "free" doesn't work. I always find these sorts of claims amusing. First of all, even if "it doesn't work," it's happening anyway. So, the real question is what are you doing about it. Bitching and moaning that "free" doesn't work doesn't change reality.

But, even then, the article doesn't actually support the claim at all. What it does find is that adult performers can't make as much money as they could before, but that's not at all surprising. That's just basic economics again. The tools of production, distribution and promotion have all become much cheaper, and the marketplace has become more crowded. By every conceivable economic measure, it makes sense that the price for the talent may get lower. That's just competition and supply and demand at work.

But does it mean that "free" doesn't work? Again, the evidence is lacking. While some producers who relied on old business models may be having trouble, we've seen others learn to embrace what the technology allows. It doesn't seem that anyone is going to be left wanting for a shortage of porn any time soon -- and give the amount of traffic driven by porn, plenty of producers are figuring out ways to make plenty of money (especially now that their overall costs have gone down).


Reader Comments (rss)

(Flattened / Threaded)

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    Dark Helmet (profile), Aug 11th, 2009 @ 12:56pm

    Good Lord,

    Please let one of these sleezebag producers buy the Have Mike Review Your Business Plan option, because I have some serious ideas about tangible scarcetitties to work into their business models....

     

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    Anonymous Coward, Aug 11th, 2009 @ 1:15pm

    Only mike

    Only mike would find unemployment amusing.

     

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    Free Capitalist, Aug 11th, 2009 @ 1:33pm

    Strange Bedfellows

    Leave it to the old-news to try to generate mass-concern for a few hundred under-employed actors, when entire communities are suffering elsewhere.

    Not a great industry for news to openly parallel with their "free is evil" campaign.

     

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    David, Aug 11th, 2009 @ 1:46pm

    Sounds like a job for:

    CwF + RtB! :) There are just laws against some of the business models that come to mind in (Most) states :)

     

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      Milo, Aug 11th, 2009 @ 1:59pm

      Re: Sounds like a job for:

      Indeed. Kink.com in San Francisco has been doing this really well, reaching out to the community, and providing exclusive, high quality content. But absolutely, this seems like exactly the model the adult industry needs.

       

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    Designerfx (profile), Aug 11th, 2009 @ 1:59pm

    deliberate porn industry lies, they want a handout

    here's the deal:

    porn industries give out their films full length for FREE to make extra money with advertising dollars and selling other complementary services. They do it on all sorts of sites such as tube8, redtube, spankwire and others (I know folks who have signed marketing agreements with them). Last I checked, Cinemax (skinemax) and other sites have been doing this for decades.

    Meanwhile, the industry is lobbying for tax dollars and sympathy from consumers by taking the easy out : "free doesn't work" meanwhile they're doing it themselves.

    Don't believe a drop, the rest is just the fact that every news company (especially big ones like LA times) will parrot ANY talking points irrespective of their views in hopes to gain a few extra viewers by stumbling onto an interesting article that gains other press. It's the "throw wet spaghetti at the wall until it sticks" method of giving away, or "give away and pray" model done by the news company.

    See how this circle goes? Pretty simple, really.

     

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      DJ (profile), Aug 11th, 2009 @ 2:53pm

      Re: deliberate porn industry lies, they want a handout

      Well, I'm a little stupefied...
      This site always gets opinions from people going off half-cocked (pun intended), without offering well-thought-out arguments.

      You've done the opposite here. You seem to be rather well-informed, and your arguments COULD be convincing; except for one small problem: I'm not sure which way you're arguing.

       

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        Designerfx (profile), Aug 11th, 2009 @ 2:56pm

        Re: Re: deliberate porn industry lies, they want a handout

        say what? I don't provide opinions, only information. People who read this site are extremely well informed/smart (even the trolls are deliberately stupid but smart people behind the scenes or just manipulative) and I expect people to simply make a more informed decision with more information.

        Personally? porn industry is fine, has had no problems, has always been a growth industry in one pun or another.

         

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      Anonymous Coward, Aug 11th, 2009 @ 3:01pm

      Re: deliberate porn industry lies, they want a handout

      Sorry dude, but sites like redtube use the content without permission, hiding behind "section 230" and claiming that end users submitted it. Redtube is currently on the back end of a very nasty lawsuit.

      The porn industry doesn't support tube sites, they don't support giving away the full product for free. It's proof that there are people out there willing to give the stuff away for free to try to upsell something else, and it only works when the steal the content to do it - if they had to pay to produce it, the upsells wouldn't make money.

      Comments like this make me understand why people here don't understand the true implications of free!

       

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        Rose M. Welch (profile), Aug 11th, 2009 @ 3:30pm

        Re: Re: deliberate porn industry lies, they want a handout

        What about the free amateur sites, like youporn?

        Video is now cheap enough that the amateur can produce pretty good video. This was not true in the past.

        People are now open enough that there are more exhibitionists and angry exes than ever. This was not true in the past.

        Site building knowledge, space, and tools are now cheap enough that there are more websites and designers than ever. This was not true in the past.

        All the Internet does is bring these people together in a way that is steadily making the core porn industry obsolete.

        There will, however, always be a market for the really hard-core stuff or for the the porn connoisseur. More competition just means that everyone has to work harder and better to get paid. What's wrong with that?

         

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        DCX2, Aug 11th, 2009 @ 3:33pm

        Re: Re: deliberate porn industry lies, they want a handout

        People who go to redtube to watch porn have probably never bought any porn, so the producers aren't really losing any money.

         

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        Alan Gerow (profile), Aug 11th, 2009 @ 4:00pm

        Re: Re: deliberate porn industry lies, they want a handout

        Comments like this make me understand why people who troll here don't understand the true meaning of free!

        (free DOESN'T mean unauthorized file sharing, that's an entirely different, though related, issue)

         

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    TheStupidOne, Aug 11th, 2009 @ 2:10pm

    Actors are Making Less??

    I've considered starting my own studio where I let any aspiring director come in and make a film. Have them pay a reasonable fee to use the equipment and a reasonable fee for the actors/actresses. No extra charge for using yourself as an actor (assuming you pass the std screening). They can then do anything they want to with the video ... including destroying all evidence of it, or publishing it on a website I would host.

    Oh, and any fan can come in and make their own film .. I assume most fans would want to be actors, and they could select whichever actress(es) they want to perform with them.

     

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      duane (profile), Aug 11th, 2009 @ 4:08pm

      Re: Actors are Making Less??

      I think that is called running a bordello.

      Actually the videoing would be a pretty good dodge. I bet you could get away with it. For a little while at least...

       

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    Scott Owens (profile), Aug 11th, 2009 @ 2:13pm

    Agreed

    I have been in the industry for 10 years and remember in the early days trying very hard to fight file sharing.

    But over time I have realized you just need to keep on your toes and adapt as things change. Identify ways you can add value and create things that people can not share by engaging your customers and creating a community around the content.

    However, one problem I have identified that has put the porn industry at a much bigger disadvantage than mainstream content industries is that you can pretty much only advertise more porn on a porn site.

    Sex and porn are rarely hot topics on my forums. It is all about the latest gadgets, music, politics, etc.. So if I could advertise products my users are actually interested in, I would make some decent money. But none of these industries are going to want to run ads next to porn. All I can advertise is more porn... Most of my users are not interested in more porn.. They already found some porn they liked and paid me money for it.

    This may make it a lot harder for some adult companies to survive. But as long as I can stay competitive enough.. I will personally welcome some of the less innovative competition being thinned out.

     

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      DJ (profile), Aug 11th, 2009 @ 3:00pm

      Re: Agreed

      hmmm a perspective few people outside of internet advertising have never considered...

      Having frequented my fair share of sites, I know what you mean. The innumerable pop-up ads get frustrating. It's kind of like walking out of a video store with a movie that you want, and having a rep from another video store start trying to sell you on his/her video store.

       

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      Marcus Carab (profile), Aug 11th, 2009 @ 3:11pm

      Re: Agreed

      It seems to me as though porn makes its money off fringe interest groups. Teenagers aren't going to pay for lesbian videos no matter what (nor, I suppose, would they be allowed to), but I suspect plenty of adults are prepared to pay for less common subject matter - there's your scarcities.

      But shouldn't the porn/sex industry's bigger concern, right now, be preparing for all these digital-natives as the majority become sexually unsatisfied adults? You can't tell me that the global socio-psychological significance of pornography isn't changing in BIG ways as the result of the internet, offering plenty of opportunities.

       

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    Anonymous Coward, Aug 11th, 2009 @ 2:16pm

    Kinda gives a whole new meaning to the "Connect with Fans" thing...

     

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    Fatduck (profile), Aug 11th, 2009 @ 3:31pm

    I thought the porn industry's business model was to trick people into signing up for $2.99 "risk-free trials" and then continuing to charge them repeatedly for large sums, hoping they will be too embarrassed about their porn habits to contest the charges?

    When did that stop working?

     

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      Anonymous Coward, Aug 11th, 2009 @ 5:03pm

      Re:

      I considered paying for a porn site I particularly like... but they use a dodgy CC processor which has quite bad user feedback. This, the "monthly fee which you can cancel at any time", and the CC number asked "just for age verification process" means they're not getting anywhere near my money.

       

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    Javarod (profile), Aug 11th, 2009 @ 5:49pm

    Kink.com

    They're also notable for their solution, instead of doing a script, filming it, and releasing it on a schedule, kink.com has heavy switched to live shows, releasing the edited version on the site later. Obviously the only way to see the live show is to be a member, and its somewhat tricky (not impossible obviously) to pirate. While kink.com isn't doing as well as they used to, they're still doing quite well by adjusting to the market, and diversifying (considering that their studios are the San Francisco Armory which was purchased for a reported $14.5 million).

     

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    Anonymous Coward, Aug 11th, 2009 @ 9:55pm

    Follow the music artists

    Should they start giving the videos away for free but charge the big bucks for "live performances?"

     

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    Nick, Aug 12th, 2009 @ 6:00pm

    Funny that you mention this. The porn industry is paralleling the music industry. How about if you watch the porn for free but then you get to bang the girls for money? That is what is happening. NSFW: http://www.houseofsodom.com/2009/07/03/bang-a-porn-star-for-300-or-less/

     

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