Free Porn Threatens Adult Film Industry

And some in the industry are borrowing methods from Wall Street. Francis Koenig, who once ran the New World Partners hedge fund, launched AdultVest last year. The hedge fund specializes in matching investors with adult entertainment companies. "We are making a market where there was none before," says Alan Ramer, the fund's director of business development.

Investors who qualify (earn an annual income of $200,000 a year, have a combined household income of $350,000 a year and have a net worth of $1 million) can put their money into several funds. The Libor Fund, which launches next month, will specialize in financing adult clubs. "This is a new model -- to promote a market in the adult industry that wasn't there before."

Porn has almost always been at the forefront of technology, adopting video, DVDs, the Internet, e-commerce, online payment, and digital TV long before the mainstream entertainment world. But as the supply of X-rated content keeps increasing, the demand for free and inexpensive porn will keep growing, rendering the industry less able to charge for its products.

One technology that some in the industry are banking on is mobile cybersex, pornographic clips to be viewed on cellphones. Industry estimates project the U.S. market will reach between $500 million and $1.5 billion by 2009.

And researchers have noted that the increased privacy of cell phones compared to computers could benefit the popularity of adult content.

"Anecdotally, we have observed that users often consider their cell phone as a very personal and private device; perhaps even moreso than their computer -- the probability of others discovering their search behavior (through cached pages, auto-completion of query terms or URLs) is smaller," wrote Maryam Kamvar and Shumeet Baluja, computer science professors affiliated with Google.

But many industry veterans don't hold out much hope for mobile cybersex, arguing that the screen is too small and that major carriers are unwilling to carry adult content.

Hustler's Rosenfeld is also skeptical. Although he says he was just given an order to start creating content for mobile phones, he doesn't believe it will be profitable any time soon. "None of that is being broadcast in the U.S. and it's only softcore right now — naked girls dancing," he says. "The big carriers here aren't willing to broadcast that kind of content."

Page
  • 1
  • |
  • 2
Join the Discussion
You are using an outdated version of Internet Explorer. Please click here to upgrade your browser in order to comment.
blog comments powered by Disqus
 
You Might Also Like...
See It, Share It
PHOTO: Left, Sabrina Allen, 4, is shown in this photo provided by the National Center for Missing and Exploited Children; right, Sabrina Allen, 17, is seen in this undated handout photo.
National Center for Missing and Exploited Children|Courtesy of PI Phillip Klein
Kelly Ripa
Seth Poppel/Yearbook Library
PHOTO: Earths moon is pictured as observed in visible light, left, topography, center, and the GRAIL gravity gradients, right.
NASA/GSFC/JPL/Colorado School of Mines/MIT
PHOTO: A long-distance bus station is filled with passengers at the start of Golden Week on Oct. 1, 2014 in Zhengzhou, China.
ChinaFotoPress/ChinaFotoPress via Getty Images