Is Porn a Growing or Shrinking Business?

Jan. 19, 2006 — -- As representatives of the Internet porn industry come before a Senate committee to talk about porn's accessibility and effect on our nation's youth, it is generally assumed that it's one of the most lucrative and largest businesses in and out of cyberspace. But is that true?

Industry trade magazine Adult Video News estimates that the industry reeled in about $12.6 billion in 2005 and estimates that more than $2.5 billion of that was from the Internet alone.

But are numbers like these accurate and do they mean that the industry has grown or remained a fringe business that caters to the marginal spendthrift?

For years, mainstream media have given the adult industry a $10 billion price tag, saying it is as big, if not bigger, than the Hollywood film industry.

But according to many media analysts, the numbers are unsubstantiated and the adult entertainment industry is virtually untrackable -- in terms of dollars spent.

"There's no reliable data available on the market," said Jan Saxton, vice president of Adams Media Research. "It's too much of a gray-area business."

Adams, which does financial analysis of the filmed entertainment and digital media markets, said the industry was too vast to cover.

"It runs the spectrum from soft-core stuff in the backrooms of family video stores," she said, "to snuff films, which are totally illegal."

Still, leading media research analyst Neilsen//NetRatings, which tracks Internet traffic and trends, offers some insight into how many users log on to adult sites and how much time Web surfers spend there.

According to research from December 2005, more than 38 million people visited adult Web sites and spent an average of about 90 minutes there.

Even with Neilsen's numbers showing that a significant number of Americans visit these sites, analysts say there's no accurate way to determine how much money is being spent because the various sites rely on very different payment and/or subscription schemes.

The dollar amounts from Adult Video News can't be independently verified, and no one from the publication immediately responded to a request for an interview.