The Future of Adult Internet - Business as Usual?
by Jo Hawke, www.aebn.net
Adult Entertainment rules the bulk of the business conducted
on the Internet - Cold Hard Fact.
Mainstream authorities can argue all they want among themselves about
whether or not the adult webmaster is actually cutting a profit. They're
just mad because even the small-time adult peddler isn't stupid enough
to shout their revenue figures from the rooftops for just anyone to
know.
Subterfuge, cleverness and figures that seem to melt like candy in
the rain... Sites that disappear overnight to reappear two weeks later...
bigger, brighter and more action-packed than ever. Sites that already
show a profit to private and privileged eyes... Life, is not perfect
in Candy Land... But then, what is perfect?
The obvious fact: if the Adult Industry didn't make a profit, the
adult webmaster wouldn't still be here.
The big question: Where does the peppermint-lined road of Adult Entertainment
lead next?
Adult Entertainment's Biggest Competitor? Itself.
Because of the rapid advances in computer technology, people are discovering
that it is no longer a simple task to set up an adult site that makes
money. The hardest part is not getting to the top - it's maintaining
your place at the top. Just because you have a good product doesn't
mean that you will remain the only purveyor of that product. You have
to constantly upgrade your technology, content, style, marketing strategy,
etc., just to stay ahead of the competition - never mind the new guy
with the innovative idea.
For example, AEBN has always encoded high-quality movies, but now
they encode for Windows Media as well as Real One Media. They've since
added downloads in both medias, and streaming feeds for membership
sites. And, these are all in addition to their original pay-per-view
product.
A few years ago, you could just put up any content, and people wanted
to come see it. The good stuff, the stuff worth seeing, could only
be found at a few select membership sites. Members were happy to pay
to be part of an elite few with access to The Good Stuff.
Today, it takes more and more to catch, then hold, the porn-surfing
audience. As each new site multiplies into dozens of copy-sites, and
new technology becomes more accessible to both the Webmaster and the
Internet viewer, it will only continue to grow more difficult to catch
them, and even harder to keep them.
Why should the adult surfer stick to one site? There are over four
million individual Adult Internet sites available to the public. The
average surfer has such a broad range of places to go, and things
to see, and stuff to do, and all of it: X-rated, it has become far
too easy for the average porn-hunter to find what they're looking
for - at 30 or 40 different sites. You name it, and someone out there
is offering it. Maybe it isn't the best quality in the world, and
it certainly doesn't have the most reliable service, but it's there.
Innovation Leads the Way
To keep customers returning to any particular membership site, the
only edge one company has over the other seems to be Variety and/or
Novelty. Novelty - being the first with an original idea is the only
advantage that anyone can have, and you will only continue to profit
as long as you remain original.
AEBN's innovation allowed them to get into a lot of the established
sites early. Entry into the film content market was expensive when
they began - and it has only gotten more so. They had time to build
solid relationships with their affiliates and with their contributing
studios, because no one else was doing it quite the same way. Now,
there are lots of other movie-content sites out there.
Take a look at 'Girls Gone Wild.' They were the first to really push
voyeur-style movies on the market. Now there are tons of sites with
up-skirt this, and flasher that, but 'Girls Gone Wild' was the first
and the owner branded his name. Bang Bus was also a first. As many
copycats as you have, they were still the first one to present this
original content to the market. Kara's and Wasteland were among the
first big membership sites; since then thousands have followed, but
basically, being first carries a lot of weight.
Unfortunately, as soon as someone gets a good idea, like say, BangBus.com,
over a dozen copycat sites appear out of nowhere.
AEBN was first with a pay-per-minute template that allows webmasters
to have movies on their site - without the AEBN Branding logo anywhere
on the finished theater. A Webmaster not only had complete control
of the appearance of his theater, but control over the genre of videos
he offered his viewers as well.
Once the copycat sites appear, they end up cluttering the market all
over again, by offering cheaper and usually poorer quality content
than the innovators. Add to this equation that somebody somewhere
is offering a similar service or content for free: pictures, movies,
downloads... and then the adult market is back to square one, with a
huge number of adult companies competing with each other for the same
customer base.
Corporate Porn
"I see adult Internet entertainment growing into more of a centralized
industry, said Scott Coffman. The main drawback to the adult market
is that the Internet can only support a finite number of companies
that will make a profit. But then, this is true in ANY industry. You
can't expect 500 companies all doing the same thing to make a profit.
There's just no business anywhere, especially on the Internet, where
you have thousands of small companies all in the same industry and
all doing well. You can only have so many businesses in any industry
eating away at the available revenue. The same goes for the adult
market, you can only have so many Video on Demand companies, so many
TGP galleries and so on... not everyone can make it.
The Internet, and in particular the adult market, has begun to follow
the same path that normal businesses have always historically followed
- Consolidation... small companies banding together - or being bought
outright - to become corporations.
You have not seen a lot of consolidation in the adult market. What
you have seen are a lot of people who just gave up and got out. However,
a thorough search through all the pretty graphics and screaming text
will cough up the fact that only a few large distributors are supplying
the bulk of the content crowding the Internet. Fewer small businesses
have as much control over e-commerce and traffic as they once did.
Consolidation is happening, right here - right now.
Right now, the larger membership sites at the top of the market are
just growing bigger with a hundred small sites to their name. I think
over the next two years you're going to continue to see consolidation,
until the bulk of the small sites are managed - or owned outright
- by only a small number of powerful corporations holding the majority
of the traffic and the high-end content.
Eventually all of the larger corporations will form strong partnerships,
and launch into the Global marketplace.
Part 2: Problems on the Horizon
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