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Is Success Killing the Porn Industry?

It's harder to make profits in porn in the digital world, the 21st-century medium of porn distribution.
 
 
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When was the last time you watched a porn flick? It doesn’t matter whether you are a man or woman, straight or gay, or whether it was a "romantic" or a “gonzo” video. Chances are you watched it on a digital TV, computer or mobile device like a smartphone or tablet, and that you accessed it via an Internet connection.

According to one estimate, there are nearly 25 million porn sites worldwide and they make up 12 percent of all websites. Sebastian Anthony, writing for ExtremeTech, reports that Xvideos is the biggest porn site on the web, receiving 4.4 billion page views and 350 million unique visits per month. He claims porn accounts for 30 percent of all web traffic. Based on Google data, the other four of the top five porn sites, and their monthly page views (pvs) are: PornHub, 2.5 billion pvs; YouPorn, 2.1 billion pvs; Tube8, 970 million pvs; and LiveJasmin, 710 million pvs. In comparison, Wikipedia gets about 8 billion pvs.  

Anthony also reports that men make up more than four-fifths (82%) of porn viewers while women consist of less the one-fifth (18%). He estimates the average length of time spent on Xvideo at 15 minutes. From an aesthetic perspective, he notes that most people receive their digital video feeds using low-resolution streaming.  

Sometimes the porn industry recalls Mark Twain’s famous line, “The reports of my death are greatly exaggerated.” In June 2012, Guardian columist Louis Theroux analyzed “the declining economics of the pornography industry.” Reporting on the January 2013 Adult Entertainment Expo, David Moye, writing at the Huffington Post, picked up the chant and warned, “porn industry in decline.” But is the porn industry in decline or yet again restructuring due to technological innovation and marketplace changes?

The porn business is like an old Sally Rand fan dance performance, with performers suggesting a lot while showing very little. It is nearly impossible to get real numbers from porn companies, as few are publicly traded. Estimates as to the size of the business range across the board. The website TopTenReviews claims that, in 2006, the worldwide porn market topped $97 billion, with the U.S. making up $13.3 billion. It argues, “the internet is not the most popular form of pornography in the United States. Video sales and rentals accounted for $3.62 billion in revenue in 2006 while internet pornography raked in $2.84 billion. Magazines were the least popular.” The world has changed since ’06.

The Guardian’s Theroux does not offer an estimate as to the size of the porn industry, but warns, "some time around 2007, the ‘business of X’ started going into a commercial tailspin.” Huffington’s Moye cites estimates from Theo Sapoutzis, the head of the Adult Video News (AVN), who claims that the porn business made $10 billion in 2012. Last year, CNBC claimed that porn businesses, led by Vivid Entertainment, Digital Playground and Manwin, “generate roughly $14 billion in revenue per year that in 2012.”  

The porn industry is facing a period of significant restructuring. Porn theatres and XXX shops catering to the “raincoat crowd” and the risqué have all but vanished; the DVD, the old cash-cow release platform, is in rapid decline for both porn and conventional movies. Digital video streaming is the 21st-century medium of porn distribution.

Most commentators identify five factors contributing to the predicament now facing the commerical porn industry: (i) the widescale pirating of copyrighted porn and its illegal resale and posting by opportunistic websites; (ii) the ease of producing do-it-yourself (DIY) amateur porn videos; (iii) the enormous increase of “free” porn sites; (iv) the resulting change in business economics; and (v) the ongoing recession with cuts discretionary spending, especially among a certain sector of the male audience.  

 
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