http://www.msnbc.msn.com/id/28737244
By Michael Ventre msnbc.com contributor updated 12:03 p.m. ET, Sun., Jan. 25, 2009
The
Los Angeles County Economic Development Corporation estimates that in
an average year the adult entertainment industry — which is
headquartered primarily in Southern California — registers total sales
of $12.6 billion.
Recently
Larry Flynt, head of the Hustler empire, and Joe Francis, the man
behind the “Girls Gone Wild” series, requested a $5 billion bailout
from Congress.
Is it that bad out there?
The
rest of the nation is reeling from a severe economic downturn. Yet the
conventional wisdom about the adult entertainment business is that it
is recession-proof.
And
that thinking is consistent with the behavior of mainstream Hollywood.
In times of economic difficulty throughout history — even during the
Great Depression — people still found the relatively small sums of
money to pay for movies and keep their spirits up.
This
time in the adult industry, though, it may be different, partly because
of the current conditions and partly because of the drift by consumers
toward new options.
“They
are definitely struggling,” said Jack Kyser, an economist with the
LACEDC. “They are subject to piracy like the mainstream industry is,
and that siphons revenue away. Then there are a lot of amateurs in the
online industry, which is growing rapidly, and they don’t charge for
it.
“The industry is really seeing a change in their business model.”AVN
Media Network, the most prominent overseer of the business, publishes
trade publications for the adult entertainment industry and puts on
trade shows. Paul Fishbein, chairman of AVN, is entering his 27th year
in the business, “and this is the first time I can honestly say the
adult business is not recession-proof.”
“Everybody I’m talking to says the business is down anywhere from 20 to 30
percent,”
he explained. “That’s in line with the rest of the economy. People in
the retail sector are down anywhere from 10 to 40 percent.”
Why buy the cow ...
While
the recession has something to do with it, Fishbein said, the
availability of cheaply made adult fare online is cutting into the cash
flow for traditional outlets and establishments.
“There’s
enough free porn on the Internet that, if you don’t care about quality,
you can get what you want,” Fishbein said. “Plus the DVD business put
out 13,000 new releases last year. That’s just too much.
“There’s
too much stuff out there. The economy is bad. And there is a lot of
free porn. So it’s a perfect storm that is affecting everybody’s
business.”
Yet
two of the more notable names in adult entertainment seem to be
weathering that tempest at least adequately, for the time being.
Even
though Francis joined with Flynt in asking Congress for a handout —
whether jokingly, half-jokingly, seriously, or all of the above — he is
comforted by the fact that “Girls Gone Wild” is a recognized brand with
an ardent following.
“We
offer reality product. We don’t do hardcore,” he said. “We’re heavily
advertised. There’s a comfort zone in choosing ‘Girls Gone Wild.’ We’re
No. 1 in all categories.”
Francis’
operation benefits from the fact that it doesn’t have to pay actresses,
or only on rare occasions. Low overhead, more profit. Also, “Girls Gone
Wild” can be sold in retail outlets that won’t sell hardcore
pornography, another advantage.
What
Francis is more upset about than the current economy is the frequent
pirating that occurs with his product. “We’re facing what the music
business faced a few years ago,” he said. “These sites are stealing our
content. We want copyright laws enforced.”
Vivid
Entertainment Group deals mostly in adult films and has had stars like
Tera Patrick, Jenna Jameson, Briana Banks and Savanna Samson on its
marquee. Its president, Steven Hirsch, said his company also depends on
loyal customers who want high-quality material.
“We’re
fortunate. We have a brand,” he said. “People know who we are. Our
girls work exclusively for us. For the past 25 years we’ve had the
reputation of producing quality movies.”
But
his business has also been affected by both the current economy and
developments in the marketplace, he said. “The DVD business is down
about 30 percent from year to year,” he said. “When it comes to adult
movies now, people go online. So we’re focusing on the vivid.com
subscription Web site. We’re also looking to new technologies, adult
entertainment on cell phones, all of the emerging businesses that will
help make up for the loss on the DVD side.”
Both
Francis and Hirsch said they didn’t expect any layoffs in their
businesses, nor have they cut back on production. But they’re still
feeling the pinch.
“I
never thought the adult industry was recession-proof,” Hirsch said,
“but it seemed in the past we could hang in there. This time, though,
we’re dealing with a downturn in DVD sales at the same time there is an
economic downturn.”
Of
course, in the adult business, like any business, there is the small
businessman, the little guy. Rob Rotten is an adult actor, director and
producer and head of Punx Productions. When he makes a film, he said,
“I have my fingers in everything, including post production and box
covers.”
“We’re
in a transition stage,” said Rotten, who has been in the business for
nine years. “I don’t necessarily think it’s a bad thing, recession or
not. It was bound to happen. And I wouldn’t blame it totally on amateur
sites.”
The
Northern California-based Rotten believes the adult entertainment
business has been hurt by opportunists who try to produce low-quality
films and charge exorbitant sums in order to make a quick buck. “It’s a
lot of low-budget gonzo stuff released into an oversaturated market,”
he said. “I think the general public just got sick of paying $49.95 for
a poorly edited, poorly shot, poorly made video.”
As
opposed to many who were hit unexpectedly by the severity of the
downturn, Rotten said he was ready. “I knew there would be a backlash
and I prepared for it,” he said. “I’ve downsized and I limit the number
of movies I make a year.”
Rotten
offered a tip that could probably apply to just about any struggling
business with a product in today’s economy. “The movies I put out and
are affiliated with, we actually care about them,” he said. “Even
though it’s an adult movie, I try to make the best movie I can within
my allotted budget.
“There are some companies that are doing better now than they were three years ago, because they never let go of the quality aspect. They’re not just shipping wood.”
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minutes) of great amateur fucking. 
