Why, asks the NY Times, is the porn industry suffering slowed growth? The quick answer goes like this:
The long answer uses basic economics. The situation: Video sales have plummeted and Internet revenue can't catch up. The logical explanation: The Internet made free porn plentiful by removing porn from the physical boundaries of videos, and by forcing sellers onto a playing field leveled by Google and link lists. Now any porn site that wants to charge has to give some content free.
As many could attest, it's far harder (and riskier) to drive to an adult video store and buy a few DVDs than to surf some porn sites in the privacy of home. That's why, as the showtune says, porn now feels acceptable for "normal people." If it was as simple as moving the profit online, profits would be booming. But that assumes that Internet behavior is the same as real-world behavior.
Stats are hard to come by, but presumably the Internet attracts younger viewers than VHS did. That younger bracket grows up considering porn not as a rare thing found in the woods or Dad's sock drawer but as a commodity. And plenty of kids get their hands on more porn than the earlier generation dreamed of. Supply creates demand.
But as with mainstream music and movies, kids see porn as an ephemeral product that's okay to copy for free. In fact, many go out of their way to spread files through Bittorrent or to post cracked passwords for pay sites to message boards. As in the field of software, movie and music piracy (where pirates attach their callsigns to files they spread), a status cult drives these Rubbin' Hoods (Ed. Term of art) to pass out porn without financial incentive. Unlike the RIAA and MPAA, porn makers won't find many lawmakers willing to publicly campaign to curb piracy.
Meanwhile, the supply side is diluted with user-generated content (Ed. an interesting spin on supply-side economics: Supply creates demand in the same stroke as it satisfies it! Er, pun not intended). While no "YouTube for Porn" has dominated the market like its mainstream namesake — perhaps because there are already so many: XTube, PornoTube, SensualTube, Spankwire — the typical porn cast and crew are replaced by two guys, a camcorder and a web template, and and a disconcertingly limitless procession of gullible females. And that's why the $658-million drop in video revenue was only replaced with $341 million online, and why cable and pay-per-view, though booming, are still secondary markets.
The Times notes that sex toy sales to women are still growing healthily. Naturally — you can't replace those with a Quicktime file.
