Youth, Pornography, and the Internet (2002) / Chapter Skim
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3. The Adult Online Entertainment Industry
3. The Adult Online Entertainment Industry
Pages 71-83
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From page 71... ...
1Legitimate online adult entertainment businesses are not generally providers of child pornography. However, one firm in the adult online industry that provided access to a range of sexually explicit materials was indicted and convicted on child pornography charges.
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From page 72... ...
According to industry statistics, approximately 70 million different individuals per week view at least one adult Web site on a global basis 20 million view adult pages that are apparently hosted on sites in 2The total size of the adult entertainment industry is not well known, and estimates range from $4 billion to $10 billion. See Frank Rich, 2001, "Naked Capitalists: There's No Business Like Porn Business," The New York Times Magazine, May 20; Emmanuelle Richard, 2001, "The Perils of Covering Porn," Online Journalism Review, July 10, available online at |
From page 73... ...
The cost of entry into the business is relatively low, and the availability of a range of services from content provision to free Web site hosting and credit card transaction processing makes it easy to set up an adult Web site. However, because the market is highly saturated (i.e., for a Web site with any given sexual theme, there are likely to be a large number of competitors)
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From page 74... ...
This assumption is not valid under all circumstances, but does not appear to be an unreasonable approach. However, home pages that serve as billboards for the sites' contents and the generation of revenue
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From page 75... ...
, and a mousetrapped user who tries to leave a sexually explicit site is automatically forwarded to another such site. This other site may be operated by a different operator, but that fact is irrelevant to the user who just wants to get out.7 (Technically, mousetrapping refers to a process enabled by lavaScript (a scripting language for Internet browsers)
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From page 76... ...
For example, one firm employing some of these means allegedly earned between $800,000 and $1 million annually from selling traffic to advertisers whose ads were included on its Web sites.l° Subscriber retention is extremely difficult for these pay sites without a constant supply of fresh content that they must produce themselves or 9In principle, sponsors of "affiliate" programs bear the responsibility for policing affiliates that behave in an over-aggressive manner and promote their affiliate Web sites through the use of spam or other improper methods. In practice, some sponsors take this responsibility more seriously than others, and sanctions for improper promotion can range from non-existent to revocation of the affiliate relationship and withholding of payments that would otherwise be received for traffic.
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From page 77... ...
· Third-party billing processors offer their services to adult Internet companies that may or may not have merchant accounts. Third-party billing also avoids potential embarrassment for users who wish to subscribe with some degree of privacy (since the name of the billing party rather than the adult Web site operator appears on the credit-card bill)
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From page 78... ...
Often AVSs are used by "free" adult Web sites, which receive a portion of the revenue generated by the AVS required for entry to those sites. · Content provision services provide sexually explicit content to Web site operators that cannot produce their own content.
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From page 79... ...
Since perhaps the mid-199Os (when the World Wide Web began to grow at a rapid rate) , the proliferation of adult Web sites suggests that the adult online industry has been in an imitation phase.
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From page 80... ...
A second occurred in October 2001 in which it took action against a party that used misspellings of common Web sites not oriented to adult entertainment to draw traffic and that engaged in "mouse/rapping" of users.~7 A third occurred in November 2001, in which a number of adult entertainment firms on the Internet paid $30 million in fines in response to FTC charges that they illegally billed thousands of consumers for services that were advertised as "free" and billed other consumers who never visited the Web sites at all. In addition, the settlement bars the illegal practices in the future and requires that the defendants post a bond before they are allowed to continue to market adult entertainment on the Internet.~8 The long-term meaning of such actions for the industry is as yet unclear, but coupled with a new administration, it may suggest that the adult industry will be feeling increased pressure in the future.
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From page 81... ...
However, since explicit regulation is often quite onerous, businesses in an industry that is subject to regulation may have strong incentives to self-regulate that is, to adopt codes of behavior to ward off the threat of explicit regulation.~9 Whether self-regulation will characterize the path of the adult online industry remains to be seen, but it is likely to depend on the occurrence of a shakeout that leads to substantial consolidation in the industry and trade groups with influence over a sufficiently large number of individual firms in the business. 3.4.3 Future Products and Services Today, the vast majority of online adult content consists of still images.
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From page 82... ...
Such considerations are also likely to play a role in the evolution of the content offered by the industry. For example, the committee heard from well-established firms in the industry that noted that adult Web sites were becoming increasingly specialized to accommodate any imaginable sexual preference or taste (including those that might be regarded as more "extreme")
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From page 83... ...
The first is content: some possibilities for site content include uncensored sexually explicit images; sexually explicit images with strategically placed blurrings or black spots; images that are merely suggestive but not sexually explicit; text that describes the content of the rest of the Web site; and/or text that tells the user to leave if he or she is a minor. The second is navigation: some possibilities include links that allow the user to see other pages on the site only with payment, links that allow the user to see some other pages on the site without payment, and/or links to other Web sites.
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