overview

This profile looks at the online 'adult content' industries, variously described as having a trillion dollar turnover, a model for commoditisation of cyberspace and an object of journalistic hype or political disinformation.

     contents of this profile

This page considers the overall shape of the online adult sector, debate about its size and regulatory issues.

The following pages cover -

• precursors - adult content production, distribution and before the net
• consumers - audiences, consumption patterns and consumer issues
• creation - an introduction to the adult content industries
• distribution - the distribution side of those industries
• drivers - debate about online adult content as a driver for commercialisation of the web, profitability, economic relationships and pointers to major resources
• people - the people in front of the cameras (and behind the digital cash-registers), along with pointers to some primers
• tubes - questions about amateur and professional adult content in venues such as xtube and youtube

     industries

What are the 'adult content industries'? The lack of agreement about basic terminology bedevils much of the writing about what one purist dubbed the 'X Internet' and others have sought to quarantine in a special X gTLD.

Few government statistical collections offer a tight categorisation of 'adult' goods and services, including online content and retailing of tangible products. In reading the following paragraphs and some of the cited writings it is worth noting that some authors bundle everything from fees for hosting amateur erotica through to fully commercial (pay per play) streamed video and Amazon.com style etailing of vibrators and knickers.

Some key sectors are -

• publishers of erotica (eg text, still images, film/video and games) for free or paid access
• generators of that content (eg video producers and syndicators)
• age verification services (AVS) that underpin restrictions to online access
• other providers of services, such as intermediaries for the processing of payments

We've discussed particular sectors in the following pages. There is a complementary profile about online gambling.

     turnover

How much is the online adult sector worth?

Your guess, we suspect, is likely to be as accurate as that of most commentators. Uncertainty reflects -

• the lack of comprehensive government or academic studies
• the absence of basic metrics
• disagreement about the value and prevalence of non-commercial self-publishing (much of which appears to involve content appropriated from commercial sites or offline publishers)
• the dubious (and often notably self-serving) nature of many industry claims - "an industry where they exaggerate the size of everything"
• the innate difficulty of tracking consumption patterns, investment and revenue that is often illicit

One promoter claimed in 2002 that

the Adult Internet industry generated over US$900 billion in revenues in 2000 making it account for 13% of all revenue generated on the internet and making it the #1 product/service on the Internet today!

Another estimated that

the pornography industry in the United States earns revenues of over $10 billion annually. Of that amount, it is possible that up to $2 billion is spent on porn Web sites, with steady growth forecast

and went on to claim that US Baby Boomers account for most of an estimated US$5 billion per year on adult videos. In June 2007 AVN claimed that US sales and rentals of pornographic videos in 2006 were US$3.62 billion, down from US$4.28 billion in 2005. Revenue from online subscriptions and sales in 2006 was supposedly US$2.8 billion, up from US$2.5 billion in 2005.

William Lyon of US industry advocacy group the Free Speech Coalition (FSC) claimed that the online sector had a gross annual profit in 2001 of between US$10 and US$12 billion (significantly more than that of Microsoft).

A 1999 White Paper from the FSC and Video Software Dealers Association had claimed that adult video sales/rentals from adult product stores in the US were around US$4.1 billion, with around 70% of the films being produced in California and mail order video sales amounting to an estimated US$400 million.

Jason Hendeles referred to an unidentified source in estimating that

in 2000, the adult-content industry accounted for more than 30% of all Internet traffic worldwide, and for the majority of spending for online content including subscription and pay-on-demand services.

Frederick Lane, author of Obscene Profits: The Entrepreneurs of Pornography in the Cyber Age (London: Routledge 2000) and the Sexbizlaw.com site, claimed in 2000 that the global "online adult market" was worth around US$2 billion a year, about three-fourths from subscriptions. There are similar figures in Eroticabiz: How Sex Shaped the Internet (New York: iUniverse 2002) by Lewis Perdue.

In 1998 Datamonitor forecast that by 2000 adult content would generate US$1.7 billion revenue and claimed that it accounted for 70% of the aggregate European online content market (estimated at £900 million).

Lane had elsewhere referred to the operators of "porn sites" as riding high on a sea of cash although, alas, has not provided a detailed map of that sea's depth or extent. One sounding was provided in claims during litigation over the Sex.com domain name that the portal generated revenue of at least US$95.5 million in a year and scored 25 million visits a day. Another sounding was testimony, in 2004 litigation between Australian telco Optus and adult content operator Gilsan, that the latter's global revenue was upwards of $100 million.

Donna Hughes' 2000 paper The Internet & Sex Industries: Partners in Global Sexual Exploitation highlighted claims that the US market for adult content involved annual sales of US$10 billion to US$14 billion.

Such estimates are questioned in Blaise Cronin & Elisabeth Davenport's thoughtful paper 'E-rogenous Zones: Positioning Pornography in the Digital Economy' in volume 17(1) of The Information Society, in Laura Kipnis' Bound & Gagged: Pornography & the Politics of Fantasy in America (New York: Grove 1996), in the 2002 An Economic Map of the Internet (PDF) by Shawn O'Donnell and other studies noted in the Censorship & Free Speech guide on this site. There is a perceptive discussion of data collection and analysis challenges in the 2002 US National Academies' report on Youth, Pornography & the Internet.

A 2001 article in Forbes, an upbeat publication generally not distinguished by its scepticism, attributed claims of US$10 billion pa for online erotica to uncritical recycling of news about a 1998 report by Forrester Research and assertions by Adult Video News (AVN) that US consumers spent US$4 billion on adult video rentals in 2000.

That report concerned the online "adult content" industry, with annual revenue estimated at US$750 million to $1 billion, with three groups of sites enjoying revenue of US$100 million to US$150 million. Forbes claims that a higher figure is improbable - even if turnover for adult video, sites, phone service, sex toys and publications was bundled together - and questioned claims about sale/rental of adult videos. It was echoed in commentary (here) in the Online Journalism Review.

Specific features of the Forbes analysis were not particularly convincing for us but the article usefully places claims by adult content industry proponents in context.

The US consumer magazine market for example grossed US$7.8 billion (sales plus advertising) in 1999, with broadcast television at US$32.3 billion, cable tv at US$45.5 billion and professional / educational publishing at US$14.8 billion. Sale and rental of 'legitimate' videos were estimated at US$20 billion in 2000, with cinemas turning over US$7.67 billion. Historian of science Donald MacKenzie noted (PDF) that by June 2000 the total notional amount of derivatives contracts outstanding worldwide was $108 trillion (equivalent to around $18,000 for every person on earth); Helen Reynolds suggested that in 1986 there were 0.5 million sex workers in the US, with annual revenue of US$20 billion. A 1999 estimate by Jupiter Communications, a competitor of Forrester, was that the US market for online pornography was under US$175 million.

Interactive Consumer Broadband: Sex, Sport & Shopping, a 2001 report from UK group Analysys, bravely forecast that broadband erotica would be worth US$3 billion by 2003 on a global basis. Competitors have simply added another digit to such figures.

In February 2003 VisionGain forecast that the value of the "online pornography market" will be US$70bn (£44bn) in 2006, and that US$4bn (£2.4bn) of that "could come from mobile services". In 2005 Informa claimed that the market for "erotic content" would be worth about US$2.3bn by the end of the decade; Juniper Research claimed in 2006 that the market for "mobile adult services" was worth US$1.4bn, rising to US$3.3bn by 2011.

     how many sites?

The answer to that question is that no-one knows.

We have noted claims that there are 30,000 to 60,000 "pornography sites" on the net. Researchers at the OCLC suggested that globally there are around 74,000 commercial sites; US industry group UAS/IFA offers an "educated guess" that there are around 200,000 sites. The 2002 US Youth, Pornography & the Internet report noted above suggested that there were over 100,000 subscription sites in the US (with around 400,000 sites across the globe), possibly with aggregate revenue of US$2.4 billion per year.

That reflected research such as the 1999 Accessibility & Distribution of Information on the Web paper by Steve Lawrence & C Lee Giles discussed in our Net Metrics & Statistics guide and Childproofing on the World Wide Web: A Survey of Adult Webservers, a 2001 paper in Jurimetrics by Daniel Orr & Josephine Ferrigno-Stack.

Others assert that 'adult content' (however defined) is available on millions of pages, in line with estimates of a billion-plus pages on the web, with much of that content being published by enthusiasts and having an ephemeral existence. One 2001 back-of-the-envelope study reported that an AltaVista search for 'porn' identified three million pages. That was roughly half the number for 'god'. (A 2003 Google search for 'Hitler' produced 1.7 million pages, ahead of 1.2 million pages for 'kitten' but behind 17 million for 'dog' and 132 million for 'sex'. A Google image search found 0.126 million 'porn' images at that time).

A 2003 search using the Domainsurfer engine (a tool for identifying variants on domain names) found 167,171 domains that include 'sex', 32,972 with 'anal', 19,268 for the F word, 407 for 'bestiality', 53,194 for 'porn' and 39,495 for 'XXX'. Those figures should be considered in conjunction with Matthew Zook's 'Report on the Location of the Internet Adult Industry' (PDF) at 103-121 of C'Lick Me (Amsterdam: Institute of Network Cultures 2007) edited by Katrien Jacobs, Marije Janssen & Matteo Pasquinelli.

Sexual and pornographic Web searching: Trends analysis, a 2006 paper by Amanda Spink, Helen Partridge & Bernard Jansen considered studies of web search logs from 1997 to 2005, suggesting that the "level of sexual or pornographic searches" has declined as a proportion of all queries since 1997 and currently representes less than 4% of queries.

     How many people?

Figures for the number of people employed producing, distributing or otherwise involved in the online adult content sector vary widely. Few are supported by details that would allow a rigorous assessment.

Australia's Eros Foundation, promoting the sector as a non-marginal industry that deserves respect by government, claims that 640,000 Australians are on adult video mailing lists, with around 250 adult shops having a turnover of A$100 million. Supposedly there are 800 legal and 350 illegal brothels, escort agencies and sexual massage services, accounting for 12 million visits to sex workers.

     and how many consumers?

A much quoted figure is that "four out of every ten people using the Web have visited an adult site in the last week". That appears to be well off the mark, based on extrapolation from a problematical sample and inconsistent with a range of studies about normalisation of the online population. Consumption of adult content is, however, mainstream: recent Australian figures are supplied in The Porn Report (Carlton: Melbourne University Press 2008) by Alan McKee, Kath Albury & Catharine Lumby

The following page of this profile examines particular claims in more detail.

     regulation

We have highlighted online content regulation regimes in our Censorship and Governance guides.

Key features of those regimes are -

• attempts, often quite successful, to exploit regulatory choke points or otherwise establish borders in a supposedly borderless and unregulated cyberspace
• disagreement about whether online content requires special treatment, with claims for example that in an effort to address substantive problems regulators have prohibited online content that would be legitimately accessed offline
• tensions because what is illicit in one jurisdiction is legitimate in another nation/state (or merely that restrictions are not enforced).

The cost of regulation is unclear and is as contested as its benefits. Some observers have tried to attribute regulatory costs on a per site or enforcement action basis, with for example a problematical claim in 2002 of $14,364 per item 'taken down' under the Australian regime.

An historical perspective is provided in 'Pornography, Technology, and Progress' by Jonathan Coopersmith in 4 ICON (1998), 94-125.





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