Thursday, June 10, 2010

Cult of the amateur or cult of the professional?

The porn industry's biggest threat!

One of the myths about the porn industry is that it is recession proof. Granted it fairs better than most but the porn industry is facing issues greater than the economy…exhibitionists. Amateur porn (also known as free porn) is taking over the internet. Similar to the video game industry piracy is a problem but the big issue is there are people in their homes making videos and posting for free.

Just like all the other media industries Web 2.0 has negatively impacted the porn industry. Unlike the other industries, the cult of the amateur is surpassing the professionals with extreme ease. In previous posts I have mentioned my theory that the porn market is perfectly competitive in the same vain the goods that amateurs create are a perfect substitute good. In fact they are more desirable than the goods produced by the companies because they are free.

In other media industries the substitutable goods are imperfect substitutes such as getting your news from a newspaper or from the television.

The imperfect substitutes that are found in the other industries allow for the companies to really push product differentiation. The quality of pirated movies online does not have the special features found on a DVD. The television online is posted by the same companies that produce the shows so they have some control over creating ad revenue. iTunes is making money off of selling music online.

Unlike the other industries who have found ways to make money online, the porn industry has a much larger issue. There are subscription based sites, on demand options, and there are websites where the actresses interact with fans over a web cam, which all make money but the competition is free. Free clips, films, and girls can be found on the same websites. There are loyal fans in the porn community but for the most part consumers of pornography are not looking to build a connection but are looking to get instant gratification. Three to five minute clips are enough to satisfy many consumers.

The rise of free porn has dramatically impacted DVD sales. In 2006 sales dropped by 11% and things have been dwindling quicker by the year. In the early 2000s the porn industry appeared invincible but by 2010 the largest porn convention which used to take up two floors of a convention center now only takes place on one.

The biggest competitor to the porn industry is the user based websites Youporn and Pornhub. Both websites are in the top fifty most viewed sites in the world, while the sites hosted by the production companies are nowhere near the top. There is a stigma surrounding adult products and the advent of a website which one does not have to leave their home or pay a subscription fee has increased the number of porn viewers. The issue with Youporn and Pornhub is that users upload their own videos or put of pirated copies of films. Similar to Viacom suing YouTube, porn companies such as Vivid want to get their content off of free websites. The odd thing is Youporn is not only destroying the porn industry, but it is making no money in doing so. Just like all other media industries, Youporn is still trying to figure out how to make a profit off a free website.

Some awesome consequences from amateur porn!


It is the best kind of photo bomb!


The two gifs on this post come from website which shows animals that pop up in amateur videos. Expect the unexpected when you film at home!

There are also websites dedicated to ranking home decor found in amateur porn.

Some people actually make some good side money but not enough to make a sustainable living.

Not awesome consequence of amateur porn.

An earlier post was about AIM which has a mission to keep the porn community safe from STDs. The rise of amateur porn means more people are having sex and highly unlikely they are being tested. The industry has been doing a great job and enforcing health policies while people at home are not.

Child pornography could become an issue. There is no way to verify the age or consent of the participants. The laws are harder to enforce when the producer of the product in unknown.

Other issues facing the industry:

An imperfect substitute might be taking away viewership and it is World of Warcraft. Users are using their computer for something other than looking at porn and spending more than a few minutes on the website as well.

Piracy is a big problem and has been ever since the internet came to be. It is becoming increasingly more problematic due to user based sites where people upload the films and people can watch them free of charge. It is such a problem that the porn community got together and made a PSA.




Other steps the industry has made to combat the cult of the amateur is to create some product differentiation. There are more big budget films being produced and the industry is trying to tap into the female market. Women are more likely to buy a DVD, than watch porn on the internet. A string of films have been made with females and couples in mind.

Diversification is another tool used to create new sources of revenue. There are toys, clothes, magazines, and even video games. None of these things are making up for the loss of DVD revenues but it is helping companies stay afloat.

Only time will tell if the internet will be the end of porn or just a new beginning. Something will have to change on both sides of the spectrum. Eventually the websites will have to generate money or it will become a public service. The adult entertainment industry needs to find out what consumers are willing to pay for and how to use Web 2.0 to their advantage.














Saturday, May 29, 2010

Jenna Jameson Media Commodity or Corporate Profile?


Jenna Jameson is known as the Queen of Porn and perhaps the most well known porn star of all time. Jenna has managed to do something most porn actors cannot do: become a household name. Jenna Jameson has made a name for herself through adult films, magazines, television appearances, various websites, and a best-selling book.

History

Jenna Jameson was born Jenna Massoli in 1974 in Las Vegas, Nevada. Her father was a police officer and her mother was a former showgirl. When Jenna was around the age of two her mother passed away from skin cancer. After that her household became very unstable. At the age of 16, Jenna left home to live with her tattoo artist boyfriend. A year later she became a dancer at the Crazy Horse Too. Once conquering the strip club, Jenna transitioned into soft core pornography to get even with her boyfriend. A few years later she walked up to Steve Orenstein, the founder of Wicked, and told him she wanted to be the biggest porn star ever.

In 2000 Jenna Jameson and her then husband Jay Grdina founded ClubJenna. It grew very quickly and in 2006 was purchased by Playboy. Even though Playboy bought ClubJenna Grdina and Jameson are still in charge of the company.

ClubJenna started out as just an internet based company but it grew to include production and acquiring contract girls of their own. The films are distributed by Vivid (ironically the biggest competitor of Wicked). ClubJenna also manages over 150 adult themed websites. Most of their profits come from subscriptions.

Important People to the Company

Chairwoman and Co-Founder Jenna Massoli

President, CEO, and Co-Founder John Grdina

VP Merchandising Kris Grdina

Financial Information

ClubJenna made around $30 million in revenue back in 2005. Information on revenue and profits more recently are not found due to the company being under Playboy. Playboy’s acquisition of ClubJenna boosted Playboy’s stock. It is reasonable to infer the company continues to make good margins since ClubJenna is about 1/3 of Vivid Entertainment's entire revenue and in 2005 ClubJenna films were bringing in net margins of fifty percent.

Diversification

ClubJenna may have started out as just an internet company but it has expanded into many fields. You can purchase cell phone ringers of Jenna moaning, you can buy sex toys in her likeness, and there is also ClubJenna television. Not only does ClubJenna run other actresses’ websites, ClubJenna owns a website targeted towards gay male fans. Jenna Jameson also created a dating website. The most interesting piece of diversification is Virtually Jenna, which is an online computer game where the user gets to create characters and have them have sex. The synergy between ClubJenna and Virtually Jenna is very apparent. The updates to the game reflect new contract girls being added to ClubJenna and the game offers the user to virtually use the sex toys ClubJenna sells. The company is global in that anyone around the world can subscribe but the company itself is solely located in Scottsdale, Arizona.

Major Holdings

ClubJenna is a major holding of Playboy. The contract allows for Jenna Jameson to control her persona and merchandising. The most important intellectual property for ClubJenna is Briana Loves Jenna. It was the most successful porn of 2003 and continues to sell exceptionally well. Jameson’s persona is the most important asset to the company since the brand is Jenna. Through her career she managed to create a loyal fan base and any film with Jenna Jameson sells better than any other porn released.

Vertically Intergrated

ClubJenna is vertically integrated in that is owns production and parts of retail but distribution goes through Vivid or now Playboy. The company does really well with the subscriptions to the website and selling of merchandise from the website.

Competitors

There are no true competitors to ClubJenna. Most subscription based websites are run by ClubJenna. Vivid is the biggest porn distributor and producer and that is their distributor. And their parent company is Playboy. Other porn companies are smaller and much more niche market. It would be hard for another company to build a following as big or as loyal as Jenna Jameson.

What makes ClubJenna a very unique porn company is its reliance on one woman, who has retired from porn. Even though there are contract stars working solely for the ClubJenna brand, the selling point is Jenna herself. The porn industry is famous for being male dominated but Jenna Jameson managed to make an extremely profitable company in the industry which was then purchased by Playboy (which at the time had a female president).


Jenna Jameson as a media commodity


Jenna Jameson is a commodity made for the porn industry. She cultivated her look, persona, and jobs around sex. She realized there is a way for a woman in the adult entertainment industry to take control. She is an asset to the company not the other way around. Jenna's self marketing created a one woman empire. ClubJenna is just one of many products a fan can consume.

From Porn to Slaying and to think Buffy just started out as a high school student


The persona of Jenna Jameson became the face of the porn industry. Through her determination and creativity Jameson got her face and name out there. Jenna Jameson took hosting gigs for the E! network and has been interviewed by Oprah. Her accessibility has brought porn into the mainstream. Discussions about the industry and sexuality in recent years can be attributed to society becoming more accepting of porn.

I think the most interesting consequence of Jenna Jameson becoming a media commodity is the role she plays in young girls' lives. The occupation of a porn star seems more glamorous and profitable. Jenna Jameson is the poster child of a woman who has an amazing life due to porn (not counting relationship problems).

ClubJenna

Jenna Jameson

Playboy

Playboy acquiring ClubJenna

Virtually Jenna

Jenna Jameson Merchandise

Jenna Jameson's autobiography

Information on ClubJenna

Dating Website

The success of ClubJenna