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Violence Against Women on the Internet

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Pervasive, Popular, Profitable, and Private:
The Economics of Internet Pornography

The business of pornography, adult and child pornography alike, underpins and arguably sustains the Internet. It has often been said that pornography is the only profitable entity on the Internet. Some distinguishing characteristics of Internet pornography are its profitability, accessibility, and popularity. In 2000, it was estimated that pornography was a $10 billion industry in the United States. In 2001, The New York Times Magazine reported that the $10 billion estimate is on "the low-end." Frank Rich write an article for The New York Times Magazine entitled "Naked Capitalists: There's No Business Like Porn Business" and noted:

"…The $4 billion that Americans spend on video pornography is larger than the annual revenue accrued by either the N.F.L., the N.B.A. or Major League Baseball. But that's literally not the half of it: the porn business is estimated to total between $10 billion and $14 billion annually in the United States when you toss in porn networks and pay-per-view movies on cable and satellite, Internet Web sites, in-room hotel movies, phone sex, sex toys and that archaic medium of my own occasionally misspent youth, magazines. Take even the low-end $10 billion estimate (from a 1998 study by Forrester Research in Cambridge, Mass.), and pornography is a bigger business than professional football, basketball and baseball put together. People pay more money for pornography in America in a year than they do on movie tickets, more than they do on all the performing arts combined. As one of the porn people I met in the industry's epicenter, the San Fernando Valley, put it, "We realized that when there are 700 million porn rentals a year, it can't just be a million perverts renting 700 videos each."
For the full article, see

In the following excerpt from The New York Times, Timothy Egan analyzes pornography as an industry.

Wall Street Meets Pornography

By Timothy Egan

…Spurred by changes in technology that make pornography easier to order into the home than pizza, and court decisions that offer broad legal protection, the business of selling sexual desire through images has become a $10 billion annual industry in the United States, according to Forrester Research of Cambridge, Mass., and the industry's own Securities and Exchange Commission filings.

Whatever the phenomenon may say about the nature of American society, the financial rewards are so great that some of the biggest distributors of explicit sex on film and online include the country's most recognizable corporate names.

The General Motors Corporation, the world's largest company, now sells more graphic sex films every year than does Larry Flynt, owner of the Hustler empire. The 8.7 million Americans who subscribe to DirecTV, a General Motors subsidiary, buy nearly $200 million a year in pay-per-view sex films from satellite, according to estimates provided by distributors of the films, estimates the company did not dispute.

EchoStar Communications Corporation, the No. 2 satellite provider, whose chief financial backers include Mr. Murdoch, makes more money selling graphic adult films through its satellite subsidiary than Playboy, the oldest and best-known company in the sex business, does with its magazine, cable and Internet businesses combined, according to public and private revenue accounts by the companies.

AT&T Corporation, the nation's biggest communications company, offers a hard-core sex channel called the Hot Network to subscribers to its broadband cable service. It also owns a company that sells sex videos to nearly a million hotel rooms. Nearly one in five of AT&T's broadband cable customers pays an average of $10 a film to see what the distributor calls "real, live all-American sex - not simulated by actors."

For all the money being made on sex - legally - by mainstream corporations, the topic remains taboo outside the boardroom. The major satellite and cable companies do very little marketing of their X-rated products, and they are not mentioned in annual reports except in the vaguest of euphemisms. …

On the Internet, sex is one of the few things that prompts large numbers of people to disclose their credit card numbers. According to two Web ratings services, about one in four regular Internet users, or 21 million Americans, visits one of the more than 60,000 sex sites on the Web at least once a month - more people than go to sports or government sites.

Though estimates have been greatly inflated by some e-commerce sex merchants, analysts from Forrester Research say that sex sites on the Web generate at least $1 billion a year in revenue, providing a windfall for credit card companies, Internet search engines and people who build Web sites, among others in the commercial food chain.

Some of the most popular Web properties - which feature quick links to sites labeled "Virgin Sluts" and "See Teens Have Sex" - are owned by a publicly held company in Boulder, Colo. That company, New Frontier Media, has stock traded like any other, and it expects its video network to be in 25 million homes within a few years. It does business with several major companies, including EchoStar and In Demand, the nation's leading pay-per-view distributor, which is owned in part by AT&T, Time Warner, Advance-Newhouse, Cox Communications and Comcast….

Thirty years ago, a federal study put the total retail value of hard-core pornography in the United States between $5 million and $10 million - or about the same amount that a single successful sex-related Web site brings in today. It seemed likely that the industry would remain where it had always been - largely out of sight, but profitable, and faced with consistent legal problems.

What kept the market relatively small, in the view of people in the industry, were the barriers between consumer and product. Typically, a person would have to go to a run- down part of town, among people considered less than savory, to find hard-core adult films or bookstores. These retail outlets frequently were raided by law enforcement authorities, further adding to the risk for a consumer - a risk of shame, or arrest. …

But even with most Americans owning VCR's, people still had to take a trip to the video store, risking some embarrassment. Pay-per-view television and the Internet removed the final barriers. …

What investors and bigger corporations soon discovered was the vast audience for pornography - once the privacy barrier was eliminated. Twenty percent of all American households with a VCR or cable access will pay to watch an explicit adult video - and 10 percent will pay frequently, according to the distributors New Frontier and Vivid. That interest explains, in part, why the production of pornographic films has grown tenfold in the last decade. There are now nearly 10,000 adult movies made every year, according to an annual survey of the films produced in the Los Angeles area. …

But video rentals have reached a plateau over the last two years. The future is pay- per-view at home - driven by the easy access and good technical quality of digital television - and pay-per-view from the Internet, driven by the technological innovations of new cable and phone lines that carry far more images, more quickly, to a computer screen. …

The number of people visiting sex sites on the Web doubled over the last year, outpacing the number of new Internet users. Some of the more popular sex Web sites attract in excess of 50 million hits, or visits, a month, according to the ratings services Nielsen/ Net and Media Metrix. About one in a thousand people who visit a site will subscribe, for fees averaging $20 a month, according to some of the leading Web pornography providers and Flying Crocodile Inc., a company based in Seattle that tracks and services the sexual-content market.

"Wall Street Meets Pornography," New York Times, October 23, 2000. For the full article, see

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