The state of the Industry.

there will always be money in porn ;)

but think it always become a little harder for a new webmaster to make a living with it

How big a threat is saturation right now?

Rhino, saturation is always an issue, but only because it dillutes the profit potential for any single item. It doesn't, in my mind, mean that the total number of sales would drop from it, just that they are spread over more product points.

The real issues facing online porn at this point are these:

(A) Convergence. We are very close to reaching the point where people will start (in numbers) to use things like windows media edition or other web connected appliances to download movies and tv shows to view Tivo style. The number of players in this field will be much smaller, and the overhead required to get in the door much higher than the current bar for opening a paysite.

(B) Programs and systems such as Zango, spyware, and such are whittling away sales from affiliates at a fairly alarming rate, such that the open affiliate model is actually currently at some risk of collapsing over time.

(C) keyword purchases, placement purchases, and other search engine pay per manipulations are making it nearly impossible for normal webmasters to acheive decent rankings for any period of time.

(D) P2P networks, file sharing, new group resellers, and similar are taking a big chunk out of the porn market these days.

(E) the market overall is pretty much matured, and as such, overall growth in the market has slowed. Anything new is often just taking business from other existing sites (the dillution you mention). Very few items get a very long term buzz, even the Jordan Capri Honeymoon tape deal pretty much ran out of steam withing 45 days end to end (might come back for one more shot when the rest of the material is released in the next 10 days or so).

(F) Most of the big money categories from the last couple of years, such as live chat and dating have pretty much run their course, mostly because these programs have bought and now own a large percentage of the possible customers already, and they aren't going to pay for them to signup again.

(F2) Most of the major programs have either "join 1 get all" or "mega pass" sites, which basically pay you for a buyer once, even if you could have resold them something else next month in the same program. Every sale these days pretty much makes that surfer "dead" for anywhere from 10 to up to 100 sites.

(G) The expansion of the internet in the english marketplace has slowed dramatically, more and more surfers are "experienced", less likely to buy, and more than likely got burned by a scam, spyware, spam, or some other misdirection and are no longer intending to takeout their credit card online.

All of those things go together to form up a business that isn't going anywhere any time soon.

I wish any new webmaster the best of luck.

put out a good product and content and you will make money.

Well, considering we have people telling people on GFY that they bought a Ferrari when in reality they didn't and just posted pictures that they found on Ebay... the state of the industry can't be all that great.

Rapidshare, megaupload, and similar sites definitely take a huge chunk. We do surfer forum promotions for mainstream clients and come across tons of illegally uploaded crap on RS, MU, and many other similar sites. Yousendit.com was also a big dumping ground for video collections but YS killed it by lowering their file size capacity and amount of days free.

I agree, if your product is good people will buy.

There will always be money in porn but it will all depen how creative your accountant is during tax time.

I agree, but I think that your sales will come at the expense of some other "product" that goes out of style. It isn't MORE total industry sales, just a move from left to right or whatever. Net, the sales remain the same.

always money in Porn

..........

Wow...this was a damn good post. A couple factors I hadn't taken into consideration there. Good stuff. Thanks Alex.

later
c-lo

Great post

Holy shit Alex, your post sounds pretty gloomy:



You know, people were saying in 1999 that all the good money was gone and the online porn biz was dead. I almost quit then because I was so discouraged. I'm glad they were wrong!

Steve Lightspeed

My lord, this is beautiful. Let's talk about this some more.

I've been telling everyone that full screen DVD quality videos are the way to go. Why should I watch porn on my computer montior when I can watch it on my sixty inch TV downstairs? IPTV look promising for a while but few companies can afford to pull it off. People are already hacking their game boxes to download movies off the Internet. Earlier today M$ announced they will begin selling movies via their X Box Live ( Yahoo News Link).

The cost to us as an industry will only be in bandwidth; The end user will have better equiptment and will begin watching movies (and thus porn) on their TV.

And this will go on until a large company discovers their sales are dropping because of it, files a lawsuit, and it becomes front page news. It's ironic how the US Goverment seems so concerned about SPAM yet allows this crap to go on.

This is already happening and I don't see this changing.

And opening themselves up to a huge lawsuit at the same time.

As new programs open up, there is less and less of the pie to go around. Granted, there are new customers born every day, but these newbies are much smarter than before and the old ways of getting traffic will be forced to smarten up. Sometime in the future programs will be forced to have quality sites with original content.

I'm not going to comment on this much.

This poses a problem for smaller programs, doesn't it? Again, quality of sites and original content - and lots of it - will go a long way.

Other languages will become much more important in the future. The Internet is in fact World Wide and it's possible our industry is missing a lot of business without knowing it. I think Spanish is going to be the next best thing.

It's not all doom and gloom; The sky is not fallng down. There will be room for new smart programs, but others will fall by the wayside. Programs who build their entire program on one main site sooner or later will fail.

Very good post!

its getting harder for noobs forsure

Buy domains with natural type-in's.

There will always be money in porn.