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Porn Beyond Porn Valley

Porn Beyond Porn Valley

September 30, 2005
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" companies that aren't actually producing adult entertainment but are profiting handsomely by distributing it "

A look at the top 10 mainstream companies profiting from adult Adult entertainment is estimated to be a $12-billion-a-year industry in the United States ($56 billion worldwide), and the profits are not only being enjoyed by adult-oriented powerhouses such as Vivid Entertainment, Playboy, Wicked Pictures and Larry Flynt's Hustler/LFP empire — mainstream companies such as AOL Time Warner and Comcast Communications also are prospering from adult entertainment.

Some mainstream companies have made a conscious decision not to distribute adult entertainment; in 1999, the Omni hotel chain cited "family values" as the reason it quit showing adult pay-per-view movies — a decision that, according to ABC News, cost the chain $1 million in annual profits. And in 2002, Yahoo caved in to pressure from anti-porn crusaders and began to distance itself from adult material. But many other large mainstream corporations are unwilling to sacrifice the huge profits that adult entertainment is bringing them, although they are generally reluctant or unwilling to discuss their porn-related profits with the media.

Below are 10 major mainstream companies that aren't actually producing adult entertainment but are profiting handsomely by distributing it:

Comcast Communications
1. The National Cable & Telecommunications Association (NCTA) ranks Comcast as the largest cable television provider in the United States with more than 21 million subscribers nationwide — and while mainstream programming dominates Comcast, the cable giant is earning a fortune from pay-per-view porn. In 2002, Comcast earned an estimated $50 million from adult-oriented programming, according to CBS News. Comcast has offered adult entertainment since the 1990s, and its profits from erotica increased when, in late 2001, the company merged with AT&T Broadband, which had been offering adult entertainment through Vivid's Hot Network. Before the merger, AT&T Broadband's willingness to carry the Hot Network was vehemently criticized by an organization called the Religious Alliance Against Pornography.

AOL Time Warner
2. According to the NCTA, Time Warner Cable, which is part of the Time Warner empire, is the United States' second-largest cable television provider with more than 10 million subscribers — many of whom enjoy the cable giant's pay-per-view erotica, including Playboy material. In 2004, Time Warner spokesman Mark Harrad told ABC News that traditionally, Time Warner Cable had offered "more softcore" erotica but that the cable giant had branched out into hardcore offerings because of consumer demand.

DirecTV/News Corp.
3. Adult entertainment has been extremely profitable for satellite television provider DirecTV, a company that has given both Australian media mogul Rupert Murdoch and General Motors an indirect link to adult entertainment. DirecTV was launched in 1994 by General Motors subsidiary Hughes Electronics, and in December 2003, GM sold Murdoch's News Corp. a controlling interest in Hughes. It should be noted that the socially conservative Fox News Channel — which, since its inception in 1996, has often been friendly to the Christian Right — is owned by the Fox Entertainment Group, a subsidiary of News Corp. While Fox News' programming includes a weekly show hosted by Cal Thomas (former communications director for the Rev. Jerry Falwell's Moral Majority), DirecTV is earning millions by offering the erotica of Playboy and others. In 2004, entertainment industry analyst Dennis McAlpine of McAlpine Associates told CBS' "60 Minutes" that he estimated DirecTV was bringing in "maybe as much as $500 million off of adult entertainment, in a broad sense." DirecTV has more than 8.7 million subscribers.

EchoStar Communications
4. DirecTV's competitor EchoStar, the second-largest satellite TV provider in the United States, has been offering adult programming for several years on its Dish Network —including triple-X material. The Dish Network, which EchoStar launched in 1996, doesn't provide adult entertainment exclusively but certainly profits from it. In 2004, EchoStar boasted a market capitalization of $16.74 billion.

Cox Communications
5. The NCTA cites the Atlanta-based Cox Communications as the third-largest cable television provider in the United States with 6.3 million customers as of December. Cox, like Time Warner and Comcast, offers mostly mainstream content but is earning a bundle offering adult content as well. Cox's adult offerings have included the Hot Network.

Marriott International
6. Adult pay-per-view films are not offered at all of the Marriott's U.S. hotels, but they are offered at most of them. Marriott's involvement with adult entertainment has come under fire from the Christian Right. In 2002, a Marriott in the Cincinnati area quit offering adult pay-per-view after being harassed by the fundamentalist Citizens for Community Values and threatened with obscenity charges by a local prosecutor.

LodgeNet Entertainment Corp.
7. The LodgeNet Entertainment Corp., whose core market is the United States and Canada, is well known for supplying mainstream pay-per-view films to major hotel chains — and it supplies adult pay-per-view films to many of its clients as well (including Sheraton, Hilton and Holiday Inn). LodgeNet's website states that its clientele includes "more than 5,900 lodging properties with more than 1 million hotel rooms as of Feb. 28." Because of LodgeNet's reluctance to discuss its adult-oriented activities with the media, it is difficult to pinpoint exactly what percentage of the company's overall profits are coming from pay-per-view porn. But it is safe to say that adult entertainment is a major source of revenue for the digital powerhouse.

OnCommand Corp.
8. Denver-based OnCommand is LodgeNet's main competitor when it comes to bringing pay-per-view films — both mainstream and adult — to large hotels in the United States. According to OnCommand's website, the company services "approximately 890,000 rooms in approximately 3,300 hotel properties." The long list of major hotel chains that OnCommand works with includes Sheraton, Marriott, Hyatt and Radisson — and while not all of OnCommand's clients accept adult films, many of them do. OnCommand is owned by Liberty Media, formerly a part of AT&T.

Charter Communications
9. Charter Communications is, according to the NCTA, the U.S.' fourth-largest cable television provider and had nearly 6 million subscribers as of December. Like other cable companies, Charter has offered Vivid's Hot Network and would take a major financial hit if it quit offering adult entertainment.

Adelphia Communications
10. At one time, cable giant Adelphia Communications refused to offer sexually explicit material. In 2000, Adelphia founder John Rigas dropped the erotic Spice Channel from cable systems Adelphia had acquired in Southern California because he considered erotica immoral. But Adelphia's anti-porn policy changed in early 2005, when Adelphia (which is the largest cable television provider in Southern California and the fifth-largest in the United States) decided that adult entertainment was too profitable to avoid. By that time, Rigas was no longer running Adelphia or lecturing others on morals; in 2004, he was convicted of fraudulent accounting and looting the company. Rigas was sentenced in June to 15 years in prison.

Honorable Mentions
In early 2005, Colombia House announced that it was launching a subsidiary called Hush, an adult-oriented video club. And financial services firm Blackstone has holdings in the Colorado-based adult company New Frontier Media Inc.


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