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Maximizing Content

Maximizing Content

October 3, 2005
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Will virtual reality boost the paysite market?
Yes, it will soon
  39.66%
Yes, but in a few years
  36.87%
No
  23.46%
Out of 179 votes. Results based on votes submitted by members of XBIZ.net social network.

" can you afford not to sell to a specific distribution segment? "

With an ever-increasing array of online distribution channels, adult producers can realize multiple revenue opportunities from a single video — but you have to be careful not to degrade the value of your product by licensing your content willy-nilly.

Every other week, adult producers are hit with invitations from pay-per-view, pay-per-minute, cable or satellite television aggregators as well as mobile phone network providers telling us how absolutely essential it is for our content to be onboard their platforms. Much of this has been caused by the availability of affordable, off-the-shelf delivery systems.

Porn is part of a fast-moving consumer product line, and the value of media rights depreciate rapidly. However, the rate of depreciation of quality product can be managed. The challenge for the producer is to find the right distribution mix that will maximize return on investment over the longest possible term.

But the larger, long-term producers in the adult business often have mixed emotions about online content distribution and the way it's evolving. Some are still suffering CDD — Chronic Digital Denial — and believe that the Internet is an untrustworthy animal stealing primary revenue from the hard-copy audience and eroding the long-term value of their catalogs. Others have put their digital futures solely in the hands of pay-per view/minute providers believing that PPV is the only equitable online distribution mechanism that will prevent the degradation of future media rights and revenue.

At the other end of the digital spectrum, there are producers for whom the future value of their media isn't a consideration, and they permit unprotected downloads and swapping and sharing of their products.

The main question is how to sell the most of what you make while keeping the residual value as high as possible — for as long as possible.

The term "convergence" was born during the dotcom boom and was hailed as the solution for producers to get rich. It's a great concept — any content to any device, any place, at any time — which all adds up to a bigger piece of the pie. Unfortunately, it also means that the original pie is cut into more pieces, resulting in a higher cost of delivery.

As Internet access continues to increase in speed and availability, the lines separating traditional distribution platforms continues to blur. At the same time, some loyal customers remain exclusive to specific networks and mediums, like the guy who will only buy his porn on VHS (no joke — we have more than a handful of these types on our customer list). Convergence is causing an increase in overall market capacity, however, and also is splintering regular distribution channels.

So, with this in mind, can you afford not to sell to a specific distribution segment?

It's worth analyzing each opportunity on a segment-by-segment basis. If it is too expensive to deliver for the return that you are expecting (as seems to be the case with many third-generation cellphone networks at this time), then you shouldn't do it. By talking with potential marketing partners, distributors and, of course, customers, you can gain an overall idea of the potential for a new distribution opportunity. Reducing the cost of delivery to multiple distribution platforms also can be achieved by effective content management systems, which thankfully are becoming cheaper and more effective.

With much of the current focus of online distribution being directed at PPV and PPM, providers of some of our more "traditional" methods such as paysites and plugin products are being overlooked, which is unfortunate. Part of this is generated by content security fears and the degrading effects of file swapping and piracy — issues now easily addressed with affordable and easy-to-use digital rights management and security systems.

Paysites and feeds can be profitable and address markets that may otherwise never see the fruits of your labor. Many consumers like the flexibility that a regular paysite subscription enables, as well as the enormous variety that can be provided with the addition of leased feeds and plugin products. Consumers can remain loyal members of paysites for years, and consequently, the paysite business has become highly competitive.

However, the right plugin products within a paysite can be enormously popular and have a measurable impact on member retention. Secure plugins offer content providers a great opportunity to add valuable and ongoing revenue to their business model, while also getting their products in front of new eyeballs.

Another benefit worth mentioning with regard to established PPV providers and cable/satellite networks is that not only can you make good money, you can also get your brands noticed by a larger and newer audience. The downside is that you will never get to develop a relationship with your customer base — an important variable to consider in the ROI equation.

But guaranteed, with the concept of "any content to any device, anytime, anywhere," the invitations will keep on coming. My advice is to get the most from it and keep your content valuable for as long as possible by containing your costs, using CMS, controlling secure distribution and owning your own customers whenever possible.

Brian Randall is the owner of Pistol Media/HardGayFeeds.com/Gunzblazing.com and director of online operations for Raging Stallion Studios.


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