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Q&A With Brian Shuster, Founder of Utherverse Inc.

Q&A With Brian Shuster, Founder of Utherverse Inc.

March 26, 2014
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" We have been developing the third-generation virtual world platform for the past five years. This has required an enormous investment of capital and manpower, but we are making progress as the product is now in alpha testing. "

Later this month, thousands of attendees will together enjoy a wide range of exhibitors and speakers at AEVC by just trekking over to their nearest desktop or device.

Now in its third year, the Adult Entertainment Virtual Convention has become a stomping ground for porn stars and Internet business owners and executives who make that pilgrimage to the annual event and sit down for a seminar or two in conference rooms with such colorful names as The Wheelbarrow, The Doggy Hall, The Anvil and Cowgirl. Later on, conventioneers attending the two-day event might mingle, have down and dirty sex or party on and dance through the night in one of the clubs. It is quite the virtual experience, and it has all of the polish of its chief architect, Brian Shuster — founder and CEO of Utherverse Inc.

In this Presidential Suite interview, XBIZ sat down, virtually of course, with Shuster to find out more about AEVC, as well as Utherverse Inc.’s massive multiplayer online world Red Light Center.

XBIZ: It has been about eight years since Red Light Center first debuted. What are the critical things you’ve learned most about the community and its users (are they looking for porn experiences or casual encounters)?

SHUSTER: I am very, very pleased with the way the Red Light Center community has turned out. I wanted to produce an environment in which progressive minded people could freely enjoy each other’s company, exchange ideas, have fun and feel safe — all without being judged by the close-minded and oppressive real-world culture in which we all find ourselves living today.

The community within Red Light Center has not disappointed me. It has organically developed to have it’s own mores and structure (“families” developed naturally within the community and now serve as a kind of grouping system for people to find other’s of similar mind and attitude), and the nature of the people who form the community are generally helpful and friendly and supportive.

It’s very unlike Facebook, in that users are more positive than negative, and although there is drama in any community, there is much more support and encouragement as one might expect from a group of users who are there to enjoy an adult lifestyle that includes virtual sex, drugs, music and companionship.

Not surprisingly, sex is the main draw that brings users into the virtual world but it is really the friendship and enjoyment of the community that keeps them long-term.

Plus, there are many fun activities and real relationships (more than 1,100 weddings last year for example) end up meaning that sex activities make up less than 10 percent of overall activity in RLC.

XBIZ: How many users does Red Light Center typically have each day?

SHUSTER: We typically see between 11,000 unique users of our online worlds each day, and 19,000 users who visit our Social Center.

XBIZ: And what does it take to power on the site with its so many users? How many servers do you employ?

SHUSTER: We keep our network lean but redundant and scalable by employing virtualization software (VMWare) on simple commodity hardware, connected with industry standard highly available networking technology and backed by a scalable and redundant storage system to protect user data.

Efficient software design allows us to accommodate thousands of users online in the 3D world and tens of thousands of users on the web with only a few dozen CPU cores and a few hundred gigabytes of memory. Storage is always a challenge as we manage many terabytes of user uploaded content and other data, but deduplication and efficient storage design makes this manageable.

XBIZ: Each year AEVC is getting more attention, despite it not being your typical industry event composed of program owners, affiliates, billers, web hosts and other service providers. What does it have to offer this year?

SHUSTER: AEVC is a complete adult trade show that caters to both the industry and the consumer. As in the previous two years of the show, AEVC structures its program to focus on the business of the adult industry on the first two days, followed by a cross over or business to consumer day and concludes with a day structured just for the fans, and also to celebrate the best in adult entertainment with our annual awards ceremony.

In previous years AEVC has successfully attracted the “not so familiar” faces of our industry — many whom work in areas such as animation and blogging who for one reason or another, choose not to attend live industry events. It has proven to be a fantastic outlet for those voices to exchange information and virtually meet with others that they do not normally engage with during the year.

Our last year showed a rise in interest in utilizing the virtual medium and attracted the likes of Diane Duke, Colin Rowntree, Douglas Richter, Jules Jordan, James Deen, Kim Nielsen, Ron Jeremy and many more — all familiar fixtures in our industry.

With increased interest from industry for our upcoming show we have implemented the following in order to maximize the benefit to those looking to gain valuable information and networking opportunities from the first two and a half days of the show:

• All members who have registered for AEVC using the XBIZ promo code will be labeled or badged with an industry tag to help better identify those who are members of the XBIZ community from those that may just be starting out or are simply curious about the business side of our industry.

• This year we are focusing more on very concise and extremely informative workshop sessions over the typical panel. Some topics will include: writing a successful press release, advanced SEO techniques and tips, making the most of your mobile traffic, google analytics, social media tips and how to crowd fund your project. These workshops will be held on top of our standard panels such as the popular “State of the Industry” and the “Future of the Industry” that will feature the best in web, mobile, legal, publishing and content in our industry today.

• This will be the last year that AEVC will be held on our older platform, and for those that are either unable to join us on their computer or are having technical difficulties, full streaming coverage will be available on http://being.me/AEVC where participants can still be a part of the action.

• For those on the performer and film side of the industry, this year will feature talks from top performers and business women Joanna Angel, Tera Patrick and Seka.

• Finally, we predict that our numbers will top our previous year of 8,000 attendees over the 4 days of the event, offering those who are looking to attract qualified consumers to their product a great opportunity to advertise and generate sales from consumer traffic. Sponsors and featured exhibitors also get an opportunity to showcase their product in a virtual swag bag — one that never gets tossed aside or thrown away after a show. At the close of each show, exhibitors, speakers and sponsors are each sent adetailed wrap report with statics and information on how many virtual bodies participated and were exposed to their brand and information - something that you never get from a live trade show.

For more information on the show and to register visit: www.adultvirtualconvention.com.

XBIZ: Does Utherverse have other projects, roll outs in the works? Any other brands to speak of?

SHUSTER: Yes, many! Utherverse sells franchises, so in addition to Red Light Center (global) we have geographic versions of RLC operated through our franchise partners in countries like Germany, Brazil, Russia, Spain, Poland, Italy, Hungary and Latin America.

We operate in the non-adult space as well. In mainstream, we have an online University (UtherAcademy), a virtual convention subsidiary (UtherConvention), a mainstream real estate enterprise (UtherInteriors), and a multitude of other brands in the music, arts and entertainment verticals.

As for new project roll outs, we have been developing the third-generation virtual world platform for the past five years. This has required an enormous investment of capital and manpower, but we are making progress as the product is now in alpha testing.

By the end of 2014, we will be migrating RLC and other properties onto this new platform, which is graphically stunning (movie quality), as well as dynamically amazing. The new platform will enable easy set-up of service providers who want to host and run their own virtual worlds, simple creation tools to build complex games (think World-of-Warcraft-level games being built for thousands of dollars in a matter of months), live and recorded video capabilities (make movies/shows using Avatars), full customization (Avatars can be human, animal, fantasy monster, etc.) and many more features of similar value.

XBIZ: You are technologist first and an adult businessman second, it appears. How did you get your feet wet with online adult entertainment?

SHUSTER: When I was in college, I became an internationally syndicated newspaper cartoonist with my comic panel “CHAOS.” In 1994 I was introduced to the Internet, and I quickly created a web site for CHAOS and started to reproduce my comic there for readers who didn’t get it in their local paper.

It is important to recall that in 1994/1995 the Internet was completely devoid of commercialization. It was an academic platform only. My comic website became a popular destination, and I very quickly realized the potential of the web. I started a mainstream business to help sites like mine generate revenue from advertising.

Advertising had not yet appeared anywhere on the web, and my company, World Wide Internet Network, assembled thousands of medium and “large” size sites to aggregate into an ad network and sell something I had come up with: banner ads.

I had enlisted the help of a NASA engineer to build my first ad serving network that could actually rotate banners on web pages and track which banner was displayed so we could send the click to the right spot. It is impossible to relate to readers how revolutionary this was at the time. It was actually deemed impossible by several developers I had talked to.

I got death threats and hate mail by the hundreds — saying things like, “commercializing the web is the work of the devil. I will come to your house and kill you if you don’t leave the web alone!” Crazy times.

Anyway, the short version of the rest of the story is that because the web had not been commercially exploited up to that time, I was unable to get any venture capitalist to invest with me. I was roundly rejected by firms who would only two years later begin investing billions into companies like mine.

Alas, I was a poor recent-college graduate, and I maxed out my credit and could not sell enough ads to keep my company afloat. In the final days, I got a $700 investment from my personal trainer, and he purchased a phone-sex line, and I started up a free adult site, XPics Site of the Day. I used all my contacts and experience to promote the site and within a few days, it was the second most trafficked site on the web. The phone sex line rang off the hook and money started pouring in.

It didn’t take long for me to upgrade my computer, begin to branch out into promoting other people’s adult products, and soon to have the funds to put together my own membership site.

My first membership site, Sex Roulette, did more than 100 sales per day starting on the day it was launched. I tweaked the model and optimized the site over the next month or so while we configured an affiliate program, and kaboom.

When I launched my first affiliate program (by this time, it was not the web’s first affiliate program, but it was by far the most advanced), we offered 6 cents per click compared to the next best program that was offering only 15 cents per click. Almost every web site on the internet that could advertise adult grabbed our banners and my feet were officially wet in the adult entertainment industry.

XBIZ: You are a man of many ideas, and patents. How many patents do you hold? And which are you most proud of?

SHUSTER: As of this writing, I’ve been awarded 31 U.S. patents, and a multitude of foreign patents. I’ve probably got a dozen more patents pending, with several of those in some state of allowance.

All told, my companies have received well over 100 patents, and there are many of these that I’m quite proud of for various reasons.

Of my own inventions, I like discussing some of the things that I brought to market that have made our industry billions of dollars collectively. Pop-under advertising and exit traffic were two of my early patent filings. They’ve been around for so long now that it’s hard to imagine a history of the internet without them, but I developed and introduced them back in the days when banners were controversial, and the money that they’ve generated has undoubtedly advanced the state of our industry by many years.

I’ve invented anti-spam technology and search-engine technology and even crowd-sourcing technology that have been adopted (and for the most part, legally licensed and used by) every large internet company that readers have heard of.

My companies have developed technology that we call “Cleanet” that scours the internet looking for pictures of underage children and reports them. No human needs to be involved, and the accuracy rate is well over 99.99 percent for true positives. This technology has been responsible for several “busts” of major CP rings globally.

But these days, I’m most proud of the state-of-the-art patents that I’m getting in the virtual reality and augmented reality spaces. They may seem wildly fantastic right now, but in a few years, they will be as accepted as the pop-under.

XBIZ: What about bitcoin and online transactions. What is the future of the virtual currency and others like it?

SHUSTER: Virtual currencies are going to replace fiat currencies within our lifetimes. However, this won’t happen without major disruptive fallout and possibly a game-of-chicken between the current powers-that-be and the rest of the world’s population.

The current system is unsustainable. This doesn’t take a PhD in economics to understand. Right now, governments around the world are printing trillions of new dollars (and other currencies) every year. This has never happened before on a global scale, but on a local scale, it has happened something like 81 times in recorded history; and in every one of those instances, it resulted in the collapse of the empire that had done it — the Roman Empire being the most famous example, although Weimer, Germany, is also quite well known.

Whether it will be a crypto-currency like Bitcoin is a different question, though. I am afraid of the future of crypto-currencies because they are easily destroyed by quantum computers. That may sound like gibberish to some, but if and when the first true quantum computers come out, they will likely be purchased by governments, and it would not surprise me to learn one day that that the bitcoin blockchain has been hacked and all bitcoins have been stolen. It might even be done by a governmental agency that we all know and love.

Fear not, though. I have a pending patent on a new kind of digital currency that has as solid a backing as physical gold, without the limitations of a gold-backed currency, and without the vulnerabilities of a crypto-currency. I’ll say more if and when that patent issues.

XBIZ: What’s a typical work day like?

SHUSTER: I wake up at 10:00am, eat, check my email, check my companies stats, read Zero Hedge and the headline news on NBC’s and Bloomberg’s websites. I check the current value of the Canadian dollar versus the U.S. dollar (we are based in Canada, but we bill mostly in U.S. dollars, so the exchange rate heavily impacts our profitability), and then I play a few hands of cards on a CCG that I’m addicted to.

Now that I’m properly awake, I shower and dress and head into the office. I meet with my assistant, chat with my operations department and my top officers, then start answering my emails.

Next comes lunch, which is either a lunch meeting or a chance for me to spend some time thinking. Once I’m back in the office, I’ll do various meetings and work on papers, presentations, proposals or patents (4 Ps). I’ll also check our forum boards and see what the pulse of our user-base is.

When I’m done at the office, if I’m not otherwise engaged, I’ll head home for dinner and then bounce around between goofing off and brainstorming. I like to reality-check the direction that the company is heading a few times a week, and that means a lot of solo-time thinking about things like software development and direction, staffing issues, including staff satisfaction or problems, revenue and cash-flow, and new potential paths.

Overall, brainstorming is the most fun part of my job and dealing with internal problems is my least favorite.

XBIZ: When not thinking about the biz, what do you like to do?

SHUSTER: Does sex count as thinking about the business?

Let’s see here, I play online games (Kingdoms CCG), I read (fantasy/sci-fi, historical fiction, nonfiction), I write (please check out my debut novel, “The Minerva Virus,” available on Amazon.com). I watch the Daily Show and Colbert Report, and oddly enough, my hobbies also include physics and economics — I invent and theorize within both area s. I like to come up with neat new things (I have a product line of breakthrough adult toys that I’m trying to get license to interested companies). I also enjoy hanging out with my girlfriend and helping her with her art career.


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