These problems are not uncommon with any business, and can be surmounted. The one problem, which I fear has no "exit strategy," is the "rolling snowball" factor: You start a paysite and very soon it resembles a snowball rolling down the hill, getting bigger and bigger, and unstoppable – but soon to crash and break up. Sound pessimistic? I'd say realistic...
The crux of the matter is how far you can or want to go with paysite content. Can you shoot content? Will it be any good? Can you find fresh, raw talented pornstars? If not, how much can you pay to keep on buying new content? This is the first and most important question you have to answer before you can start an adult paysite.
A freshly minted paysite has a lot of steam pushing it – new content, search engines rushing to index the pages, affiliates rushing to promote it, TGP's eager to accept galleries, porn surfers eager to find out what's inside and last, but not least – the paysite owner's optimism which drives him to work hard, promote the site and spend money.
The problem comes after the "honeymoon" is over; and the paysite is just one among a million others. So, you spend more money, buy new content, introduce affiliate goodies, advertise and buy gallery spots.
The older the site gets, the less interest both surfers and affiliates have, the content gets overexposed and updates less frequent. There's two ways from here – either the site goes downhill with decreasing affiliates, members and traffic – or you start spending more and more money, just trying to keep afloat.
The jackpot on the Internet lies in eyeballs – targeted eyeballs. The more people interested in your niche, and that view your site, the better your chances are of making a sale. The question is, "How do you get these eyeballs, and how much are you willing to pay for them?"
There's the issue of bandwidth, paying affiliates and advertising costs – in addition to various promotional schemes such as free trials and free hosting for affiliates. The sum total of all these factors, put together with regular monthly expenses like content, utility bills, etc., can quickly climb up to and beyond your sales.
Affiliates won't remember your paysite unless surfers do. When affiliates find that surfers are searching for your content, they'll be lining up to sign up. That's why it's important to not just be a traffic sink, but to be a brand name which draws in targeted traffic – both surfers and webmasters – from search engines, link sites, articles, reviews, user groups and message boards.
The result: less work, more longevity.
There's two final points to be noted about running a successful paysite in today's world of online adult entertainment: it has to be a big hit on the search engines, and it has to a big hit on GFY.