The Internet, it is well known, is the playground of scamsters; cheats; con-artists; spammers; profit gougers; and all the rest of the "me first, scum of the earth" proving daily the axiom that "a fool and his money are soon parted."
But as to the question at hand, two things serve to balance the entry into the Internet market by the "established" studios vs. the "no friggen' budget home made porn" guys who are already there in hoards.
First: The studio guys actually put real money into their businesses. Shooting a "studio" feature now can sometimes run to a three-to-five day shooting schedule, an overall production timeline of weeks, and an investment upwards of 100K+. For the "no friggen' budget home made porn" guys, their budget and time constraints are laughable by comparison... but the situation is not unlike some of the Hollywood work of the early 19-teens and 20's. The "no friggen' budget home made porn" guys can produce three [short] features of stills-over-video content in an afternoon for nearly nothing. Editing and post can take all of hours. This presents some serious problems for the studios in ROI terms where the "no friggen' budget home made porn" guys look at it more in throwaway terms. Where they can actually sell, say, 1/3 of their production, if that pays for the whole of it then the rest is, literally, a throwaway at nearly nothing prices... all of which is profit.
Second: The "established" studios have moved over time to using "names" [sometimes on costly exclusive contracts] and they use a much more limited talent pool of adult performers who, in a pinch, could be called on to actually deliver lines. The "no friggen' budget home made porn" guys, on the other hand, think more like... "Well I can add the ohhhh's and the ahhhh's in post... so I'll just shoot it all MOS." Adding, and in many cases correctly, "Who the hell wants to hear a porn actor/actress actually try to say anything with a cock stuffed in their mouth anyway? The viewer is only there for the visual experience." So they produce exactly that way.
As to talent, unlike the "established" studio guys, the "no friggen' budget home made porn" guys don't care if the performers are big, small, white, black or orange, attractive or downright ugly. They don't concern themselves that the girls/guys, in close-up, display a horrible rash on their ass [or worse]... they take what they can get on a no-budget basis and use the hell out of them for the time the performer's fee covers them.
So where the game is, today, is in the difference between the quality, quantity and range of work both kinds of business model produce vs. the problem of ROI. The "established" studios, with their production model, just can't compete in the low end market against the "no friggen' budget home made porn" guys working with a $300 WalMart video camera, two 500-watt work lights from the local hardware store, and no support crew for hair, make-up; lighting; sound; and all the rest that the studio guys throw at it.
Bumping and grinding against the bottom line?
The low end guys will probably hold on to their market for some time; but the high end guys are going to have to develop a whole new premium market with a supportable and maintainable price point. Once they do, however, and in part we already see that with web delivered "burn to keep DVDs," the low end guys had better be ready to start cashing out. It will definitely end, for them, with blood on the floor.
