Can Celebrity Sex Tapes Save the DVD Market?

Bob Johnson

LOS ANGELES — It seems like the second a mainstream celebrity creates media buzz adult producers can’t wait to get their hooks into them, ready to produce the next big Kardashian-like sex tape.

The feeding frenzy is started by what motivates any studio — big dollars from big sales, all buoyed by free Internet porn-saturated viewers looking for something new and exciting. Porn hounds can’t wait to see their favorite 15-minute of fame (or infamy) stars naked and doing the nasty.

So, in an ever-dwindling DVD market are celeb sex tapes the panacea for adult companies constantly swimming upstream in the battle against piracy, mandatory condom laws and porn that’s as extreme as it can probably get without being downright illegal?

If the most recent “jump on the bandwagon” move by studios to entice shamed L.A. Clipper’s Donald Sterling’s companion, V. Stiviano to star in her own sex tape is any indication, the appeal of the fresh celebrity having sex is in full swing, and something adult players want to cash in on.

Vivid Entertainment, Exile Distribution and Monarchy Distribution all recently offered Stiviano sex tape deals within a matter of days, giving some credence to the potential power of the genre.

But despite the hoopla, the honchos behind the offers surprisingly say celeb sex tapes don’t make money and will not be the saving grace of the hard goods DVD market.

If any company should know, it's Vivid Entertainment with its solid hold on the market. The studio is hands down the most proficient and successful at the game since it virtually started the craze with the releasse of the "Pam & Tommy Lee Hardcore & Uncensored" sex tape in 1988 and parlayed the appeal into its celebrity juggernaut  — Vivid Celeb — that's delivered tapes from Kim Kardashian to the more recent teen mom Farrah Abraham. The studio has also massaged the genre to include rocker Phil Varone’s swinger series that blends Varone’s celeb status with the hot amateur appeal.

But despite the clever marketing push, Vivid’s founder and co-CEO Steven Hirsch told XBIZ that his studio makes “very little money” from celeb titles. “It was different when we had Kim [Kardashian] and even to some extent the first Farrah movie. Nothing will save the DVD business at this point. We distribute celeb tapes for VividTV and That’s where the majority of the revenue comes from,” Hirsch said.

And even though Exile Distribution President and veteran celeb sex tape sales pro Howard Levine also made Stiviano an offer — albeit a modest $6,000 —  he agrees that celebrity sex tapes are not the panacea they once were, and that consumers are often duped because most are not candid sex tapes but instead manufactured to appear to be real.

Levine told XBIZ that throughout his career he was responsible for selling most of the celeb tapes in the market, but cautions against studios thinking they’ll hit it big if they land one. “Anyone who gets a tape in their hands can [get into the game]. If someone is coming out with a tape that means the people in the tape have signed off on it. Period. If they didn’t sign off on it, the tape will not come out.

“There is one legitimate sex tape, that was never signed off on from the beginning. Pam and Tommy. Every other one is just some person who thinks they will get famous because they made one. Some do, most don’t,” Levine said.

It could mean however that consumers just don't care — as long as their stars are having sex.

Monarchy Distribution CEO Mike Kulich also made a pitch to Stiviano with the goal to contribute the proceeds to the NAACP. Kulich approached the Stiviano controversy differently by reaching out to Sterling requesting that he simply sit on a sex tape with black male talent — with or without Stiviano participating. He joined the consensus about the overblown appeal of today's celeb sex tapes, but still saw the PR opportunity for his company. He did note however, that from a sales perspective the tapes aren’t as powerful as they once were. “Back in the Paris [Hilton] and Kim days the celeb sex tape was a huge seller. I remember when I was at IVD for “One Night in Paris,” we did well over 100,000 copies and a good chunk of those were out the door or pre-orders."

He added, "Any celeb sex tape will sell. History has shown that. However, I wouldn't refer to it as a saving grace for the DVD market. Most of the time with a celeb sex tape in this market it is a struggle for the studio to even make their money back. That's why the majority of the new celeb sex tape deals involve a small up-front payment and percentage of back end sales. Regardless of how big the celebrity is, it is difficult to get your sales ahead of the piracy factor. If you don't profit on your pre-orders and out the door sales, chances are you won't recoup your investment."

And Kulich’s point about piracy is well taken, and a niggly reality that's also contributed in taking the steam out of any potential tape. Many viewers will just sit back and wait until it appears on a tube site.

But Hirsch said Vivid does a good job of keeping its celeb tapes (and Vivid titles in general) off the tubes. “We may put up clips but that’s just to drive traffic back to The tubes have worked with us to keep off unauthorized footage.” And along with anit-piracy measures, most poached celeb content appears as short clips, and in many cases just whets the appetite for the real production.

But it appears that’s still not enough to save DVDs, and companies seeking to concentrate on the slim opportunity need to think again.

Hirsch said that studios shouldn’t build their companies around what appears to be a cash cow.  He said it’s “very difficult,” and the deals are not cheap. “You never know how well they are going to do. I think we have figured out the secret formula but I believe it would be very hard to replicate.”

If actor Lindsey Lohan made a tape for example, Levine noted, it would do well. Aside from that, a D-list celebrity tape just won’t cut it.

The mainstream appeal is what might drive the quest for celebrity content but Kulich pointed out that there hasn't been a grand slam sex tape since Hilton and Kardashian, noting that the marginal celebrities who have took the plunge and have done a sex tape haven't seen their careers propelled like before.

“Montana Fishburne, Farrah Abraham, Tila Tequila. They all tried to follow in Paris and Kim's footprints and they are even less significant now than they were before. Of course there will be B and C-list stars trying to capitalize on whatever mainstream reputation they have, but I don't see them blowing up the way they did,” Kulich said.

However, any studio with the guts — and sufficient capital — can jump in and try to seduce a celebrity to give up — or star in a sex tape. But the struggling industry just doesn’t have the discretionary funds it once did.

The bottom line today is unless there’s an eight-figure deal on the table for any top celebrity, the majority of those interested will be from what Levine calls people who’ve appeared on “Celebrity Rehab” who are told, “We’ll get you off drugs and into porno.”

Although Hirsch also admits most celebs today come from the reality TV world, fame is still fame, and noted that they don’t make tons of money on their shows but are popular, and people know who they are. “This is a way they can cash in on their fame,” Hirsch said. And that may be the magic formula that keeps the niche alive — and what spawns the next mega-hit for the right studio.

But top sex tape broker Kevin Blatt said flatly that the sex tape market is over, pointing to the Farrah Abraham release that she helped engineer despite her repeated public denials. He maintained that tapes like Abraham's are no longer the mysterious phenomenons they once were. "It's the mystery that sells the tape. Not company marketing," he said.