He isn’t an old-timer, but it’s safe to say that Michael Stabile has been around the block a few times. The industry guru first came to prominence in 2004, co-writing the serial Wet Palms for Jet Set and Naked Sword — a series that forever changed the gay porn content landscape and proved to be an influential experiment that would have a lasting effect. Recently hired to manage marketing for the rising Kink Men brand of sites, he is now helping to shape the gay space into even more extreme and exciting directions. In between those gigs, he has seen and done it all. To put it not so mildly, Stabile knows his shit. So how are things looking?
“The reduced revenue from piracy and the economy has changed the landscape dramatically. When I lived in New York, we used to joke that all the Indian food places on 6th Street used the same underground kitchen. In some ways, that’s what the gay porn industry has become over the past five years,” he says. “There are still nominal exclusives, but no one can afford to really give them enough work to keep them exclusive. So everyone works for everyone. It means that a lot of studios look alike. I don’t think it’s as much of an issue for us, because our product is so unique. There’s no one doing what we’re doing at the scale we’re doing it. But for studios that are doing a slightly different version of what everyone else does, and trying to do it on the cheap? I think that it’s difficult to make that work. People have to think boldly if they want to survive.”
The consumers love to involve their minds and body in one hardcore adventure. But these movies are very expensive and they take a large amount of effort to pull off the quality we seek. -Michael Lucas, President, Lucas Entertainment.
GETTING DEFINED
Back at Naked Sword, President Tim Valenti recognizes that now just as well as he did eight years ago with the web series that started it all.
“At the time, the idea that you would put something online to generate buzz before moving to DVD was inconceivable. But it got a tremendous amount of press, especially with blogs that were just coming of age. We learned a lot there, but it also helped us integrate all our projects — from our original series to sites like The Sword, which really drive the conversation about porn,” he says, adding that when it comes to films these days, there is a dramatic split.
“There used to be a wide — pardon the expression — middle class of porn: mid-range budgets that still looked good. Now, it’s split between people who can produce movies at a really high level with really big budgets, and a lot of places that are doing it on the cheap. I think that what we’re doing with our original series — “Stalker,” “Boyfriends,” etc. — is really integrating a model that builds each week. Things that are connected. There are so few true exclusives these days — the only way you can stand out is to really define yourself.”
Mark Bower, vice president of strategy and business Development at Next Door Entertainment, says that content remains the most important element of their business. “The continued identification of niches that appeal to and convert consumers is one of the most noticeable trends. As the availability of porn becomes more and more commonplace and essentially becomes a commoditized product, focusing on niches, building and sustaining brands and differentiating the product will be essential.”
FINDING A FIT
RJ Friedman, co-owner of SexEntertain.com — which picked up last year’s XBIZ Award for Content Licensor of the Year — notes that because the Internet as a delivery medium is maturing, it creates an environment in which customers can demand more from providers and will shun those that don’t adapt to their needs. The transition is made more complex, he adds, by the vast content piracy that allowed some bad players to harvest traffic illegally and train some consumer segments to expect what had been paid content for free.
“That said, the largest trend is for content producers to connect directly with consumers without a middleman between, and to focus on their customers rather than the myriad devices they own. That is one of the reasons why some traditional business models such as pay-per-minute are losing favor; it’s very content-centric and not customer-centric. This is a big aspect of SexEntertain’s business,” he says, adding that whereas once the adult industry led in building compelling online experiences for consumers who were willing to pay to access content, the mainstream now leads this effort.
“Customers now want to have a better ‘fit’ between their preferred mode of consumption and the content services they use. As customers gain education from mainstream companies like Apple, Amazon and others — and with the leverage tilting to consumers using the Internet to consume content — consumers now expect their adult content services to behave like their mainstream ones. This is not yet happening, and this is where SexEntertain sees opportunity.”
Friedman says they see a confluence of three trends occurring, and are positioning their business to take advantage: consumers expect a rich experience oriented around their needs, not the webmasters; technology makes it easier to provide a rich multiscreen experience to consumers, allowing them access to their content anywhere, anytime; and technology has made online video delivery so clear and rich at internet speeds so fast that downloading huge files is no longer as valuable. “They find it better, faster and cheaper to focus on better content access and find it is not total content control that they really cherish.”
He notes that SexEntertain focuses only on “A” grade content — and that gay porn consumers in particular favor quality over quantity as it relates both to content and the online experience they choose to get it. That is one of the reasons he says the Lucas Entertainment content they lease is so popular, sought after even by webmasters with large owned-content libraries.
“In terms of content, our mainline big-budget storyline movies are very popular,” Michael Lucas, president of Lucas Entertainment, says. “The consumers love to involve their minds and body in one hardcore adventure. But these movies are very expensive and they take a large amount of effort to pull off the quality we seek. Also, the Lucas Raunch line has taken off and consumers really enjoy the kink side of sex. What survives today is the most expensive movies like ours and the low/no-budget amateur products. Everything in the middle can’t succeed. You have to be the king of top quality or to low, cheap content providers to survive. Nothing in the middle can last.”
Lucas adds that they branch out in several lines for many tastes. People also want different models in different environments, and he notes they are the only American company that continues to travel around the globe and film in exotic locations — giving their content a unique draw that helps enhance the visual fantasy.
R-E-S-P-E-C-T
“The gay consumer has always been different,” Stabile says. “We’re more swayed by stars, more loyal to brand, more interested in community. A lot of companies think that you can just transfer over the model you use for straight and treat gay like a niche. ”
Stabile says that gay audiences don’t want to be an afterthought, and can immediately tell when a straight studio has taken a formula and just dumped in a twink to replace the woman. “Most straight sites still treat women like this odd, confusing creature — they either worship her or demean her. Gay is more equal, so consumers wince when they see something — in marketing, in production, in tone — that echoes that straight tone.”
Stabile now sees a multipolar porn world where recorded content is only one part of the equation. “It used to be that there were three sources of income: memberships, PPV and DVD, all different versions of the same product. Now you’re seeing a lot more diversification: dating, cams, mailing list rental, novelties. Again, this is really where brand comes in.”
And Kink has mastered the brand loyalty concept by infusing top quality with a niche that has left the dungeon and exploded in popularity. Traditionally, Stabile notes, BDSM sites shot people from within the scene, not mainstream porn stars. But Darkholme changed that, using porn stars people would never dream seeing tied up, caned, shamed, flogged ... you name it.
“Our gay productions tend to be intense ... it’s unlike anything anyone else can produce because we have the money and expertise to do it. But there are a lot of guys who are curious abound bondage, or curious about fetish, but aren’t experts — what we’ve worked on recently are sites that serve as better entry points — sites like MenOnEdge, a restrained edging site that isn’t as intimidating for newbies. It’s been phenomenal. The conversions are great, and when those consumers get broken in, so to speak, they move on to our other sites, like Bound Gods.”
A STEADY DIET
Ian Klein, vice president of business development at AdultCentro.com, says that two primary types of studios have emerged: studios that are part of a mega corp, and independent, self-sufficient studios. Instead of only focusing on content production, independent studios are now able to (and frequently do) offer their own websites (VOD, membership, etc.), manage their own licensing deals (a change from the previous common model, as broadcast had been frequently bundled with DVD distribution) and frequently have their own traffic resources as well.
“Much like straight porn consumers, gay porn consumers want it all and they want it now,” Klein says. “They want the formats of their choice to the device of their choice. They want the option to download or have HD streaming and everywhere in between. They want it to work on their iPad, iphone, Android, PC, Mac ... there is less tolerance for quantity over quality (aka megasites); they prefer their favorite niches as a steady diet and have come to expect it. Unlike straight consumers, most gay couples seem to have a porn budget as an open topic of conversation.”
And no one understands that more than Valenti, who notes that consumers used to be more likely to jump around — sign up for one site for one scene, watch it and cancel the next month, when they would try a new site.
“Remember all those sites where they promised one pass to 17 different sites, and they were all crappy? People don’t buy it any more. Those people have just moved onto tube sites. If you’re trying to make quick low-end sales with lousy porn, you’re racing to the bottom. You can’t focus on the people who want free porn. They’re a lost cause,” he says. “People willing to pay for porn are more discerning.”