LOS ANGELES — XBIZ continued its legacy of examining the business of adult entertainment for the coming year and beyond, with the 2018 edition of its insightful “State of the Industry” panel.
Presented by ManyVids, the 2018 XBIZ Show casts light on the cutting edge of adult entertainment with a comprehensive showcase of all things adult-related, encompassing all market segments, while keeping a special focus on the digital media market and the impact technology has on it.
XBIZ event attendees have long valued the State of the Industry sessions as a guidepost for the near-to-mid-term future of our dynamic and fast-evolving trade, revealing challenges and opportunities ahead.
Moderated by Penthouse’s Kelly Holland, who took a commanding front-and-center position among the panelists, which included CCBill’s Gary Jackson, ASACP’s Tim Henning, Studio 20’s Mugur Frunzetti, MojoHost’s Brad Mitchell, Tony Cochi from Hustler, Clement Picquet from Bang.com, and NETbilling’s Mitch Farber.
Following a brief introduction, the session delved into the details of 2018’s likely outlook, with Holland asking the panel about 2017’s unfulfilled initiatives and “What keeps you up at night?”
Focusing on the evolution of mobile technology, Farber said the need for mobile billing is driven by the customer (merchant) and where their traffic is from.
“A lot of our merchants lock down certain regions to avoid fraud,” Farber explained. “Because of the high incidence of fraud, [doing business in] some countries should be avoided.”
For Jackson and for CCBill, 2017 was a great year, highlighted by the company’s launch of its stored payment option, CCBill Pay.
“I don’t know that it’s a new technology we’re looking for,” Jackson said. “2018 is about building a relationship with the customer — to be able to provide multiple offers to consumers to help boost the ecosystem of opportunity.”
Calling Bang.com “The Netflix of Porn,” Picquet said the company focuses on offering a good user experience with a frictionless login.
In response to Holland’s query as to the necessity of effective search tools for such an expansive site and the volume at which new content is being added, Picquet wowed with the scale of the challenge.
“With 120,000+ movies on Bang.com, search is vital and enabled by keywords and tags,” Picquet said. “The company produces 20 full titles per month, which it licenses, and is looking for the next big niche.”
Noting that ASACP only exists through the generous support of its industry sponsors, including the new breed of adult entertainment powerhouses including ManyVids and iWantEmpire, Henning called the association “A canary in a coal mine” because of its effectiveness at revealing hidden dangers.
“It’s nice to see new players entering the market,” Henning said, noting “age verification and human trafficking are hot topics for 2018,” underscoring the escalating legal and regulatory challenges facing the industry.
Calling Hustler “the biggest distributor of adult content in the world,” Cochi said the company once focused on home video as “the bread and butter” of its distribution, along with broadcast and internet, but cites the growing incidence of “cord cutting” — where consumers abandon traditional TV viewing for internet-only entertainment — as fueling a decline in broadcast sales.
Touching on the company’s approach to uncovering new opportunities, Cochi was pragmatic.
“We look for what will make the most money for us, not necessarily ‘the next big niche,’” Cochi said, noting he “constantly monitors the customer experience” and is highly supportive of the brands full use of the market space; branching out into retail (where it is expanding despite an overall decline in retail), casinos, and more, leveraging this palette of customer touch points through extensive cross-promotion.
For his part, Studio 20’s Frunzetti faces a problem that is familiar to all companies that experience meteoric growth — an inability to acquire and retain suitable staffing in a timely manner.
“2017 was an interesting year for us, with the opening of new studios and our expansion into new countries,” Frunzetti said, explaining that in a live cam studio, “you don’t deal with logistics, your only issue is people.”
“When we open a cam studio in a place where there never was one before, how do you hire someone that knows what to do?” Frunzetti asked. “The biggest challenge for us is not having enough qualified people to hire — training is our biggest job.”
Authoritatively announcing “The cheese has moved,” Mitchell confided that an ongoing decline in its customer base — and what to do about it — is MojoHost’s biggest problem. As perhaps the most prominent hosting company, MojoHost provides a snapshot of online porn’s overall health, with one metric being a drop from a high of ~2,000 to a current level of ~700 hosting clients.
“My biggest challenge is that for every year since 2008, I lose one percent of business every month,” Mitchell revealed. “New technology is to blame. What used to take dozens or hundreds of servers 10 or 15 years ago, only takes a few today.”
From fewer companies in adult to more companies moving to the cloud, Mitchell faces a juggling act where small customers become loss-leaders when expensive service personnel is required to support the account, leading him to consider a rollout of outsourced tech support available even to non-clients.
“We try to create a platform that offers both self-serve and concierge services,” Mitchell said. “As I look towards the future, one thing we’re looking at is doubling our support team” — a move in addition to his recent $300K+ investment in new technology.
Overall, the discussions during the State of the Industry panel outlined a wide range of challenges and opportunities for the road ahead, with an upshot of hope and optimism for a brighter future, and was capped by perhaps one of the brightest facets of this industry — the personal touch and relationships that transcend business or the companies we work for.
This was highlighted by Holland’s presentation to Cochi of a birthday cake, accompanied by strains of “Happy Birthday to You!” as the audience of porn professionals sang along — a camaraderie that speaks volumes and shows that while adult may have been beaten down over the years, it is far from broken, and indeed, making a comeback.
The session wrapped with attendees leaving for the evening’s frolics, including Happy Hour Networking Socials sponsored by AgeChecked and intimate.io, followed by the XBIZ signature Winter Wonderland party.
Stay tuned to XBIZ for more!