LAS VEGAS—At the 2014 Internext Expo, the keynote speaker was an internet pioneer who could look back clearly at the past as well as peer into the future. When Andrew Conru took the stage at Vinyl nightclub on January 12 to deliver his keynote address to a packed audience, he obligatorily shared his history in the online adult business, but more importantly he provided insight into some demographic realities that will affect the industry in years to come. It was the type of solidly detailed presentation, complete with slides and stats, which one would expect from a Ph.D. in mechanical engineering design.
Founder and CEO of FriendFinder Networks—the internet-based social networking company that now operates Adult FriendFinder, Cams.com, Penthouse and other popular adult and dating-related websites—Conru in 1993 created one of the first web development companies. He was also the first to build a working web-based shopping cart, a centralized ad server servicing a network of websites, an online matchmaking site (WebPersonals.com) and technologies to enable real-time website customization—all of which have become ecommerce staples.
Conru founded FriendFinder in 1996 while finishing his Ph.D. at Stanford. In December 2007, he handed over his creation to a private equity group for a small initial payment with the balance in IOUs. By December 2013, however, Conru was back in charge as majority owner and CEO.
In the first few minutes of his talk, illustrating his story with simple slides, Conru recounted the high points of his entrepreneurial history from 1993 to 2007, when he sold FriendFinder—and much of the material was undoubtedly familiar to this audience. But then he showed a slide illustrating the period from 2008 to 2013: a blank screen. After getting a big laugh, he proceeded to fill in the “lost” years with an explanation of what had occupied his mind and time those five years. “You can’t get the tech out of the tech person,” Conru explained, almost apologetically, as he ticked off the various sites he’d built as a way to serve “some of the under-addressed niche markets.” These included a social network site for monks (Monastery.com), for the homeless (Cityroof.org) and the studious (StudyOnline.org).
“What’s the commonality of these sites?” Conru asked rhetorically. “They don’t make any money.” With that experience in mind, he went ahead and started a bona fide non-profit called Compute.org.
After a humorous aside about his return to FriendFinder and the state in which he found the company (compared with when he had left it!), Conru was ready to move on to “what’s going to happen in five to 10 years,” basically a detailed discussion of demographic trends.
First, Conru talked about the marked age differences in populations of countries around the world and how the various rates of aging over time also differs. Second, he discussed the different economic status of these populations, and how much discretionary income people have available.
In a series of charts and graphs, he addressed the first point and how it affects the adult industry: “You need to know the age distribution in each country and how much sex each age group is having.” This is important, he explained, because individuals have sex less often as they age. At this point, he said, 223 billion people worldwide have sex in a year, adding, “About 2 billion [people] are doing it right now.”
The statistics offer some good news: Every year more people are having sex.
But there’s also the not-so-good news: As birth rates decrease in various countries, this trend will peak. In one slide, Conru exemplified the point with demographic data on Japan—a country where the frequency of sex hit its apex in 1994, and is on a steady decline.
What about the United States? According to Conru, we’re due to hit our own apex of sex in 2016—after which the numbers head south.
Where, then, are the hot spots for sexual activity going to be? India and China are still on the upswing in terms of rising statistics for sexual activity—and in Africa, the future holds the promise of 30 percent more sex.
Conru shared more statistics that took into account population and relative earnings per person, creating a map that shows “who’s getting a larger share of worldwide sex ‘value.’” Using these metrics, the “winners” are U.S., China, Turkey, Russia, South Korea, Brazil, Qatar, Mexico, Kazakhstan, Saudi Arabia, Taiwan, Hong Kong, India, Israel and Indonesia.
Conru then told the assembled crowd that more information could be found online at PeakOrgasm.com, and he opened the proceedings up to questions from the audience.
Among the first pitched his way was, “What are you doing to help affiliates?” Conru noted that affiliates are looking for money, but they also want a company that they can work with and trust. FFN is “definitely full speed ahead” on looking for global traffic.
In terms of what lies ahead for the Penthouse brand, Conru said, “I actually believe in the adult publication business.” Though there have been declines in Penthouse’s print properties, he believes that’s partly because the company has not dedicated enough resources to give the publications “a fighting chance.”
As far as FriendFinder’s plans for mobile traffic, Conru said, “Last week we had a complete reorganization. … We’re going full steam ahead on the mobile product in a way we haven’t before.”
One audience member asked whether there were plans for free dating sites. Conru replied that in his opening talk after he returned to FriendFinder he told the staff, “We cannot be afraid to be our own competitor.” Toward that end, he said, FFN is looking at taking some of its current brands to the “freemium” model.
In general, Conru’s message was that the current team at FFN is not afraid of change. “I have a zero tolerance for crappy websites,” he said. “Some of them—we have to make a decision whether we shut them down or revamp them. … Sometimes it’s nicer to have a clean funeral than let the corpse lie there.”
This article originally ran in the February 2014 issue of AVN magazine.
