You think sex sells and, ordinarily, you would be right - unless you consider some million entrepreneurs trying to stake themselves a piece of Internet turf, according to a panel of sex industry experts in San Francisco.
Panelists observed that online sex may be a billion dollar business but there is severe saturation at the level where nearly all of it is aimed - young men. They also say the adult Web business's notoriety as a spam source creates further problems. And, that lenders are leery of underwriting stock offerings for adult-oriented Web businesses.
Bay Area Adult Sites founder Caity McPherson says aspiring Web porn hosts are in a difficult position, which is why she convened the panel Wednesday at the Velvet Lounge - which just so happens to sit a block away from the nation's first topless bar, the Condor Club.
Net analysts and porn stars alike gathered to brainstorm. "We're talking about business - the tricks of the trade, so to speak," said porn star panelist Mimi Miyagi to Wired magazine's online news page. Their goal was to lay out and tackle the largest challenges and chances for the online sex business.
Among the more serious questions discussed were how to sell women online adult fare, the apparent void in couples-based and soft-to-medium core erotica, how spam injures the online erotica business, and future financing for new adult Web sites since so few sex-oriented businesses go public.
Forrester Research analyst Mark Hardie says with more women coming on line, "they'll be disappointed" that there is so little erotica aimed explicitly toward them. Adult portal Jane'sGuide host Jane Duvall says figuring out precisely what they want is not easy.
"Lots of people out there are trying to fill the women's erotica void," Duvall says, and they have figured women respond more, as a rule, to text than visual images, and to such erotica as draws emotion and senses of intimacy, as opposed to the hardcore style.
Others say that a small but growing number of men respond more to similar erotica presentations as opposed to the hardcore. And women are not very likely to pay more for image-dominant, hardcore-suggestive online sex material, Duvall says.
Women will, however, pay for certain things, says Adult Toy Chest owner Micah Jericho. "Sixty to eighty percent of our buyers are women," says Jericho, whose shop specializes in sexual aids and toys. "(And) women like clean, well-organized sites without a lot of messy stuff around."
Another help: lose the spam. Adult Web sites still have a too-well-established habit of "trying to grope you with unsolicited e-mail," panelists said. But that might stop very soon, thanks to a new network of Internet service provider administrators who have created the Mail Abuse Prevention System.
It runs the Realtime Blackhole List, an e-mail service which lets system administrators block incoming e-mail from addressed and domains known as habitual or problematic spammers. It can also block ISP clients from access to the offending Web sites. And adult-oriented Web sites are learning the hard way that any gains from spam do not override the risks.
"(K)eep your (e-mail) system totally clean," Jericho warned, "or you will get isolated from the rest of the Internet."
Panelists also noted that, while adult Web sites make the vast majority of online money, not one has gone to public ownership. The conventional wisdom seems to be that the banks are too fearful of negative public relations if they underwrite an initial public offering (IPO) for an adult Web site.
But Hardie says the real problem is fear of new government laws which limit adult oriented materials online. He says he expects some kind of legislation solidifying that government position will come forward within the next few years. Once in place, he adds, the IPOs could be following.
And other problems include other legal problems - like litigation and, in some instances, alleged proximity to outright crime.
Consider Sex.com host Stephen Cohen, for example, who may say his success is based on selling sex online to the world, but he has been sued by a San Franciscan businessman who says he cheated him out of the site name.
Gary Kremen says he registered Sex.com in early 1994 with a domain registration body now controlled by Network Solutions, and that Cohen - whose garish looking site is said to pull down about $100 million a year - stole the name by way of "a cleverly forged letter" to Network solutions.
And it would not be the first time Cohen has been accused of criminal activity, either. While Kremen says he put Sex.com at the back of his 1994 activities, which involved creating or snapping up profitable domain names' rights, Cohen was in the federal calaboose in Lompoc, Ca., on a 1991 conviction for posing as a bankruptcy attorney in a plot to cheat an elderly woman's creditors out of $200,000.
That, according to Wired, was Cohen's second criminal conviction. In 1975, the magazine says, he was found guilty of check kiting and grand theft. And, within eight months of his release, Cohen had taken control of the Sex.com name.
