Industry News

Porn Economics

Beth Barrett writes in the L.A. Daily News (my thoughts):

But a review of industry and state financial records show Valley porn production companies brought in just $750 million last year. While that’s more than the $600 million total generated by the industry’s biggest players – Playboy, Hustler, Frontier and Private – it’s far less than most people have believed.

That’s because local firms realized just 40 percent of the nation’s $2.4 billion in annual X-rated video sales and rentals.

In addition, Valley manufacturers of sex novelties and toys – also an export business – earned about $250 million last year.

But while research group TopTenREVIEWS puts U.S. revenues from Internet porn at $2.84 billion last year, little of that is earned by Valley companies.

The pay-per-view and subscription porn business last year brought in $1.7 billion – but most of that was realized by cable and satellite companies, adult channels and hotels.

The Valley also gets just a small slice of the $2 billion adult nightclub business, with about 42 of the nation’s estimated 3,000 clubs in the city of Los Angeles.

And while Chatsworth-based industry trade publication AVN estimates it had $17 million in revenues, most of the $1 billion retail adult-magazine business also is outside the Valley.

Ultimately, the Valley’s biggest financial porn winners appear to be a handful of owners, including James, who also owns Peach DVD. He said he personally made about $4.5 million last year.

David Feldman, owner of Pipedream Products, employs 110 workers in a 125,000-square-foot warehouse in Chatsworth. The company has annual sales of $25 million to $50 million, but Feldman said more than 90 percent of his 4,000-item product line is shipped outside California and most of the manufacturing is done in Asia.

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