Sexuality - Does Sex Really Sell?

Estimated size of pornography market in 1970: $5-10 million

Estimated size of pornography market in 2000: $10 billion

Estimated size of the legal global sex industry: $56 billion

Number of adult movie rentals in 1975: 75 million units

Number of adult movie rentals in 1996: 665 million units

Percent of adult films rented by men alone: 71%

Percent of adult films rented by women alone: 2%

Number of adult films produced in 1990: 1,275

Number of adult films produced in 1998: 8,948

Under President Reagan, Attorney General Edwin Meese III's Commission on Pornography released a report stating that sexually explicit materials are harmful and calling for the strict enforcement of obscenity laws. The hard-core pornography market was estimated at between $5-10 million in a federal study. In 1998, total spending on adult entertainment was placed at $10 billion, a figure that has been cited in a variety of sources such as Time and The New York Times.

Technology played an important role in the growth of the pornography industry. Previously, if one wanted to see an X-rated film, one had to visit a theater in the bad part of town (and purchase a raincoat and hat, too, presumably). But then Sony released the video cassette recorder in 1975, and a decade later roughly 75% of homes in America had one. The home video market came into existence — and with it the market for blue movies. A person could now watch adult films in the privacy of his own home.

There is still the potentially embarrassing moment of having to go and rent a pornographic film at the local video store. Technology has come to the rescue again. Cable and satellite programmers feature a number of sexually oriented cable stations, including The Playboy Channel, The Spice Channel, and the Hot Network. The financial incentives are just too enticing for companies. It isn't just back alley companies enjoying these revenues either. General Motors owns DirecTV, a satellite broadcaster, that sells $200 million annually in pay-per-view sex films to its customers. AT&T owns a company that sells sex films to nearly a million hotel rooms, according to the New York Times. Several conservative groups have launched campaigns against upscale prominent hotel chains to rid themselves of the adult pay-per-view services (which are in 60% of mid and upper level hotel chains).

But we do we really spend $10 billion a year on hard-core videos, peep shows, sexual devices, magazines and Internet porn? We spent slightly over $4 billion on diapers and $10 billion on heroin in 1999. The motion picture industry had revenues of $8 billion. If the $10 billion figure is accurate, has pornography really become mainstream? Could Nadine Strossen of the ACLU be correct when she said of the $10 billion figure: "It's not 10 perverts spending $1 billion a year."

More than a few people have questioned this figure. Dan Ackman in Forbes cites a variety of industry data to peg the industry at about $4 billion. Is this still too high? Perhaps too low?

Another staggering figure is a study published in Forbes that attempted to measure the value of the legal sex industry: $56 billion spent on videos, magazines, adult clubs, escort services, phone lines, sexual devices and the Internet. Is this to be believed?

Source: Egan, Timothy. "Technology Sent Wall Street Into Market for Pornography." New York Times, October 23, 2000; Dan Ackman. "How Big is Porn?" Forbes, May 25, 2001, Richard C. Morais. "Porn Goes Public." Forbes, June 14, 1999.