Soft Porn, Hard Cash (continued)
Within your subscription model, do you offer multiple tiers, say, the basic package, the platinum package?
Other people do that. We find the retention is better if you just stick with one rate, with monthly renewing. It renews close to 80 percent each month.
What do you see as the biggest obstacles to generating revenue from online content in general?
The Internet's all about niches, I think. It's all about narrowcasting. But there is no viable payment system for selling tiny bits of content — that's the biggest problem with selling digital content. I'm just trying to create a really stable platform for people to get the content. Because when it gets right down to it, that's all they really want. They don't care about silly flash presentations or really nice graphics. They just want the content.
I don't think it's so much that our technology is that cutting edge or exciting; it's just that we've developed things that are practical and they work. I'm not really a groundbreaker when it comes to technology, because I think it's not necessarily good business to do that.
Do you see other revenue opportunities outside the provision of entertainment content?
We've just started doing hosting and other technology services for other Web sites, so we're bringing in revenues for just offering our services. We offer credit card processing, hosting, a series of technical services … All the things that we've learned the hard way, we're now letting other people buy from us. We expect the technology side of the business to grow significantly over the next year.
"I'm the only woman in history that's ever been on the cover of Juggs and the Wall Street Journal."
What does the adult entertainment industry do correctly that other streaming companies might be able to benefit from?
I think the adult industry has been really good at identifying what makes their businesses work. And that, when it gets right down to it, is traffic. You have to throw a lot of traffic at a Web site to sell a subscription. The conversion ratios are not that high. And I think the average in the industry is like 3.3 per 1000. So a lot of adult webmasters have set up these networks of exchanging traffic, so if you don't sign up at my site, I'll send you to the next site and the next site and the next site. Major competitors will trade traffic with each other because they find that they survive better working together than they do working against each other.
There are really four business models in the adult industry. There are the small, really niche players, small pre-sites that live on building traffic and selling it. So they'll be the most active in trading links with people, getting hooked up with adult networks — just turning traffic around. And then they'll sell some of that traffic to various pay sites through the pay sites' affiliate program. And the pay sites will then receive all this traffic and do their best to convert it to membership. What they don't convert, they then sell to the next pay site. So then you have these large pay sites, small pre-sites, and you have the adult networks or link sites that sort of act like traffic routers.
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