Explaining Southern California's economy

What's hard to get? The numbers on the porn business, that's what

When I recently blogged about the struggles of the California porn industry, I cited a figure of $12.6 billion in yearly sales. I'd seen figures in this general ballpark before. But there's also a…let's call it a feeling out there that the porn business' numbers are unreliable. 

So is it really a $12 billion-plus game? Ten years ago, a somewhat smaller number — $10 billion — was being questioned by Forbes:

The idea that pornography is a $10 billion business is often credited to a study by Forrester Research. This figure gets repeated over and over. The only problem is that there is no such study. In 1998, Forrester did publish a report on the online "adult content" industry, which it pegged at $750 million to $1 billion in annual revenue. The $10 billion aggregate figure was unsourced and mentioned in passing....For the $10 billion figure to be accurate, you have to add in adult video networks and pay-per-view movies on cable and satellite, Web sites, in-room hotel movies, phone sex, sex toys and magazines--and still you can't get there. 

Forbes did the math and put the industry's total worth at "$2.6 billion to $3.9 billion." The internet slice was assessed at $1 billion. By 2006, that had grown to $2.84 billion (not Forbes' data, though). I'm going to assume that it's above $3 billion by now, which would increase the upper end of the Forbes number to $7 billion. It's possible that pay-per-view, $128 million in 2001, is up to $1 billion by 2011, so that gets us close to $8 bil. Increases in other categories — magazines and video — might add another $2-$3 billion, getting us close to $12 billion. But that's being optimistic and also assuming that porn is recovering from the recession.

So what I conclude here is that the porn industry is only just now achieving its alleged 2001 numbers, or slightly exceeding them. If it were truly a $10 billion industry in 2001, it should be…What? A $30 billion industry today, just in the U.S.? 

There's a lot of back-of-the-envelope here, but this does make me wonder if porn is really the serious chunk of the regional economy its long been argued to be. And maybe it's under the same pressure as other types of media to drive the cost of its product down, down, down. Possibly all the way to free.

Free porn. Now there's a business!

Photo: GABRIEL BOUYS/Getty Images

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