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It’s a world where Playboy —in print and online—because it can’t compete with the Internet at large. Mobile and social media platforms have pulled us away from the openness of the worldwide web and into walled gardens, squeezing the avenues of distribution for porn, co-opting its audience (at least in part), and forcing outfits like Playboy to become more “mainstream.” The larger porn industry is headed in the same direction, careening away from the stereotypes held by journalists and pundits and pop culture like Silicon Valley. “That’s obviously a fictional adult company—because I don’t know a single one that would pay $15 million for compression software,” quips Chris O’Connell, who helps run a real adult company called Mikandi. “The thing about the adult industry today is that … it’s a very low-margin business.”
operates the world’s largest porn app store. When I talked to the publisher of , the leading adult business news organization, he called it “the future of the porn industry.” And in some ways, it is. But that future isn’t what the popular imagination expects.
He lives in Arizona because he likes the politics, including the gun laws. Like many others in the porn business, he sits at the libertarian end of the spectrum. Free speech and free guns. He also lives in Arizona because that’s where he went to grad school. After three years of liberal arts at Middlebury in Vermont and a few more years in the Silicon Valley startup world, he studied astronomy at the University of Arizona, working with the and contributing to academic papers in publications like The Astrophysical Journal and The Astronomical Society of the Pacific. At one point, to make some extra money, he helped build some websites, and some of them were adult sites. Mikandi was a next step. The world was going mobile, and the likes of Apple wouldn’t allow porn apps. He thought it should. But he also liked the idea of, in his own way, rebuilding what Apple had built. He still does. “It’s a very hard thing to do,” he says.
And yet, all these years later, Mikandi remains a small business. O’Connell loves what he does. So do Adams and McEwen. And their business is successful. But it’s small. That’s because a porn startup can’t raise large amounts of money like other startups. And because their store has been pushed to the edge of the Android world. And because so much porn is available for free from the tube sites and other sources. “The adult industry has a very large content library, with, to use one of the buzzwords of the Internet, a very long tail,” O’Connell says. “You have so few viewers for each piece of content.” But nowadays, those aren’t the only forces keeping the company from the enormous bucks.
As he built Mikandi amidst this new world order, O’Connell didn’t pay $15 million for video software. He and his team built it themselves. That’s pretty much the way it works in the porn business. Part of it, O’Connell says, is that with all that free porn available across the `net, industry margins are much too thin for that kind of spending. But even if a company did pay $15 million for that kind of tech, it isn’t likely to pay a mainstream startup a la Pied Piper.
