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January 10, 2000 11:05pm
Year of the Rabbit
Source: News Wire
by: Lessley Anderson

Times have changed since Hugh Hefner successfully launched Playboy magazine with a centerfold of Marilyn Monroe lying nude on red silk. Now, 47 years later, Hefner acknowledged recently, "All things sexual and otherwise are now expressed through sound bites and images on the Internet."

Once a trendsetter, Playboy.com followed the dot-com pack Monday as it filed to go public. It hopes to raise $50 million to reinvest in e-commerce, acquisitions and new content, according to the company's filing with the Securities and Exchange Commission.

Playboy.com, which offers lifestyle-related articles about sex, entertainment and relationships - as well as pictures of scantily clad or nude women - is in a highly competitive business. Though the Playboy brand has kept site traffic high (100 million pageviews last November alone), its numbers are increasingly threatened by adult sites offering more titillating content.

The site has chosen to stick with soft-core porn, and try to attract users with more articles and fun features on everything from cigars to cyberdildos. But it also faces heat from the online versions of men's magazines like Maxim, which plans to relaunch a new and improved site.

Extra capital won't come too soon. The company, run by Hefner's daughter Christie Hefner, suffers from many of the same problems faced by most Net companies - losses that outweigh revenues. In the nine months ending last September, Playboy.com lost $7.2 million to its $6.7 million in revenues.

Unlike most sites, the site also relies on revenues from paid subscriptions. Playboy.com charges members $6.95 per month to belong to the Playboy CyberClub, which contains archived photos and interviews with Playboy bunnies, as well as other goodies. These revenues have been relatively flat, yielding $1.4 million for the nine months ending September 1998 and $1.8 million by September 1999.

The CyberClub's lack of growth may well be because some of its potential members have fled to raunchier pastures. Andy Esmond, the CEO of SexTracker, a Web site that covers the online adult industry, estimates that one out of 500 Web surfers pay for a subscription to a site with adult content, and that few will subscribe to more than one site.

Subscription-based porn sites like IEG's ClubLove, or CyberErotica often offer a wider range of products, like tens of thousands of still images, hundreds of channels of videos or live strip shows where customers can chat with dancers. And unlike Playboy.com, whose S-1 primly stresses its "lifestyle" content over its adult content, these sites offer hard-core material.

Playboy.com's decision is testament to the fact that, though its clientele overlaps with adult sites, the main source of its revenues does not. Playboy.com makes 54 percent of its income from advertising, which includes traditional media companies like Sony's Columbia TriStar. Its competitors in the adult world make money off advertising, but from smaller adult sites that pay per click-through. It's true that, with an IPO on the horizon, Playboy.com can't afford to make anybody nervous - the hard-core IEG has had notorious problems in finding an underwriter that can stomach its content.

But Playboy's S-1 signals that this might change. In March 1999, Playboy Enterprises, which includes the publishing and television units, bought its cable competitor, the Spice Channel. Spice's Web site, Cyberspice.com, now belongs to the Playboy.com family. And though it's definitely not much to brag about now - a collection of broken links to free porn pics, and lousy porn star bios, there is more to come. The company plans to launch a Cyberspice subscription service that will feature "pictorials, adult-oriented news and articles, videos and chats with adult film stars." No mention of "lifestyle" content here.

If Cyberspice.com succeeds, however, it could be a mixed blessing. In 1972, with Hugh Hefner in charge, Playboy launched a hard-core mag called Oui to compete with Penthouse. Oui was a success, but it isn't around today. Why? According to Frederick S. Lane III, the writer of the recently published book, Obscene Profits - the Entrepreneurs of Pornography in the Cyber Age, "Oui was doing a better job of attracting Playboy's own readers."

Pornography feminists unshackle their desires and celebrate their sexuality in the patriarchal world

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