The Business of Pornography
Most of the outsize profits being generated by pornography today are being earned by businesses not traditionally associated with the sex industry
John Stagliano is a wealthy entrepreneur, a self-made man whose rise to the top could happen only in America. Raised in a conservative, Midwestern household, Stagliano read the books of Ayn Rand and was greatly influenced by their heroes, rugged individualists willing to defy conventional opinion. He attended the University of California--Los Angeles hoping to become a professor of economics. Instead, he studied modern dance, struggled to find work as an actor, became one of the original Chippendale dancers, performed occasionally in hard-core films, and used the prize money won during a cable television strip contest to finance and direct a porn film of his own.
Today, Stagliano is the nation's leading director of hard-core videos, a porn auteur whose distinctive cinema verite style of filmmaking has been widely imitated. His videos cost about $8,000 to produce--and often earn him 30 times that amount. Stagliano shoots without a crew, edits the films himself, and performs in them. He also is a major contributor to the Cato Institute, a well-known think tank in Washington, D.C., where he regularly discusses policy issues with its economists.
Stagliano's company, Evil Angel Video, has become a veritable United Artists of porn, distributing the work of other top directors. Evil Angel sold about half a million videos last year. At its modern Southern California warehouse, hundreds of VCRs, stacked floor to ceiling, run 24 hours a day, five days a week, churning out copies of hard-core films.
A great deal has been written about pornography, both pro and con. A new movie about the life of Larry Flynt, the publisher of Hustler magazine, has once again raised the issue of pornography and the First Amendment. But much less attention has been given to the underlying economics of porn, to porn as a commodity, the end product of a modern industry that arose in this country after the Second World War and has grown enormously ever since.
Critics of the sex industry have long attacked it for being "un-American"--and yet there is something quintessentially American about it: the heady mix of sex and money, the fortunes quickly made and lost, the new identities assumed and then discarded, the public condemnations of a private obsession. Largely fueled by loneliness and frustration, the sex industry has been transformed from a minor subculture on the fringes of society into a major component of American popular culture.
Meese formation. More than a decade ago, Attorney General Edwin Meese III's Commission on Pornography issued its controversial report, asserting that sexually explicit materials were harmful and calling for strict enforcement of the federal obscenity laws. The report prompted President Ronald Reagan to launch one of the most far-reaching assaults on porn in the nation's history, a campaign that continued under President George Bush. Hundreds of producers, distributors, and retailers in the sex industry were indicted and convicted. Many were driven from the business and imprisoned.
The Reagan-Bush war on pornography coincided, however, with a dramatic increase in America's consumption of sexually explicit materials. According to Adult Video News, an industry trade publication, the number of hard-core-video rentals rose from 75 million in 1985 to 490 million in 1992. The total climbed to 665 million, an all-time high, in 1996. Last year Americans spent more than $8 billion on hard-core videos, peep shows, live sex acts, adult cable programming, sexual vices, computer porn, and sex magazines--an amount much larger than Hollywood's domestic box office receipts and larger than all the revenues generated by rock and country music recordings. Americans now spend more money at strip clubs than at Broadway, off-Broadway, regional, and nonprofit theaters; at the opera, the ballet, and jazz and classical music performances--combined.