... there's a huge glut of absolute crap (and a few good titles) flooding the DVD market. This has had the effect of spreading the total unit sales over a much larger number of producers. People like Vivid, who are used to selling 15 to 25,000 units of a title, are being hit really hard, because the crap is selling at retail for less than half of what the premium titles are selling for, and that's eating into the sales of premium titles.
Those of you in your thirties and forties may remember the great Atari 2600 crash of 1982. Although you have probably never heard that term, I'll bet that you remember the game machine being all sorts of fun when it was released.

The Atari 2600 caused a massive crazy and the rise of several game reknown companies such as Activision. But as time went on though more and more companies started dumping progressively more cheaply made game cartridges on the market. This had the effect of causing prices to plummet until everyone, even non-game companies wanted a piece of the action by dumping crap product on the market.

This caused waves of problems for the better game companies. Their sales plummeted resulting in less good games being developed. Game players started buying less games because most of what existed was crap. And eventually everything that wouldn't sell, good and bad, was getting tossed in $10 bargain bins.

In 1982 the market hit an all-time low with the release of Kool-Aid Man (yes, this was a real game). Users hung up their Atari 2600's and switched to other platforms like Intellivision and Colecovision. Not everyone, of course, but many did. Other kids decided to go play outside instead. The Atari 2600 had lost its once-massive appeal.

The lingering effect of this, by the way, is that systems like the PS3 and Xbox are specifically made so that third party companies can't release games that work on them. Total crap games are kept outta the market, and thus the appeal (and prices) of new games remains high.

Porn doesn't have the option of preventing independent companies from getting into the market. But at the same time there is a much wider and dedicated customer base than the kids that played the Atari.

The market will inevitably self-regulate as time goes on. The rise of porn site review sites like GayGeek, for example, is in direct response to the rise of affiliate programs and the wide divergence between good and bad porn sites. It's also reflective of the increasing number of porn sites on the market. No one can keep track of them all any more. So businesses like mine specifically do this for customers, and in doing so separate the wheat from the chaff.

As the webmaster of a review site, I am naturally most curious to know how the rise of "free porn" sites are going to affect the industry. Tube sites, for example. From everything I have seen TGP sites are slowly dying out as the same content is being presented in more intelligent ways. Blogs, for example, that are dedicated to promoting content for specific themes such as twink bareback sites. And "crap review sites" are popping up fast now. Those are sites that appear as if they're writing reviews, but in reality are just plastering happy banalities about every website they list while providing no independent review. Often their "reviews" are written by the porn companies themselves!

I will also be curious to see how the mega-porn companies like Channel 1 Releasing do over time. They offer a wider diversity of porn than a quality website (say, Sean Cody), but ultimately a typical porn site customer only looks at so much porn in a week. If the porn is high-quality, a dozen sites like Sean Cody may be more than enough to give a company like C1R a run for their money. Especially as time goes on and viewers increasingly turn to downloading porn movies from the Internet instead of buying them on DVD. And for what it costs to buy a single porn DVD, users may find that membership sites are a much better value for their money.

--Aaron (long-winded and on tangents as always, but I hope you found this interesting)