By David M. Ewalt. Wall Street Journal, 11 July 2019
Naughty America, one of the world’s most prolific producers of VR content, is at the forefront of a lucrative niche driving adoption of the technology
|Adult content helped popularize new media formats like|
VHS, Blu-ray and streaming video, and now it's doing the
same for virtual reality. Photo: ISTOCK
Mr. Johnson, like the babysitter, is a character in an adult video, and the actor who plays him doesn’t have any lines. The audience will never hear his voice or see his face, even though he does have a big part in the movie. This is virtual-reality pornography, and every scene is shot from his point of view.
Pornography has provided the first real boom in VR, and adult-entertainment companies like Naughty America—producer and distributor of “Bangin’ the Babysitter”—are leading the way. In the 18 months after producing its first VR video, the San Diego-based studio released 108 more, making it one of the most prolific producers of VR content in the world. In 2017, the company operated a booth at the annual International Consumer Electronics Show in Las Vegas and became the first adult business allowed to exhibit in 19 years.
“Our customers have embraced VR,” said Andreas Hronopoulos, CEO and owner of La Touraine, Naughty America’s parent company, which launched the brand shortly after its founding in 2004. “It’s just so intimate, there’s just nothing else like it.”
It’s not surprising that adult-entertainment companies are among the first movers in the nascent VR industry. After adult content helped popularize new media formats like VHS, Blu-ray and streaming video, the idea that porn drives digital innovation became a widely accepted truth.
What is surprising is how big VR porn has become, and how quickly. In 2016, Samsung, HTC, Google, Sony and Facebook-owned Oculus sold just over 6.1 million headsets worldwide, according to an estimate from SuperData, a videogame market research firm. In December 2016 alone, Naughty America’s customers downloaded more than 20 million VR videos, the company said.
VR porn consumers are also more willing to pay for content than consumers of typical online porn. One of every 167 visitors to the VR-scene preview pages on Naughty America’s website became a paying customer, the company said, compared to one in 1,500 for traditional scenes. Subscriptions to Naughty America’s website grew 55% in 2016, its first full year of offering VR; customers paid $25 a month to access unlimited videos (including more than 7,500 traditional two‑dimensional movies), or $74 for a year. And in the 18 months since releasing its first VR video, Naughty America’s revenue increased more than 40%; for all of 2016, VR-driven revenue was up 433%, the company said.
“We try to be an innovator, a first adopter,” said Ian Paul, the company’s chief information officer. “Virtual reality had been on our radar for a long time, but always as one of those ‘Oh, man, if only we could’ ideas.” It was only after Oculus VR successfully funded its first Rift headset via a 2012 Kickstarter campaign that Naughty America began seriously investigating the technology.
Since only a few producers had made VR movies before, the company had to invent its own production process. “It took a lot of experimentation, a lot of investment into R&D, and basically just buying all the equipment that was available and figuring it out,” Paul said. “One of the most basic problems we faced was camera placement—we originally had it too high, and it just felt weird.”
The company says its exact process is proprietary, but it’s based on a setup used by many VR-video producers: Two digital cameras are rigged next to each other in order to capture a binocular view of a scene. Postproduction involves combining the two video feeds into a single file that includes a left-eye and a right-eye perspective; when viewed through a VR headset, the images combine and appear to be a single 3-D picture.
Naughty America released its first VR movie, “Birthday Surprise,” in July 2015. “We’ve come a long way in a very, very short period,” Paul said. “I think it’s probably the same story for a lot of companies that are in this space. It’s moving fast.”
Naughty America isn’t the only producer in the industry. Adult-entertainment giant Pornhub contracted with Rochester, N.Y.-based virtual-reality porn production company BaDoinkVR to produce videos for its websites. Smaller players include dedicated VR startups like VirtualRealPorn.com, as well as an increasing number of solo performers who offer one-on-one live VR videoconferencing to clients.
One of the most enterprising small businesses in the space is run by Ela Darling, an entrepreneur who produced and starred in original virtual-reality porn for her company VRTube.xxx. For Darling, who had worked as a porn actress and performed in front of a webcam, virtual reality offered the chance to make a viewer feel like he was actually in the room with her, to make a real connection—emotionally, if not physically.
For most adult enterprises, a bigger draw was the money. According to the investment bank Piper Jaffray, VR porn is set to grow into a $1 billion industry by 2020. And VR also makes piracy harder, since the movies must be downloaded and played on specialized hardware.
While most adult-entertainment companies worry about other sites taking and distributing their content, the biggest problem facing producers of VR porn is that not enough partners are willing to distribute it. The vast majority of VR software and content is sold directly through the companies that produce VR hardware; if a consumer owned Sony’s PlayStation VR headset, they could only buy content through the PlayStation Store. None of the major digital-distribution services allow adult content in their stores. Naughty America subscribers have to access the content via a web browser, which is lower quality, or download files to their computer or phone and then “sideload” them into a VR video player in order to view them.
“A lot of these big companies are fearful of getting associated with porn,” said Paul. “I think there’s concern about minors accessing the content, but we’ve had pay-for-view on cable systems for years, so it’s not like that problem can’t be solved technologically. There’s a way you can do verification to avoid that. So I think a lot of it is political.”
The big content platforms might do well to open up their doors. The VHS videotape standard famously eclipsed Betamax in part because Sony wouldn’t allow porn companies to license its Betamax technology. If Oculus, HTC, Samsung or Sony became the first to relent and allow adult content in their stores, it could be a big selling point for their hardware. “If you look at the history of technology, anytime anyone’s ever bet against porn, they’ve lost,” said Paul. “Of course we want adoption to happen faster just because it’s our business. But it’ll happen, it’s just a matter of when.”
This article is adapted from David M. Ewalt’s book “Defying Reality: The Inside Story of the Virtual Reality Revolution,” to be published July 17 by Blue Rider Press, an imprint of Penguin Publishing Group, a division of Penguin Random House LLC.