The(definite article) adult(adjective) online(adjective) industry(noun) in(preposition) the United States(noun) generates(verb) approximately(adverb) $1 billion(noun) in(preposition) revenues(noun) annually(adverb), and(conjunction) some(adjective) in(preposition) the(definite article) industry(noun) expect(adverb) this(pronoun) figure(noun) to grow(infinitive to) to(preposition) $5 billion(noun) to(preposition) $7 billion(noun) over(preposition) the(definite article) next(adjective) 5(cardinal number) years(noun), barring(preposition) unforeseen(adjective) change(verb). As(conjunction) the(definite article) rest(noun) of(preposition) this(pronoun) chapter(noun) discusses(verb), revenues(noun) can(modal/auxiliary verb) come(verb) from(preposition) a number(cardinal number) of(preposition) sources(noun): paid(adjective) subscriptions(noun) to(preposition) the(definite article) site(noun), advertisements(noun) carried(verb) on(preposition) the(definite article) site(noun), sending(verb) traffic(noun) to(preposition) other(determiner) sites(noun), sale(noun) of(preposition) sex-related(adjective) products(noun), and(conjunction) providing(conjunction) auxiliary(adjective) services(noun) such(pronoun) as(conjunction) adult(adjective) content(noun) search engines(noun), content(noun) for(preposition) other(determiner) adult(adjective) Web site(noun) operators(noun), or(conjunction) age(noun) verification(noun) services(noun). For(preposition) purposes(verb) of(preposition) this(pronoun) report(noun), the(definite article) term(noun) “commercial(adjective) sources”(noun) should(modal/auxiliary verb) be(verb) understood(verb) to mean(infinitive to) sites(noun) that(connector) charge(verb) a(indefinite article) fee(noun) for(preposition) access(verb) and(conjunction) sites(noun) that(connector) provide(verb) access(noun) to(preposition) content(noun) for(preposition) free(adjective) but(conjunction) are(be) supported(verb) by(preposition) advertising(noun) revenues(noun).

According to(preposition) the(definite article) best(adjective) information(noun) available(adjective) to(preposition) the(definite article) committee(noun), subscription(noun) sites(noun) with(preposition) adult(adjective) content(noun) exceed(verb) 100,000(cardinal number) in(preposition) the United States(noun) (with(preposition) each(determiner) site(noun) having(verb) multiple(adjective) Web pages(noun) underneath(preposition) it)(noun), and(conjunction) about(adverb) 400,000(cardinal number) for-pay(adjective) adult(adjective) sites(noun) globally(adverb). The(definite article) business(noun) entities(noun) responsible(adjective) for(preposition) these(pronoun) U.S.(abbreviation) sites(noun) include(verb) about(adverb) 1,000(cardinal number) U.S.(abbreviation) firms(noun) operating(verb) as(conjunction) genuine(adjective) business(noun) enterprises(noun), with(preposition) perhaps(adverb) another(determiner) 9,000(cardinal number) or(conjunction) so(conjunction) operating(verb) as(conjunction) (usually(adverb) small(adjective) scale)(noun) affiliates(noun) of(preposition) other(determiner) established(verb) online(adjective) adult(adjective) entertainment(noun) firms(noun).

Compared(verb) to(conjunction) the(definite article) totality(noun) of(preposition) content(noun) on(preposition) the(definite article) public(noun) World Wide Web(noun), adult-oriented(adjective) sites(noun) account(noun) for(preposition) a(indefinite article) relatively(adverb) small(adjective) fraction(noun) (about(adverb) 1.5(cardinal number) percent)(noun). However(conjunction), these(pronoun) sites(noun) account(noun) for(preposition) a(indefinite article) significant(adjective) amount(verb) of(preposition) Web traffic(noun). According to(preposition) industry(noun) statistics(noun), approximately(adverb) 70 million(cardinal number) different(adjective) individuals(adjective) per(preposition) week(noun) view(noun) at(preposition) least(noun) one(cardinal number) adult(adjective) Web site(noun) on(preposition) a(indefinite article) global(adjective) basis(noun)—20 million(cardinal number) view(noun) adult(adjective) pages(noun) that(connector) are(be) apparently(adverb) hosted(verb) on(preposition) sites(noun) in(preposition) the United States(noun) or(conjunction) Canada(noun). The(definite article) number(noun) of(preposition) paying(verb) subscribers(noun) is(be) on(preposition) the(definite article) order(verb) of(preposition) several(determiner) million(noun) in(preposition) the United States(noun), and(conjunction) may(modal/auxiliary verb) be(verb) as(adverb) high(adjective) as(adverb) 10 million(cardinal number). The(definite article) majority(noun) of(preposition) these(pronoun) viewers(noun) and(conjunction) subscribers(noun) are(be) male(noun), though(conjunction) the(definite article) fraction(noun) of(preposition) female(noun) viewers(noun) may(modal/auxiliary verb) be(verb) growing(verb). On(preposition) average(noun). a(indefinite article) paid(adjective) subscription(noun) generates(verb) $20(noun) to(preposition) $40(noun) per(preposition) month(noun) in(preposition) revenue(noun). The(definite article) majority(noun) of(preposition) subscribers(noun) cancel(verb) within(preposition) a(indefinite article) month(noun), but(conjunction) of(preposition) those(connector) who(pronoun) remain(verb) after(preposition) a(indefinite article) month(noun), the(definite article) typical(adjective) retention(noun) time(noun) is(be) approximately(adverb) 3(cardinal number) to(preposition) 4(cardinal number) months(noun).

A(indefinite article) profitable(adjective) adult(adjective) online(adjective) business(noun) is(be) often(adverb) difficult(adjective) to(preposition) sustain(verb) over(preposition) the(definite article) long(adjective) run(noun), despite(preposition) the(definite article) high(adjective) demand(noun). The(definite article) cost(noun) of(preposition) entry(noun) into(preposition) the(definite article) business(noun) is(be) relatively(adverb) low(adjective), and(conjunction) the(definite article) availability(noun) of(preposition) a(indefinite article) range(noun) of(preposition) services(noun) from(preposition) content(noun) provision(noun) to(preposition) free(adjective) Web site(noun) hosting(noun) and(conjunction) credit card(noun) transaction(noun) processing(verb) makes(verb) it(pronoun) easy(adjective) to(preposition) set up(verb) an(indefinite article) adult(adjective) Web site(noun). However(conjunction), because(conjunction) the(definite article) market(noun) is(be) highly(adverb) saturated(adjective) (i.e.(abbreviation), for(preposition) a(indefinite article) Web site(noun) with(preposition) any(determiner) given(adjective) sexual(adjective) theme(noun), there(pronoun) are(be) likely(adjective) to(preposition) be(verb) a(indefinite article) large(adjective) number(noun) of(preposition) competitors)(noun), and(conjunction) subscription(noun) prices(noun) more(determiner) or(conjunction) less(determiner) capped(verb) in(preposition) price(noun), the(definite article) business(noun) is(be) one(adjective) with(preposition) low(adjective) margins(noun). Thus(adverb), profitable(adjective) enterprises(noun) depend(verb) in(preposition) large(adjective) measure(noun) on(preposition) drawing(verb) large(adjective) volumes(noun) of(preposition) traffic(noun) (in(preposition) industry(noun) jargon(noun), “eyeballs”)(noun) in(preposition) the(definite article) hope(noun) of(preposition) converting(verb) some(pronoun) of(preposition) this(pronoun) traffic(noun) into(preposition) revenue(noun) (i.e.(abbreviation), customers(noun) paying(verb) for(preposition) subscriptions)(noun).

For(preposition) large(adjective) firms(noun) in(preposition) the(definite article) adult(adjective) online(adjective) industry(noun), the(definite article) cost(noun) of(preposition) bandwidth(noun) is(be) a(indefinite article) major(adjective) element(noun) in(preposition) their(pronoun) cost(noun) structure(noun). Because(conjunction) its(adjective) products(noun) are(be) graphics(adjective) intensive(adjective), the(definite article) adult(adjective) online(adjective) industry(noun) consumes(verb) enormous(adjective) amounts(verb) of(preposition) bandwidth(noun)—and(conjunction) the(definite article) two(adjective) largest(adjective) individual(adjective) buyers(noun) of(preposition) bandwidth(noun) in(preposition) the United States(noun) are(be) firms(noun) in(preposition) the(definite article) adult(adjective) online(adjective) industry(noun). However(conjunction), it(pronoun) is(be) also(adverb) true(adjective) that(connector) most(determiner) bandwidth(noun) is(be) used(adjective) by(preposition) viewers(noun) of(preposition) these(pronoun) sites(noun) who(pronoun) do(verb) not(adverb) pay(verb) for(preposition) their(pronoun) use(verb) of(preposition) these(pronoun) sites(noun), because(conjunction) non-paying(adjective) individuals(noun) can(modal/auxiliary verb) see(verb) large(adjective) amounts(verb) of(preposition) sexually(adverb) explicit(adjective) material(noun) simply(adverb) by(preposition) looking(verb) at(preposition) the(definite article) home pages(noun) of(preposition) these(pronoun) sites(noun), their(pronoun) free(adjective) “teaser”(noun) pages(noun), and(conjunction) their(pronoun) free(adjective) demos(noun).

The(definite article) structure(noun) of(preposition) the(definite article) industry(noun) involves(verb) a(indefinite article) relatively(adverb) small(adjective) number(noun) of(preposition) large(adjective) firms(noun) and(conjunction) a(indefinite article) much(determiner) larger(adjective) number(noun) of(preposition) smaller(adjective) ones(noun). The(definite article) major(adjective) firms(noun) (numbering(verb) 100(cardinal number) to(preposition) 200)(cardinal number) generate(verb) revenue(noun) from(preposition) subscriptions(noun) and(conjunction) from(preposition) providing(verb) content(noun) to(preposition) other(determiner), smaller(adjective) businesses(noun). To(preposition) increase(verb) traffic(noun) flow(noun), these(pronoun) large(adjective) firms(noun) also(adverb) pay(verb) for(preposition) traffic(noun) that(connector) is(be) forwarded(verb) to(preposition) them(pronoun) by(preposition) other(determiner), smaller(adjective) businesses(noun). These(pronoun) other(determiner) smaller(adjective) businesses(noun) also(adverb) receive(verb) content(noun) from(preposition) these(pronoun) large(adjective) firms(noun) to(preposition) display(verb) on(preposition) their(pronoun) own(adjective) sites(noun). The(definite article) majority(noun) of(preposition) adult(adjective) Web pages(noun) have(verb) adult(adjective) content(noun) that(connector) draws(verb) customers(noun) who(pronoun) can(modal/auxiliary verb) then(adverb) be(verb) referred(verb) to(preposition) another(determiner) site(noun) (where(adverb) they(pronoun) will(modal/auxiliary verb) encounter(verb) subscription(noun) offers)(noun).