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Porn Will Be Bitcoin's Killer App 216

Posted by timothy
from the we-call-this-the-duh-factor dept.
An anonymous reader writes "In December, porn.com started accepting Bitcoin for its premium services, and the virtual currency quickly came to account for 10 percent of sales. At the start of January, a post on Reddit's Bitcoin subforum boosted the figure to 50 percent, before settling down to about 25 percent. The tremendous interest has led David Kay, the marketing director at porn.com's parent company Sagan, to talk very positively about the virtual currency: 'I definitely believe that porn will be Bitcoin's killer app,' he told The Guardian. 'Fast, private and confidential payments.'"
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Porn Will Be Bitcoin's Killer App

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  • seems reasonable (Score:5, Interesting)

    by wbr1 (2538558) on Saturday January 18, 2014 @05:12AM (#45996887)
    Porn is what made VHS win the format war.
  • Pay for pr0n (Score:4, Interesting)

    by MouseTheLuckyDog (2752443) on Saturday January 18, 2014 @05:15AM (#45996897)
    Heaven forbid. Hell, they are giving it away.
  • by Neo-Rio-101 (700494) on Saturday January 18, 2014 @05:17AM (#45996913)

    It started with video.

    Pretty much any new gadget takes off when it's meshed with porn in some way.

  • Re:seems reasonable (Score:5, Interesting)

    by The New Guy 2.0 (3497907) on Saturday January 18, 2014 @05:31AM (#45996965)
    Porn couldn't get its hands on anything Betamax, so they released everything on VHS only. Beta had the better tech, VHS had the better content.
  • by mendax (114116) on Saturday January 18, 2014 @06:04AM (#45997101)

    Not really, no. Who would even read their posting? Who would even care?

    Maybe in some Taliban-controlled country it could be a problem, but I doubt they're buying much internet porn over there.

    Oh, you'd be surprised. Several years ago, a friend of mine worked in Iraq doing computer forensics on computers taken from Islamic whack jobs. One of his jobs was to watch all the porn videos looking for other video that might have been embedded in it. There was a lot of it. It wouldn't surprise me if there's plenty of porn on Taliban computers.

  • by myowntrueself (607117) on Saturday January 18, 2014 @06:41AM (#45997201)

    It started with video.

    Pretty much any new gadget takes off when it's meshed with porn in some way.

    Google Glass. A HUD for sex, much needed by geeks?

  • Re:Pay for pr0n (Score:5, Interesting)

    by HuguesT (84078) on Saturday January 18, 2014 @06:52AM (#45997233)

    At some level everybody is a "moron". Most people confuse ignorance and stupidity, and everybody is ignorant of something.

  • by mellyra (2676159) on Saturday January 18, 2014 @06:59AM (#45997257)
    Currently the business model of most porn websites is based on subscriptions and not on pay per view. A large part of their customers do most likely not even use their product but have just forgot/don't bother to cancel the subscription. Currently there is no way to set up such automatically recurring payments with bitcoin.

    Why would a porn company willingly throw away all these paying users that don't actually use anything (i.e. don't cause them any costs)?
  • by Anonymous Coward on Saturday January 18, 2014 @07:28AM (#45997359)

    I'm a cypherpunk. (On a good day, I might describe myself as a cryptographer if it's simpler to, but emphasise my slightly different fields of experience compared to my peers. I hang around a lot of cryptographers.)

    I work in porn (fetish porn, both behind, and in, the scenes, and yes, it's risk-aware, consensual kink, and our content is legal both here and in the US and most other places).

    I strongly agree. We've been looking into accepting payments in BTC for some time. We hope to go live soon.

    You have no idea - unless you also run an adult site! - just how much we hate payment processors, and just how much payment processors hate us. At best, we tolerate each other as a necessary evil business partner. But at worst...

    They censor us. There is plenty of legal content that we cannot publish because if we do, they will pull service from us. (Sure, because that's what this industry needs - MORE censorship?!) They apologise profusely and say that this is because of Visa or MasterCard's rules, not their fault. Yet Visa and MasterCard claim to some that they do not have these rules, and to others the opposite. A large porn site based in California definitely gets to post content that we, not based in the US, definitely do not, even though it's totally legal in both our countries. It's not the large site's fault: they're doing the best they can and I appreciate their competition. I just wish we got a fairer deal, and I know the US State Department is heavily involved somewhere in all that mess. Wonderful. That's all we need. Fucking diplomats. (Actually, no, that might be a cool idea. Putting that in the notebook.)

    They blame us for chargebacks. They apparently hate porn because they get chargebacks from people who buy porn, and then get buyer's remorse: jealous spouses, or something. Nope, not seeing that. That's not been our experience with our customers. We've only had 2 chargebacks from customers, ever. Our paying customers are very happy and enthusiastic about our content, which means we must be doing something right. Yay.

    They blame us for card fraud. We have a very low rate of card fraud: lower than companies who sell computer parts. And it's easy to see why. If people want to steal our content they don't have to steal credit cards to get it. They just pirate it: it gets reposted on tumblr or sex.com or Bittorrent or RedTube or PornHub, or anywhere else, really. We KNOW that, of course: and we can either spend our time chasing around taking it down, or we can spend our time making more porn: I don't know about you, but I prefer the latter. There isn't anything we can do about piracy except hope they keep the watermarks and people see it, like it, decide they want more of our content, and come to our site and buy some, and so, it becomes promotional material. Is it sustainable? That's a business model problem. It is for us, right now. Though plagiarists who remove watermarks from stuff, or put their own on it? They can fuck off - that's just rude, and that's coming from a Pirate Party member. (Well, there's nothing we can do about it that doesn't involve being massive arseholes to potential customers - Prenda Law can eat a dick for giving our industry a bad name by using porn piracy as an excuse for outright blackmail!) You can't pirate computer parts (unless they've gotten REALLY good at 3D printing while I wasn't looking!). Result: we don't get carders, computer companies do.

    Sure Bitcoin's value fluctuates compared to currency. Sure interchanges between hard currency and Bitcoin will likely be regulated (Bitcoin itself, of course, cannot be regulated in any useful manner). But the option to potentially remove a payment processor which is ultimately based in the US from the chain is a HUGE win. We can even pay our hosting and DNS directly with Bitcoin now. There are some things in life that hashcash can't buy. For everything else, there's Bitcoin. =)

    It's not anonymous in the sense that it absolutely can't be tracked. Hell, the blockchain is public, and the US Govern

  • Re:seems reasonable (Score:5, Interesting)

    by Zocalo (252965) on Saturday January 18, 2014 @07:44AM (#45997401) Homepage
    You joke, but I'm not so sure there may not be some element of truth in that. When the specs for the audio CD were being thrashed out CBS/Sony president (and later CEO and chairman) Norio Ohga all but forced Philips into changing the format to accomodate his favourite piece, Beethoven's 9th Symphony, in its entirety. Before the change to 12cm diameter disks, Philips had been proposing 11.5cm and a playing time of one hour exactly, but the longest running version of Beethoven's 9th was Furtwangler's 1951 Bayreuth Festival recording at 74 minutes, requiring the extra 0.5cm. If Sony's audio division could use the length of pieces to dictate technology specs, then why not the video division?
  • Re:seems reasonable (Score:5, Interesting)

    by neilo_1701D (2765337) on Saturday January 18, 2014 @09:38AM (#45997765)

    VHS had a simpler tape path, too. A Betamax machine needed to unspool the tape 3/4 around the head drum, and had other mechanisms that needed the tape to move out, too. If something went wrong, despooling the tape became problematic. VHS, on the other hand, spooled tape out in a "M" fashion: two arms pulled the tape out and achieved a 1/2 wrap of the drum head. Because of that pattern, if the tape failed to retract getting it out wasn't as hard.

    Serviceability played a major part in VHS winning the format wars, too. If you needed to replace a Betamax head, you needed all sorts of aligning jigs, test tapes and oscilloscopes to make sure the head was in exactly the right position. VHS heads, on the other hand, simply required 4 wires desoldered, the head lifted off with a single tool, the new head being slid into position and those 4 wires soldered back on. 10 min job with a quick clean + cost of head; easy money.

    In truth, Betamax wasn't that much better than VHS in terms of signal quality. Betamax put a high frequency "ring" in the signal when there were abrupt changes in the luminance signal. This gave the appearance of a higher definition, as the edges seemed sharper than they actually were. VHS simply blurred the same scene.

  • by jawtheshark (198669) * <slashdot&jawtheshark,com> on Saturday January 18, 2014 @11:06AM (#45998239) Homepage Journal
    As someone working in the business: no, video on demand isn't all that big. (Big enough, for it not to be ignored, but not exactly all that interesting) What seems to work best is live shows. People (well, mostly men) are willing to pay for that.
  • Re:seems reasonable (Score:3, Interesting)

    by Solandri (704621) on Saturday January 18, 2014 @12:06PM (#45998613)
    If they really wanted to put more music onto a single disc, the easier way would have been to encode the audio's amplitude on a logarithmic scale rather than linear. The current CD format is linear in amplitude and wastes a lot of bandwidth by recording very fine grades of amplitude differences in very loud sounds, not enough for very quiet sounds. Digital telephony uses logarithmic encoding because it's such an easy way to reduce bandwidth.

    The Beethoven's 9nth story is probably popular among the record labels' marketing divisions because it counters the conspiracy theory that they picked inefficient linear PCM coding to deliberately reduce the amount of audio which could be stored on a CD, to try to make it better match the two-sided LP (about 45-50 minutes for both sides). Customers would have been up in arms if they found out the record companies were producing CDs with 35 minutes of music on it when the CDs could hold 2-3 hours. Since these things were usually sold at about $15-$18 per disc (not per song), consumer demand to "fill up" the discs with more music would have been devastating to their revenue stream.

    Regardless of whether that conspiracy theory is true, it sowed the seeds for the success of MP3s. Because the CD audio format was uncompressed and so bloated because it was encoded linearly, it compressed fantastically (roughly 10x) once people were able to get their hands on the digital data and do what they wanted with it, rather than have to live with whatever format the labels preferred. It's a good lesson in giving customers what they want. If you try to force them to accept what you want, you just sow the seeds of your own demise.
  • by waveclaw (43274) on Saturday January 18, 2014 @08:18PM (#46001773) Homepage Journal

    Porn may tip the favor for a particular coin but there is one market that can make Bitcoin or any given altcoin an huge (relative to current) market.

    Marijuana is a Schedule I drug no matter what any State's laws say. This Federal classification means that banks cannot do direct business with dealers, transporters, processors or growers of it. Several [psmag.com] publications [time.com] have covered this problem.

    People in the trade are either working in very grey banking situations or dealing with large amounts of cash. Having to pay your $20,000 taxes this quarter with a duffle bag of twenties is a perfect situation for robbery. Pot dispensaries on Colorado, USA are starting to figure out that they don't need banks to deal with Bitcoin or other altcoins. Right there could be a real Business-to-Business revolution [ibtimes.com] for digital currency.

    Sure, today a digital coin is mostly useful for transactions. A business would have to convert between cash and coin at the ends. And even when you can go bitcoin from customer to suppliers for your business you'll still need to get out cash.

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