The Sad Battles Skin Biz Icons Are Fighting as They Struggle to Survive

Sep 20, 2013 • Papers/Rags, Porn, porn

Playboy, Penthouse and Hustler -- going under?

Over the summer, the Pentagon put some of those American tax dollars to work when the “indecency”-fighting Morality in Media asked them to remove nudie rags from commissary shelves on military bases. The U.S. Department of Defense had a long hard look at Playboy, Penthouse and Nude and determined they were not, as a whole, explicit material and could stay. Sadly for the magazines, not one week later, the Army and Air Force Exchange Service decided to stop carrying them and other “adult sophisticate” publications due to an 86 percent decline in sales over the past 15 years.

Just a month later, news broke that FriendFinder Networks Inc., which publishes Penthouse, had filed for bankruptcy, with estimated liabilities ranging bteween US$500 million and $1 billion. According to the same court filing, their assets, which include the iconic site, are worth less than $10 million. Speaking with XBIZ, FriendFinder Networks CEO Anthony Previte said that their cam and dating businesses were solid — it’s Penthouse that’s turned out to be the biggest drain on the company.

It’s a good thing that Penthouse Media Group decided to diversify their offerings in 2007, when they bought FriendFinder’s parent company, Various, Inc. FriendFinder Networks Inc. (Penthouse Media’s new name post-acquisition) wouldn’t have lasted a minute without the revenue generated by the 8,000-plus sites they got for their $500 million in that deal, especially given the drain Penthouse has turned out to be.

Though Previte didn’t say there were plans to kill the rag, it’s hard to imagine it will last much longer. According to reports, Penthouse‘s circulation declined radically over the last decade, diving from one million in 1998 to 565,000 in 2003. In 2010, that figure was 213,187 — the same year that the rag’s parent company bid to buy Playboy Enterprises for $210 million. The deal fell through; Hugh Hefner ended up buying Playboy Enterprises back for $207 million.

Things are interesting on the bunny front, too. Playboy Enterprises has been working hard since going private to cut costs and drive profit. This February, the Wall Street Journal reported that adjusted earnings before interest, taxes, depreciation and amortization had improved for Playboy, rising to $38.9 million in 2012 from $19.3 million in 2009. There is cautious optimism as the company repositions itself as a licensing company, trading in the smutty in favor of “aspirational.” Playboy CEO Scott Flanders told the Wall Street Journal that Playboy Enterprises would be “well positioned to pursue a public offering at the end of 2014.”

As far as “aspirational” content, the magazine would do well to consider a recent prank by a feminist group which reimagined the rag’s annual list of party schools as a guide to sexual consent. The fake Playboy guide depicted the 10 commandments to having a rocking good time, listing tenets like “ask first” and “don’t take advantage of sloshed people.”

No story about the iconic giants of print would be complete without Hustler, of course, so here you go: last month, 6th U.S. Circuit Court of Appeals ruled that Larry Flynt’s brother, Jimmy, does not have the right to use the Hustler trademark. This is one more episode in the insanely long saga of the Flynt family feud. The relationship between the brothers, who often faced obscenity charges together in the early days, went bad when Jimmy’s sons started a porn business to compete with Larry Flynt’s Hustler empire in 2009. Uncle Larry was pissed: he fired Jimmy and sued his nephews’ company Flynt Media. Jimmy filed for wrongful termination.

Larry Flynt countered by going after the Cincinnati Hustler store, which is owned solely by Jimmy. Larry tried to have his brother evicted from the store, and lost. Failing that, Larry decided to strip the Hustler trademark from the shop. A fierce legal battle ensured. In August, 6th U.S. Circuit Court of Appeals ruled that Jimmy had failed to establish for the court the existence of a partnership with his brother and thus could not retain the Hustler brand name. Jimmy told XBIZ earlier this month that his attorneys plan to file an appeal with the U.S. Supreme Court.

And there you have it. They’re fighting but somehow surviving. Just the same, it feels a lot like the end of an era and has for some time.

Header image by Shawn Hoke.