Why Have Tech Companies Forsaken the Pornography Cash-Cow?

Michael Teague |

Though perhaps ill-suited as a subject of Thanksgiving dinner conversation, there is no denying  that pornography is a topic that offers a myriad of angles for commentary, analysis, and conjecture.

This is especially true when we consider pornography as an industry, a very profitable one, and one whose relationship with the latest technological developments has always been more natural than is usually admitted. And so, like the whole of the tech sector, the porn industry was dramatically transformed by the arrival of mobile devices and cloud computing. But it could just as well be argued that the porn industry figured out quicker than others how to generate enormous revenue streams from the new technologies.


Pornography In the Mobile Era

The most current example of this would have to be the internet-based porn empire of one Fabian Thylmann, a German computer whiz who is often credited with single-handedly moving the industry into the mobile age. Thylamann’s empire was known as Manwin Holdings, but changed to MindGeek when he sold his stake in the company in October of this year.

He leaves in his wake a business that describes itself as an “international information technology firm, specializing in highly trafficked websites.” Indeed the company’s different porn sites, taken as a whole, comprise the world’s top-five consumers of internet bandwidth.

While MindGeek’s actual revenues have been notoriously difficult to assess, it is a safe bet that the company is making a great deal of money, in large part because of its embrace of mobile technology.

The story changes substantially, however, when it comes to the tech sector’s attitude towards the porn industry.


Not Welcome in the App Store

Shortly before his passing, Steve Jobs took an overtly moral stance against  the presence of pornography on Apple (AAPL) products, a stance that doesn’t look like it will be changing anytime soon. For example, earlier this year, the company removed the photo-sharing app 500px for iOS from its App Store, citing the fact that the app did not have the proper safeguards in place to protect users from seeing pornographic images.

In june of this year Google (GOOG) , the new tech giant on the block, effectively banned porn apps from its own store when, without warning, it changed the developer policies for its much-ballyhooed prototype of the Glass device to exclude sexually explicit material.

Google has been more tight-lipped about its reasoning behind the ban, but like other tech firms such as Microsoft (MSFT) , has cited grave concerns about its devices and the apps that run on them becoming a conduit for child pornography.

As for Apple, Steve Jobs was openly unapologetic about his stance on porn, and had no qualms about telling his customers, sometimes on an individual basis, about his feelings on the matter. “You might care about porn when you have kids” was his blunt response to an Apple customer who had the temerity to suggest that neither he nor his wife had any qualms with internet smut. Otherwise, Apple has also cited child pornography as a primary concern driving its App policies, as do Google and Microsoft just about any time the subject comes up.


Brand Integrity, or Lots of Cash?

But it’s hard to imagine that the stance of tech companies vis-a-vis pornography is one based entirely on moral conviction. Indeed, if such were actually the case, one would imagine that companies like Apple would display a similar amount of disgust with the labor conditions that exist in many of the countries that actually manufacture their products.

And then there is the matter of how much money is being left behind by tech companies who shy away from pornography. Most companies that produce pornographic content are privately owned and tend to avoid drawing attention to themselves, so it is very difficult to figure out how much money exactly is being made. One statistic has would have it that porn made some $13 billion on the internet in 2006, and given that mobile has subsequently changed the way things work, one can only imagine this figure to be much higher by now.

Of course, there is always the other possibility that the squeamishness if not downright hostility on the part of tech companies to porn is more than a little cosmetic. Indeed, developer policies at the App Store or the Play Store may make a show of cracking down on pornography, but there has so far been no rush on the part of any of these companies to, for example, prevent the viewing of porn through their various web browser products, like Safari, Chrome, or Internet Explorer.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer


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AAPL Apple Inc. 116.60 -0.46 -0.39 23,192,665
GOOG Alphabet Inc. 799.37 2.40 0.30 1,266,181
KPOC Kimberly Parry Organics Corp 0.02 0.00 0.00 0
MSFT Microsoft Corporation 59.66 2.41 4.21 80,032,206


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