My biggest challenge of that time was reliable billing. That said, it wasn't quite as bad as you make it out to be. When you have a long history of low chargebacks you can make some deals, and even then there were a few options. We always had a few processors integrated at any one time because 1) any processor could pull the plug on us with minimal notice and 2) these organizations tended to be technologically inept and their platforms were not reliable.

Some payments we processed through our own merchant account. We tried to get more merchant accounts and were unsuccessful. It's difficult because (IIRC) banks only allow a certain percentage of their total volume to be "high risk" and porn is in that bucket no matter how low your chargeback rate is and how long you've been established. It's something you could probably arbitrage profitably if you were a bank, but by the time you get to be a big enough bank you are bound into the stodgy culture of banking ("ewww porn").

That ship has sailed however; there's not much money in porn anymore. The tube sites have killed the content business; this is a shrinking industry. I agree, the content is better than it ever has been before, and you can get it free... uploaded to tube sites by the very producers themselves, hoping to get exposure.

> That ship has sailed; there’s not much money in porn anymore

That’s interesting, and would be the very reason small creators would move to a patreon backed model. The logic is similar to how youtube and podcast creators diversify to patreon as the platform revenue can’t be counted on.

Also the impact of Patreon’s policy goes beyond porn, to take an extreme example, educational content involving sex in any graphic way would also get banned.

I wonder what happens next. Would moving to direct peer to peer payment with a one to one link between the creator and the “customer” be a workaround ? Then when volumes get big enough there would be ashakedown again ?

Hopefully the crypto world will mature in the upcoming years and people will use it for payments. That would help customers stay anonymous and there will be no charge-backs. Sure, we will miss recurring payments but still a win imo.

Source: I’m the CTO of a mid-sized live cam platform.

My friend owns one such service, he is using Luxemborg based payment facilitator.

Then why is so much porn still being made if there's so little money in it today?

1. New content creator enters market. 2. Content gets uploaded to tube sites constantly, take-downs are intentionally slow and ineffective to make this process as tiresome and inefficient as possible. 3. New creator is eventually forced to upload the content themselves in order to generate leads and collect some revenue although this is very little. 4. This revenue is not and was never planned to be enough for the creator, two options: A. Quality of content and models is reduced in order to reduce costs and remain profitable. B. This does not happen, studio struggles to stay afloat and is forced to sell, it gets acquired by guess who... the parent company of the tube site.

I probably got some things wrong so feel free to correct me!

http://www.jonronson.com/butterfly.html

Source: work with porn people.

As an example of something I heard at least a year ago back here in HN: I get it that PHP can be secure and fast but that requires a lot of extra effort and I'd bet most sites don't want their programmers to work more because they will have to pay more?

(I am skeptical if porn sites even keep fulltime programmers on a wage; I'd bet they just hire them periodically.)

...Or am I missing something very obvious here and talking uninformed? I am curious.

I am not asking about site names or anything identifiable; just the tech side of things.

The fun thing is more about the db. E.g some go full in memory redis while others stay on a good old mysql.

Although, don't let yourself fooled by the poor ui. It doesn't reflect the tech behind, and is now mostly ugly for marketting reasons.

Big sites makes millions and of course have full time dev team. They need to innovate constantly. E.g provide best moments on the player timeline, add face recognition to categorize actors, buff the infra for live cams, etc.

However, very few use the cloud. It's mostly home made. Video streaming is expensive, and you can divide your costs by 10 by avoiding aws and cie.

I sometimes wondered if I should try and work in the area; these people seem to constantly have to do stuff better and better which is an appealing aspect for me and keeps me from being bored. And as more and more time passes, I don't care for societal approval. Plus I never viewed porn as a "sin" or whatever.

Thank you.

Also, are you folks open to something newer in terms of stacks? Something much more efficient and fast out of the box, like Go or Erlang/Elixir? Is the legacy too big for a code reorganization to ever be viable?

The problem with Go and the like is that you shoot yourself in the foot regarding recruiting. An exotic tech stack really narrows the already small pool of people willing to work for an adult company.

But aren't these companies of the kind that like to nurture employees as a result? Namely good social programs, maybe some free food, some advertise good parties (wtf?) or maybe none of these -- just a promise for job stability and having a friendly and outgoing team and a "family"-like environment overall.

Regarding parties: I watched a video years ago when 2 of an adult site's programmers went to a company party and they were very pampered, including voluntary flirting and sex by some of the porn stars (that was a bit weird but also kind of hot). While as a very happily taken man I don't care about such activities in company parties one bit, this is one of the examples of a smaller community that has tighter bonds and (overly) friendly atmosphere.

I mean, not everybody is obsessed by growth and being able to replace humans as nuts and bolts in a machine, after all.

https://www.quora.com/What-is-it-like-to-work-on-the-develop...

[0] https://www.mindgeek.com/careers/

1) Porn (crypto, gambling, etc.) transactions are significantly riskier than other transactions.

2) CC processing involves a long chain of intermediaries.

3) At every step of the chain there's strong pressure upstream for better rates, and strong pressure downstream to ensure the blended payment stream is safer.

So, eventually, someone in the chain gets told "sure, we can give you better rates, but only if you can improve the risk profile of your payment stream". And then they crunch the numbers, and decide it's worth it, knowing they'll lose some volume but hoping they can make it up with better margins. And then the people who churn find one of the remaining partners who hasn't adopted strict policies, and this repeats until all the "dodgy" payments are going through a high-fee chain that can't possibly afford to change their policies, and everyone else is going through a low-fee chain.

If you check CCBill, their "Blue" package that allows adult content runs 10.8% to 14.5%, with a $1,000 yearly "high risk registration fee". And even their normal plan (which doesn't allow adult content) seems to be 5.9% + $0.55 per transaction? Braintree is 2.9% + $0.30; Stripe is the same.

You can see why, eg, Stripe would be happy to leave CCBill to have a virtual monopily on adult transactions: There's not that many of them, they're so risky you'll need to charge absurdly high rates just to cover your costs, and just touching them at all will potentially taint your other transactions in the eyes of your upstream partners, driving up your rates. Conversely, you can see why CCBill will never kick the adult payments off their platform; it's the only thing they have to offer.

Disruptive startups work best when they can start with a niche and then grow from there, but the logic of the financial system makes that very difficult.

I genuinely wonder how true this is. Does anyone know of any stats/data that have been released about it?

And the times my other half sees odd payments on my credit card, she's on the phone claiming chargebacks lickety-split because nobody she knows would pay for porn.

So I have no data to provide on this matter. None at all.

Quoting from a Finnish crime story:

"People are willing to pay a lot of money for good porn."

"Could be. Too bad nobody's ever seen such a thing."

"Honey..about that..uh..well..I..ummm.. porn is disgusting!! Thank you dear!"

Porn consumption is pretty common, but "nobody pays for porn" is a punchline for a reason.

Even if only 10% of users are paying it would still be a very high number of transactions.

Some of my friends in the biz solely got interested in btc because of this.

We have still only a few customers using them though, so it's not a success yet.

But for those who thing crypto is a solution in search for a problem: there it is.

I often hear lack of chargeback being touted as a feature for cryptocurrencies but it's more like the lack of a feature. It's obviously beneficial if you're in the shoes of the seller but if it's so great then why does chargeback exist in the first place?

Put yourselves in the shoes of a porn buyer, would you really put your billing info on bigtitties.ru if you knew that if they steal your money you have no recourse whatsoever? Also there's now a transaction on an immutable public ledger that might trivially show anybody who cares to look for it that you're buying incest porn online?

For Cryptocurrencies on the other hand, you never give you private key to somebody. You always decide yourself which amount to transfer. No chargeback is needed for this model.

I have an EC-card and chargeback is only available for pull-transactions, not for push-transactions.

I've initiated chargebacks before, but overwhelmingly it's not because I've been overcharged (that only happened once and, ironically, by a company that subsequently launched an ICO...): It's because I did not receive the product/service, or it wasn't as advertised.

And that is just as much of an issue with crypto.

Keep in mind, in many cases the standard advise to consumers is to use credit, NOT cash, purely to be able to obtain the protections of chargebacks, but cash already has all the advantages you list as meaning chargebacks aren't needed for crypto.

EDIT: Apparently chargeback may be the major issue for porn payment processing:

https://news.ycombinator.com/item?id=17433794

With a credit card, you'd do a chargeback. With crypto there no protection from dodgy sites.

So, no, not just for physical goods.

By which you mean, the solution for the high rate of people initiating chargebacks is to just use a payment method which won't let them? I think the underlying problem is that people want to make chargebacks, not that Visa lets them. And if I'm right, then you'd expect to see customers refusing to switch, since from there point of view this isn't the solution to a problem, it's taking a solution away from them.

> We have still only a few customers using them though, so it's not a success yet.

Not a surprise, really, is it?

Sites scaming customers has been solved mostly by communities organising and insta banning bad apples.

The reverse is insolved. And yes, removing a gun will make people mug less.

Apparently the chargeback rates on adult content is really high. Anecdotally, it makes sense. You buy the nude pics, your husband sees the charge on your card, "I was hacked" boom, chargeback. You buy the nude pics, do the nasty alone in your room, have some regrets once the pressure to do the nasty is gone, try to get a refund, get refused, boom chargeback.

I'm not sure that quite holds up in our post-Pornhub world, where everyone is openly admitting to using porn these days. But banks are conservative (in all the ways) and slow to change.

High chargebacks in high-risk industries are related to three things:

1) The goods are digital and delivered immediately. This means that if I just got a hold of a 100 stolen CC numbers and want to test whether or not they're legit before moving on to physical goods, I'm going to test them out at one such service - which shoots up the CB/refund rate.

2) This also creates a secondary market for illicitly opened accounts / access, which is easy money (and anything else you can imagine down the lane on piracy etc.)

3) Because the margins are so low due to high marketing costs + competition, many sites (especially in the past) would sign the user up to endless recurring billing schemes which are nigh impossible (or costly) to cancel, also driving up the chargeback rate.

I run product for Pornhub Premium, we have a clean, no cross-sale offer and it's very easy to cancel, our chargeback ratio is near 0.

I never worked in porn but I did work with payment and clearance systems from carrier companies a long time ago, think billing customers for SMS messages to specific numbers and then getting clearance for the carrier for the money. The risk of fraud or any kind of weird issue is stupidly higher for porn. Either simple "customer doesn't have the money" fraud or "the police knocks on your door because you got money from X customer" fraud. So maybe you need more people or better systems to deal with it while still being profitable. CCBill charges are huge when compared to other credit card processors.

It's easy to reduce costs and complexity until the easiest solution to keep or improve current margins is don't do porn.

I live in New Orleans, which has an unusual concentration of strip clubs. I've heard people who work in them complain that to use a credit card, they require you to let them photograph your ID, make an impression or photo of your card, and have you sign a carbon copied form.

This gives some customers cold enough feet that they head out, but the reason is that people will run up a serious tab with lap dances, champagne and whatever else and then strenuously deny they ever set foot in such an establishment. I'm sure porn has the same problem.

It's pretty gross as far as I'm concerned. There's no legitimate moral distinction between falsely saying you never signed up for (random porn service) and Netflix, or saying you never got a lap dance and saying you never went to the ballet, and people acting differently causes legal businesses with avid customers real harm.

"Paying for porn is stupid. But I just have to have everything of this specific person or fetish, so I'll pay, scrape, then chargeback."

I'm skeptical that it's a lot of kids because I feel like finding free porn is pretty darn easy if you try. Why would they ever bother with all the friction that goes with charging their parents CC?

(Just checked, the top three Googles for "free porn" are sites with a lifetime of free porn)

Porn is much more about revealed preferences in isolation.

Just a FYI.

They own Brazzers, Digital Playground, Reality Kings, Twistys, Babes, Sean Cody and Men.com for production studios.

There are thousands of tube sites, two of which have more traffic than those mentioned above. There are hundreds of porn studios, many which are more popular than those listed above.

I download a lot of that content too (sans the chargeback). I like to have it available locally, even when the internet is down, when the site decides to take a particular video down for whatever reason, or even when my account expires. And paying for it makes it just a little more likely they will continue to produce more of it in the future.

They are also willing to eat the fines that come with supporting merchants with more than 1% chargeback.

The reason why there aren’t many more of them isn’t morality it’s just very hard to maintain profits in this environment. Patreon will have to pay fines if they have high chargeback rates and those fines are intentionally huge so for them it’s a none-brainer they need to reduce chargeback rates and their adult content creators are likely one of the biggest offenders and even if they are not they are an easy sacrifice to the PCI gods.

It's really pretty absurd how a handful of companies who do nothing but shuffle numbers from one place to another not only charge steep fees for the service, but also manage to charge a percentage of the transaction - as if transferring a bigger number down a wire cost more! In the past there was some sense in that there were liabilities involved, but most all of that has been eliminated and only the fees remain.

The problem isn't really the law most of the time: It's how companies are hooked up to the financial system.

The Stripes and Paypals of the world aren't really connected to all the credit card networks directly: There's layers underneath, and one of them is banks that act as intermediaries. These kind of companies start with one bank (say, Wells Fargo), and might expand to more as they want to expand to other parts of the world. Eventually, they might have dozens of banking partners that are part of the transaction processing. Even though this online processors are carrying most of the fraud risk, they still have to adhere to what their baking partners will accept, and pretty much every bank out there will tell them things that they can't sponsor past what is legal, and that almost always includes pornography, drug paraphernalia, medicines and sex toys. The bank will come knocking to their door, and they'll have to say no. This is not just down to banks disliking the businesses for image reasons, but also has to do with risk: The number of stolen credit cards used in those sites, and the amount of disputes on the charges for other reasons is pretty high compared to other lines of business.

Therefore, what you need is to form all your banking relationships with entities that have no problem with you processing cards for porn sites. So you have to find banks that will deal with this companies at all, and then convince them that your fraud protection is good enough, and your pockets deep enough, to take the risk.

PayPal, Stripe and the rest are their own https://en.m.wikipedia.org/wiki/Acquiring_bank which means they can process the payment themselves.

[1] https://paymentcloudinc.com

You can go to a museum and see highly lauded art with nipples in it. But put a picture of that painting online and you're a pornographer.

It's the "custodian of record" you MAY see at the beginning of a FakeTaxi or Hospital.

You're the only other person I've seen use this phrase.

If you're serious about working on this, contact me.

I'm female. I watch porn. So does my spouse. There is no secret there. If either of us were going to a strip club for whatever reason or visited a prostitute somewhere legal, we can simply tell each other about it knowing the other won't be angry. We can openly discuss folks we are attracted to. We understand that finding others attractive is normal human behavior, and would rather not lie about it.

On the other hand, I've known plenty of women that get angry about men watching porn. I have known plenty of men that won't admit to their wife - this person they claim to trust - that they watch porn or have visited a strip club. There are others that actively protest against porn for whatever reason. In general, you find more "porn is morally wrong!" arguements in conservative environments.

That's pretty fringe...

The rest of it is pretty normal stuff (watching porn, being physically attracted to others), though it is stuff folks tend to not discuss openly.