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Danni's hard drive to adult content success
(CNN) -- Sometimes it seems like you can't get away from sex on the Internet -- from incessant spam to creepy pop-up windows. It's no wonder an estimated 37 percent of Web surfers find their way to adult sites.
"There was a time early on in the days of Danni's Hard Drive that we were within the top 10 Web sites in the world," said Danni Ashe, president and founder of Danni's Hard Drive.
One of the best-known adult sites on the Internet, Danni's Hard Drive made $5.2 million last year and expects to exceed $6 million this year, according to Ashe.
Ashe discovered there was money to be made while she was poking around the newsgroups and bulletin boards of an Internet in its infancy back in 1995.
"I picked up some software and some books and got online," said Ashe, "and there were all these Danni Ashe pictures all over the newsgroup. I started striking up conversations with people, saying, 'Hey, you know, hi, I'm Danni. Where'd you get that picture?'"
Frustrated with her career as a featured strip club dancer, the computer geek in Ashe took over and she seized her opportunity.
"I picked up the 'HTML Manual of Style,' and for inspiration I picked up Negroponte's 'Being Digital,' got on a plane, flew to the Bahamas and sat on a beach and read these books," Ashe said. "And a week later, came home and started building the Web site myself."
Ashe invested $8,000 into computer equipment and Danni's Hard Drive was launched. For the first year, she programmed the site herself.
After five successful years, Danni's Hard Drive is largely free of advertising, unlike most adult-oriented sites on the Web. Nearly all of the company's revenue comes from subscriptions.
Why are people willing to pay $19.95 per month to belong to Danni's Hard Drive when they're used to getting things for free on the Internet?
"There's an awful lot of content available for free on the Internet. You can find virtually anything out there for free. I think people are interested in subscribing to my site because it's a real environment. It's all just a really fun, organized experience that's all laid out for you. People are willing to pay for that," Ashe said.
And it may be that Ashe is on to something. The music industry is considering a subscription model similar to the one used by Ashe to alleviate some of its copyright issues with online sites like Napster and MP3.com.
Using subscriptions is only one way adult sites have been innovators on the Internet. One-click ordering and Avatar guides also got their start in the adult-content world, according to David Card, a senior analyst at Jupiter Research.
"They're early adopters and they're willing to experiment," Card said. "The adult content market historically has always been a leader in new media. It's sort of a joke that's probably true that the first thing that was printed on the Guttenberg press after the Bible was probably dirty limericks or something like that. And adult content in the video space helped jump start the video rental business."
Card estimates that online adult content generates about $300 million annually in the United States. In an atmosphere where many dot-coms are struggling and online magazines are folding, adult entertainment has managed to maintain a loyal following that's willing to pay for its services.
One essential tool to Danni Ashe's success is the million-dollar, all-digital studio she recently built at the Los Angeles home base of Danni's Hard Drive. In a state-of-the art control room, a director uses multiple cameras to record the action in five separate studios. Some of the photo shoots and filmed performances are installed and archived on the Web site.
At Ashe's studio, a chat operator moderates a discussion between online patrons and two strippers who are performing a live simulcast. The live performances and talk shows that occur at least weekly on Danni's Hard Drive may be the most popular features because they offer something traditional adult entertainment cannot.
"The thing you can do online that you can't do in the physical world is interactivity and two-way conversation," Card said.
Technologically, adult sites on the Web are leading the way in several areas. Ashe and her team have developed their own streaming technology called DanniVision. It eliminates the need for downloading RealPlayer or any other plug-in. With one click, it streams through a user's Internet browser. "We try to make the experience as easy for possible for people," says Ashe.
In addition to running the show behind the scenes with her husband Bert, Ashe is also the star.
"It's very schizophrenic for her," said Bert. "But you know, trust me, she loves it. She complains a lot, but she loves both sides of those businesses."
And it's a good thing she does, considering she's the only woman ever to have graced the covers of both The Wall Street Journal and Juggs magazine.
Conservative elements are advocating that Internet pornography be regulated -- a dirty word to adult content providers. While Ashe favors certain parental filtering software, her views on Internet regulation are simple.
"Anyone who believes that we can take the entire Internet and water it down so that it's good for only children is kidding themselves," Ashe said.
Like all other adult-oriented sites, Danni's Hard Drive is privately held. But it's not the fear of possible government regulation that keeps investors away from these often profitable sites.
"There's a definite perception that people would be unwilling to invest or are nervous about that," Card said. "Although, frankly, if people invest in tobacco companies, then I don't know. Not my place to be a moral judge."
Ashe said she has no plans for an initial public offering - she's too busy running the business, and ensuring that she keeps her place in the Guinness Book of World Records as the most downloaded woman on the Web.
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