Sunday, April 02, 2006

PlayGay ?

PLAYBOY Enterprises, the New York-listed adult publisher and broadcaster, wants to use Britain as its base to move into the gay market for the first time.
The company, which describes itself as “pro-sex” rather than pornographic, wants to launch a new gay brand as it tries to boost revenues beyond last year’s $329 million (£189 million).

Christie Hefner, the chief executive, said: “We’ve extended the Playboy brand to women, and where there is a meaningful gay market, launching under a different brand is something we are very comfortable doing.

Playboy’s plans to focus on the gay market are part of a strategy of diversification away from the company’s Playboy magazine which, despite its 3 million circulation, is only just profitable. The company has developed a more lucrative product-licensing division that targets women with clothing and accessories. It also wants to maintain growth by supplying adult mobile phone clips.

Soft-core pornography on television is its most profitable activity, although Ms Hefner prefers to describe the company’s activities as “valuing sexiness and style” and giving “entertainment for grown-ups”.

The company has been publicly listed since 1971, although Hugh Hefner, the 79-year-old founder and Christie’s father, remains in control with the help of a dual-share structure comprised of voting and non-voting stock.

Last year’s pre-tax profit was $14 million, ending several years of losses that stemmed from investment in internet expansion. The company, which is based in Chicago but has operations in New York, is worth $466 million.

Ms Hefner has run the business since 1988, 13 years after her father asked her to join the company in 1975. The 53-year-old said that she had wanted to be “a lawyer or a journalist” but “got intrigued by the business” in which you can “have big ideas, work with creative people and feel like you make a difference”.

However, the father-daughter duo have been a target of corporate governance criticism. Ms Hefner defended some of the perks enjoyed by her father, who is the chief creative officer of the business.

Mr Hefner’s Playboy Mansion, rarely open to the public, is owned by the listed company. Valued at $45 million, Mr Hefner pays a rent of $1.3 million in a house that can easily accommodate 1,000 for a party.

However, his daughter said that the “whole Playboy lifestyle is what gives the brand its value” and that the cost of the mansion “is modest compared to an advertising budget” that might otherwise be required to build the brand.

Ms Hefner, who described her father as “pretty cool”, acts as the serious face of the company in public “in different ways, at shareholder meetings”.

1 comment:

Brad said...

Makes a lot of sense. We gay folks usually have a little more discretionary income than the average family unit.