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Michael Cook
Michael Cook is the editor of MercatorNet. He lives in Sydney, Australia.
Pornography is not an industry that springs to mind as an ethical investment. But it is for a new Canadian firm called Ethical Capital Partners.
In its first acquisition, it has purchased MindGeek, the Canadian owner of PornHub, one of the world’s biggest adult sites. According to similarweb.com, PornHub is the 12th most visited site on the internet – it has more visitors than amazon.com! ECP says that there are 130 million daily visitors to Pornhub’s three million videos.
Plus, MindGeek owns “adult entertainment” sites like YouPorn, Redtube, Brazzers, Men.com, Sean Cody, Trans Angels and Nutaku.
Like YouTube, PornHub’s content is created by users. It has been targetted by anti-pornography and anti-trafficking campaigners, who claim that it profits from raunchy uploads of sex with violence, sex with minors and sex without consent.
Last year a $500 million class action lawsuit was launched against MindGeek by an Ontario woman, Christine Wing, who claimed that three intimate videos appeared on PornHub without her knowledge or consent. “It is astonishing how little safeguards PornHub had against harm,” said Darryl Singer, of Diamond and Diamond Lawyers. “We’re talking about a business built on under-age, non-consensual and pirated content.”
Mastercard and Visa cut PornHub off in 2021 after New York Times columnist Nicholas Kristoff published a blistering exposé. MindGeek’s executives have been interrogated by committees of the Canadian Parliament. Laila Micklewait, head of the Justice Defense Fund, has led an international campaign against MindGeek. She claims that the site is infested with videos of trafficked women and child sexual abuse. “PornHub is not a sex site; it’s a crime scene,” she says.
In short, MindGeek has shiploads of what investors term “reputational risk”.
But the motto of Ethical Capital Partners is “Where others see complexity, we see opportunity.” It believes that it will be able to cut through the thickets of regulatory, reputational and ethical risk to profit from ethical pornography.
A spokesperson for ECP, Sarah Bain, told MercatorNet via email that “the MindGeek team and all MindGeek platforms operate with trust and safety at the forefront of everything they do”.
ECP’s view of PornHub is so different from that of PornHub’s critics that they might exist in parallel universes. Where Mickelwait sees a crime scene, Bain sees “a dynamic tech brand that is built upon a foundation of trust, safety and compliance”. Or, as ECP’s press release describes its corporate mission: the company will be “Unlocking shareholder value through state-of-the-art tech and IP investments”.
The P*rnhub\MindGeek Criminal Enterprise was just bought by a shell company run by a criminal defense attorney. How appropriate.
— Laila Mickelwait (@LailaMickelwait) March 18, 2023
P.S. Reliable insiders are saying the “old owners” are still involved, they just moved deep into the background.
Lipstick on a pig. Shut it down.
From a business point of view, ECP’s battle to turn PornHub from a reeking cesspit of abuse, misogyny, exploitation and lust into a “ethical” enterprise is a fight worth fighting. According to the Financial Times, “Its most recently published figures show revenues in 2018 reached $460m while profit margins have at times neared 50 per cent”. The risks are high, but the rewards will be immense.
So critics of pornography should be prepared for a barrage of porn-positive publicity from the company as it seeks to scrub the dirt off PornHub’s brand. Solomon Friedman, co-founding partner of ECP, told the Financial Times that “lawsuits as well as criticism of MindGeek stemmed from a misunderstanding of how the company is now safeguarding its content”. (Misunderstanding? Perhaps that is an example of what Laila Mickelwait means by “lipstick on a pig”.)
Curiously, the most powerful arguments on both sides of the debate at the moment tiptoe around the inherent dignity of human sexuality. Instead, they both rely on autonomy. Campaigners like Mickelwait highlight lack of consent when women (and men) are exploited and trafficked. Supporters of pornography highlight the free consent given by stigmatised sex workers. For better or worse, no one is talking about morality.
Could this be a mistake? What if ECP convinces regulators that lack of consent is no longer a problem? The air might go out of the anti-pornography tyres.
Perhaps anticipating this, a charm offensive seems to be under way. The theme of the Netflix documentary Money Shot: The PornHub Story (reviewed in MercatorNet today) seems to be that online sex workers are just ordinary, honest, hard-working folks – “creative entrepreneurs and heroes of consenting sensuality”, as one film critic put it.
A few days after ECP announced that it had bought MindGeek, Bloomberg published an article based on interviews with sex workers: “content creators warn of financial discrimination and danger to free speech”. This is a succinct summary of the porn industry’s defensive strategy. And to give its public relations some academic heft, ECP has recruited Val Webber, an expert on online pornography platforms with years of experience in the sex industry, for its advisory board.
A recent article in the Florida Law Review suggests that the “new pornography wars” are essentially resurrecting feminist and Christian objections against immorality. “Trafficking statutes, if mobilized too broadly, can have harmful implications for civil liberties, internet freedom and sexual expression,” writes the author.
These are arguments which have traction with many people.
Furthermore, the increasing sophistication of deep fakes and AI means that pornographers might not need humans any more to create their products.
In fact, an industry insider told the New York Post that this might explain ECP’s acquisition of MindGeek and its industry-leading technology. “Every major piece of technological change is mastered by porn first: from VHS tapes to DVDs to internet video – all became popularized because of porn. And now the same thing is happening with generative AI and deep fakes — buying [MindGeek] is a great way to get into this business before most porn is computer generated and dramatically reducing the costs of content creation.”
It’s easy to mock the purchase of one of the world’s largest porn companies by Ethical Capital Partners as sleazy hypocrisy. “Irony is dead,” quipped journalists. But that’s not enough. Unless we present appealing and intellectually coherent arguments to support family friendly sexual morality, the pornographers may have a good chance of winning the public relations battle.
