GameLink LLC is an adult entertainment company and e-commerce business that is headquartered in San Francisco, California and was founded in 1993. The company provides streaming video on demand (VOD) for adult films and media, and also sells adult products such as lingerie, costumes, and toys through its e-commerce portal.
As one of the first online adult stores, GameLink has signed distribution agreements with all major U.S. adult content providers, giving it one of the largest video libraries. Content is available in formats including VOD, pay-per-minute, mobile, PC download, DVD, and Blu-ray.
Ilan Bunimovitz serves as GameLink’s founder, president, and chief executive officer. GameLink’s primary competitors include other adult VOD websites such as AEBN, FyreTV, and Adult Empire. It is currently a subsidiary of Mama’s LLC.
How Big is the Adult Entertainment Business?
Despite being marginalized in broader society, the adult entertainment industry is a sizable business worth billions of dollars. However, this stigma also makes it difficult to estimate the adult industry’s annual revenue.
According to Dan Miller, managing editor of the adult video industry trade magazine AVN: “The safe estimate is to say it’s worth billions, but I don’t know exactly how many billion, and no one does.”
Privacy concerns and widespread piracy are just two issues that complicate the matter. In addition, some analysts include peripheral industries such as webcam models and strip clubs in their estimates, while others limit themselves only to professional media and entertainment companies.
Columbia journalism professor David Klatell once said that adult entertainment is “an industry where they exaggerate the size of everything,” including their revenues. Estimates about the size of the adult entertainment business have ranged from $4 billion on the low end, to an eye-popping $97 billion globally.
Is Adult Entertainment A Good Investment?
In August 2018, HBO quietly exited the adult entertainment industry by removing all of its adult movies and TV shows from its content library, including long-running series such as “Real Sex” and “Taxicab Confessions.” This decision was reportedly made two months earlier in June, when HBO joined the AT&T [NYSE: T] family as part of the Time Warner deal.
According to an HBO representative, this move was in part due to a decline in viewership: “Over the past several years HBO has been winding down its late-night adult fare. While we’re greatly ramping up our other original program offerings, there hasn’t been a strong demand for this kind of adult programming, perhaps because it’s easily available elsewhere.”
By “elsewhere,” the representative almost surely means the Internet, which has made adult content within reach for anyone with a Wi-Fi connection. In 2016, pornographic video website Pornhub revealed that its content was watched 92 billion times in that year alone, with 64 million daily visitors.
Nevertheless, adult entertainment remains a controversial industry for many businesses and countries. For example, the United Kingdom’s “porn law,” which is scheduled to come into effect in July 2019, will block users from accessing adult pictures, videos, and text unless they can verify their age through a third-party service.
Blogging and social networking website Tumblr made headlines in December 2018 when it announced it would ban all adult content, causing the site to lose 30 percent of its web traffic.
One major expected future development for adult entertainment is virtual and augmented reality. VR and AR have yet to make a big splash in the wider consumer market, besides applications such as video games and mobile apps like Pokemon GO.
Facebook [NASDAQ: FB] bought Oculus Rift because of its expectations for VR to mushroom in popularity in coming years.
However, companies such as Naughty America and BaDoink, among others, are currently working on producing VR and AR adult experiences. Investment bank Piper Jaffray [NYSE: PJC] has projected that adult VR content will become a $1 billion dollar industry by 2025.
Acknowledging this growing trend, GameLink launched what it claims to be the first aggregation website for adult VR content, GameLink VR, in 2016. The company’s ability to respond to trends such as VR/AR bodes well for its future in the adult Internet marketplace.
Perhaps it’s no surprise: over the years since it was founded, GameLink claims to have been among the first adult entertainment websites to provide once cutting-edge features such as online video sales, real-time order tracking, and streaming video.
How Does GameLink Make Money?
GameLink primarily generates revenue via two methods: its adult VOD content, and its e-commerce store for adult clothing and novelty items. The company operates a partner network with affiliate marketing programs for both direct traffic and white-label video stores.
Like the adult industry itself, GameLink has remained tight-lipped about its annual revenues or the profitability of its different products and services.
As a privately held company, this will likely remain the case into the foreseeable future.
GameLink: The Bottom Line
GameLink is an interesting case study of a successful adult entertainment company that has continued to innovate over the years in order to remain relevant in the industry.
While investors can’t put their money into GameLink, other adult entertainment companies are publicly traded, such as RCI Hospitality Holdings [NASDAQ: RCI] (formerly Rick’s Cabaret) and many of them represent interesting investment opportunities.