Everyone is overlooking the obvious here. Myspace.com and other free social networking sites are killing paid dating sites. It's just a matter of time before all paid dating sites lose so much of their market share, they're no longer relevant players in the dating game.

same here...

yeah but MySpace is not Adult dating site for people looking for sex partners than rather friend social network, just as FB so there is still room for adult dating sites...

Personally I will laugh my fucking ass off:1orglaugh:1orglaugh:1orglaugh

yep http://www.businessweek.com/technolo...120_688300.htm

And it's raining and 60 here today...but the snow is melting and there's water everywhere:mad:

Other than that...I'm OK:thumbsup

This was expected .. I am glad ..and it feels to me like Santa just dropped me off one quick present before heading back up north for the year .. YAAAAA

1 - fake profiles with model content they haven't paid for tricks people to sign up
2 - They allow torrent, warez and stolen member area sites to send them traffic

Well lets just hope you aren't the first one whom makes tht post.. :error



Anyway I won't have to do a thing if they go out of business because I wouldn't promote them because of their support of tubes,torrents and all the other BS that hurts my profits.

I'd say good riddance if they go under, but that's just my opinion.

And those same sites are raping there danni.com site and posting full site rips, They need to control there pirates better:1orglaugh:1orglaugh

Is this the result of mismanagement or changes in the market (ie. losing marketshare to free social network sites)? If it's the latter and AFF banners are still flying on just about ever site online, what does this say about the current and future prospects of other paid dating sites?

I don't understand how a popular dating site like that can be losing money. Their bandwidth costs are minimal, they don't produce nor buy any content. All other overhead is standard stuff - customer service, programming, maintenance. AFF just provides a forum for people to interact. How do you lose money on that? If the rumors are true that AFF is controlled by ex-Ibill execs, it would make perfect sense since they're versed at running enormously successful companies into the ground.

I'm completely spooked about 2009. It's gearing up to be a horrendous year. :(

yeah only guys look for sex on myspace

Dont care... I dont promote them.

It was the growth through acquisition model that got them in over their heads:thumbsup

I will sell all your open inventory ad space and make your money back for you :)

affiliates will leave in droves and thus making their stats drop like a rock making them look even worse than they already do.

65pps still sounds pretty good, 130 is crazy

I think Lars convinced them to blow too much money

I could not have said it better. Well put. :thumbsup

It will be a glorious day to watch AFF close their doors. From Zango to stolen content to funding ALL the illegal tube sites, allow me to be the first to say FUCK THEM, I hope they crash and burn.

Of course someone will take their place, but they will fail sooner or later as well.

I don't think they want to do an IPO in a recession, but they have to since they already default on their debt as mention in the article. In any case I don't think it matters, doing an IPO will only buy them time and they'll most likey file for bankrupt later anyway. So if they did an IPO I would very much like to short their stock.

WHOA WHOA WHOA.... did anyone actually read that article?

The unstructured debt is all a result of how Penthouse funded the various acquisition. It really doesn't say that AFF is LOSING MONEY... it says they have a cashflow issue.


Basically, Penthouse was broke, took a huuuuuuuge loan to buy various, and fucked over their investers in the process. AFF and webcams still are throwing off cash, but not enough cash to fix how poorly Penthouse is doing, and all the debt penthouse brought on to buy various.

It's like penthouse bought a home, and now they can't pay the mortguage. Sure, they still feed themselves and have money left over, but not enough to pay off the loans they took out to move in..

Looks like by selling out, lars and andrew have condemned their employees and companies to be crushed under the mighty penthouse falling on them.

Typical poor merger... what's penthouse gain synergy wise from aff? what's aff's synergy with penthouse? poor pairing, mis-matched managment, and a desperation play to even try to buy various which was too big for their britches. And if the penthouse name would have brought substantial value to AFF, then the combination would create surplus value above it's selling price. However, no surplus value was created, and there was still all kinds of debt... bla bla bla


but for real... this bankruptcy has NOTHING to do with their pre-paid placements on Tube site, or AFF's business or business practices at all. It is basically penthouse's execs fucking up on a truly royal scale.

it also sounds like penthouse violated some loan terms which caused this long-term debt to move short term.

All true... however making it sound like the tubes had something to do with it just makes it SOUND SO MUCH BETTER!

I will bid $500 on their picture scrapper to find hot girls.


:bigears


And on top of that, I never got paid for running that sig deal
when lars were around.

:ak47:

I couldn't say it better :thumbsup

what i got out of that disclosure by Penthouse is that the entities to whom Penthouse owes the majority of that 400 plus million in debt to are Lars and Andrew. And they sound like they are pissed off and not willing to negotiate to change any terms. It would seem crazy to sell their company without doing more due diligence but when somebody is offering you 500 million for a company that is nowhere near worth that kind of money it affects your judgement.

If Penthouse defaults on its loans to the previous owners I wonder what happens.

Good post.

I think the tube angle most people are talking about though is that if AFF goes down, the prepaid ads go away. Not sure if someone else can step up and pay what AFF has been paying all this time. Only time will tell I guess.

incorrect. The 400 million was already PAID to lars and andrew, hence the $400 million in debt to other people... You have to raise the money to buy it, when they bought it, lars and andrew got paid. I forget who's $400 mill it is, but it sounded like more traditional banking lenders... who are in no position to be cutting people slack right now..

lars is probably off fishin, or driving his car.

there are other buys. Sure, any decrease in demand will affect price of those spots... but enough to break backs... I dunno

Since everyone is speculating and all - what about this scenario, which has nothing to do with Penthouse or Adult Friend Finder, or the impending AFF IPO...just a made for TV financial thriller script concept I have been toying with:

Two scamming companies, up to their chins in debt due to their shenanigans, conspire to cover up their dubious business practices by having one thieving entity supposedly buy the other out for a ridiculous sum (considering the insolvency of both companies), with the intent of hoodwinking suckers into thinking the company is worthy of investment, thus bailing them both out.

I know, such an idea is truly far-fetched. Next thing you know, people will suggest that money-laundering, or perhaps some other unsavory practices may have been afoot.

It would be a shame to see the funding of sites that steal content suddenly dry up...NOT!!! :winkwink:

ADG

relax, they aren't closing shop any time soon

i think a few of them can like fling although they may not want too

you clearly can't read... maybe you can do math...


they are over 300 million short of their SHORT TERM LIABILITIES

that's 90 days or less

This is the most important post so far. Well said. :thumbsup

I would imagine who the money is owed to is important. Because it looks like the loan will not be paid, so what happens then?

AFF isn't going anywhere. At least not any time soon.

OK, so Penthouse owes a lot of money and their long term debt has become short term debt. That is all any of us know. None of us know the terms of their loans. Hell, perhaps it is in the terms of their loan that they must file for an IPO if they default. Maybe if the IPO fails, the terms get renegotiated. Seems possible. Who knows? None of us.

Do you really think this is going to kill AFF? You think that FFN will run out of money and then just delete everything and 404 their sites? LOL. Do you think that the banks are going to just let their $400MM disappear into thin air? FFN has assets. Those assets are AFF, cams.com, and Penthouse. What they hell do you think is backing those loans?

Just like a mortgage, the loan is backed by an asset. If you can't pay your mortgage, the bank takes your house and tries to recoup their money. This doesn't mean that the assets are worth the loan amount, but they certainly have some value. In fact, their S1 says that AFF made a profit to the tune of $17MM in the first 9 months. After Q4 it might be as high as $22MM.

Worst case, the note holders take over the company, hire new management, run the company themselves, and maybe eventually sell it off. We know that no one in adult can afford AFF and certainly not in this climate, so I'd plan on seeing it around for quite some time.

People seem to forget, Lars and Andrew didn't sell 100% of AFF to Penthouse, they sold a portion of the company.

funny... Penthouse was losing $$ left and right and bought iBill and tanked that. Then borrowed a crap load of $$ to buy AFF and now is tanking that.

stat on penthouse per wiki... An April 2002 New York Times article quoted Guccione as saying that Penthouse grossed $3.5 billion to $4 billion over the 30-year life of the company, with a net income of almost half a billion dollars

so guccione leaves the company in 03 and the company runs itself into debt and into forseeable BK.

With the turmoil in the markets and credit markets, there is "NO" way this IPO gets done. Auditors and SOXS auditors would have a field day going through the books.

let AFF burn..

Banks running a porn company, makes that script idea by ADG even juicier. :1orglaugh

My take on this whole thing is that it proves traffic is not king, selling the traffic something is. And what ever you're selling it had better be worth the price and worth buying again if you want to stay in business. Selling somebody a faulty, low value and poor product makes them reluctant to buy again. No matter how many people you send to see that product.

WTF are you talking about? They are selling plenty. Last time I checked, AFF had nearly 1MM users paying $19 a month, which equates to roughly $180MM in the first 9 months, with operating income of $17MM (dragged down by Penthouse's losses.) That interest and other expenses stems from Penthouse and most likely from that $414MM of debt. If Andrew and Lars didn't sell, guess how much of that $414MM of debt they would have.

Also, you can talk all you want about selling customers good products, but guess what. These are adult websites. This isn't Comcast or Sprint. It's a monthly, subscription based, adult website. Could you maybe give me a list of other adult entities that net $20-30MM a year?

You, and many others, need to start reading. If you did, you'd see that all those numbers don't include solely AFF.

Why don't they triple it? Looks like they won't have to pay out anyways... :pimp

Where did you learn your business skills?

It's not just about how much you're selling, it's what the profits are after the sales that's important.

OK Penthouse funded the acquisition by taking out a loan, it happens in the business world. The idea is to take the company, then the profits from the company will repay the initial loan, usually increased profits. This did not happen so all the sales were not enough, or cost too much or the guys at the top skimmed off the profits. What ever is the reason it did not work.

So a top site selling a less than good product is good for you because this is porn. About as fucked up a theory as I've heard. Unless you can totally lock the customer into buying you will lose him with that approach.

Look around you and see what happens in the real world. Sponsors spending more and more on traffic to get less and less on sales. Because the buyer is a repeat buyer and he's not taking it any more.

And if you seriously think a free Tube site should be an alternative to a paysite you're screwed. If we can't give the customer more for his $30 than what a Tube site gives him we are in the wrong. And if the customer only needs something that costs 2 cents to satisfy him, why are you charging him $30 in the first place?