Penthouse Buys Adult-themed Social Net Various Inc. For $500 Million
By David Kaplan - Wed 12 Dec 2007 12:46 AM PST
Update: it has been announced officially.
Penthouse Media Group has acquired adult-oriented social network operator Various Inc. for $500 million, NYT (FRB: 066570) reports. Various runs more than 25 social net sites under its flagship site,FriendFinder.com
While porn remains one of the most lucrative areas of online media, more traditional companies like Penthouse and Playboy (NYSE: PLA) have been struggling to catch up on the digital side. Playboy CEO Christie Hefner boasted of 50 percent gains in digital revenue earlier this month at the UBS Global Media & Communications Conference, thanks in part to the launch of its social net PlayboyU.com this past year. She cited the investment in a community site as a way to extend Playboy’s brand.
Penthouse CEO Marc Bell also points to brand building among 18- to 34-year-old men as the impetus behind the purchase. Palo Alto-based Various brings Penthouse an existing membership base of more than 260 million users, with roughly 1.2 million paid subscribers. The combination would bring in an estimated $340 million in revenue this year.
In addition to its porn-related social nets, Various also has sites that aren’t centered around sex, including Italianfriendfinder.com, gradfinder.com and a faith-based community site called bigchurch.com. At least for now, Penthouse expects to absorb all of Various’s holdings.
-- WaPo: Apart from the acquisition, Various has settled charges brought by the U.S. Federal Trade Commission related to adware. While the suit specifically named its AdultFriendFinder.com site, Various’s agreement with the FTC, which includes a promise to clean up its marketing tactics and use of pop-up ads, cover all of its properties. Since this was its first violation, the company is not subject to fines, according to FTC rules.
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