Shifting Gears

Change has been a constant at Playboy TV in its first quarter-century. And as the network and its parent company seek to emerge from some trying times, executives continue to embrace new ideas and technologies with an open mind.

Much of the current programming lineup — which includes titles such as Hot Babes Doing Stuff Naked, Naked Happy Girls: San Francisco and Around the World in 80 Babes — reflects efforts to keep pace with different viewing tastes and habits, from short-form programming aimed at the YouTube generation to an emphasis on storytelling.

“What Playboy TV and all television will be like in five to 10 years will be dramatically different because the alternative ways to deliver video content is staggering,” said Playboy Enterprises president of media Bob Meyers.

Meyer points to Netflix's planned set-top box to deliver movies directly to consumers' homes as a path that Playboy itself could explore. “It changes the game immediately and could be a disruption to the current business model,” he said. “The challenge is figuring out how to stay front and center for consumers. We have a lot of work to do, market by market and medium by medium.”

While the company's licensing and international arms have been flourishing, much of the news has been less then flattering. Despite landing some important on-demand carriage deals in 2006, a difficult year led to the loss of jobs for several top executives at Playboy Entertainment Group and the downgrading of Playboy Enterprises stock by several investment bankers.

In the fourth quarter of 2007, domestic TV revenue fell 10% — offset largely by a 9% growth in international TV revenue. In the first quarter of 2008, revenue was again down compared to the same quarter last year, this time by 16%. And even though monthly subscription revenue was up, there was a drop in pay-per-view as more viewers switched from linear networks to on-demand. International revenue also rose 6% during the period.

While Playboy TV was slow to jump on the subscription video-on-demand bandwagon — mostly because operators keep more money than they do in Playboy's PPV deals — adult-entertainment competitors such as Hustler have gained traction in SVOD.

CEO Christie Hefner, in a publice statement, acknowledged that the publishing and domestic entertainment sides of the company “face unprecedented change in the way consumers access and use media content,” but the company is determined to plunge forward into SVOD.

Gary Rosenson , senior vice president of sales and affiliate marketing for Playboy Media Group, said Playboy TV and operators understand the importance of SVOD and that a network with a strong, easily identifiable brand will fare well in that universe. “I think you'll see us start pushing forward now,” he said.

Playboy TV offers its SVOD in a package with its linear channel. It does not debut new programming on SVOD, as the network still focuses on marketing shows and building awareness first through its linear channel — an approach more similar to HBO On Demand than other adult channels. The depth and range of programming is also more aligned with a typical premium channel than that of an adult movie channel. The results are turning positive, Schwartz said. “We're starting to see nice growth.”

Meanwhile, Playboy TV's international outlets take chances in other ways, allowing the company to test drive new concepts — in Latin America, LifeStyle TV, an ad-supported basic-cable network that focuses on celebrities and nightlife, is the company's first non-erotic channel. If successful, the company would consider a U.S. version.

Rosenson said cable operators are becoming more willing to market the network, which, for all its sexual content, remains much tamer than most other adult outlets. “They are much more open to getting the channel out there in the forefront,” he said.

One reason is that the Internet has created more competition in terms of adult-targeted content and has helped shift boundaries for what is considered taboo or acceptable. “Now our partners are a lot more bold and aggressive,” Rosenson said. “There's more cross-channel marketing and online too. There is an understanding that it's a competitive world out there for the entertainment dollar.”

Playboy's ambitious marketing of itself as a brand in licensing agreements has also helped, not just because the merchandise makes Playboy TV seem hip to a new generation but because, according to Rosenson, it has reinforced for MSOs the brand's mainstream appeal. Now being able to use the Playboy Mansion in some form of marketing or sweepstakes is seen as cool, not risqué.

Meanwhile, Rosenson and Schwartz say new technology has helped Playboy sharpen its programming focus. Measuring audience response to specific on-demand purchases, for example, is much easier than gauging response to four-to-six-hour blocks of pay-per-view programming. Case in point: the show Foursome, in which four singles share a 24-hour blind date. “We knew from the response of the first season it was really clear so we ordered more episodes,” Schwartz said. The new season just launched this month.

Foursome fits in with the network's effort to track successful trends on other more traditional cable networks — in this case, reality programming. “It's important because it makes us relevant in people's lives, but we also provide a sexier aspect the other shows don't,” Schwartz said.

One forthcoming show, The Search for the Perfect Girlfriend, will also raise the bar in terms of viewer interaction. Playboy TV is asking viewers to suggest their girlfriend (or for women to nominate themselves) for the show — the chosen ones will be profiled on camera and given a Playmate test shoot.

Boy Nexxt Door is a documentary series about Danny Vegas, an aspiring porn filmmaker who lives at home and shoots the films on the sly in his parents' basement. “It's funny and has tension and the maverick spirit that fits our brand, but there's also a good level of sexy content,” said Schwartz. “We'll be producing more of this type of show where you'll see the intersection of story and the sexy side of life.”

The programmer is also trying to blend eroticism with information in shows such as 69 Sexy Things 2 Do Before You Die. Essentially a travelogue — with nudity — the show takes viewers on adventures such as nude scuba diving in Key Largo. “These are events and destinations that you can really experience if you want,” Schwarz said.

For Playboy TV to stay fresh and continue attracting audiences, it needs to push the boundaries of what is expected even further, according to Bryan Postlethwait, senior vice president of programming for Playboy Media Group. “We get a lot of very conventional pitches like cooking shows with naked girls, but we challenge producers to think about the hipness of the brand, about sexuality and this lifestyle and the openness of thought and not just the base assumptions,” he said.

To keep the network moving in the right direction, Schwartz said it has to become more ambitious about who they hire. “In the past year we've reached out to a much larger pool of producers, especially people from other premium and cable networks,” he said. “At first, they say, “Really? We can do something for you guys? But then when we tell them what we want, they get very excited.”