PHOENIX, AZ – A panel of industry experts took center stage at the Phoenix Forum on Friday afternoon to discuss the state of the industry. Topics included trends in billing, and a somewhat surprising discussion of industry ethics. Speakers included Morgan Sommer from CyberSocket, Mitch Farber from NetBilling, Tony Morgan from National Net, Clay Andrews from Epoch, Alec Helmy from XBIZ, and Ron Cadwell from CCBill.The Phoenix Forum, an annual conference of adult internet professionals, is taking place this year at the Mission Palms Hotel in Phoenix, Arizona.

Trends in adult website billing dominated the first half of the seminar.

According to Andrews, the last year has been remarkably stable for the adult website billing industry as a whole.

“The biggest change is that there hasn’t been that much change,” said Andrews. He added that threats to billing models are “becoming less and less of a concern on a daily basis.”

Cadwell agreed, commenting that Visa and MasterCard have been remarkably quiet recently.

“This is the first time I can remember since ’96 that they didn’t do any change,” remarked Cadwell.

“There are no rule changes, which is phenomenal,” agreed Farber.

Sommer however pointed out that there was one piece of recent bad news that other panelists weren’t mentioning.

“There is a really, really big change that happened this year,” said Sommer, alluding to the recent demise of third party processor iBill. Without mentioning iBill by name, Sommer pointed out that a number of adult companies lost a lot of business when iBill went under, leading to tough times for the companies who are trying to recover.

Sommer pointed out that only two major billing companies currently remain.

“Some people are concerned that something could happen to the two remaining biggest players,” said Sommer, referring to Epoch and CCBill.

“Whenever a processor goes out of business, especially one the size of iBill, there’s always going to be fallout,” conceded Andrews. But in terms of future problems with the two remaining billing giants, “I don’t see anything on the horizon,” he added.

Farber pointed out the problem of not having a backup plan.

“It’s really good to have alternatives in place,” advised Farber.

He also argued that some of the information posted on webmaster chat boards like GoFuckYourself.com can be misleading.

“Do your homework,” said Farber. “Take what’s posted on the boards seriously, but look at all aspects of the post.”

Farber then added that good business can reduce instances of “friendly fraud,” meaning chargebacks initiated by customers who actually did buy and receive what they requested.

“We have to provide good customer service,” advised Farber. “Nothing pisses off a surfer more than when the inside of [the site] doesn’t provide what the outside promised.”

Andrews then stated that despite rumors that are circulated on chat boards, often initiated by seemingly strange statistical anomalies, the top billing companies don’t often change their fraud scrubbing methods.

Morgan then joked that a lack of industry focus on hosting is good news for hosting providers.

“As long as you’re not talking about us, everything is good,” joked Morgan. He said that trends in hosting have been lower costs but an increase in bandwidth demand brought on partially by broadband penetration and the continuing emergence of video content.

Asked about the effect of the Patriot Act, Sommer said that there has been a mental impact for gay entertainment providers.

“”It’s just made us slightly more paranoid, is all,” said Sommer. “We know we’re already on their hit list because we’re gay.”

In terms of content, Cadwell argued that video is the only real future for the adult internet. Farber agreed.

“Video on Demand is getting really big,” observed Farber. “You should really take advantage of that for your sites.”

Sommer disagreed with sentiments often expressed by billing companies that European and international traffic is a potential goldmine for American webmasters.

“A lot of webmasters don’t really have a product that Europeans want to see,” argued Sommer. He added that he didn’t see dialers having a big impact on the average webmaster’s business.

The topic then turned to the image of the adult entertainment industry and how it might be protected.

“The industry as a whole, in my opinion, has gone through many positive changes,” said Helmy, starting a speech he had prepared for the seminar. “Industry organizations such as ASACP and the Free Speech Coalition have [setup] certain guidelines for the industry.”

Helmy then discussed websites with content that seems to degrade or abuse women.

“I am pretty concerned about this trend towards more and more hardcore content,” explained Helmy.”

Helmy wouldn’t name any names, but said he was referring to the type of content where “you know for a fact that the model in front of the camera is being mistreated.” He added: “Mistreatment of talent is not professional.”

Andrews then told the audience that his credit card processing company, Epoch, has forced certain webmasters to remove content that Epoch representatives found objectionable.

But who decides what’s objectionable?

“If a legal entity says there’s something wrong with the content then there’s probably something wrong with the content,” said Andrews.

Morgan seemed to take some objection to the tone of the discussion.

“When you start trying to draw a line, everything gets really grey,” said Morgan. He said that opinions about what is ethical and what is not ethical are relative and companies concerned with ethics should just try to separate themselves from the people who are behaving badly. “There’s always going to be those bad apples,” he said.

“There’s a lot of diversity in this country,” agreed Sommer. “Congress is not one mind or one person.”

He added that many of the opponents of porn are unreasonable.

“They’re not rational, they’re not even reasonable,” said Sommer.

Michelle Freridge, the new Executive Director of the Free Speech Coalition, then stood up from the audience to suggest that Congress ought to be spending its time going after real crimes and not trying to censor what adults can see and hear. She said that there is a kind of “hysteria” in Congress over adult entertainment.

The conversation took one more turn, this time to the subject of “shaving” and whether some affiliate programs don’t report all of an affiliate’s sales to the affiliate.

“I wouldn’t want the industry as a whole to think that [shaving] is that widespread because I don’t think it is,” said Sommer.

Morgan added that the best way to guard against shaving is to keep an eye on how much a sponsor is paying in the end.

“Watch the checks,” said Morgan.