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Playboy's profits are falling

By Editorial Staff
Published January 1, 1989

CHICAGO, IL (FR) – Playboy Enterprises, apparently bending to pressure from anti-pornography activists, is taking another obvious step to change its corporate image. After several years of declining magazine sales, and the 1988 closing of all of its Playboy Clubs, the company’s video department is now reporting huge losses in cable subscribers.

When the “Playboy Channel” began several years ago – offering a mixture of pornographic movies and documentaries – the format was touted as the future of Playboy. But sources record that the video format has been a money loser from the beginning. The number of cable subscribers has dropped more than 30 percent to about 400,000 from a peak of 743,000 in 1984.

This has prompted corporate president Christie Hefner to take a second look at the Playboy image itself and how it should be portrayed to the public. Plans are now underway to change the television programming from edited X-rated films to more mainstream R-rated films, and to rename the channel because of viewer and operator opposition to the Playboy image.

The new channel, according to Hefner, will still carry some of the Playboy Video Centerfold and sex-oriented talk shows, but it will be called “Night Life” and will be co-sponsored by another company. “If we can make it happen, it has the most significant profit upside in the next three years of anything we’re working on right now,” said Hefner.

Playboy publicity spokesperson Terry Tomcison, speaking from her office in Chicago, confirmed that the company is seeking to appeal to a “broader audience.” She also added that co-sponsors for the new format have not been found at this point, and that the company has “nothing new to announce” about its plans until the new format is fully funded.

Cable operators around the U.S. apparently plan to continue avoiding the Playboy Channel. Lynn Skinner, customer service director for Cox Cable in Oklahoma City, reports that her company dropped the channel in 1985. “We look at what the viewer wants,” said Skinner, “and we had too many religious people calling in to complain about it.” Skinner also related that, after the channel was dropped, no one ever called in to say that they wanted the Playboy Channel reinstated in the programming selection.

Rich Gilman, director of studio operations for Heritage Cablevision in Des Moines, Iowa, said that his 1985 decision to drop Playboy was strictly a “business decision. We can only offer four pay channels, and the ones we offer reach a higher subscriber level than Playboy did.” Gilman stated that subscribers to the Playboy Channel tended to subscribe for a few months and then drop the service, whereas subscribers to other services like H.B.O. and Cinemax are usually long-term customers.

When asked whether Heritage Cablevision might reconsider its decision if Playboy changes its format, Gilman said, “We have no interest in carrying another pay service. It was not a good business decision.”


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