Despite a reputation as the most profitable of businesses, life is not all beautiful women, hot tubs, and a constant stream of money for porn kings these days. In a tell-tale sign of financial stress, Vivid Entertainment Group -- one of the largest pornography shops -- is suing a Web site called PornoTube and its parent company for copyright infringement.

Vivid is asking for $4.5 million in damages and an injunction against Adult Entertainment Broadcast Network from continuing to operate PornoTube. The amount is based on the statutory maximum of $150,000 per copyright infringement.

"PornoTube and AEBN have exactly the same responsibility as any other adult content distributor or producer to obey U.S. copyright laws," said Steven Hirsch, cochairman of Vivid. "We've decided to take a stand and say 'no more,'" Hirsch added. "We will go after all the free sites."

Porn 2.0 vs. Traditional Media

Vivid is something of a poster child for the pressures the traditional industry is suffering at the hands of Porn 2.0 -- the numerous sites modeled on Google's YouTube that allow users to upload their own video content. While much of the content on those sites consists of illegally copied content, users are uploading their own amateur videos. As the trend continues, viewers are finding fewer reasons to pay for porn.

Three years ago, 80 percent of Vivid's income came from DVD sales; today, it's about 30 percent. In a profile for Conde Nast Portfolio magazine, Hirsch told writer Claire Hoffman that he expects DVD sales to hit zero within five years. In 2007, DVD sales dropped 35 percent, he said.

With those trend lines, porn producers such as Vivid are betting on Internet sales to make up the difference. But that's going to be hard if users of sites like PornoTube are just going to copy their content and give it away.

Federal Law May Protect Sites

PornoTube is just one of three major Porn 2.0 sites that threatens the mainstream porn business, so more lawsuits may be coming. YouPorn is the biggest adult site on the Web, ranked No. 1 by Alexa and logging about 15 million unique visitors per month.

The suit mirrors the $1 billion lawsuit filed by Viacom against Google for less racy infringements on YouTube. Google's and AEBN's defenses would be the same: The 1998 Digital Millennium Copyright Act, which gives Web sites immunity from lawsuits that are based on user-created copyright infringement. The law largely puts the burden on copyright owners to notify sites of infringing material; sites must comply with these "take-down notices."

Eric Goldman, director of Santa Clara University's High-Tech Law Institute, pointed out that the DMCA is unsettled. "We have no more clarity here than we had with the Viacom lawsuit; the issues are identical," Goldman said. He explained that there are two ways to interpret the DMCA's Safe Harbors provisions: Either DMCA provides full immunity from all copyright infringement claims or it provides only immunity from direct infringement claims but not contributory or vicarious liability claims.

"If it's the first interpretation, YouTube and all the dash-tubes are safe," he said. "If it's the second, the Safe Harbors provisions are worthless." While the statute is too "poorly drafted" for a clear understanding, Goldman said, the legislative history contains "very clear language" that Congress intended the latter interpretation.