Patrick Trueman barely flinched when he first read an April 11 Los Angeles Times story about Yahoo's decision to expand its adult-video store. As legal counsel to the right-wing American Family Association and as a former child-porn prosecutor in the Reagan and Bush Justice Departments, Trueman had grown accustomed to watching big business cozy up to porn. He figured that the AFA should simply do what it often did when confronted with yet another case of corporate smut: Send out a press release denouncing the company and calling for a boycott.
But then he checked with a few sources at online filtering companies, who told him that Yahoo wasn't just selling videos, it was also hosting porn on its servers.
"They told me where to go," Trueman says. "I checked out the Yahoo Clubs section" -- home of several thousand electronic user-generated personal ads -- "and found the same kind of stuff we used to prosecute when I was at the Justice Department. I was amazed at how much was there. Searching under key words like 'Lolita' or 'preteen,' you could find a number of obscene images, many of children in sexually explicit poses."
Trueman immediately switched into high gear. He made sure that the AFA press release hit the wires before 2 p.m. -- in time for newspaper reporters to grab quotes before their daily deadline -- and typed out a quick letter to Attorney General John Ashcroft. The 200-word note cut to the quick. It urged Ashcroft to personally "investigate and prosecute Yahoo for its direct involvement in the sale and distribution of obscene material and child pornography," adding that Yahoo "must not be allowed to flaunt [sic] federal law" because other major companies would follow its lead.
Immediately, the letter and press release thrust Trueman into an already-forming media maelstrom. He became the spokesman of the anti-porn movement, spending the next day and a half railing at Yahoo in interviews with the Associated Press, television networks, National Public Radio and other outlets.
Then, on April 13, Yahoo bowed to the criticism. The 3,500-employee company cut off access to certain personals in its Clubs section -- and searches for "preteen" and "Lolita" now come up blank. Yahoo didn't just remove allegedly illegal kiddie porn. The portal also stopped accepting adult banner ads and closed its adult store, effectively removing every legal adult-related entertainment product that it had been selling for the past two years without complaint.
Yahoo argues that the retreat makes perfect sense. Users demanded prudishness and Yahoo simply complied. "About 100,00 people e-mailed us," says Jackson Holtz, a company spokesman. "We decided to value our readers and take a leadership position based on their feedback."
But the move can't be explained so easily. Yahoo has 192 million registered users and while Holtz refused to say how many customers complain about non-porn issues in a given two-day period, it's hard to believe that 100,000 e-mails represent a massive groundswell. Plus, Yahoo has stood up to criticism before. When a French anti-racism group sued in April 2000, demanding that the portal stop selling Nazi memorabilia in its auctions, Yahoo fought back with all the legal guns it had. Even now, after banning the items, Yahoo is still fighting to overturn a French court's decision that bars the company from selling hate-related products.
It's not as if the AFA is a powerhouse of influence, either. Though the Tupelo, Miss., nonprofit has won a handful of battles over the course of its 25-year history -- it led the campaign to keep 7-Elevens from selling Playboy in the '80s -- its demands have typically gone unanswered. A high-profile attempt to put Internet filters in Michigan libraries failed last year, while this year, the AFA has tried to turn Fox from "Temptation Island" and Showtime from "Queer as Folk," and it even tried to keep 7UP from running a commercial that depicts a nudist colony -- all to no avail.
So, what gives? Other portals, such as Excite, offer adult videos and have no plans to stop. Why did Yahoo reverse its course? Did the company react because it feared its users or, rather, because it feared the wrath of Wall Street and the law?
And what do Yahoo's entry and exit mean for the future of online pornography? As Trueman and other so-called decency crusaders meet this week with Attorney General Ashcroft to urge prosecution of companies that profit from porn, could Yahoo's retreat be the beginning of a trend? Is the freewheeling, smut-peddling era of the Internet about to end?
"It's all in the timing." That's the line most Yahoo watchers offer when asked why the Sunnyvale, Calif., company bailed from what could have been a profitable business. When the portal started fighting for the right to sell Nazi memorabilia in April 2000, Yahoo looked unbeatable. It had won the portal wars, drubbing competition from Excite, Lycos and others. Meanwhile, its stock traded at more than $100 per share and its user base equaled the population of a small country. Profits flowed in, Wall Street was happy and Yahoo looked as if it had a chance to be even bigger than America Online.
Then all hell broke loose. The NASDAQ plummeted, advertisers pulled back their budgets and Yahoo suffered dearly. In March, the company announced that its earnings were lower than expected, that layoffs were on the way and that its CEO, Tim Koogle, would be stepping down. While Yahoo licked its wounds, the L.A. Times story broke.
"The scandal hit Yahoo at a very vulnerable time for the company," says Andrea Rice, an analyst with Deutsche Banc Alex. Brown. "Not only was the stock depressed but investors were concerned with the viability of the company."
Yahoo acted swiftly because it had to. "The objections and outrage were striking at their most important asset -- consumer popularity," Rice says. "The one asset that hadn't been tarnished was being attacked in a very public way."
Other companies endure such criticism all the time. The AFA and other Christian groups have been trying to engineer a massive Disney boycott for years over hidden images in the company's animated features and its alleged "homosexual agenda."
But Yahoo was an especially vulnerable target -- and not just because of its tanking stock price. Unlike Disney or Rupert Murdoch's News Corp. or AOL Time Warner -- which profits handily from porn distributed over Time Warner cable -- the vast majority of Yahoo's products and services fall under a single brand. If conservative groups boycott, say, Channel 35, a porn channel that all New Yorkers get when they sign up for Time Warner cable, AOL, Time magazine and the company's other tentacles keep clean. Similarly, when conservatives denounce Disney, few if any bother targeting its affiliate, ABC. But when Yahoo suffers the wrath of public anger, the whole company is forced to wear the scarlet letter.
Yahoo is far more susceptible to public outrage because it "stands alone," says Mark Crispin Miller, media studies professor at New York University. "Yahoo's continued bid for independence is admirable but there are dangers that come along with it."
But is an association with porn even more dangerous than an association with Nazi merchandise, which Yahoo continues to defend? Yahoo has repeatedly said that the difference between the two cases isn't the nature of the content but the legal issues surrounding the controversy. In the Nazi case, an anti-racism group argued (successfully) that a French law prohibiting the sale or display of anything that incites racism should be applied to the American version of Yahoo. Though the French version of Yahoo omitted Nazi items, the court said that wasn't enough: The company must also make sure that every Web page available to French people complies with French law.
That demand, argued Yahoo, went too far. If the French can tell Yahoo what to do, what's to stop Iran or China from doing the same thing?
In contrast, the porn brouhaha concerns itself only with an American audience and has yet to attract a lawsuit. Plus, Yahoo argues, getting out of the porn business was an easy burden to bear. Adult content funneled "an infinitesimal" amount of revenue into company coffers, Yahoo's Holtz says.
Still, many see Yahoo's move as a sign of America's peculiar relationship to sex.
"We live in a country that's always worried about what the moral minority is going to think," says Eric Riddley, an adult industry producer who occasionally sold videos through Yahoo. "The squeakiest, most-prudish wheel controls how the media moves."
The public's relationship to pornography "is rife with hypocrisy," adds Bill Margold, a 30-year vet of adult entertainment and the founder of Fans of X-Rated Entertainment, a porn fan club. "Americans are masturbating to what Yahoo puts out with their left hand and pushing it all away with their right."
Media critics say that the Internet is just another battleground for an ancient debate. Since the 1920s, conservative elements have struggled with sex, trying to whitewash Hollywood, while the vast majority of Americans clamor for more and more smut.
"It's been like this as long as anyone can remember," says Martin Black, a communications professor at Northwestern University. "The only thing that's changed is that it's easier to find outlets where this kind of controversy is possible. With the rise of cable and the Internet and video games, it's easier to find media options that are controversial."
Some Yahoo watchers, including Trueman, think that the company also feared that its porn trade could bring trouble with the law. There's no legal precedent to worry about; the government has brought very few criminal actions against Internet companies that traffic in what could be considered child pornography or illegal obscene content. But Internet law is still murky enough to scare off potential porn sellers -- particularly in a high-profile controversy like this one. The mere possibility of new legislation may have scared Yahoo away from porn.
The problem with governing porn online has to do with the Internet's lack of geography. Obscenity laws were originally based on what were, in traditional media, determined as "community standards." On the Internet, such guidelines become nearly impossible to determine.
"Times have drastically changed in the last decade, and as the Net has become more popular, the whole definition of community has changed, making the obscenity laws archaic," says David Wasserman, a First Amendment attorney who regularly defends the adult industry. "It fails to acknowledge that a 'community' is a group of people with common interests. It's not just your neighbors."
But there's a new attorney general in town, and Ashcroft may not agree with Wasserman's interpretation of the law. The Justice Department refused to comment on Yahoo or on anything related to obscenity law, but Ashcroft has already made comments about the importance of keeping the Internet clean of illegal content. His history of protecting online privacy could act as a counterweight to his social conservatism, but under a Republican administration, it's likely he'll be a tougher enforcer of obscenity laws than Janet Reno was.
Even adult industry veterans expect an Ashcroft assault. Yahoo was smart to clean itself up because "most of us in the business think there are going to be a lot of obscenity actions under Ashcroft," says Mark Tiarra, president of United Adult Sites, an association of adult-content providers. "Some Internet entrepreneur is going to be the next Larry Flynt, the next high-profile target. Yahoo might have fit the bill."
In fact, Yahoo may still be in dangerous territory. Trueman says that Yahoo's Geocities Web sites -- user-generated pages that are, in Trueman's view at least, full of illegal content -- should be shut down. And when he meets with Ashcroft, Trueman plans to bring them up.
"We're not going to demand that they target Yahoo," Trueman says. "We're going to speak in general terms about why they ought to make obscenity prosecutions a priority. But Yahoo and several other companies will come up because what we want to do is give examples of how porn is becoming mainstream."
Not even Trueman expects that a campaign against Yahoo, AOL Time Warner or some other company will do much to curb the demand for steamy content of both the legal and the illegal variety. Sales estimates value the Internet porn business at about $1 billion a year, while the entire adult industry rakes in $8 billion annually, according to Adult Video News, a trade publication that tracks the industry. Few analysts expect those numbers to dwindle any time soon.
Some people in the adult industry even argue that Yahoo's exit will help the industry grow. "It's good for us," says Larry Flynt's nephew Jimmy Flynt II, director of marketing for Hustler. "We don't want Yahoo entering into our business because we do it very well. We could sell our videos through them, but we'd rather sell them ourselves."
"This is a business that succeeds because it's taboo," says adult entertainment veteran Margold. If major outlets like Yahoo started trafficking in porn, the industry would lose its appeal. "Respectability would breed contempt," he says. "First it would breed complacency, then stagnation, then death. The moment we go mainstream is the moment we die."
But Trueman figures that prosecution can limit the availability and variety of illegal content. He believes that the laissez-faire law enforcement of the Clinton administration nurtured an industry that has grown arrogant, bloated and lazy. Law enforcement must fight back. "You're never going to stop all drugs or all pornography," he says. "But the pornography industry has become more mainstream by getting its products all over the Net. People consider it a fact of life. They figure that it must be legal if you can see it. But it's not. And if you begin enforcing the law, these companies will cut back. I believe we can make a major difference. We can change the Internet."
Yahoo, he says, is just the beginning.