New business models reframe age-old debates about entrepreneurialism and exploitation in the sex industry.
PORTLAND — By now everyone knows Portland is a mecca for sex businesses. The city boasts the most strip clubs per capita in the nation, dozens of adult-video stores and “lingerie modeling” shops, and not one but two swinger clubs.
But it’s not just brick and mortar: A vast online ecosystem has transformed the buying and selling of sex in Oregon and around the world. Internet tools have increased the size of the commercial sex market, led to the near disappearance of street prostitution and made it easier for sex workers to be self-employed — and to stay safe.
Inhabiting a murky world between empowerment and victimization, the sex industry has long attracted impassioned defenders and accusers. Now new technologies are adding urgency to longstanding debates over whether to decriminalize prostitution or crack down on the businesses, many of them tech-based, that benefit from the illegal sex trade.
On one aspect everyone agrees: When it comes to the world’s oldest profession and, more broadly, the lucrative business of pleasure, tech is breaking down barriers, creating new markets and earning its reputation as a disruptor.
In a word, tech has made the sex industry more entrepreneurial, says Baylor University professor Scott Cunningham, one of a handful of economists who studies tech’s impact on sex work. “The internet really put the independent sex worker forward as the new business model,” he says.
Online how-to-become-an-escort guides and Reddit discussion forums may be making it easier to enter the profession. And while some might blanch at the notion, Yelp-like escort-review sites like TNAboard.com may be improving the quality and reliability of services, Cunningham says.
“In the same way that you really want to have positive reviews on Amazon or Airbnb, the threat of a bad review will cause the vendor to work really hard to satisfy the customer.”
New technologies have also enabled whole new niches of sex work in the last decade, like webcamming (the Skype-age version of phone sex) and sites like SeekingArrangement.com, where modern-day mistressing blurs the lines between paid and unpaid sex.
Pornography moved almost entirely online, where it became vast and ubiquitous; by some estimates it accounts for 30% of internet bandwidth.
More technological change may be coming: On the more speculative side, AI could one day combine with virtual reality, motion-sense and robotics to produce android sex along the lines depicted in the new HBO series Westworld. For now, Uber-esque smart phone apps are moving into the market, at least in Europe, where in some countries a more relaxed attitude toward commercial sex prevails.
An app called Peppr launched in Germany in 2014, matching customers to providers with geolocation, reviews and online payment. (Germany eliminated federal level legal restrictions on commercial sex in 2002.) Last year Peppr founder Pia Poppenreiter created Ohlala, a spinoff app for “paid dates,” but so far it operates only in New York City.
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In Portland, Mathilda Shaddows, 25, epitomizes the tech-enabled, sex-work gig economy. Shaddows, who was featured in the Oct. 26 episode of the MTV show True Life, works on the side as a home care provider for a disabled client.
But she makes her real living with an array of sex business gigs, She acts in and directs custom videos, sells her time in private Skype sessions, and obtains escort work via online classifieds on Backpage.com. She uses social media — Twitter, Instagram and community sites like FetLife — to find community, build an audience and attract paying clients. And she receives payment via Paypal, Google Wallet and Amazon gift cards.
Not everyone is sanguine about the flourishing of this new business model. “I’m convinced the smartphone is the brothel of the 21st-century,” says Tom Perez, executive director of the EPIK Project, a Portland-based organization that works to involve men in antiprostitution and antitrafficking efforts.
Escorts have come to use internet tools to verify customer identities — from Google and Facebook to industry-specific sites like Preferred411.com and VerifyHim.com. Because of that, tech may be contributing to increased safety and a big decline in prostitution arrests.
At the same time, a sustained state and federal-law enforcement crackdown is underway against escort review sites and other third-party platforms where sex workers advertise. In the sex industry, entrepreneurialism and exploitation can be difficult to disentangle. It’s an issue with special resonance in Oregon, a state with higher rates of sex trafficking, the forced prostitution of women and children.
“When I think about trafficking, I view it as a third party benefiting from a commercial sex act,” says JR Ujifusa, a Multnomah County deputy district attorney who works on trafficking/prostitution cases.
The internet is where traffickers recruit, he says, and on Facebook and other platforms, they look for young, vulnerable women with self-esteem issues.
“And I use the word ‘victim’ pretty liberally, because based on my experience, even if a victim says they’re independent, I know that almost every ad we’ve posted on the internet, a trafficker has been trying to recruit us, even as undercover operators.”
Mar Brettmann, executive director of the Seattle-based nonprofit, Businesses Ending Slavery & Trafficking, echoes that assertion.
“Because there’s such high demand for [commercial] sex, that is what is creating sex trafficking, because a majority of people don’t want to go into commercial sex work willingly,” Brettmann says. “There may be some who choose to go into this, but because there’s this gap in supply, trafficking victims are filling that gap. The demand side of this crime can’t be ignored.”
One after another, escort-review websites have been seized, their CEOs jailed and prosecuted: San Francisco’s MyRedBook, Seattle’s TheReviewBoard.net, and the NYC-based gay escort site Rentboy. The most significant tech outfit to be targeted in the antitrafficking campaign is Backpage.com, which is involved in a tangle of court cases going all the way up to the U.S. Supreme Court.
“Unfortunately for Oregon businesses, buyers are coming from the tech industry.”
In March Backpage was cited in a unanimous U.S. Senate resolution holding the company in contempt for refusing to divulge its internal practices for combating sex trafficking. On October 6, its CEO was arrested and charged with pimping a minor — because his company accepted payment for ads from underage sex workers.
Some Portland advocates for sex workers view the battle against third-party websites as a step in the wrong direction.
“When the government shuts down sites like Rentboy, they’re really taking away tools for folks to be safe,” says Becky Barryte, a direct service advocate at Portland-based non-profit Call to Safety (formerly known as the Portland Women’s Crisis Line).
If Backpage goes dark, it could hamper law-enforcement efforts. Ujifusa says when he began working sex trafficking/prostitution cases full-time in 2009, law enforcement against prostitution and trafficking was mostly done at street level. Today 90% of it is internet based.
“The internet has changed the way we identify victims, find victims, locate victims, track victims,” he says. “It has changed the way we do stings and operations and missions in order to identify offenders. And of course it’s changed the way we prove cases and do investigations through the data we have, whether it’s website data, cell phone data, cell phone downloads or IP address coordinates.”
To go after johns, prostitutes, pimps and traffickers, Ujifusa works with three Portland Police detectives, two officers and two sergeants, plus officers in Fairview, Troutdale and Gresham.
As of mid-October, Ujifusa had prosecuted 152 individuals in 2016 for misdemeanor prostitution charges, and all but eight of them were buyers. (There can be 220 sellers posting escort ads before noon on any given day in Oregon, just on Backpage, generating gross ad revenues for the company that could be in the range of $2 million a year.)
Most of the prosecutions result from sting operations — police post ads for underage providers and arrest customers when they show up. And recent stings have highlighted another uncomfortable intersection between tech and sex: how software companies, their leaders and their employees, may be abetting the crime.
“The internet really put the independent sex worker forward as the new business model.”
On May 10, Seattle detectives charged a director from Microsoft and a former Amazon director for promoting prostitution online. The Microsoft director, Sumit Virmani, will be sentenced in November.
“These were incredibly prolific sex buyers who were very influential in the sex-buying community in terms of generating demand,” Valiant Richey, senior deputy King County prosecutor told the Puget Sound Business Journal in late October. “This case is a pretty glaring example of that evolution that has been primarily enabled by the internet.”
Following the sting, the Washington Technology Industry Association (WTIA) teamed up with BEST to hold a forum for tech leaders about sex trafficking and how the tech industry could combat it.
“The tech industry isn’t any more of a buyer than any other industry,” says WTIA executive director Michael Schutzler. But tech is a predominantly white male industry, Schutzler says, and most demand in the sex trade is coming from over-30 white males. “The overlap was so high that it seemed silly for us not to take a leadership role and say, ‘Hey, wake up, people, this is what’s going on.’”
BEST’s Brettmann is more explicit about the connection between tech companies and trafficking.
“Unfortunately for Oregon businesses, buyers are coming from the tech industry,” she says, referring to the need for a Portland-based BEST spinoff. “With the crime of sex trafficking, businesspeople completely understand the laws of supply and demand. If there was no demand for sexual-trafficking victims, there would be no sexual-trafficking victims.”
Skip Newberry, executive director of the Technology Association of Oregon, did not respond to emailed questions about holding a sex-trafficking forum in Oregon. However, a business-led antitrafficking group is now forming in Portland called PDX BEST. The effort is being led by EPIK’s Perez.
How these efforts will impact the sex trade in this state remains to be seen. But as technology penetrates more deeply into legal and illegal enterprises, the debate over the regulation of sex businesses will likely intensify. As for the state’s burgeoning tech sector, its executives and its employees, the subject will certainly become more difficult to ignore.
Strip club Luddites?
The sex-work arena that’s most untouched by tech is the one that’s most above ground, and the one that, in Oregon, is protected by the state constitution’s strong free speech provisions: nude dancing.
For examples, Mary’s Club, Portland’s longest-established strip club, still operates much as it did in the 1980s. “I don’t do that internet stuff,” says owner Vicki Keller.
Sex Workers Outreach Project activist Matilda Bickers, who famously sued vegan strip club Casa Diablo over worker misclassification, says she and other strippers do spend time off the clock growing their business by maintaining profiles on social media.
And Jeffrey Falgout, a former GoDaddy technician, co-founded a Portland-based website, XoticSpot.com, to make it easier for dancers to post schedules and build up followers. But he says clubs and performers have been slow to make use of it.
Some clubs have websites listing performers online. That’s about it.
In some respects, strip clubs are one of the last remaining tech-free zones: Smartphone cameras — whipped out by the crowd-full at live music venues — can get patrons tossed out of many strip clubs. And except for downtown Portland’s Kit Kat Club, which accepts Bitcoin, strip club performers are paid exclusively in cash.
A version of this article appears in the November/December issue of Oregon Business.