1 00:00:15,316 --> 00:00:20,996 Speaker 1: Pushkin. Hey, it's Jacob Goldstein. We'll have a new episode 2 00:00:20,996 --> 00:00:23,636 Speaker 1: of What's Your Problem for you later this week. In 3 00:00:23,716 --> 00:00:26,516 Speaker 1: the meantime, we're sharing an episode of a new podcast 4 00:00:26,556 --> 00:00:29,876 Speaker 1: called Hot Money. It's a collaboration between Pushkin and The 5 00:00:29,916 --> 00:00:32,676 Speaker 1: Financial Times, and it's about the business side of the 6 00:00:32,716 --> 00:00:35,836 Speaker 1: porn industry. It's a great show, full of insights and 7 00:00:35,916 --> 00:00:39,796 Speaker 1: amazing stories, and this episode in particular seemed like a 8 00:00:39,876 --> 00:00:42,556 Speaker 1: really good fit for What's Your Problem. As you'll hear, 9 00:00:42,636 --> 00:00:46,516 Speaker 1: it's a story all about technological change and entrepreneurs and 10 00:00:46,556 --> 00:00:49,156 Speaker 1: the hard problems they're trying to solve. I hope you'll 11 00:00:49,156 --> 00:00:54,756 Speaker 1: like it. Right before we start, we're two Financial Times 12 00:00:54,796 --> 00:00:58,956 Speaker 1: journalists trying to work out who rules the porn industry. 13 00:00:59,516 --> 00:01:08,036 Speaker 1: So this show has adult themes. I want to take 14 00:01:08,156 --> 00:01:12,596 Speaker 1: you to a suburb shopping plaza in Ohio. It's nineteen 15 00:01:12,716 --> 00:01:16,076 Speaker 1: ninety three. We're in the middle of America's rust belt. 16 00:01:16,556 --> 00:01:21,676 Speaker 1: There's a two paced store place selling furniture, and tucked 17 00:01:21,716 --> 00:01:26,436 Speaker 1: in a corner a little company for interactive computer services. 18 00:01:27,836 --> 00:01:31,836 Speaker 1: I know it sounds ridiculous, but if the Internet has roots, 19 00:01:32,476 --> 00:01:37,196 Speaker 1: they stretched to here, to this modest shopping center in Youngstown, 20 00:01:37,396 --> 00:01:43,596 Speaker 1: Ohio to that corner business. Every social media website you 21 00:01:43,676 --> 00:01:49,076 Speaker 1: visit today, Facebook, Twitter, TikTok. These platforms are able to 22 00:01:49,076 --> 00:01:53,556 Speaker 1: operate in part thanks to them. A family run IT business, 23 00:01:54,836 --> 00:01:58,276 Speaker 1: A family run IT business with what was possibly the 24 00:01:58,396 --> 00:02:04,956 Speaker 1: biggest stash of digital pawn in America. Today's powered anamics 25 00:02:04,956 --> 00:02:08,716 Speaker 1: and porn came from here, straight from that family to 26 00:02:08,796 --> 00:02:12,316 Speaker 1: the most powerful pornographers of the twenty first century, the 27 00:02:12,356 --> 00:02:16,076 Speaker 1: people we've been talking about on this show. And you 28 00:02:16,116 --> 00:02:18,996 Speaker 1: know we told you in previous episodes that the masters 29 00:02:18,996 --> 00:02:21,436 Speaker 1: of the adult tube sites were able to get away 30 00:02:21,436 --> 00:02:24,916 Speaker 1: with making money from other people's content. The answer to 31 00:02:25,036 --> 00:02:29,276 Speaker 1: how lies here and the choices of an Ohio family 32 00:02:29,716 --> 00:02:34,596 Speaker 1: back in the nineties. This family, the Hardenburg's, define what 33 00:02:34,716 --> 00:02:39,396 Speaker 1: it means to moderate content and cyberspace and what happens 34 00:02:39,396 --> 00:02:44,676 Speaker 1: when you go too far. My name is Russell Francis Hardenburg, 35 00:02:44,796 --> 00:02:47,716 Speaker 1: the fourth, and I'm a sales manager at a car dealership. 36 00:02:48,076 --> 00:02:50,636 Speaker 1: Russ is one of two sons who worked at the 37 00:02:50,676 --> 00:02:54,076 Speaker 1: IT business back in the day. When I first called 38 00:02:54,156 --> 00:02:56,676 Speaker 1: him and said I was a journalist, he slammed the 39 00:02:56,676 --> 00:03:01,716 Speaker 1: phone down. I'm so pleased. I tried again after some 40 00:03:01,836 --> 00:03:05,636 Speaker 1: apologetic mumbling. I said to Russ, I want to hear 41 00:03:05,796 --> 00:03:10,036 Speaker 1: how your family changed the history of the Internet, and 42 00:03:10,156 --> 00:03:14,396 Speaker 1: after a pause he replied, Okay, call me after work. 43 00:03:15,116 --> 00:03:17,916 Speaker 1: The Internet was so new that there was some question 44 00:03:17,996 --> 00:03:22,476 Speaker 1: whether you took a book and converted it to text 45 00:03:23,516 --> 00:03:26,636 Speaker 1: where the copyright laws still would that apply to that 46 00:03:26,956 --> 00:03:38,356 Speaker 1: It was just the wild West at first, and that's 47 00:03:38,396 --> 00:03:41,956 Speaker 1: the difference Rust and his family made. Their mistakes helped 48 00:03:42,036 --> 00:03:46,676 Speaker 1: Lady ground rules for an online world. Who owns digital media, 49 00:03:47,036 --> 00:03:49,916 Speaker 1: who has a right to share it, and most importantly, 50 00:03:50,796 --> 00:03:53,236 Speaker 1: how the Mark Zuckerberg's of the world can run online 51 00:03:53,276 --> 00:03:56,836 Speaker 1: platforms to stay off the hook even when illegal content 52 00:03:56,956 --> 00:04:01,476 Speaker 1: is being shared on their sites. I'm Patrician Wilson. I'm 53 00:04:01,476 --> 00:04:05,756 Speaker 1: Alex Barker from Pushkin Industries and The Financial Times. This 54 00:04:06,276 --> 00:04:43,676 Speaker 1: is Whole Money, Act One, a Shared World. Later in 55 00:04:43,676 --> 00:04:47,236 Speaker 1: this episode, Russ and a stepbrother will tell their family 56 00:04:47,316 --> 00:04:50,756 Speaker 1: story pretty much for the first time. It's the story 57 00:04:50,836 --> 00:04:53,796 Speaker 1: that created the ground rules for the modern porn industry. 58 00:04:55,596 --> 00:04:58,036 Speaker 1: But before then, we want to take you further back 59 00:04:58,076 --> 00:05:02,756 Speaker 1: in history to the nineteen eighties, the moment that online 60 00:05:02,836 --> 00:05:06,436 Speaker 1: porn first came into being. Let's meet one of the 61 00:05:06,476 --> 00:05:11,956 Speaker 1: world's first digital pronographers. His name is Dan Lewis. So 62 00:05:12,876 --> 00:05:19,516 Speaker 1: around nineteen eighty I bought my first personal computer. It 63 00:05:19,676 --> 00:05:23,356 Speaker 1: was a Radio Shack TRSA D Model one. It was 64 00:05:23,356 --> 00:05:26,196 Speaker 1: pretty pretty exciting at the time. Your storage device was 65 00:05:26,236 --> 00:05:29,676 Speaker 1: a cassette tape recorder. The TRSA D the biggest name 66 00:05:29,716 --> 00:05:36,636 Speaker 1: in little computers only a radio Shack attending company. As 67 00:05:36,716 --> 00:05:39,676 Speaker 1: far as we can work out, Dan wasn't just one 68 00:05:39,676 --> 00:05:43,756 Speaker 1: of the first online pornographers. He was possibly the first 69 00:05:43,756 --> 00:05:46,556 Speaker 1: one to actually turn a profit from it. He's a 70 00:05:46,596 --> 00:05:51,196 Speaker 1: New Yorker and he looks like a regular boomer, beard, glasses, 71 00:05:51,596 --> 00:05:54,796 Speaker 1: a friendly uncle type. He wasn't easy to find. By 72 00:05:54,836 --> 00:06:00,116 Speaker 1: the way, Dan Lewis is his cover name. Yes, another 73 00:06:00,156 --> 00:06:03,836 Speaker 1: guy with a cover name. Out of desperation, I tried 74 00:06:03,876 --> 00:06:06,796 Speaker 1: an email address from an advert for something called a 75 00:06:06,836 --> 00:06:11,156 Speaker 1: bulletin board. It was from nineteen ninety four, but somehow 76 00:06:11,596 --> 00:06:16,556 Speaker 1: it worked. You could dial up bulletin boards and exchange 77 00:06:16,756 --> 00:06:21,996 Speaker 1: messages with people and you know, find out some technical information. 78 00:06:22,556 --> 00:06:25,756 Speaker 1: Now you might have heard of arper net and usenet, 79 00:06:26,276 --> 00:06:30,276 Speaker 1: the early ways that academics and military types communicated online. 80 00:06:30,836 --> 00:06:33,956 Speaker 1: Bullets and boards used a similar technology, but They were 81 00:06:34,076 --> 00:06:37,756 Speaker 1: for the private world, not just public institutions. Anybody could 82 00:06:37,836 --> 00:06:41,276 Speaker 1: use them. Dan's computer was in his bedroom in Queens. 83 00:06:42,156 --> 00:06:45,836 Speaker 1: The equipment wasn't cheap, and in Dan's case, no university 84 00:06:45,876 --> 00:06:49,316 Speaker 1: or government was paying the bills. He would pick up 85 00:06:49,316 --> 00:06:51,796 Speaker 1: the chunky telephone handset and plug it into an even 86 00:06:51,796 --> 00:06:56,036 Speaker 1: bigger box, the modem. Through the modem, he would then 87 00:06:56,076 --> 00:06:59,596 Speaker 1: dial another computer in some far off place, the bulletin 88 00:06:59,676 --> 00:07:04,516 Speaker 1: Board System or BBS. It was a shared world games, 89 00:07:04,636 --> 00:07:09,876 Speaker 1: basic software, conspiracy theories, bad jokes. If you knew which 90 00:07:09,916 --> 00:07:12,996 Speaker 1: board to dial up and you could master to clunky tech. 91 00:07:13,876 --> 00:07:17,996 Speaker 1: It was all there and young Dan, he was in 92 00:07:18,076 --> 00:07:21,316 Speaker 1: his early twenties. Den he got more and more obsessed. 93 00:07:21,916 --> 00:07:24,156 Speaker 1: He was dining up at eleven o'clock at night to 94 00:07:24,236 --> 00:07:28,556 Speaker 1: keep his meteoric phone bills down. He was broken, barely 95 00:07:28,596 --> 00:07:33,396 Speaker 1: scraping together money for rent. So I started trying to 96 00:07:33,436 --> 00:07:37,636 Speaker 1: think about is there a way I could leverage this 97 00:07:37,716 --> 00:07:43,276 Speaker 1: and supplement my income? Well, what other kinds of BBS 98 00:07:43,396 --> 00:07:48,036 Speaker 1: related services might people pay for? And decided that, you 99 00:07:48,116 --> 00:07:51,756 Speaker 1: know what, the only thing people will pay for is sex. 100 00:07:52,236 --> 00:07:56,836 Speaker 1: People are horny, people are purian, people want to see 101 00:07:56,876 --> 00:08:00,356 Speaker 1: images of other naked people, or they want to see 102 00:08:00,396 --> 00:08:05,116 Speaker 1: them engage in activities that they can't try now, or 103 00:08:05,236 --> 00:08:07,836 Speaker 1: want to try, or have it tried. It's just human nature. 104 00:08:08,716 --> 00:08:11,756 Speaker 1: Back in nineteen eighty four, a bulletin board interface just 105 00:08:11,876 --> 00:08:16,636 Speaker 1: had text bright neon green text, but you could download 106 00:08:16,676 --> 00:08:21,916 Speaker 1: simple images, games, that kind of stuff. Dan's idea was 107 00:08:21,956 --> 00:08:25,956 Speaker 1: to specialize. He wanted to launch a BBS dedicated to 108 00:08:26,156 --> 00:08:31,756 Speaker 1: adult stuff, an erotic platform for the uninhabited. The cool 109 00:08:31,836 --> 00:08:36,556 Speaker 1: started rolling in with hindsight. The technology was laughably basic. 110 00:08:37,636 --> 00:08:42,116 Speaker 1: Dance system Aislenet was running it one thousand, two hundred 111 00:08:42,116 --> 00:08:47,156 Speaker 1: bits per second, not kill a bits, not megabits, just bits. 112 00:08:48,076 --> 00:08:51,276 Speaker 1: So how did it work? Well, you'd sit down at 113 00:08:51,276 --> 00:08:54,596 Speaker 1: your computer, so you'd go to your dialing list. Okay, 114 00:08:54,596 --> 00:08:56,756 Speaker 1: which BBS do I want to call? All right, let's 115 00:08:56,796 --> 00:08:59,556 Speaker 1: call us. When you click on it, and you'll hear 116 00:08:59,636 --> 00:09:07,436 Speaker 1: procom dialing the modem, it'll ring and the modem will answer. 117 00:09:07,716 --> 00:09:09,756 Speaker 1: If you haven't heard what a modems sounds like, it 118 00:09:09,876 --> 00:09:14,396 Speaker 1: sounds a little bit like a fact tone. And you're connected. 119 00:09:14,476 --> 00:09:16,716 Speaker 1: So you'd get a welcome screen and then you might 120 00:09:16,756 --> 00:09:20,476 Speaker 1: get a list of subcategories of files. It's okay, So 121 00:09:20,556 --> 00:09:24,236 Speaker 1: you click on the adult section and then you might 122 00:09:24,316 --> 00:09:29,316 Speaker 1: get another sub menu of women, men, women and men, 123 00:09:29,716 --> 00:09:32,996 Speaker 1: and you pick what you want and it'll download. Now 124 00:09:33,036 --> 00:09:35,316 Speaker 1: the fun begins, zing bing bing bing bing, and it 125 00:09:35,396 --> 00:09:38,796 Speaker 1: ends up on your computer. Then you get to look 126 00:09:38,796 --> 00:09:43,036 Speaker 1: at your picture. Isn't that easy? You had to be 127 00:09:43,076 --> 00:09:48,676 Speaker 1: patient that bing bing bing took minutes, not seconds. But 128 00:09:49,236 --> 00:09:53,716 Speaker 1: for porn, people were willing to wait, and they would 129 00:09:53,756 --> 00:09:58,556 Speaker 1: pay for it. At first, Dan charged ten dollars to subscribers, 130 00:09:59,156 --> 00:10:02,196 Speaker 1: then I one two forty five a year. The checks 131 00:10:02,236 --> 00:10:05,516 Speaker 1: were being mailed to him in the post. It didn't 132 00:10:05,556 --> 00:10:08,276 Speaker 1: take long until Dan was making as much from his 133 00:10:08,396 --> 00:10:11,156 Speaker 1: adult side as he was from his day job. And 134 00:10:11,276 --> 00:10:14,036 Speaker 1: I mean it was tremendous. Those were the best years. 135 00:10:14,076 --> 00:10:18,556 Speaker 1: Those were absolutely the best years. You know what's really 136 00:10:18,596 --> 00:10:22,636 Speaker 1: striking about that time. Pioneers like Dan were on a 137 00:10:22,676 --> 00:10:25,876 Speaker 1: tiny scale revealing what was about to hit us. All 138 00:10:26,596 --> 00:10:31,116 Speaker 1: dirty pictures, software, even the written word. If digital goods 139 00:10:31,156 --> 00:10:35,076 Speaker 1: could be copied, they would be copied NonStop and shared 140 00:10:35,116 --> 00:10:38,636 Speaker 1: far and wide. And the law, well, as we'll tell 141 00:10:38,636 --> 00:10:41,756 Speaker 1: you in a bit, it hadn't caught up yet. In 142 00:10:41,756 --> 00:10:45,596 Speaker 1: this legal no man's land. Dan could become a pornographer 143 00:10:45,596 --> 00:10:49,516 Speaker 1: of swords, all from his bedroom in Queens without ever 144 00:10:49,596 --> 00:10:52,476 Speaker 1: having taken a photo or set foot on a pawn set. 145 00:10:52,956 --> 00:10:55,956 Speaker 1: Even in the age of bulletin boards, people were beginning 146 00:10:55,956 --> 00:11:00,876 Speaker 1: to realize the implications. Dan's operation was relatively modest, just 147 00:11:00,916 --> 00:11:04,916 Speaker 1: a few telephone lines. He kept his head down. But 148 00:11:05,596 --> 00:11:09,916 Speaker 1: some other operators were not so shy, operators like Rusty 149 00:11:09,956 --> 00:11:13,756 Speaker 1: and Edy Hardenberg. Rusty and Edy was really big and 150 00:11:13,836 --> 00:11:16,316 Speaker 1: they had I don't even know how many phone lines 151 00:11:16,356 --> 00:11:20,316 Speaker 1: they had, and obviously invested a lot of money, and 152 00:11:20,476 --> 00:11:24,636 Speaker 1: their objective clearly was to make their living after completely 153 00:11:25,716 --> 00:11:29,396 Speaker 1: Rusty and Edies bulletin board veterans talk of them with 154 00:11:29,476 --> 00:11:32,676 Speaker 1: a wistful air, and let me give you a clue. 155 00:11:33,196 --> 00:11:36,876 Speaker 1: Their office was in Youngstown, Ohio, in a little strip 156 00:11:36,916 --> 00:11:41,076 Speaker 1: mall next to a two pay stall. Rusty Needy were 157 00:11:41,116 --> 00:11:44,316 Speaker 1: a father and stepmother of Russ, the guy we heard 158 00:11:44,316 --> 00:11:47,516 Speaker 1: from earlier in the show. They were the family who 159 00:11:47,636 --> 00:11:51,596 Speaker 1: laid the rules for the way the internet works today. 160 00:11:58,036 --> 00:12:01,836 Speaker 1: To take a look at this advert I found for 161 00:12:02,276 --> 00:12:07,436 Speaker 1: Rusty and Needs from a magazine in the early nineties. 162 00:12:08,636 --> 00:12:12,076 Speaker 1: I'm looking two owls. They're snuggled up Wing to wing. 163 00:12:13,236 --> 00:12:17,236 Speaker 1: Some text here it says we are the friendliest bbs 164 00:12:17,276 --> 00:12:20,356 Speaker 1: in the world. Our name says at all. Ed and 165 00:12:20,396 --> 00:12:23,356 Speaker 1: I are a couple of burnouts from the nineteen sixties. 166 00:12:23,636 --> 00:12:26,036 Speaker 1: We didn't un like rules then and we don't now. 167 00:12:26,516 --> 00:12:30,116 Speaker 1: Come on in and relax, you'll be among friends. It's 168 00:12:30,116 --> 00:12:33,756 Speaker 1: a great copy, isn't it. It's fantastic. You know, this 169 00:12:33,956 --> 00:12:37,516 Speaker 1: was the Rusty and Edy brand. It was great marketing. 170 00:12:37,716 --> 00:12:40,396 Speaker 1: It worked. I mean they were the kind of Ben 171 00:12:40,436 --> 00:12:45,316 Speaker 1: and Jerry's of nineteen eighties home computing. You reached their 172 00:12:45,316 --> 00:12:50,756 Speaker 1: bulletin board and there was in big green letters, first rule, 173 00:12:50,996 --> 00:12:55,596 Speaker 1: have fun, Second rule, no more rules, wild and exactly. 174 00:12:55,636 --> 00:12:59,116 Speaker 1: And you know they would not have thought of themselves 175 00:12:59,156 --> 00:13:03,356 Speaker 1: as pornographers, not for a second, but almost by accident, 176 00:13:03,436 --> 00:13:08,756 Speaker 1: they helped define what pawn would become in an online age. 177 00:13:09,796 --> 00:13:13,916 Speaker 1: So did you manage to speak to them? Rusty passed 178 00:13:14,076 --> 00:13:16,436 Speaker 1: a few years ago, and I would love to have 179 00:13:16,436 --> 00:13:19,996 Speaker 1: spoken to him. But I did reach Ed and we 180 00:13:20,036 --> 00:13:22,676 Speaker 1: had an amazing conversation. But talking about Rusty and Ed's 181 00:13:22,876 --> 00:13:28,156 Speaker 1: it just brought back too many memories for her, so 182 00:13:28,156 --> 00:13:30,596 Speaker 1: she didn't want to talk on tape, and instead she 183 00:13:30,676 --> 00:13:34,596 Speaker 1: put me in touch with her son, Sean McFarland, and 184 00:13:34,796 --> 00:13:39,036 Speaker 1: he's an Army vet. He runs a chain of convenience stores, 185 00:13:39,636 --> 00:13:43,836 Speaker 1: and we spoke to him from a garage that looked 186 00:13:43,916 --> 00:13:46,436 Speaker 1: more like an aircraft hanger. Have you got a helicopter, 187 00:13:46,596 --> 00:13:49,476 Speaker 1: just a little one. Yeah, yeah, that's that's why I 188 00:13:49,556 --> 00:13:51,916 Speaker 1: did in the army. So my son and I like 189 00:13:52,036 --> 00:13:55,596 Speaker 1: to fly around, go have a burger and apart. Sean 190 00:13:55,876 --> 00:13:59,476 Speaker 1: didn't always run convenience stores and zip around in a helicopter. 191 00:13:59,916 --> 00:14:05,716 Speaker 1: Growing up. He helps his family run their business. I 192 00:14:05,796 --> 00:14:09,916 Speaker 1: built the computers in my network, made him cocked each other. 193 00:14:11,116 --> 00:14:14,676 Speaker 1: He remembers his stepfather, Rusty, as a man of outsized passions. 194 00:14:15,196 --> 00:14:18,796 Speaker 1: Any hobby would become industry. Their house would fill with 195 00:14:18,876 --> 00:14:22,596 Speaker 1: cigars or fish tanks. There were fifteen at one point, 196 00:14:23,236 --> 00:14:28,556 Speaker 1: or big bulky computers, dozens of them. Rusty actually wasn't 197 00:14:28,556 --> 00:14:31,836 Speaker 1: an old, burned out hippie. He was a retired insurance 198 00:14:31,876 --> 00:14:38,076 Speaker 1: manager and a lifelong libertarian. He hated being told what 199 00:14:38,236 --> 00:14:41,796 Speaker 1: to do, not just by governments, but by anyone, frankly, 200 00:14:42,116 --> 00:14:45,596 Speaker 1: so when he started visiting bulletin boards, you can guess 201 00:14:45,716 --> 00:14:49,476 Speaker 1: what happened next. So he goes, why don't I start 202 00:14:49,596 --> 00:14:54,196 Speaker 1: my own with no rules? So he wanted no rules, 203 00:14:54,556 --> 00:14:56,716 Speaker 1: are free for all, do whatever you want to do. 204 00:14:57,556 --> 00:15:00,796 Speaker 1: He wasn't the only one. A lot of bulletin board 205 00:15:00,796 --> 00:15:04,836 Speaker 1: folks were making up rules on the go. Nobody really 206 00:15:04,916 --> 00:15:08,516 Speaker 1: knew who owned a digital copy of a physical image 207 00:15:08,676 --> 00:15:14,356 Speaker 1: or a piece of text. A lot of them didn't care. Now, Russ, 208 00:15:14,716 --> 00:15:17,076 Speaker 1: the harden Burst son who I talked to at the 209 00:15:17,076 --> 00:15:19,636 Speaker 1: beginning of the show, the one who put the phone 210 00:15:19,676 --> 00:15:22,996 Speaker 1: down on me. Russ was helping his father Rusty on 211 00:15:23,036 --> 00:15:27,156 Speaker 1: the software side and handling the fallout from having no rules. 212 00:15:27,796 --> 00:15:31,036 Speaker 1: When did adult materials start right from the get go? 213 00:15:31,916 --> 00:15:37,796 Speaker 1: So at first it was just grany scanned photographs, and 214 00:15:37,836 --> 00:15:41,276 Speaker 1: then they came out with short little gifts which were 215 00:15:42,196 --> 00:15:47,236 Speaker 1: thirty second mini movies. Did Russ have any qualms about 216 00:15:47,276 --> 00:15:51,316 Speaker 1: having adult content on the system? Not really. I mean 217 00:15:51,436 --> 00:15:56,316 Speaker 1: it's a libertarian yet we're not hurting anybody. There are adults. 218 00:15:56,356 --> 00:16:00,156 Speaker 1: Some came for the game's sex chat and dating. Edie 219 00:16:00,196 --> 00:16:02,956 Speaker 1: told us that a few people got married after meeting 220 00:16:02,956 --> 00:16:07,436 Speaker 1: in their forums, but for others, well, Rusty and Dy 221 00:16:07,796 --> 00:16:11,356 Speaker 1: amassed one of the world biggest collections of digital porn. 222 00:16:11,956 --> 00:16:15,116 Speaker 1: By nineteen ninety three, Rusty and Needy had hosted roughly 223 00:16:15,316 --> 00:16:18,196 Speaker 1: three and a half million calls in total, around four 224 00:16:18,236 --> 00:16:21,916 Speaker 1: thousand on any given day. Calls came in from all 225 00:16:21,956 --> 00:16:26,316 Speaker 1: over the world, Britain, Saudi Arabia, Japan, and as the 226 00:16:26,356 --> 00:16:29,676 Speaker 1: business grew, Rusty and Needy had to find space for 227 00:16:29,796 --> 00:16:33,596 Speaker 1: dozens of computers. First, the equipment filled the bedroom of 228 00:16:33,676 --> 00:16:37,756 Speaker 1: Rusty's two room apartment, then the hall, then the entire 229 00:16:37,796 --> 00:16:41,876 Speaker 1: basement of their new home. The servers produced so much 230 00:16:41,916 --> 00:16:45,916 Speaker 1: heat Rusty installed a four ton air conditioner and it 231 00:16:45,956 --> 00:16:48,316 Speaker 1: was still like a sauna we had working even in 232 00:16:48,356 --> 00:16:50,516 Speaker 1: a winner in shorts and a T shirt. It was 233 00:16:50,596 --> 00:16:54,356 Speaker 1: just hot. I mean he was a good businessman. I 234 00:16:54,396 --> 00:16:57,076 Speaker 1: mean did he make a lot of money out of this? Oh? Yeah, 235 00:16:57,116 --> 00:17:02,916 Speaker 1: he did very well. Those overheated servers hosted around nineteen 236 00:17:03,116 --> 00:17:06,316 Speaker 1: gigabytes of data. These days you carried ten times that 237 00:17:06,396 --> 00:17:09,636 Speaker 1: data in your pocket. But back then this was like 238 00:17:09,756 --> 00:17:15,156 Speaker 1: Aladdin's cave. It was getting attention. Some commercial software makers 239 00:17:15,196 --> 00:17:19,676 Speaker 1: got upset, as did some porn barons. And then there 240 00:17:19,756 --> 00:17:32,116 Speaker 1: was the FBI Act too, The dangers of moderation. So far, 241 00:17:32,396 --> 00:17:36,716 Speaker 1: the Rusty and Edy story is a sort of libertarian dream. 242 00:17:36,756 --> 00:17:41,556 Speaker 1: An entrepreneurial family creates an online space with no rules 243 00:17:41,596 --> 00:17:46,636 Speaker 1: and builds it into a successful family business. Now we 244 00:17:46,716 --> 00:17:49,316 Speaker 1: come to the part of the story where the government 245 00:17:49,516 --> 00:17:53,476 Speaker 1: strikes back. It's a moment so dramatic that even three 246 00:17:53,556 --> 00:17:58,516 Speaker 1: decades later, Edy couldn't bear to talk about it. The 247 00:17:58,676 --> 00:18:01,996 Speaker 1: night at the raid, it was my sister's wedding day, 248 00:18:02,716 --> 00:18:05,076 Speaker 1: and I think they planned it that way so we 249 00:18:05,116 --> 00:18:08,716 Speaker 1: wouldn't be home. We were all at the reception and 250 00:18:08,916 --> 00:18:11,316 Speaker 1: my stepbrother Sean had to go back to the house 251 00:18:11,356 --> 00:18:14,956 Speaker 1: to get something. I was coming home with my girlfriend. 252 00:18:15,316 --> 00:18:17,756 Speaker 1: I like pulling the driver and I go, WHOA, what's 253 00:18:17,756 --> 00:18:20,316 Speaker 1: all these cards still in here? And then I walked 254 00:18:20,356 --> 00:18:22,556 Speaker 1: up to the garage and bunch of guys with the 255 00:18:22,556 --> 00:18:25,316 Speaker 1: FBI jacket song came and asked me who I was. 256 00:18:25,676 --> 00:18:28,756 Speaker 1: They kicked the door in and they came in all 257 00:18:28,836 --> 00:18:33,396 Speaker 1: different directions. Was gigantic. They had guns and they seized everything. 258 00:18:33,596 --> 00:18:36,836 Speaker 1: They took every computer, every server, everything out of the house. 259 00:18:37,316 --> 00:18:40,516 Speaker 1: They took all our records, everything we had, they took 260 00:18:40,516 --> 00:18:44,476 Speaker 1: it all. My father was terrified. They warn't alleged they 261 00:18:44,516 --> 00:18:48,396 Speaker 1: had illegally distributed software without permission of the copyright owners. 262 00:18:48,916 --> 00:18:51,676 Speaker 1: But there was more to it than that. By the 263 00:18:51,716 --> 00:18:54,756 Speaker 1: early nineties, Congress and the FBI had woken up to 264 00:18:54,756 --> 00:18:59,676 Speaker 1: the digital economy. The press was raising alarm about cyber porn. 265 00:19:00,796 --> 00:19:05,236 Speaker 1: The FBI wanted to set some boundaries. The government seized 266 00:19:05,236 --> 00:19:09,716 Speaker 1: the business just because they want to look around and 267 00:19:09,716 --> 00:19:12,356 Speaker 1: see if we were doing anything wrong. For two and 268 00:19:12,396 --> 00:19:15,196 Speaker 1: a half years, they took a man's business. All is hardware. 269 00:19:16,676 --> 00:19:19,916 Speaker 1: You can probably tell from Russ's voice, the memories are 270 00:19:19,996 --> 00:19:23,596 Speaker 1: still raw for the family. It's the reason Edi wouldn't 271 00:19:23,596 --> 00:19:26,196 Speaker 1: speak to us. Just thinking back to that day gave 272 00:19:26,196 --> 00:19:28,156 Speaker 1: her sleepless nights. There was a little point in her 273 00:19:28,196 --> 00:19:30,436 Speaker 1: life too. I mean the they literally thought they were 274 00:19:30,436 --> 00:19:33,076 Speaker 1: going to prison. And I mean, I don't care how 275 00:19:33,156 --> 00:19:36,676 Speaker 1: much money you have, you can't fight Uncle Sam. He's 276 00:19:36,676 --> 00:19:41,476 Speaker 1: got endless money. Somehow, Rusty and Needy's bulletin board got 277 00:19:41,476 --> 00:19:44,956 Speaker 1: back online after the FBI swooped. They had backups, they 278 00:19:44,996 --> 00:19:47,996 Speaker 1: bought new computers, and they had the shopping plaza office. 279 00:19:48,716 --> 00:19:52,556 Speaker 1: The thing is, there was a second punch, another crisis 280 00:19:52,556 --> 00:19:56,276 Speaker 1: for the family, one that actually helped create the internet 281 00:19:56,316 --> 00:19:59,036 Speaker 1: we have today. It came a few months after the 282 00:19:59,116 --> 00:20:04,236 Speaker 1: raid a lawsuit straight from Hugh Hefner's mansion. The Playboy 283 00:20:04,276 --> 00:20:07,516 Speaker 1: founder had realized that his pictures were being shared online 284 00:20:08,036 --> 00:20:12,116 Speaker 1: digital copies and he wasn't being paid, so the heff 285 00:20:12,276 --> 00:20:15,796 Speaker 1: decided to fight back. He sent a female staffer on 286 00:20:15,836 --> 00:20:19,836 Speaker 1: an undercover mission. She signed up to Rusty's bulletin board 287 00:20:19,916 --> 00:20:24,196 Speaker 1: under a fake name, Bob Campbell, and don't we love 288 00:20:24,196 --> 00:20:28,316 Speaker 1: fake names on this podcast. Her mission to hunt down 289 00:20:28,356 --> 00:20:34,076 Speaker 1: copied Playboy pigs. You gotta remember, we had maybe one 290 00:20:34,156 --> 00:20:37,756 Speaker 1: hundred to two hundred thousand images on our servers, and 291 00:20:37,836 --> 00:20:40,756 Speaker 1: I think they found five. Do you remember which pictures 292 00:20:40,756 --> 00:20:45,956 Speaker 1: they were? They said, Bo Derek. Playboy actually presented around 293 00:20:45,996 --> 00:20:48,316 Speaker 1: twenty images to the corps, but it was still a 294 00:20:48,316 --> 00:20:52,036 Speaker 1: tiny fraction of the pictures available. I like to think 295 00:20:52,076 --> 00:20:55,036 Speaker 1: they were all of Bow Derek. She was the actress 296 00:20:55,076 --> 00:20:57,476 Speaker 1: from the movie ten, cast in the role of the 297 00:20:57,516 --> 00:21:00,996 Speaker 1: Perfect Woman. Dudley Moore dreamed of her bouncing towards him 298 00:21:01,036 --> 00:21:05,276 Speaker 1: on a beach. Now. Even before the lawsuit, Rusty had 299 00:21:05,276 --> 00:21:09,516 Speaker 1: a hunch Playboy in particular would come for him someday, 300 00:21:10,076 --> 00:21:13,356 Speaker 1: so he made his son Russ, screen every uploaded image. 301 00:21:13,556 --> 00:21:16,556 Speaker 1: He was a gatekeeper, one of the first online moderators, 302 00:21:16,956 --> 00:21:19,836 Speaker 1: and he told him to keep a particular eye out 303 00:21:20,196 --> 00:21:24,476 Speaker 1: for Playboy images. Rusty even commissioned software to find Playboy 304 00:21:24,516 --> 00:21:27,476 Speaker 1: picks and take them down. For the pictures of Bo Derek, 305 00:21:28,396 --> 00:21:33,796 Speaker 1: they somehow slipped through. Rusty's case settled. His insurance company 306 00:21:33,956 --> 00:21:38,596 Speaker 1: covered the settlement amount, but this case was remembered for 307 00:21:38,676 --> 00:21:43,036 Speaker 1: something else. They don't know what digitalized information did. The 308 00:21:43,076 --> 00:21:47,276 Speaker 1: copyrights still stand for print information. That was a gray area, 309 00:21:47,356 --> 00:21:52,876 Speaker 1: but the Playboy ruling kind of started the if it's digitalized, 310 00:21:52,916 --> 00:21:57,836 Speaker 1: it's still under copyright rule. The judge ruled against Rusty 311 00:21:58,276 --> 00:22:01,676 Speaker 1: precisely because he had asked his son to moderate the uploads. 312 00:22:02,036 --> 00:22:06,916 Speaker 1: By being responsible by screening every file, Rusty became liable. 313 00:22:07,716 --> 00:22:10,396 Speaker 1: Suddenly he was a publisher, not just a bulletin board. 314 00:22:10,916 --> 00:22:14,396 Speaker 1: The thing Rusty to protect the family business actually left 315 00:22:14,396 --> 00:22:18,636 Speaker 1: them exposed. We didn't think that we would lose because 316 00:22:18,756 --> 00:22:22,036 Speaker 1: the one thing my father was against was having any 317 00:22:22,076 --> 00:22:29,156 Speaker 1: pictures of Playboy on our BBS. That was specifically tried 318 00:22:29,316 --> 00:22:32,836 Speaker 1: for years to keep anything they had to do with 319 00:22:32,916 --> 00:22:38,236 Speaker 1: Playboy off of our BBS. That's the funny thing about it. Anyway, 320 00:22:38,236 --> 00:22:40,556 Speaker 1: I guess it's funny, but we thought we had done 321 00:22:40,596 --> 00:22:45,276 Speaker 1: our due diligence. But evidently the courts thought differently. The 322 00:22:45,356 --> 00:22:48,996 Speaker 1: moderation was their downfall. If Rusty hadn't checked a thing 323 00:22:49,316 --> 00:22:52,516 Speaker 1: the people uploading Bow Derek pictures, they would have been 324 00:22:52,516 --> 00:22:55,716 Speaker 1: on the hook to Playboy, not Rusty. This became an 325 00:22:55,756 --> 00:23:00,156 Speaker 1: important ruling for digital media. Who owns it, who has 326 00:23:00,156 --> 00:23:03,676 Speaker 1: a right to share it? Most importantly, can the person 327 00:23:03,756 --> 00:23:07,916 Speaker 1: running the platform be held liable? When A and M 328 00:23:07,996 --> 00:23:12,676 Speaker 1: Records and half the US music industry sued file sharing 329 00:23:12,676 --> 00:23:17,356 Speaker 1: site Napster in two thousand, lawyers in that courtroom reciting 330 00:23:17,556 --> 00:23:21,796 Speaker 1: Playboy versus Russ Hardenberg, the case against Rusty and Edy. 331 00:23:24,316 --> 00:23:26,636 Speaker 1: It's so strange to think that the road rules of 332 00:23:26,716 --> 00:23:29,796 Speaker 1: the Internet were partly laid down in a hot basement 333 00:23:29,796 --> 00:23:33,676 Speaker 1: in suburban Ohio, a hot basement stacked full of computers, 334 00:23:33,836 --> 00:23:38,996 Speaker 1: tangled cables, and grainy gifts of pawn. These road rules 335 00:23:39,036 --> 00:23:41,396 Speaker 1: would be one hell of an important lesson for the 336 00:23:41,476 --> 00:23:46,076 Speaker 1: next generation of Internet entrepreneurs, for Mark Zuckerberg or Jack Dawsey, 337 00:23:47,076 --> 00:23:51,036 Speaker 1: but also online pornographers like Fabian Tilman and Bernt berg Meyer. 338 00:23:51,476 --> 00:23:53,876 Speaker 1: If it was not for Rusty and Edy porn Hub 339 00:23:54,076 --> 00:23:57,156 Speaker 1: might be run very differently. You can hear the same 340 00:23:57,196 --> 00:24:00,636 Speaker 1: debate today. You might have heard of big tech's favorite 341 00:24:00,676 --> 00:24:04,596 Speaker 1: laws to digital Millennial Copyright Act and section two thirty 342 00:24:04,636 --> 00:24:08,996 Speaker 1: of the Communications Decency Act. Together they effectively given you 343 00:24:09,396 --> 00:24:12,036 Speaker 1: to platforms like Google or Facebook. It is a tiny 344 00:24:12,076 --> 00:24:13,996 Speaker 1: law that's had a huge impact on the Internet, as 345 00:24:14,036 --> 00:24:17,236 Speaker 1: we know at section two thirty of the Communication's Decency Act. 346 00:24:17,356 --> 00:24:19,316 Speaker 1: Lawmakers on both sides of the eye want to change 347 00:24:19,316 --> 00:24:22,076 Speaker 1: the way the law works, affecting how content is moderated. 348 00:24:22,116 --> 00:24:26,316 Speaker 1: Online companies aren't liable for what people say or share 349 00:24:26,356 --> 00:24:30,396 Speaker 1: on their sites, even if it is illegal. Some critics 350 00:24:30,436 --> 00:24:33,516 Speaker 1: of the law say that it leaves social media free 351 00:24:33,596 --> 00:24:38,516 Speaker 1: to ignore lies, hoaxes, and slander that can wreck the 352 00:24:38,556 --> 00:24:41,956 Speaker 1: lives of innocent people. And the Playboy case against Rusty 353 00:24:41,996 --> 00:24:45,916 Speaker 1: and Needy it paved the way for that protection on 354 00:24:46,076 --> 00:24:50,876 Speaker 1: screening and moderation. It's set the legal standard for online media. 355 00:24:52,116 --> 00:24:56,516 Speaker 1: The big lesson don't screen content through rigorously. It leaves 356 00:24:56,516 --> 00:25:02,396 Speaker 1: the under hook just deal with the complaints. Rusty's family 357 00:25:02,556 --> 00:25:06,916 Speaker 1: still feels pretty sore. They were raided, dragged through the courts, 358 00:25:07,356 --> 00:25:12,596 Speaker 1: punished for moderating the whole FBI ordeal lasted two years 359 00:25:13,276 --> 00:25:17,396 Speaker 1: without a charge being filed. And all those bowderic pictures 360 00:25:17,956 --> 00:25:21,556 Speaker 1: you can find them on countless sites these days. So 361 00:25:21,716 --> 00:25:26,156 Speaker 1: I did it work? Basically you can get right now 362 00:25:26,596 --> 00:25:29,596 Speaker 1: everything we had on there. If you log in a 363 00:25:29,676 --> 00:25:32,716 Speaker 1: major search engine and hit image, you can get the 364 00:25:32,796 --> 00:25:36,996 Speaker 1: same thing. Now, now, are they suing them? The BBS 365 00:25:37,076 --> 00:25:41,436 Speaker 1: era didn't last for long. By nineteen ninety five, it 366 00:25:41,516 --> 00:25:44,516 Speaker 1: had been pretty much blown away by the popularity of 367 00:25:44,596 --> 00:25:49,636 Speaker 1: AOL and the Worldwide Web. That opened a truly libertine 368 00:25:49,716 --> 00:25:54,796 Speaker 1: era for the Internet and porn, the Great Digital Awakening. 369 00:25:55,636 --> 00:26:05,476 Speaker 1: After the break, we'll meet one of its stars. Act three, 370 00:26:05,836 --> 00:26:10,996 Speaker 1: A Web of wander. Meet Madeler Altman. She's talking from 371 00:26:10,996 --> 00:26:14,596 Speaker 1: her home in Massachusetts, designed by the founder of the 372 00:26:14,676 --> 00:26:18,076 Speaker 1: Bauhaus movement. Out of the window, I can see fields 373 00:26:18,236 --> 00:26:22,396 Speaker 1: rolling into the distance. It's a picture of New England tranquility. 374 00:26:22,876 --> 00:26:25,876 Speaker 1: Was it very intimate doing it over? I mean, oh 375 00:26:25,956 --> 00:26:28,156 Speaker 1: my god, I can Sometimes I came like five six 376 00:26:28,196 --> 00:26:30,756 Speaker 1: times a day. I swarked to God, Alex it was 377 00:26:30,836 --> 00:26:33,996 Speaker 1: so hot. You come on, You're in a private booth 378 00:26:34,036 --> 00:26:36,076 Speaker 1: and the guys are telling you how gorgeous they are 379 00:26:36,156 --> 00:26:40,836 Speaker 1: and how sexy you are and you're like great loving this, 380 00:26:41,156 --> 00:26:44,476 Speaker 1: you know. Madeline is in her late fifties, she has 381 00:26:44,476 --> 00:26:48,156 Speaker 1: two master's degrees, she speaks five languages, and back in 382 00:26:48,236 --> 00:26:51,076 Speaker 1: nineteen ninety five, she was one of the first people 383 00:26:51,156 --> 00:26:55,276 Speaker 1: to create, host, and run a live video conferencing site. 384 00:26:55,676 --> 00:27:00,076 Speaker 1: It just happens she did it while performing nude. Live 385 00:27:00,196 --> 00:27:02,916 Speaker 1: video is something many of us use every day for work. 386 00:27:03,076 --> 00:27:05,956 Speaker 1: It's one of the wonders of the Internet. Madeline's business 387 00:27:06,036 --> 00:27:09,036 Speaker 1: was the not safe for work kind. Today they're cool 388 00:27:09,236 --> 00:27:11,836 Speaker 1: cam sites and they're a great money spinner for pawn. 389 00:27:12,316 --> 00:27:15,636 Speaker 1: Live video is an experience that can't be copied and shared. 390 00:27:16,076 --> 00:27:18,476 Speaker 1: Madeline stands out because she was doing this. In nineteen 391 00:27:18,556 --> 00:27:22,276 Speaker 1: ninety five. The World Wide Web had launched, but none 392 00:27:22,276 --> 00:27:24,636 Speaker 1: of the things we take for granted online were there. 393 00:27:25,356 --> 00:27:30,556 Speaker 1: Search engines, video streaming, online payments. Everything was an experiment. 394 00:27:31,236 --> 00:27:34,556 Speaker 1: Nobody had worked out what the Internet was for or 395 00:27:34,596 --> 00:27:38,156 Speaker 1: how it could be turned into serious money. In other words, 396 00:27:38,596 --> 00:27:43,356 Speaker 1: nobody ruled cyberspace. And this is where porn had its moment, 397 00:27:44,116 --> 00:27:47,356 Speaker 1: when people like Madeline became the first colonizers of this 398 00:27:47,516 --> 00:27:51,356 Speaker 1: online world to understand Madeleine's journey, you have to start 399 00:27:51,356 --> 00:27:56,676 Speaker 1: with a television series, Madeline's Variety TV MVTV. We have 400 00:27:56,716 --> 00:28:00,316 Speaker 1: a hot show for you tonight. It's Breast maintenance Day. 401 00:28:00,596 --> 00:28:03,876 Speaker 1: Does a bra a day help the Sago away? You know? 402 00:28:03,956 --> 00:28:05,996 Speaker 1: I mean, should you? I read once when I was younger, 403 00:28:06,036 --> 00:28:07,596 Speaker 1: you should wear a bra every day? This is true? 404 00:28:07,716 --> 00:28:10,156 Speaker 1: Or that's what you told me. What do you think 405 00:28:10,196 --> 00:28:12,956 Speaker 1: about this? Do you wear a brano? Not every day? 406 00:28:13,596 --> 00:28:17,636 Speaker 1: Inspired by anarchists, it ed in San Francisco on the 407 00:28:17,676 --> 00:28:21,596 Speaker 1: Community Access Channel in the late eighties. MVTV is really 408 00:28:21,596 --> 00:28:24,036 Speaker 1: really sexy, right, because San Francisco is really really sexy, 409 00:28:24,076 --> 00:28:26,236 Speaker 1: so we get really wild, you know, like putting wrestling, 410 00:28:26,356 --> 00:28:29,076 Speaker 1: lesbians having sex on the American flag, and you know, 411 00:28:29,076 --> 00:28:31,716 Speaker 1: when you're immersed in this world. San Francisco in the 412 00:28:31,876 --> 00:28:36,196 Speaker 1: late eighties and early nineties was a heavily sexualized culture, 413 00:28:36,476 --> 00:28:39,596 Speaker 1: and it became super normalized. Right. The show picked up 414 00:28:39,596 --> 00:28:43,596 Speaker 1: a cult following and earned Madeline scholarship to NYU, So 415 00:28:43,636 --> 00:28:46,236 Speaker 1: she moved East and enrolled in one of the hippest 416 00:28:46,276 --> 00:28:50,716 Speaker 1: tech programs around. You had to code whatever was on 417 00:28:50,716 --> 00:28:53,436 Speaker 1: the Internet with HTML code. So I had to learn 418 00:28:53,556 --> 00:28:56,996 Speaker 1: that you have to be really precise, very patient. I'm 419 00:28:57,036 --> 00:29:00,796 Speaker 1: like a hyperactive, crazy, wild producer chick. I Am not 420 00:29:00,916 --> 00:29:02,836 Speaker 1: someone who's going to sit there and make sure every 421 00:29:02,876 --> 00:29:04,956 Speaker 1: dot in its place. It drove me mad, But more 422 00:29:04,996 --> 00:29:08,156 Speaker 1: than anything, the program was about big, brash ideas, and 423 00:29:08,276 --> 00:29:11,316 Speaker 1: one day of those ideas hit Madeline like the clap 424 00:29:11,356 --> 00:29:14,276 Speaker 1: of a Whitney Houston solo. She was walking in New 425 00:29:14,356 --> 00:29:17,236 Speaker 1: York's East Village and thinking back to some old guests 426 00:29:17,236 --> 00:29:22,516 Speaker 1: on her TV show. I do remember like this whole 427 00:29:22,516 --> 00:29:25,796 Speaker 1: thing with talking to strippers and about how they loved 428 00:29:25,796 --> 00:29:27,756 Speaker 1: their job and it was great, but coming back and 429 00:29:27,796 --> 00:29:30,596 Speaker 1: forth from the clubs, it was so dangerous, and I 430 00:29:30,676 --> 00:29:32,516 Speaker 1: knew a stripper who had got an attack. I was 431 00:29:32,556 --> 00:29:34,876 Speaker 1: walking down Second Avenue and I'm like, oh my god, 432 00:29:35,436 --> 00:29:38,316 Speaker 1: just have them do it online. Just is gonna be 433 00:29:38,396 --> 00:29:41,436 Speaker 1: like scooping money out of just puddles everywhere, gonna make 434 00:29:41,436 --> 00:29:44,036 Speaker 1: me so rich, And I'm so altruistic. I get to 435 00:29:44,076 --> 00:29:48,036 Speaker 1: say it's strippers. I'm just so awesome. Have them do 436 00:29:48,196 --> 00:29:52,076 Speaker 1: it online. You can just picture her in that street, 437 00:29:52,436 --> 00:29:57,156 Speaker 1: stopping dead in her tracks. Live video streaming Madeleine had 438 00:29:57,196 --> 00:30:00,196 Speaker 1: just stumbled on the idea that twenty five years later 439 00:30:00,676 --> 00:30:04,436 Speaker 1: made our pandemic zoom calls possible. It was a little 440 00:30:04,476 --> 00:30:09,676 Speaker 1: milestone in tech, Madeleine's lightbulb moment, although they were admittedly 441 00:30:10,156 --> 00:30:13,956 Speaker 1: just a few small issues with making it a reality. 442 00:30:14,516 --> 00:30:17,476 Speaker 1: There was no technology, there was no streaming video, but 443 00:30:17,596 --> 00:30:20,436 Speaker 1: it was charging anything online. But you got to work 444 00:30:20,836 --> 00:30:23,636 Speaker 1: and soon a site called Babes for You was born. 445 00:30:24,596 --> 00:30:27,996 Speaker 1: Madeline put what money she had into it, and there 446 00:30:28,076 --> 00:30:31,236 Speaker 1: wasn't much. She hired a cheap office above a loud 447 00:30:31,316 --> 00:30:34,756 Speaker 1: Mexican joint, playing the Maccarrena all night long. She found 448 00:30:34,756 --> 00:30:37,556 Speaker 1: her babes, who had mainly been working as strippers, and 449 00:30:38,076 --> 00:30:40,676 Speaker 1: in her own words, she hired and fired coders like 450 00:30:40,756 --> 00:30:44,996 Speaker 1: spinal Tap went through drummers. They first went live that year. 451 00:30:45,556 --> 00:30:49,196 Speaker 1: You downloaded some software via an eight hundred number, and 452 00:30:49,276 --> 00:30:52,316 Speaker 1: with that you could play live video. You could chat to, 453 00:30:52,596 --> 00:30:56,756 Speaker 1: although only by keyboard. Set aside the nudity for a moment. 454 00:30:56,996 --> 00:31:00,676 Speaker 1: This was a new frontier in online communication, but it 455 00:31:00,756 --> 00:31:05,676 Speaker 1: was painfully slow. One of the babes didn't show up, 456 00:31:05,756 --> 00:31:09,756 Speaker 1: and so I went and started performing my helf, which 457 00:31:10,276 --> 00:31:12,116 Speaker 1: you know was a huge thing for me because I'm like, 458 00:31:12,156 --> 00:31:14,476 Speaker 1: what am I sex industry worker? Now? Like, I'm a 459 00:31:14,516 --> 00:31:17,436 Speaker 1: super well educated, supposed tech student. Now I'm just a 460 00:31:17,476 --> 00:31:20,716 Speaker 1: sex worker. So I just ended up doing it and 461 00:31:20,916 --> 00:31:22,876 Speaker 1: it was clunky. You know, it was really difficult. A 462 00:31:22,916 --> 00:31:26,716 Speaker 1: lot of the guys simply didn't know how to use 463 00:31:26,716 --> 00:31:29,836 Speaker 1: a desktop computer at all. Right, it really did help 464 00:31:29,876 --> 00:31:33,596 Speaker 1: a lot of strippers. Most of my women were strippers. 465 00:31:33,916 --> 00:31:37,556 Speaker 1: I think it really expanded the sort of popularized view 466 00:31:37,556 --> 00:31:40,316 Speaker 1: of what kind of women men wanted. You know, online 467 00:31:40,516 --> 00:31:44,236 Speaker 1: we found out about all kinds of amazing fetishes. One 468 00:31:44,316 --> 00:31:50,276 Speaker 1: of the fetishes involved oranges, flying oranges. Apparently it's a 469 00:31:50,516 --> 00:31:52,476 Speaker 1: Dutch thing. That was really funny. We did have one 470 00:31:52,476 --> 00:31:54,316 Speaker 1: of these orange people do it, and then she threw 471 00:31:54,316 --> 00:31:56,676 Speaker 1: an orange and knocked the whole system out. It was hilarious. 472 00:31:56,996 --> 00:32:02,156 Speaker 1: But talk about controlling reality with your computer. Was the 473 00:32:02,236 --> 00:32:05,876 Speaker 1: guy wanted oranges thrown at her? Yeah, this is a fetish, Alex, 474 00:32:05,956 --> 00:32:08,156 Speaker 1: This is a big fetish. There are hundreds of men 475 00:32:08,196 --> 00:32:13,076 Speaker 1: out there who are really into it. Oh, I'm ready. 476 00:32:13,076 --> 00:32:14,876 Speaker 1: You know, we have more fun than guys, and they're 477 00:32:14,956 --> 00:32:22,916 Speaker 1: paying us. Oh, angel girl, you know you're cannibal. The 478 00:32:22,996 --> 00:32:26,396 Speaker 1: trouble in the early days was that business was slow. 479 00:32:26,716 --> 00:32:29,956 Speaker 1: Madeline had hired these babes and they were sitting around 480 00:32:30,156 --> 00:32:32,476 Speaker 1: with nothing to do. Well, first of all, nobody knew 481 00:32:32,556 --> 00:32:35,716 Speaker 1: it existed. Second of all, people were worry about giving 482 00:32:35,796 --> 00:32:38,476 Speaker 1: some random number credit card to some people. But you know, 483 00:32:38,916 --> 00:32:42,996 Speaker 1: ultimately they're intense urge to have sex drove them to 484 00:32:43,156 --> 00:32:45,636 Speaker 1: trust the internet with credit card chromos and this was 485 00:32:45,716 --> 00:32:48,356 Speaker 1: never done before. Never, Like people were like, what, what 486 00:32:48,676 --> 00:32:51,636 Speaker 1: buy something online? Who would do that? That's crazy. I'm 487 00:32:51,676 --> 00:32:53,556 Speaker 1: not going to buy anything online. Why would I do that? 488 00:32:54,836 --> 00:32:58,316 Speaker 1: But Madeline had a compelling story. When journalists discovered her, 489 00:32:58,596 --> 00:33:01,916 Speaker 1: they loved her. Here she is in an interview from 490 00:33:01,916 --> 00:33:04,836 Speaker 1: this time. We wanted to do something with sex and 491 00:33:04,916 --> 00:33:06,876 Speaker 1: something with computers because I was hooked up with some 492 00:33:06,916 --> 00:33:09,276 Speaker 1: people who were involved in the foreign business, and we're 493 00:33:09,396 --> 00:33:12,836 Speaker 1: involving the computer business as I am myself, and so 494 00:33:12,876 --> 00:33:15,316 Speaker 1: we thought, well, why don't we do online video sex. 495 00:33:15,356 --> 00:33:18,676 Speaker 1: It's a great idea. Madeline, who graduated last week with 496 00:33:18,716 --> 00:33:22,436 Speaker 1: her second master's degree, is in now get this the 497 00:33:22,556 --> 00:33:29,996 Speaker 1: computer phone sex business. That's right, computer phone sex. After 498 00:33:30,036 --> 00:33:33,756 Speaker 1: the press reports, the customers started lining up and just 499 00:33:33,876 --> 00:33:36,716 Speaker 1: remember how mad this sounded to someone in nineteen ninety six. 500 00:33:37,196 --> 00:33:40,276 Speaker 1: The customers were lining up to pay for things oh 501 00:33:40,356 --> 00:33:43,516 Speaker 1: the Internet. Madlin even worked out how to charge them 502 00:33:43,516 --> 00:33:47,196 Speaker 1: by the minute. By the way, this payment system would 503 00:33:47,276 --> 00:33:50,676 Speaker 1: prove hugely important to the port industry. We'll get into 504 00:33:50,676 --> 00:33:53,036 Speaker 1: that in later episodes. I mean you were kind of 505 00:33:53,356 --> 00:33:56,076 Speaker 1: helping people over the threshold in a way, right, in 506 00:33:56,116 --> 00:33:58,716 Speaker 1: terms of using credit cards, well, yeah, I mean sex 507 00:33:58,796 --> 00:34:00,556 Speaker 1: is the biggest drive of all right, people will do 508 00:34:00,636 --> 00:34:03,476 Speaker 1: crazy things for sex, even to use the credit card 509 00:34:03,556 --> 00:34:08,396 Speaker 1: over the Internet. I mean, basically we invented internet commerce 510 00:34:08,396 --> 00:34:11,836 Speaker 1: and just keep charging people's credit cards by the minute. 511 00:34:11,996 --> 00:34:15,556 Speaker 1: This was never done before she performed, and she also 512 00:34:15,636 --> 00:34:19,276 Speaker 1: acted as an IT help desk. She explained to customers 513 00:34:19,316 --> 00:34:22,396 Speaker 1: how to switch on their computer or warn them about 514 00:34:22,476 --> 00:34:26,636 Speaker 1: the CD ROM drive the round hole. No, it's not 515 00:34:26,716 --> 00:34:29,156 Speaker 1: for holding your coffee cup. People would call like, why 516 00:34:29,156 --> 00:34:31,476 Speaker 1: doesn't it work. You're like, seriously, it's not plugged in. 517 00:34:31,636 --> 00:34:33,036 Speaker 1: I don't know what a window is. What do you 518 00:34:33,076 --> 00:34:35,196 Speaker 1: mean by a window? Like, I don't know how to 519 00:34:35,236 --> 00:34:38,196 Speaker 1: resize the window. They're like, just drag it from the corner. 520 00:34:38,756 --> 00:34:42,676 Speaker 1: Madeline's idea that Thunderbolt on Second Avenue was a live 521 00:34:42,716 --> 00:34:46,236 Speaker 1: sex show online, but in reality she just didn't have 522 00:34:46,356 --> 00:34:49,236 Speaker 1: the tech to do it. There was no concept of streaming, 523 00:34:49,756 --> 00:34:51,836 Speaker 1: but with the help of a couple of tech wizards, 524 00:34:51,836 --> 00:34:55,636 Speaker 1: she figured it out. By nineteen ninety six, they were 525 00:34:55,676 --> 00:34:59,876 Speaker 1: streaming video directly through a web browser, a technology then 526 00:34:59,916 --> 00:35:04,076 Speaker 1: called jpeg push. This was the dawn of live camps. 527 00:35:04,556 --> 00:35:08,196 Speaker 1: Think about your zoom or FaceTime, but back then the 528 00:35:08,276 --> 00:35:12,196 Speaker 1: breakthrough was literally the digital version of an old animation book, 529 00:35:12,796 --> 00:35:14,596 Speaker 1: you know, the ones where you flipped through the images 530 00:35:14,636 --> 00:35:17,476 Speaker 1: which your thumb. We were the first to stream live video. 531 00:35:17,876 --> 00:35:20,556 Speaker 1: I mean, the live part is the real component here, 532 00:35:20,556 --> 00:35:22,596 Speaker 1: and that's really where I came in because I've been 533 00:35:22,596 --> 00:35:24,436 Speaker 1: dealing with live programming for so long. It was a 534 00:35:24,516 --> 00:35:27,396 Speaker 1: shoe in for me to figure out how to get 535 00:35:27,436 --> 00:35:31,476 Speaker 1: this live programming through the Internet. While Madeline might not 536 00:35:31,556 --> 00:35:35,156 Speaker 1: have been the very first, she definitely was one of 537 00:35:35,196 --> 00:35:38,196 Speaker 1: the first. It was so cutting edge that some people 538 00:35:38,236 --> 00:35:41,436 Speaker 1: were showing up with no interest in Paul. It's amazing 539 00:35:41,476 --> 00:35:44,236 Speaker 1: how many customers in the beginning came on not for sex, 540 00:35:44,276 --> 00:35:46,636 Speaker 1: but to figure out the technology. They were like, wait, okay, 541 00:35:46,636 --> 00:35:49,556 Speaker 1: how are you doing this? Can you just I will pay? 542 00:35:50,076 --> 00:35:51,716 Speaker 1: I don't want to see the girl, Just get me 543 00:35:51,756 --> 00:35:54,036 Speaker 1: the owner, and I need to talk to the programmer 544 00:35:54,076 --> 00:35:57,756 Speaker 1: and I need to figure out what's going on. Porn 545 00:35:58,316 --> 00:36:01,916 Speaker 1: was teaching the world how to use the Internet. Sure, 546 00:36:02,556 --> 00:36:05,756 Speaker 1: I mean people were experimenting with live video, but at 547 00:36:05,756 --> 00:36:08,476 Speaker 1: that point the people who made it work and made 548 00:36:08,516 --> 00:36:13,116 Speaker 1: money from it were important, like Madeline's sites, plus a 549 00:36:13,156 --> 00:36:19,636 Speaker 1: few streamed sex shows from Amsterdam. Madeline, though, didn't stick around. 550 00:36:20,156 --> 00:36:23,356 Speaker 1: Her adventures in online sex were drawing to a close. 551 00:36:23,876 --> 00:36:26,996 Speaker 1: She was pregnant, her priorities changed, and she got an 552 00:36:26,996 --> 00:36:29,996 Speaker 1: offer on Babes for You. It came from a couple 553 00:36:29,996 --> 00:36:33,956 Speaker 1: of ex insurance salesman from Boston. They got into the 554 00:36:34,036 --> 00:36:36,636 Speaker 1: world of live video thinking it would be a way 555 00:36:36,676 --> 00:36:41,516 Speaker 1: to connect financial advices, theither being the largest purveyors of 556 00:36:41,556 --> 00:36:46,116 Speaker 1: sex worldwide. Madeleine's site became part of a business that 557 00:36:46,236 --> 00:36:49,796 Speaker 1: launched Float for Free, one of the biggest live camporn sites. 558 00:36:50,676 --> 00:36:54,436 Speaker 1: Madeleine was happy, though she bought a Bouhou's house with 559 00:36:54,516 --> 00:36:57,916 Speaker 1: her earnings. She's still there in the house that sex 560 00:36:57,996 --> 00:37:00,956 Speaker 1: bot and she's proud of what she did in those 561 00:37:00,996 --> 00:37:05,276 Speaker 1: wild days of online experimentation. Madeleine was in the first 562 00:37:05,316 --> 00:37:08,956 Speaker 1: generation of Internet entrepreneurs, the first to play with the 563 00:37:08,956 --> 00:37:13,436 Speaker 1: spell binding potential of the worldwide Web. Madeline's thing was 564 00:37:13,676 --> 00:37:16,196 Speaker 1: live video, but we could have told you stories of 565 00:37:16,276 --> 00:37:21,476 Speaker 1: solo performers with amateur scites, swinging couples, credit card swindlers. 566 00:37:21,516 --> 00:37:25,636 Speaker 1: These were crazy days. One pornographer at the time boasted 567 00:37:25,676 --> 00:37:29,476 Speaker 1: that she used more bandwidth than all of Central America. 568 00:37:29,556 --> 00:37:32,956 Speaker 1: It was porn that really pushed for the streaming technology. 569 00:37:32,956 --> 00:37:35,756 Speaker 1: It was porn that really pushed for all the credit 570 00:37:35,796 --> 00:37:39,796 Speaker 1: card and online commerce technology. It was us, We're the 571 00:37:39,796 --> 00:37:47,076 Speaker 1: ones who did it. A chick from NYU. They set 572 00:37:47,116 --> 00:37:50,276 Speaker 1: the fire. They taught the world about the power of 573 00:37:50,276 --> 00:37:55,836 Speaker 1: the web, deliberating side and the scary, uncontrolled side. Within 574 00:37:55,876 --> 00:37:59,276 Speaker 1: a couple of decades, the fire that Madeline's generation started, 575 00:38:00,116 --> 00:38:03,036 Speaker 1: it became an inferno. The tube sites we told you 576 00:38:03,036 --> 00:38:07,596 Speaker 1: about they popped up. Porn became ubiquitous, streamed in an 577 00:38:07,596 --> 00:38:11,276 Speaker 1: instant often for free. Thanks in part to the Playboy 578 00:38:11,356 --> 00:38:15,156 Speaker 1: court case, owners of sites like Pornhub could host vast 579 00:38:15,236 --> 00:38:18,636 Speaker 1: amounts of porn without being held to count for any 580 00:38:18,676 --> 00:38:24,876 Speaker 1: specific video until twenty twenty, that is, when pawn faced 581 00:38:24,916 --> 00:38:29,276 Speaker 1: an almighty reckoning over illegal content, and pawn Hub's world 582 00:38:29,796 --> 00:38:33,756 Speaker 1: came crashing down. It was the moment pawn hubs Enemies 583 00:38:33,796 --> 00:38:40,076 Speaker 1: discovered the Achilles Heel of online pawn. That's our next episode. So, 584 00:38:40,116 --> 00:38:44,716 Speaker 1: in my opinion, there's two players on this planet that 585 00:38:44,876 --> 00:38:47,676 Speaker 1: can kill pawn online, and they can literally kill it. 586 00:38:47,916 --> 00:38:51,916 Speaker 1: And if they decidele they it's dead. It's done, absolutely impossible. 587 00:39:01,516 --> 00:39:04,076 Speaker 1: Hot Money is a production of The Financial Times and 588 00:39:04,076 --> 00:39:07,356 Speaker 1: Pushkin Industries. It was written or reported by me Patrician 589 00:39:07,396 --> 00:39:11,796 Speaker 1: Neilson and me X Barker. Peter Sale is our lead 590 00:39:11,796 --> 00:39:16,356 Speaker 1: producer and sound designer. Edith Russolo is our associate producer. 591 00:39:16,556 --> 00:39:22,036 Speaker 1: Our editor is Karen Shakerjie Amanda Kwong is our engineer. 592 00:39:22,396 --> 00:39:27,996 Speaker 1: Music composition by Pascal Wise, fact checking by Andrea Lopez Kusado. 593 00:39:28,556 --> 00:39:33,196 Speaker 1: Our executive producers are Cheryl Brumley and Jacob Goldstein. Special 594 00:39:33,196 --> 00:39:35,956 Speaker 1: thanks to Renee Kaplan and Ruler Kalov at The Financial 595 00:39:35,956 --> 00:39:41,356 Speaker 1: Times and Mia Lobel, lital Molad, Justine Lang, Julia Barton 596 00:39:41,676 --> 00:39:45,516 Speaker 1: and Jacob Weisberg at Pushkin Industries. Thank you to a 597 00:39:45,516 --> 00:39:49,836 Speaker 1: similar Web for providing our web traffic data. If you 598 00:39:49,916 --> 00:39:53,836 Speaker 1: liked this show, consider subscribing to Pushkin Plus, offering bonus 599 00:39:53,836 --> 00:39:56,676 Speaker 1: content and ad free listening across our network for four 600 00:39:56,716 --> 00:39:59,516 Speaker 1: dollars ninety nine a month. Look for the Pushkin Plus 601 00:39:59,636 --> 00:40:12,236 Speaker 1: channel on Apple Podcasts or at pushkin dot fm. Hope 602 00:40:12,276 --> 00:40:14,356 Speaker 1: you will know how you give your dread