Triangle
Things are so bad these days even the porn industry could use a helping hand. Right or left, it doesn’t matter as long as it’s holding lots of money. Two smut kings, Larry Flynt, publisher of Hustler magazine, and Joe Francis, creator of the Girls Gone Wild videos, even asked Congress for $5 billion to make up for soft demand.
At least one Tar Heel member of the industry is feeling the pinch. Sales at Hillsborough-based Adam & Eve fell 3.6% to $110 million in 2008. It’s still the nation’s largest mail-order company for erotic material, but it faces stiff challenges from the ailing economy and changing technology. When money is tight, people are more likely to put off purchases, just as they might wait for better times to buy a sexier pair of sunglasses. Why spring for Hot Cherry Pies 4 when you can make do with Hot Cherry Pies 3?
The company also must contend with Internet-spawned competitors such as Charlotte-based AEBN, a provider of adult videos on demand — not to mention the plethora of free porn online. “The glut of adult DVDs out there and the availability of free adult content on the Web have definitely affected us,” spokeswoman Katy Zvolerin says.
In fact, DVDs are no longer the top source of revenue. During the past few years, Adam & Eve has returned to its roots, depending more on its own stimulus packages. In 2005, vibrators and other sex toys each accounted for 23% of sales, same as DVDs. Last year, DVDs dropped to 19%, while vibrators and other sex toys each made up 29%. Online sales have surpassed those from the company’s mail-order catalogs, which Phil Harvey, president of parent PHE Inc., launched in 1970 to sell condoms.
It plans to continue its focus on toys and novelties, offering a wider variety of prices. As for its own line of Adam & Eve DVDs, which it began producing in the 1990s, the company is focusing on bigger-budget, star-driven productions. “Basically we’re making fewer movies but better ones,” Zvolerin says. “The future of adult DVD is unknown at this time, but adults will always want sexual enhancements to spice up the bedroom. And luckily, these can’t be found free online.”
Location is everything
In a way, computer maker Lenovo Group Ltd. became more of an American company after replacing its Yankee CEO with a Chinese citizen. Though Lenovo stock still trades on the Hong Kong exchange, Morrisville not only is home of the company’s worldwide product development and marketing, it’s now the base of its chief executive. Bill Amelio, who had “come to the end of his three-year contract” as the company reported its first quarterly loss, was succeeded by Yang Yuanging, who held the CEO job for several years before Amelio and helped build Lenovo’s business in China. While Amelio ran the company from Singapore, Yang spent three years in Morrisville as chairman, spokesman Ray Gorman says. And that’s where he’ll stay.
RALEIGH — Red Hat will join forces with rival Microsoft to develop software that will allow servers to run applications from both companies’ operating systems. Red Hat’s Linux and Microsoft’s Windows account for 80% of operating systems on servers that run multiple applications.
DURHAM — Icagen cut CEO Kay Wagoner’s salary 10% to $334,152, at her request, to soften some of the recession’s impact on the company. She can earn a bonus of up to $189,353.
CARY — ASG, which provides staffing services for contract drug research, purchased drug tester Ockham Development Group, also based here. Terms were not disclosed. ASG employs 175, including 32 at its headquarters. Ockham has 40 of its 65 employees here. About 10 jobs will be cut.
MORRISVILLE — Etrials Worldwide, a maker of software for testing drugs, sued Belgian rival Unithink, accusing it of stealing employees and secrets. The suit seeks unspecified damages from Unithink and two former Etrials employees, Chief Operating Officer Robert Sammis and Director of Technical Operations Brendon Ball.
RALEIGH — Optimal Technologies cut 44 jobs, leaving it with 25. It had promised to employ about 325 when it moved its headquarters from Canada to Raleigh a year ago. Optimal specializes in improving the flow of electricity over transmission grids.
CARY — Qimonda North America filed for Chapter 11 bankruptcy protection. Its parent, German chip maker Qimonda, filed for insolvency reorganization in its homeland a month earlier. The company employs about 60, down from 300 last fall.
SOUTHERN PINES — Ingersoll-Rand laid off 29 employees. Its tool factory here now employs about 180. The company is based in Woodcliff Lake, N.J.
RALEIGH — Veredus, a Tampa, Fla.-based Internet-technology staffing company, opened an office here and plans to hire 30 within a year. The company also has offices in Atlanta and Maitland, Fla.
MORRISVILLE — Richard Bird, 65, replaced Dennis Reed, who was fired as CEO of gem maker Charles & Colvard. Bird is president of Bird Capital Group Inc., a Houston-based consultant for private-equity investments. Reed had been running the company since the resignation last summer of CEO Robert Thomas, 60.
RALEIGH — Lewis R. Holding, 81, retired as chairman of First Citizens BancShares, making way for Frank Holding Jr., 47. He had turned over the CEO role to his nephew early last year.
DURHAM — Duke University trustees approved a 3.9% tuition increase for undergraduate students, one of the smallest increases in recent years. The total cost to attend this coming school year, including room, board and fees, will be $49,895.
