Tim Valenti and Greg Lindberg are accidental pornographers.

When the two former advertising men started their own Web design company, Cubik Media, in the mid-1990s, one of their first clients was Eidos Entertainment, the company that makes the Tomb Raider video game. Part of the campaign used streaming video, but the new technology was not ready for prime time and almost no one had the high-speed connections necessary to view the content. But Valenti and Lindberg saw potential. On a whim, they started Nakedsword.com, an adult site for gay men, figuring that online video would save a potentially embarrassing trip to the video store. “We built some password-protected areas and threw up some videos, mainly as an experiment,” says Lindberg, Cubik’s CTO. Then something unexpected happened: “People started buying it left and right.” Almost overnight, Nakedsword.com became 90 percent of Cubik’s business. In the years since, Cubik has continued to innovate with online video. It was among the first to use Flash for streaming video, build digital rights management capability into its movies and use peer-to-peer networks for distribution. Most recently, Cubik is integrating a cutting-edge digital fingerprinting system that can spot copyrighted material posted by users on one of its sites, an adult version of YouTube. The system works by turning the sound waves from a movie’s audio track into an image. Every time a user uploads a clip, the system makes a graph of the new audio and compares it to the graphs in its database. If the clip a user is trying to post matches a copyrighted one, Cubik takes it down.

On the Cutting Edge
Red light sites probably aren’t places CIOs normally would look to find innovative IT. But the sex and gambling industries have always been at the forefront of technological innovation. During World War II, the illegal telephone network that bookies developed was more reliable than the one the War Department used, says Harold Layer, professor emeritus at San Francisco State University. And the pornography industry has helped select technology winners and losers for ages. In the 1980s, for example, demand for adult material gave VCR makers the economies of scale they needed to make their devices affordable, says Jonathan Coopersmith, a professor of technology history at Texas A&M University.