Playboy in Shanghai

This is a partial transcript from "Your World with Neil Cavuto," December 6, 2004, that was edited for clarity.

NEIL CAVUTO, HOST: You know a society has come of age when Playboy (search) comes a-calling. Such is the case with China (search) and such is the mission of one Christie Hefner, the woman who runs the vast Playboy empire.

Christie, good to have you.


CAVUTO: What would you call this? Like a gentleman's club in Shanghai or what?

HEFNER: We call it entertainment destination, because it's more than a club. It's going to have a store, a spa, two restaurants, concierge service, a wine and cigar bar, live entertainment. It's 120,000 square feet, so this is a major entertainment facility.

CAVUTO: I thought that they had problems with our skin in this country and our obsession with that.

HEFNER: Well, I think if you think about the history of sexuality, you think about Asian art and beauty and the question is how well do you do it? And I think nobody is more tasteful or more respectful of local differences than Playboy. Remember, we've been doing business for 25 years in China.

CAVUTO: Does Playboy magazine, sell in China? Or is this a precursor to that.

HEFNER: We do sell in Hong Kong and Taiwan.

CAVUTO: I see.

HEFNER: But we have had licensed products, fashion and accessories, in China for over two decades. There may be a point in time where we do a magazine. But right now we're really excited about bringing the brand to life.

CAVUTO: All right. Now the fee, I understand, to be part of this club, whatever you want to call it, is the U.S. equivalent of 50 grand?

HEFNER: That's the corporate membership. But for you it's only $10,000.

CAVUTO: It's only $10,000.

HEFNER: For an individual, just $10,000.

CAVUTO: So what kind of interest reaction have you got?

HEFNER: Well, let me put it this way. Our partners have, by agreement with us, said we need to cap the membership at 1,000 to provide the level of service that we want to. And they believe that they will be at that level before we open.

CAVUTO: Well, let's talk a little bit about the FCC crackdown on the likes of Howard Stern and others on this country. Was there any boomerang on your company?

HEFNER: Well, ironically, I think it's good for Playboy. Because what it does is draw a stronger distinction between broadcast free media and pay media. I mean, Howard Stern goes to Sirius. Playboy does subscriber radio. Playboy is pay television.

CAVUTO: So your subscriber rate, is that carried on Sirius and X.M.?

HEFNER: Right now just on X.M.

CAVUTO: Just on X.M.

HEFNER: We are obviously pay television.

CAVUTO: That's very popular, the X.M. show, right?

HEFNER: Yes. Very popular.

CAVUTO: Because you're doing that without seeing anything.

HEFNER: I think that it may be a significant contributor to why they have a couple of million subscribers.

CAVUTO: Yes, it is that many, right?

HEFNER: But Playboy has always been in the business of providing quality adult entertainment, and our video game that's coming out in January is M-rated.

CAVUTO: What's that going to be, though?

HEFNER: Mature audiences, like an R-rated movie.

CAVUTO: What's the game?

HEFNER: Oh, the game is very cool. You get to be Hef.

CAVUTO: Be your dad.

HEFNER: And you get to create the magazine. And if you're successful as an editor, you get to build a mansion and throw parties. It's a Sims-style reality game and will be in stores January 26.

CAVUTO: What do you think of your dad?

HEFNER: How cool is he?


HEFNER: And I think the thing that is most neat and most fun for him is that guys in their 20s think he's the man.

CAVUTO: Yes. Don't you think this is all a shtick on his part, though, the satin robe and all that stuff? He's actually a very savvy businessman, right?

HEFNER: Oh, he is so. I mean, it is not a shtick in the sense that he has found a way to live the life he wants to live and, by extension, everybody wants to be Hef. But he is also unquestionably a brilliant marketer.

CAVUTO: But I told you, and I wasn't just blowing smoke your way. This brand was dying on the vine before you came along and not only spread it out to other venues, video, what have you, but it was looking like Playboy's days were numbered.

HEFNER: Well, I think any strong brand can go through a life cycle, and sometimes it doesn't recover. I think we were fortunate in that we made the right moves with the license business and television. And then a year and a half ago we redesigned the magazine and now it's hotter than ever.

CAVUTO: Now people are reading it for the articles.

HEFNER: There you go.

CAVUTO: Anyway, Christie Hefner, thank you. Very good seeing you. Good luck in China.

HEFNER: Thank you.

CAVUTO: As you conquer the known world.

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