Porn Production Hit Hard

"Filming is beginning to slowly move to Eastern European countries where girls are willing to do the work for less money," says Michael, a British expatriate who used to work at a publication specialising in the porn film industry.

One of the best known figures in the industry, director and producer Istvan "Kovi" Kovacs disagrees, "Due to the recession and to the free content available on the Internet, the industry is suffering losses in Hungary and everywhere else."

A bulky man in his fifties, "Kovi" has made over 70 X-rated films and won two AVN Adult Movie Awards, also known as the "Oscars of porn", with his production company LUXx Video, which he started in the 1990s.

"Nowadays, Internet users stop at the gates of paid content," says Kovi, sitting in his office in an outer district of Budapest, surrounded by shelves of awards; "Consumers are tightening their belts and with widespread DVD piracy, good times seem to be over for the adult film industry."