We need a little history to put things in perspective though.
The video cassette recorder (VCR), first hit the streets in 1972 with Sony's "U-matic", and made a splash as an interesting, if expensive toy.
It wasn't until the porn industry realized that they could make movies very cheaply (or very cheap movies?) on video cassettes and began selling them that VCR sales improved. When sales improved, the price dropped, and within a few years VCR's were as common as computers are today. Anyone who is interested can go read a lengthy, but eminently readable article "History and Future of Sex" at http://www.ejhs.org/volume2/history.htm
A few years later (after copyright battles about blank tapes and so forth) large entertainment companies realized that the VCR had important ancillary benefits to their industry. Movie rentals earn an income long after the movie is released, and even supports an entire industry of direct-to-video 'B' movies.
Video stores in the early days usually had a section devoted to pornography. But increased merchandising awareness among entertainment giants eventually drove these movies out onto their own.
The peep show was replaced by commonly available video cassettes, and those video cassettes were driven (largely) into separate stores behind covered windows. The circle is complete.
Of course, one might wonder that sex is off limits, but some of the worst, most violent, and superficial movies ever produced are still displayed in 'family' stores alongside family movies. But that's another topic.
The internet grew slowly at first, and was populated by the Bulletin Board System. As lately as the early 1990's there were still BBS's selling subscription services. The communications infrastructure simply wasn't capable of much more than sending text messages. Go to 'The Roads and Crossroads of Internet History" at: http://www.netvalley.com/intval.html if you want to know the whole history.
But the internet itself was born in 1989, and the aforementioned BBS's started linking their 'nets'. About a day later, the porn industry figured out what to do with it, while large business stood by and wondered why their employees should be allowed to send huge image files, presentations, and talk to each other long distance. Remember that the largest software company in the world could still at that time produce reasonably compact programs and file structures.
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