I think the flourishing of pornography in the 90’s had more to do with the growth of the internet. I was rading a story somewhere recently however that said the porn business has taken a hit lately because porn is readily available now for free and doesn’t have to be paid for (sorry I can’t remember where I read that).
I think that porn is a double-edged sword. It went from peep-show sleeze theaters and grainy 8mm films to a huge business today. It drove advances in in-home entertainment (think VHS+home theater). It made the internet ubiquitous in the 90s. It's driven the development of high-speed bandwidth infrastructure this decade. I think that the next advancement that it will drive will be a Virtual Reality-type environment (think Star Trek Holodeck).
Would these advancements have come about without porn as a driver? Sure, but IMHO, they would've taken a lot longer. Never underestimate the power of legions of horny geeks with no girlfriends and lots of disposable income.
HOWEVER, is society as a whole, worse off for it? I would guess yes, but I'm not certain. I'm sure that people are far more desensitized to sexual content, and that's not a good thing. I don't have enough contact with teenagers that have grown up with virtually unlimited access to porn (NetNanny works all the time? surrrre, keep on believing that) to see what the end result is. I would think that they'd get bored with porn, just like any other thing that's no longer "new and interesting". But I don't know.
Things have changed a lot from sneaking into my friend's father's garage and checking out his stash of Playboy mags.