The Green Stock Exchange (GREENSX) trades securities in the cultural industry. Note that issuers in the cultural industry needs to keep their social and creative ideals central to their mission - to ensure both a sustainable enterprise and great art.
The cultural industry is under tremendous change, due to the rise of the Internet. Traditional retail economics limit stores to only stocking hits because shelf space is limited and expensive. But online retailers (Amazon, iTunes, etc.) can stock virtually everything.
The millions of niches that can stock anything besides just the hits are the “Long Tail”. We paraphrase Chris Anderson’s definition as: “The theory of the Long Tail is that the economy is increasingly shifting away from a focus on a relatively small number of ‘hits’ (mainstream products and markets) at the ‘head’ of the demand curve and toward niches at the ‘tail’ of the demand curve. In the new world, all content
can be accessed, including the Long Tail on the right. In a Long Tail world,
word of mouth will be more important; it is also
the best marketing strategy for decades (lowest customer acquisition cost). The Long Tail is “pull”. Broadcast is “push”. The Long Tail
personalizes content to the person looking for cultural products, which
results in higher customer satisfaction.
Social Networks such as our E=MC² Creative Friends Network will become more important as a tool to create word of mouth for authentic favorites of members on a viral scale.
In an era without the constraints of physical shelf space, narrowly-targeted goods and services can be as economically attractive as mainstream fare… Economically, the aggregate size of the many small markets in goods that don’t individually sell well enough for traditional retail and broadcast distribution may rival that of ‘hits’.
The Green Stock Exchange (GREENSX) and the E=MC² Creative Friends Network serve the Long Tail, by supporting more small independent artists and independent publishers.
The LOHAS Mix
The arts strengthen social capital. In fact, the arts are a central part of the LOHAS (Lifestyles of Health and Sustainability) consumers (called "cultural creatives" or the "creative class"), that we are targeting. They are called cultural creatives for a reason, they love arts and culture. Imagine how dull life would be without any movies, music, television, art, books, magazines, dance, Academy Awards, movie stars, and other cultural products.
The term LOHAS was first coined by sociologist Paul Ray and psychologist Sherry Anderson, co-authors of The Cultural Creatives (also founders of Gaiam, LOHAS Journal and Forum in 1999).LOHAS now represent 23% of the population (about 50 million adults) in the United States, and 29% of the population in Japan (about 37 million). What is astounding is the speed with which the group appeared, moving from less than 4 percent of the U.S. population in the 1960s to more than 23% percent in the 1990s, a new record for such a population trend .Countries around the world are showing interest—Japan, Taiwan, China, Australia, New Zealand, India, Germany, Holland, England, France, Canada, and more—all want to understand and integrate LOHAS principles into their own cultures.
How Important for LOHAS?
Studies have found that the arts combine with more traditional “community quality of life” was the second most important
factor—just below salary—and more important than benefits, stock options, or company
stability.
Community quality of life includes: access to theatres, cinemas, performing arts centers, art galleries, bars and clubs,
film festivals, music festivals, arts festival, good restaurants, safe neighborhoods, good schools, strong infrastructure, and
outdoor “natural” attractions. Cultural activities are enjoyable
and fun.
Statistics on this Sector
|
U.S. Consumer Spend Per person Per Year
Note: Other includes Box Office, Video Games, Mobile Content, Broadcast/Satellite Radio.
Source: Veronis Suhler Stevenson |
The cultural sector includes: fine arts, music, computer games, design, museums, art galleries, archives, historic sites , film and video production / distribution, movie theatres, TV viewing, radio listening, the performing arts, book and periodical publishing, heritage institutions, botanical gardens, exhibition halls, amusement parks, dance companies, edutainment industry, country clubs, museums, amusement arcades, government and private sector funding of culture, culture trade and investment, the culture labor force, online ticket sales ...etc.
The arts and culture sector is supported both by non-profit organizations, as well as for-profit organizations.
Non-Profit
On the formal side, the United States is home to some 21,750 non-profit arts, culture, and
humanities organizations, according to federal government estimates. These officially recognized
organizations hold an astonishing $37-billion in assets and spend $13.3-billion annually to enrich
our understanding of truth, to enlarge our appreciation of beauty, and to give us insights into the
human condition.
Report show that America's nonprofit arts industry generates $134 billion in economic activity every year, including $80 billion+ in audience spending, $53 billion+ in spending by arts organizations, and $24 billion+ in tax revenue. The non-profit arts industry, with $36.8 billion in annual revenue, is a potent force
in economic development nationwide that supports 1.3 million
full-time jobs. States and communities have integrated the
arts into their economic development arsenal to achieve a wide range of direct and indirect economic goals. Arts programs have served as components of high-impact economic development programs by assisting state and local government.
Alongside these formally established organizations are tens of thousands of groups known
collectively as the “unincorporated arts.” Under this umbrella are non-professional and loosely
organized church choirs, poetry slams, recital series, chamber music ensembles, quilting guilds,
reading groups, hip-hop sessions, and other largely volunteer-run groups.
As for trading between countries,
UNESCO shows that the trade of cultural goods was $59.2 billion in 2002 - music, books, crafts, films and many other cultural goods and services move across international borders.
For-Profit
Here are highlights of some key cultural categories that investors might be interested in:
Art is an integral part of the LOHAS lifestyle; creative people like to share in all things creative. The LOHAS consumer ( "cultural creatives") are more open to new ideas, so they are more likely to have a diverse range of art interests.
Artists create art to communicate ideas, thoughts, or feelings. They use a variety of methods — painting, sculpting, or illustration—and an assortment of materials, including oils, watercolors, acrylics, pastels, pencils, pen and ink, plaster, clay, and computers. Artists’ works may be realistic, stylized, or abstract and may depict objects, people, nature, or events.
Artists held about 218,000 jobs in 2006. About 62% were self-employed. Employment was distributed as follows:
| Multimedia artists and animators |
87,000 |
| Art directors |
78,000 |
| Fine artists, including painters, sculptors and illustrators |
30,000 |
| Craft artists |
8,800 |
| Artists and related workers, all other |
14,000 |
Artists generally fall into one of four categories.
- Art directors formulate design concepts and presentation approaches for visual communications.
- Craft artists create or reproduce handmade objects for sale or exhibition.
- Fine artists, including painters, sculptors, and illustrators, create original artwork, using a variety of media and techniques.
- Multi-media artists and animators create special effects, animation, or other visual images on film, on video, or with computers or other electronic media.
Of the artists who were not self-employed, many worked for advertising and related services; newspaper, periodical, book, and software publishers; motion picture and video industries; specialized design services; and computer systems design and related services. Some self-employed artists offered their services to advertising agencies, design firms, publishing houses, and other businesses.
Now, let us look at fine art - including painters, sculptors and illustrators. Well-established fine arts artists earn more than salaried artists, while others find it difficult to rely solely on income earned from selling fine art. As an investment point of view, the global public auction fine art market in 2006 generated a
total revenue of $ 6.4 billion which represents double the amounts
regularly posted during the 1999 - 2003 period and an increase of
52% compared with 2005.
There are also numerous fine art sold independently that is not listed above, which brings brings cultural capital, including paintings, sculptures, fine art photographs, installations and fine art digital media.
Through the E=MC² Creative Friends Network and the Green Stock Exchange (GREENSX), we will empower the fine art market with more venues for art exhibitions and art sales.
Fine Art > Risks: Medium
If you are considering investing in fine art, you should select something that you like to have around your house or office.
Art is considered a gift of beauty, usually not an investment. Only real art lovers should consider investing in this sector. Most investors of fine art are the domain of the super-rich, but more and more young people are getting into collecting and supporting young artists. Young collectors can see the artist grow, as their own career grows.
If you are buying art of a well know artist you should investigate the artist's historical prices. If it is a new or emerging artists, prices vary. Although investments in art historically outperform traditional stock investments, if you are not an art lover do not consider investing in this sector.
A good place to start investing in fine art is at your local gallery, getting to know young local artists and appreciating fine art. |
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Music is the passion of LOHAS consumers; creative people loves music to give them inspiration. However, the LOHAS consumer ("cultural creatives") differ somewhat from the mainstream because the cultural creatives listens to more independent and diverse types of music.
The global market was estimated at $30-40 million annually, with annual unit sales (CDs, music videos, mp3s) about 3 billion.
The industry was dominated by the "Big Five ":
- Universal Music Group — 25.5%
- Sony BMG Music Entertainment — 21.5%
- EMI Group — 13.4%
- Warner Music Group — 11.3%
- independent labels — 28.4%
The Green Stock Exchange (GREENSX) collaborative securities trading system sand the the E=MC² Creative Friends Network will be most beneficial to the 28.4% of independent labels worldwide. There are more than 100,000 independent bands worldwide; just go to GarageBand.com and you will see
50,000 independent bands listed alone.
Who hears independent labels music? The radio stations only playing a small fraction of the abysmally small number of music that actually managed to get released. According to Clear Channel owner Art Mays, at a recent Senate Commerce Committee hearing (Jan 30, 2003), Clear Channel -- representing more than 1,200 radio stations across the country -- added only 3000 songs to their playlists in 2002, which represented the work of only 550 artists.
The most important component of the music industry is the artist's effort in developing that music and getting the music heard. Artists spend a large portion of their creative energy on writing song lyrics and composing music or working with producers and A&R executives to find great songs from great writers. This task can take weeks, months, or even years. The creative ability of these artists to produce the music we love, combined with the time and energy they spend throughout that process is in itself priceless. Artists are usually paid about 6 to 9 cents per song sold.
Apple's iTunes, which sells music digitally for the iPOD has revived the music industry. iTunes is now the second largest seller of music in the United States. The recording industry is focusing on the evil consumer and the Internet downloads as the cause of the industry's problem, but it may be due to many factors such as the lack of mega-superstars, copy-protected CDs, few and fewer new releases every year, and the drop in the price of CDs. Record companies are now getting into new businesses, like so-called "360 deals" in which they take a cut of all proceeds related to an artist--not just record sales, but also touring and merchandise.
Through the effort of the E=MC² Creative Friends Network and the Green Stock Exchange (GREENSX) we hope to bring more independent music to the masses, while giving artists a bigger cut of the revenue. We also want to help independent music labels to green-up their practices: by adopting more recycled paper, soy inks, carbon-neutrality, eco-educational programs, and printing processes less harmful to the environment.
Music > Risks: Very High
Only 10% of the new music releases every year are ever profitable for the music labels, after production and marketing costs. That means 10% of the mega selling artists or hits are supporting the remaining 90% of the money losers.
The risks of a music album becoming very successful is like finding a diamond in the sand, but if you find the diamond you will be very happy.
The life of a independent music label is not easy. The big 5 record labels control most of the distribution, sales, air play (radio, MTV ...etc.) and marketing of music. However, the Internet is giving a great boost for independent music, especially for services like MYSPACE.COM and Last.fm. The Arctic Monkeys became famous by people just promoting it on MYSPACE.COM, without any radio or television air play.
New business models, the Internet and consumer referrals are driving demand for entertainment assets in a Long Tail world. Because specialized markets are more predictable, the risk of failure is lower, lowering the risk profile of traditionally “hit-driven” businesses. Thomas Hawk states (paraphrasing his Motley Fool article):”The future
of music is local bands, combining talent with the power of local search to
build audiences across a national footprint. It will be the Long Tail of local
music that will drive music cash flows for decades. In addition to hundreds of
musical artists selling millions of CDs, a Long Tail world implies that there will
be millions of bands selling hundreds of CDs. Record labels will be
complimented by Google, Yahoo and Microsoft where local search is key to
pushing consumers down the Long Tail.”
The power of the Long Tail world is shown in the Rhapsody’s online music service; an average music store carries 10,000 titles, yet Rhapsody’s online music service streams more songs each month outside its top 10,000 titles than it does its top 10,000 titles.
If you are considering investing in the music industry, the best investments are Internet related as music goes digital - which means more Internet downloads, without having to produced and market CDs. Social networks, music search, music download services and websites that cater to music lovers is a good place for the future of music. |
"There is no business like show business." Movies continue to be an important part of the LOHAS lifestyle; creative people like creative things, plus it is fun and enjoyable to watch movies. However, the LOHAS consumer ("cultural creatives") differ somewhat from the mainstream because the cultural creatives watches more foreign features and documentaries than any other group.
Movies have a huge cultural impact on society, including: movies themselves, movie stars and celebrities, and cultural commentary on society (example of topics include: blood diamonds, climate change, AIDS ...etc.).
The current "media" by which feature motion pictures are delivered to the territories includes movie theaters, home video cassettes, DVDs, cable TV (monthly subscription and pay-per-view), direct broadcast satellite TV, free broadcast TV (Network and Syndication), movie rentals, ancillaries (such as airlines and libraries), and online downloads.
Despite intense competition with other forms of entertainment (such as music and sports), the Motion Picture Association of America (MPAA) says worldwide box office grew in 2006 to an all-time high of $26.7 billion, with
U.S. box office climbing to a record $9.63 billion. In 2006, 607 films were released into 6,353 theatres, showing on 39,668 screens in the U.S.
Note that the box office receipts does not include revenue derived from home viewing (such as home video cassettes, DVDs, cable TV, direct broadcast satellite TV, free broadcast TV, movie rentals, ancillaries, and online downloads). Besides theatrical releases, exhibiting the movie output are 4 major television networks, and hundreds of cable/independent stations in the United States.
The motion picture industry employs a whopping 357,000 people, including production and services, theatres and video rentals.
Producing and/or financing the above product are approximately 7 major studios (8 if you count DreamWorks SKG), 16 mini-major studios, 50 to 80 major independent production companies and over 1,750 smaller independent production companies, many of which may never produce even one feature or produce only one feature every two or more years. According to a study conducted by Monitor Co., found that the vast majority of feature films and television programs are produced by independent producers. Independent production mostly takes place in California, however it is becoming more prevalent in other areas of the United States, especially Nevada, North Carolina and the Tri-State Area (of New York, New Jersey and Pennsylvania).
Movies > Risks: High
An average cost of making and marketing a movie for MPAA companies, which include Hollywood's major studios, cost $106.6 million. This includes $70.8 million in negative costs and $35.9 million in marketing costs.
Despite these burgeoning statistics, the fact remains that motion pictures with high production and marketing costs, often entail greater risks with less likelihood of return than lower-cost pictures released in the non-theatrical markets.
The reasons for the high cost of theatrical releases is: marketing and promotional costs (combined with substantial fees paid to exhibitors, usually 40% to 65% of box office gross), distribution fees (usually 33%), overhead, interest and expenses (paid usually to studio distributors) and gross participation, greatly reduce the revenue stream flowing to the producer and net profit participants. These statistics alone make the task of recouping production and marketing costs for MPAA pictures formidable.
Theatrical release is now just a platform to launch videos & DVDs, cable, network & pay television, games and merchandise. This shift toward multiple revenue streams allows unsuccessful movies to find positive economic value through Netflix or online demand over time.
Low and medium budget pictures produced by the independents (typically for less than $1.5 million and $10 million, respectively), have less difficulty recouping, however low budget pictures often go direct to home video in lieu of a release in the theatrical market. In a Long Tail world implies that there will
be more and more movies reaching a smaller audience. For example,
Bollywood films (films made in India) shows the economic
power of aggregating niche audiences. There are nearly 2 million Indians in
the US, but they are so spread out across the US that Bollywood films almost
never find enough of a local audience to exhibit these films in US cinemas.
However, Netflix aggregates this audience and Bollywood represents about
100,000 rentals each month.
Furthermore, Star Wars was one of the first motion pictures to demonstrate, on a major scale, how valuable ancillary markets (consisting of such spin-offs as toys, games, T-shirts and novelty items) can be. In a continuing trend to present day, Jurassic Park, for instance, continues to generate spin-off sales which may eventually be as significant as revenues the picture has already earned in various other markets. Typically, independently produced features do not generate significant ancillary revenues of this nature, although this trend has been changing in the recent past.
Investors who are interested in the movie industry should also considering investing in movie distribution, such as online movie downloads, as more and more movies go digital and higher download speeds become more readily available. |
Jeff Abraham, executive director of Book Industry Study Group, says that that U.S. book revenue in 2007 is represented in current industry sales estimates—which puts revenue at between $23.7 billion and $28.5 billion. There are 6 large publishers (in New York),
300 to 400 medium-sized publishers and
86,000 small/self-publishers. California is home to 16,787 publishers, far more than any other state and more than double the 7,371 located in New York State.
The six U.S. conglomerate publishers are:
- Random House, Inc.
- Penguin Putnam Inc.
- HarperCollins
- Holtzbrinck Publishing Holdings
- Time Warner
- Simon & Schuster, Inc.
What genres/categories are people buying?
- 55% Popular fiction
- 10% Religious nonfiction
- 9% Cooking/Crafts
Statistics from other countries are as follows: (1) Canada: $2.4 billion in revenue; about 50,000 titles are published each year; 627+ publishers. (2) Australia: $820 million in revenue. (3) UK: £2.81biilion in revenue; 787miilion books in 2006. For more statistics on the book industry, see the Para Publishing site.
The E=MC² Creative Friends Network and the Green Stock Exchange (GREENSX) we hope to bring more independent books to the masses. Here are some interesting facts about independent book publishers:
- 54% of small independent publishers are male, 42% are female (3% won’t say).
- California has 600% more small publishers than any other state.
- Over 60% operate out of home offices (65% of males, 76% of females)
- They’ve published an average of 7 titles each.
- Half of the high income small publishers earned over $1 million in 1997.
- On average it takes 475 hours to write a fiction title and 725 hours to
write a nonfiction title.
We hope to not only bring more independent book publishers, but also to green-up the publishing industry by adopting more recycled paper, soy inks, book exchanges, carbon-neutrality, eco-educational programs, and printing processes less harmful to the environment.
Books > Risks: Low to Medium
With 86,000 publishers in the U.S. alone and 99% of them are independent book publishers, fighting for shelf space in chain stores is a big concern as more an more independent book sellers disappear. Publishers with the biggest marketing budget get the most shelf space.
With the rise of Internet book sellers like Amazon.com and more traditional book sellers, such as Barnes & Noble, Borders, and Chapters-Indigo offering online book ordering, the future looks bright for independent book publishers, as the variety of book selection becomes more and more important .
In a Long Tail world implies that there will
be more and more books reaching a smaller audience, yet can still be profitable. For example, an average Barnes & Nobles store carries 130,000 tittles, yet 50% of
Amazon’s book sales come from outside its top 130,000 titles. That is the power of the Internet in supporting smaller publishers.
As long as people read and good books are written, the future will be promising for the independent book publishing industry.
Investors who are interested in the book industry should also considering investing in authors they love and the online distribution of books. |
The video game industry is a new 21st century business, creating
forms of entertainment that have never
previously existed. The US entertainment software
industry is also one of the most rapidly growing
industries in the United States.
Video games produced more revenue than movie theater box office receipts.
Independent marketing researcher NDP has reported that in 2007 video games reached $17.94 billion in sales of non-PC hardware, software, and accessories sold in the US at retail. That’s a 43% jump from 2006.
No wonder, 75% of American heads of households play computer
and video games. The average game buyer is 37 years old, with about 95% of
computer game buyers were over
the age of 18.
The US entertainment software industry directly
employs more than 24,000 people in 31 states, with California employing the majority of the people at 42%. Employees in the US entertainment
software industry may work in small
game developer shops or in large game
publishing companies with thousands of employees.
They may be employed as programmers, arts
and animation specialists, game designers, game
production experts, quality assurance personnel,
audio specialists, legal staff members, and business
or marketing personnel. Developers may specialize
in games for specific types of platforms including
mobile, handheld and online media.
Unsurprisingly, the year’s most popular console was the Nintendo Wii with 6.29 million units sold. But if you thought Nintendo had some impressive numbers with the Wii you might want to take a look at the numbers they pulled off with the DS. Nintendo’s handheld device was by far the year’s best-selling gaming system with 8.5 million units sold, 2.5 million of them in December alone.
Nintendo’s Wii was followed by the Xbox 360 with a respectable 4.62 million, the PlayStation 2 at 3.97 million and PlayStation 3 with 2.56 million consoles sold. Though the PS3 still lagged behind its rivals, it’s had a huge turnaround since Sony slashed the console’s price by $100 and launched a low-end model last fall, with 797,600 consoles sold during December. By comparison, Sony sold just 121,000 units in October.
On the software side, the top-selling game of 2007 was Halo 3 for Microsoft’s Xbox, which has sold 4.8 million copies since its launch. Guitar Hero, however, was the best selling franchise for 2007, bringing in $820 million in retail sales between its various Guitar Hero 2 and 3 games across consoles.
Video Games > Risks: Low to Medium
Video game software publishing is composed mainly of independent publishers and depends on the talent of people. The greatest assets of a video software publisher is people, so an investor must take a look at the record of the software developer in creating games and how they treat the employees to evaluate investment opportunities.
Investors who are interested in the video game industry not only consider video game publishers, but should also consider investing in online gaming sites, which can connect thousands of users online simultaneously. |
For virtually every human interest, there is a magazine.
There are 17,000 magazine titles in the U.S., with
6,000 of them being consumer magazines.
Reading a magazine is an intimate, involving experience that fulfills the
personal needs and reflects the values of the reader, which is one reason
the average reader spends 45 minutes reading each issue. A magazine is
a friend; a tangible and enduring companion; and an integral part of a
reader’s personal and professional life. The power of magazines stems from the relationship each
magazine has with its readers. Consumers have a bond
with their favorite magazines, and it is this relationship with
the editorial product that enhances the credibility of the
advertising environment, causing the consumer to take
action.
From fashion to technology, mainstream news to fitness, a magazine’s
editorial product focuses on the reader’s interests and communicates in
a way that is both informative and entertaining. The top ranking
subject categories by order of largest to smallest were Entertainment/Celebrity, Wearing Apparel/Accessories, Home Furnishings/Management, Business & Industry, Food & Nutrition, Culture, Travel/Transportation, Sports/Recreation/Hobby,
Beauty & Grooming, Health/Medical Science, Miscellaneous, and National Affairs.
At a time when both readers and advertisers face a broader array of media choices, still over 80% of households
read and/or buy
at least one
magazine title
every year. On average, every household purchases 6 different magazines
annually. While some consumers
prefer the convenience
of home or work delivery,
others choose to pick up
copies of their favorite
magazines at newsstands
and other retail outlets. Subscriptions account for 85% of sales, while only 15% are single copy purchases at retailers.
The magazine industry chain consist of of publishers, national distributors, wholesalers, retailers and the readers. Publishers don’t directly bear the costs of
returning unsold copies and want to maximize a magazine’s rate base in order to maximize
advertising revenues. The publisher is, therefore, much more concerned about out-of-stock risk
than overstock risk.
On the other hand, wholesalers, retailers, and to some extent, national
distributors, bear the costs of handling returns but do not benefit directly from increased
advertising revenues. As a result of these divergent incentives, there is dissatisfaction with the
numbers of copies delivered to, but unsold, by retail establishments.
Magazine
wholesalers have consolidated dramatically: their number has declined from more than 180 to
just 4 large wholesalers that handle 90% of the single copy business. As the large wholesalers have competed nationwide for retail accounts in recent years, exclusive
territories have been abandoned. This loss of exclusive territories has increased the average cost
to service each outlet. Because transportation costs associated with a particular route are largely
fixed, costs per stop (retail outlet) have increased. “Pre-weekend delivery” has further reduced
wholesaler efficiency, as many retail outlets require multiple visits per week.
However, the increased wholesaler competition for retail chain
accounts and shelf space has further reduced margins to unprofitable levels. Retailers are
increasingly demanding that wholesalers provide a single upfront payment that includes
discounts such as the Retail Display Allowance (RDA) which were promised to the retailer by
the publisher. This adds to the economic pressure on the wholesalers as they subsequently have
to recoup the monies from the publisher. This pattern is unlikely to change: retailer demands
will likely continue to limit potential changes that the channel might attempt in order to restore
profitability, unless the retailers assess any potential change to the distribution system as
enhancing their sell-through rates and profits.
Magazines (Periodicals) > Risks: High
Despite the rapid change that has occurred, neither retailers who sell magazines to the public nor
any of the other trading partners in the supply chain are content with how the magazine channel currently
operates.
In particular, some retailers, dissatisfied both with the level of service that they
receive and the efforts required of them to sell this product, have suggested that the amount of
shelf space devoted to the sale of magazines should be reduced.
The wholesalers are also facing
severe economic pressures from loss of efficiency, lower margins, and other retailer demands,
resulting in decreased liquidity and financial stability. They appear to be earning little or no
profits and face substantial uncertainty with respect to their futures.
As a result, these firms are
unable to undertake further investments that would be likely to improve the retail distribution
system.
Furthermore, with the rise of the Internet fighting for the attention of readers, readers have less leisure time and therefore may buy less magazines. Some magazines have gone fully electronic or started electronic editions on the Internet, with revenue derived from advertising or subscriptions. Magazines with both a printed edition and an electronic edition are unsure of how to keep both editions profitable due to cannibalization; if a publisher is not committed to a relationship they will fail.
As for the greening of the magazine industry, climate change is on the minds of consumers, politicians and government agencies, and every industry that emits harmful greenhouse gases into the atmosphere. Not only is the magazine industry a major consumer of trees, but it also ranks 4th among manufacturers for carbon-dioxide emissions.
Furthermore,
only one in six magazines gets recycled, which is very low.
Time, the largest magazine publisher in the U.S brought in a coalition of stakeholders, to launch ReMix, to run a “Please Recycle This Magazine” and some to substantially increasing their use of recycled-content paper.
David Refkin at Time Inc. says, "we’re facing a carbon tax or carbon cap treaty in the next three or four years, and any executive who doesn’t think that’s coming is going to find out they’re in for a big surprise. It’s going to affect the whole supply chain.”
As the magazine industry is greening-up, the Green Stock Exchange (GREENSX) will directly benefit via our Carbon Trading system.
Investors who are interested in the magazine industry should also considering investing in online magazines, blogging and citizen journalism (like our LOHAS Magazine). |
Tough times are ahead for television, as viewing audience become more and more fragmented for each television show. What percentage of the US market could an advertiser hit by advertising during the program? The most popular show is "America Idol":
- American Idol US audience reach: 4% of the US population
- I Love Lucy US audience reach: 45% of the US population
American Idol, the most popular show now could reach only a measly 4% of the US population, representing 11 million viewers.
Television stations are also fighting for the leisure time of viewers from video games, the Internet, DVDs to other new forms of media.
Teens spend 40% less time watching TV than their parents, and 600% more time online than their parents, those reach stats for TV will continue to sink.
You think there are a lot of television stations now, with nearly 10,990 commercial and non-commercial stations, including Full Power, Low Power, Class A, Cable, Satellite and Translator stations, think again.
Analyst predict that the will be thousands more new channels added
with the arrival of digital broadcasting, because television stations can broadcast on as many as six channels--simultaneously! Furthermore, there will be more Internet broadband connections and IPTV to expand the TV channel universe.
Also, the industry continues to experience strong competition from the digital cable and satellite TV industries. The cable TV industry in particular represents a significant threat to future industry growth.
A number of factors point to low growth in advertising revenue, including forecast low economic growth, the declining overall share of the TV audience, and competition from new media. The bleak outlook for this industry has already prompted News Corp to expand its satellite TV interests.
Television > Risks: High
The average cost of making and marketing a television show is getting higher and higher, with as much as $1 million per episode for prime time shows.
Due to the dwindling number of viewers that watch a show, and the money moving from television advertising to the Internet, the television show business is not like once it was used to. With the arrival of TiVO, channel surfing, and other distractions, who is really watching the commercials, which is the bread and butter of the TV industry?
In a Long Tail world implies that there will
be more and more television shows will be reaching a smaller audience.
Investors who are interested in the television industry need deep pockets and a lot of patience. If you are smart or lucky like Rudolph Murdoch, then you would invest in social networks like MYSPACE and marry it to television. Sure, you can make waves with your single Super Bowl ad, but you can extend its power with online tie-ins, contests and viral marketing add-ons. With lower viewership overall on TV, companies poised to add targeted social media marketing to their mix are not only going to do a better job reaching consumers, they will have a better ability to track their return on investment.
Therefore, the smart investor will look at what the audience is doing and where they are spending their free time, like at online social networks that link to television shows, music, downloads, and other media. Why not invest in social networks, like our E=MC² Creative Friends Network, which allow people to create their own personal and customized television station? |
Conclusion
Artists continue to be some of the leading voices in the green movement. With film's such as Al Gore's Inconvenient Truth and
Live Earth concerts, the Art & Entertainment industry will continue to be a strong advocate for social and environmental change.
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