Interesting People mailing list archives
Price of Fun -- an interesting point of view
From: David Farber <farber () central cis upenn edu>
Date: Mon, 15 Aug 1994 12:40:28 -0400
Date: Mon, 15 Aug 94 07:22 EST From: "New Media Associates, Inc." <0005406742 () mcimail com> The Price of Fun: Value vs. Technology OK, let's just clear one thing up -- before any more irate publishers of multimedia magazines try to crazy glue my E-mailbox shut. I didn't tell the Wall Street Journal that most CD-ROMs don't even have even a minute worth of information or entertainment on them. That was a misquote. What I did say is that most CD-ROMs don't have more than a hour's worth of useful information or entertainment on them. One Hour -- not One Minute. And, what I said was that if all you get is an hour worth of fun out of a CD-ROM, it had better cost a whole lot less than $30/50/70. Which brings me to the price of fun. Back when I was on Wall Street, I started to put together a simple spreadsheet that calculated the average price paid for an hour of fun. All kinds of fun. I priced out helicopter skiing in the Andes. I budgeted photo-safaris to Kenya. I tallied up carnivals, rock concerts, amusement parks and dude ranches. Or, how about reading a book. And, I even figured out the number of hours of fun in bottle of wine. No recreation was left un-charted. This may surprise you but, in the world where most of us live, most fun is priced at around $1 to $2 per hour. Sure, averages can be deceiving. Yes, Ripple and other vagabond brews cost less and there are some very old forms of fun and some exotic ones that cost considerably more but your everyday leisure activity nowadays is pretty well clustered around that magic figure -- $1-2/hour. Myst takes an average user 40 hours to complete and it costs roughly $40. Music CDs get played for 10-20 hours of fun and they cost $15. A two hour video rental costs $2-4. America Online costs $10 for 5 hours of connect time (the price of "shareware"). Romance novels take 3-4 hours to read and cost $4-6. Think about it. How much do you spend per week on fun? $10? $40? $100? Add up your cable subscription, your magazines, your movie/concert/video rentals, your beer bill and your vacations. What does it average out to? And, how many hours a week do you have enjoy yourself? Let's look at the averages. On average, Americans have about 40 hours a week for leisure. And, we spend about 5% of our pre-tax income on leisure (regardless of income). If you pull in $80,000 then, if you're average, you should spend about $4000 for 2000 hours of fun annually. That's $2/hour. Most Americans make less. Any product/service which costs $50-100/hour will automatically have a very limited market. And, if the product seems to have a chance for mass market appeal, it will be made illegal so that it doesn't eat up all the rent money. Until CD-ROMs all cost $4.95 or until they are all as good as Myst, multimedia will continue to suffer from an industry crippling value gap. Shocked that only CD-ROM bundles sell? Think again. [ Copyright New Media Associates 1994]
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- Price of Fun -- an interesting point of view David Farber (Aug 15)
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- Re: Price of Fun -- an interesting point of view David Farber (Aug 15)
- Re: Price of Fun -- an interesting point of view David Farber (Aug 17)