Table Of ContentEntertainment Industry Economics
AGuideforFinancialAnalysis,TenthEdition
Already among the most important sectors of the U.S. economy, the enter-
tainment and media industries are continuing to grow worldwide. Fully
updated, the tenth edition of Entertainment Industry Economics is the
definitivereferenceontheeconomicsoffilm,music,television,advertising,
broadcasting, cable, casinos, publishing, arts and culture, performing arts,
toys and games, sports, and theme parks. Its synthesis of a vast amount of
data provides an up-to-date guide to the economics, financing, accounting,
production,marketing,andhistoryofthesesectorsintheUnitedStatesand
countries across the globe. This edition offers new material on streaming
services, the relationship between demographics and entertainment spend-
ing,electromagneticspectrumforbroadcasters,andmusicindustrysalesas
related to GDP. Financial analysts and investors, economists, industry
executives, accountants, lawyers, regulators, and journalists, as well as
students preparing to join these professions will benefit from this compre-
hensivesource.
Harold(Hal)L. Vogel,PhD,CFA,was theseniorentertainment andmedia
analystatMerrillLynch&Co.,Inc.andhastaughtattheColumbiaBusiness
School in New York and the Cass Business School in London. His books
include Travel Industry Economics: A Guide for Financial Analysis, 3rd
edition (2016) and Financial Market Bubbles and Crashes: Features,
Causes,andEffects,2ndedition(2018).
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Entertainment
Industry
Economics
A Guide for Financial Analysis
TENTH EDITION
Harold L. Vogel
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DOI:10.1017/9781108675499
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TO MY DEAR FATHER
– WHO WOULD HAVE BEEN SO PROUD
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Contents
Preface pagexix
PartI Introduction 1
Chapter1 EconomicPerspectives 3
1.1 TimeConcepts 3
LeisureandWork 3
RecreationandEntertainment 4
Time 5
ExpansionofLeisureTime 5
1.2 SupplyandDemandFactors 9
Productivity 9
DemandforLeisure 11
ExpectedUtilityComparisons 13
DemographicsandDebts 14
BarrierstoEntry 17
vii
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viii Contents
1.3 PrimaryPrinciples 18
MarginalMatters 18
PriceDiscrimination 21
Public-GoodCharacteristics 23
1.4 Personal-ConsumptionExpenditureRelationships 23
1.5 PriceEffects 27
1.6 IndustryStructuresandSegments 29
Structures 29
Segments 30
1.7 ValuationVariables 35
DiscountedCashFlows 35
ComparisonMethods 37
Options 38
1.8 ConcludingRemarks 38
Notes 39
FurtherReading 46
Chapter2 BasicElements 48
2.1 PsychologicalRoots 48
2.2 RulesoftheRoad 49
LawsoftheMedia 49
NetworkFeatures 52
2.3 LegalLayersandLimitations 54
Layers 54
LimitationsandConcentrationIssues 55
2.4 TheInternet 56
AgentofChange 56
BigDataandAI(ArtificialIntelligence) 61
Long-TailEffects 62
2.5 Advertising 64
Functionality 66
EconomicandBusinessAspects 67
2.6 AccountingandValuation 70
Accounting 70
Valuation 70
2.7 ConcludingRemarks 71
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Contents ix
Notes 71
FurtherReading 83
PartII Media-DependentEntertainment 87
Chapter3 MovieMacroeconomics 89
3.1 FlickeringImages 90
3.2 MaytheForcesBewithYou 92
EvolutionaryElements 92
Technology 92
Capital 95
PeckingOrders 96
Exhibition 96
ProductionandDistribution 97
3.3 UpsandDowns 99
AdmissionCycles 99
PricesandElasticities 100
ProductionStartsandCapital 102
ReleasesandInventories 104
Market-ShareFactors 110
CollateralFactors 110
Exchange-RateEffects 110
TradeEffects 111
FinancialAggregates 113
3.4 Markets–PrimaryandSecondary 113
3.5 Assets 117
FilmLibraries 117
Technology 117
UtilizationRates 119
InterestandInflationRates 119
CollectionsandContracts 121
LibraryTransfers 121
RealEstate 124
3.6 ConcludingRemarks 124
Notes 124
FurtherReading 132
Chapter4 MakingandMarketingMovies 134
4.1 Properties–TangibleandIntangible 134
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