Re: Price of Fun -- an interesting point of view

[David Farber <farber@central.cis.upenn.edu>]

Date: Wed, 17 Aug 1994 09:27:40 -0400 (EDT)
From: deyoung@ARPA.MIL


David,


     Here is an interesting sidebar about the price of fun.  Many
pundits  say that the driving force behind the new NII will be
video on demand?  Do the  math yourself, how many movies does a
person have to watch/week to justify the cable (and other
companies) expense of ~$1,000/household to hook them up (assume
$5.00/movie).  Let's also assume the enormous cost of the
delivery mechanism is included in that figure, too (bad
assumption).   Yup, you got it, ~4/week.  Any questions about why
video on demand won't hack it?  By the way, this also excludes
the fact that people like to wander around the video store,
browsing.  One other thing to ponder, the percentage of their
income that folks spend on entertainment hasn't changed since
around the turn of the century (the last one).  Where are all
these new dollars coming from that are being bandied about?  Now,
how many still think video on demand will drive the NII?


Tice




  To continue on the original subject, 4 videos is about 8 hours,
divided into $20 gives about $2.5/hour of video entertainment,
but normally at least two are watching, so this comes out right
in the range estimated, $1.25/hour.