Category 1 - Implicit Space/Implicit Time

Theater Industry


American consumers spent $12.8 billion (avg. $42.8 per person) on admissions to performing arts events in 2005. This was $3.2 billion less than for admissions to sporting events but $3 billion more than the total American spending for movie admissions[i]. The theater industry is a large but extremely diverse industry, including small and large companies, commercial and non-profit ventures. It ranges from specialized theater (concert hall and opera house) to a multi-disciplinary venue. Hence approaches to revenues are widely different from a commercial Broadway theater to a highly-subsidized non-profit center.

Usually in theater, the unit sold is a seat, represented by an admission ticket that mentions the date and time of the show (validity), the seat number (the location), and the conditions (rate fences).

The theater has no control over the duration as the show is provided by external producers. However, theaters generally use tier pricing, which can be adapted to the nature and the popularity of the show. In addition, they use matinee and evening as well as weekday and weekend pricing. Discounts are usually offered for student and senior citizen. Specific partners such as local art club can be offered discounts. Theaters often offer also group and corporate booking for minimum number of tickets at preferential price.

Esplanade -Theaters on the Bay, Singapore (http://www.esplanade.com/index.jsp)
The Esplanade is the premier performing art center in Singapore. Opened in October 2002, the Esplanade has four main venues:
· Theater (play, musical, dance, opera) – 2000 seats
· Concert Hall (symphony and concert) – 1600 seats
· Recital Studio (smaller recital, jazz concert) – 245 seats
· Theater Studio (experimental works) – 220 seats
In addition, the Esplanade has rehearsal studios, an outdoor performance stage, several opened spaces for reception and events. The Esplanade also features an extensive retail and F&B area.

In addition to its performing art events, the Esplanade has developed a large range of activity to encourage people to stay as long as they want in order to:

· Increase usage of F&B and retail outlets
· Expose to the Esplanade marketing for up-coming events
· Break the barrier about arts being elitist and expensive
Being a recently-built theater, the Esplanade was designed with flexibility in mind. The Esplanade can then adapt its capacity by closing or opening sections.

As other source of revenues, the Esplanade rents its theaters, F&B and retail spaces, as well as reception spaces for private events.

The Esplanade has succeeded to develop its entire space into a dynamic and busy space, which is always bustling with activities outside show times.

Hong Kong Cultural Centre (HKCC), Hong Kong
(http://www.lcsd.gov.hk/CE/CulturalService/HKCC/eindex.html )
In comparison to the Esplanade, the HKCC is a quiet and empty space outside of show times. Opened in 1989, HKCC includes a Concert Hall, Grand Theatre, Studio Theatre, a Exhibition Gallery and four foyer exhibition areas, 11 rehearsal and practice rooms and 2 conference rooms.
The main difference between the Esplanade and the HKCC is that HKCC makes its revenues entirely from hiring instead of ticket sales.
Financial results: http://www.lcsd.gov.hk/CE/CulturalService/HKCC/en/financial/financial.html



Anchor partners such HK Philharmonic Orchestra, LCSD, the HK Arts Festival, and the HK Ballet has long-term agreement with the HKCC. Tickets are sold through a third-party company such as HK ticketing (www.hkticketing.com/eng/).



Whereas the Esplanade can manage its revenue on both aspects: hiring and ticketing, HKCC has limited possibility in focusing only on hiring. The space & time definition changes: from seat to the entire hall and from duration of show to duration of lease.



HKCC has also very few extra-revenues, with only limited F&B and one retail shop. HKCC also rent for special events such as private cocktail parties and organized guided tour.



The Substation, Singapore - (http://www.substation.org/ )
The Substation is a smaller cultural center, focusing on presenting local and experimental works. Venues are the Substation Theatre (108 seats), the Substation Gallery, a dance studio and two classrooms.



The Substation offers packages for its venue rental. Package are divided by target market (artist/ commercial venture), however there is no pricing by WD/WE, the time of the year, the duration of the booking (longer rentals can get discount). Hence additional possibilities can exist there.



As the Substation is also a co-producer, it also drives revenues through ticketing. The venue offers usually one ticket price which varies depending on the event, sometimes student discounts. The Theater is limited in terms of capacity (108 seats) to maybe implement tier pricing (space flexibility).



Carnegie Hall, New York ( http://www.carnegiehall.org/SiteCode/Intro.aspx )
“Carnegie Hall has been the premier classical music performance space in the United States since its opening in 1891, showcasing the world's greatest soloists, conductors, and ensembles”[ii]. It features 3 main stages:

• Isaac Stern Auditorium / Ronald O. Perelman Stage - 2,804 Seats


• Joan and Sanford I. Weill Recital Hall - 268 Seats


• Judy and Arthur Zankel Hall - 599 Seats

Similarly to the Esplanade & HKCC, Carnegie Hall has guided tour, shop and F&B outlets. It rents several banquet rooms as well as the performing halls. It offers an online retail store and gift certificate.

However, Carnegie Hall being a specialized theater (music), it has the possibility to offer season subscription in addition to its normal ticketing. Subscriptions help the theater to anticipate its demand, to collect the money up-front, and to encourage the customer to up-buy (higher category, more shows). Student subscription package at discounted price are also available (program of 3 concerts for US$ 45)

In addition of its season tickets, Carnegie hall also offers several pricing scheme: Senior Rush Tickets, Partial-View Seats, Student Tickets, For Concertgoers 40 or Younger Membership card (discount & privileges), Group Ticket Discounts.

[i] National Endowment for the Arts, Consumer Spending on Performing Arts, 2006, http://www.nea.gov/
[ii] http://www.carnegiehall.org/article/the_basics/art_overview.html

Museum Industry
This industry comprises establishments primarily engaged in the preservation and exhibition of objects of historical, cultural and/or educational value and includes art galleries, art museums and other museums in general.[1]

The American Association of Museums (AMA) uses a much broader definition on museums, which includes zoos etc., and has estimated that there are 17,500 museums in the US which attract a total annual visitation of 850 million.

Based on their 2003 Museums survey, the median museum had an annual operating budget of $750,000, 7 full-time and 5 part-time paid staff and 60 volunteers. They had a building of 22,000 square feet, which cost $3 per square foot a year to operate, had almost 40,000 visitors and a $5 admission fee. Although 36% charged no admission fee and a further 4 percent operated on a donation for admission basis. It is estimated that the industry is broadly segmented by revenue to 66% for museums and 33 % for art museums/galleries.

Here is the link for the definition of the museum Industry:
http://www.aam-us.org/aboutmuseums/whatis.cfm

We define the industry in the implicit time - implicit space category because of the following reasons:

1. How is time defined and who controls the time definition? How is it used to make money?
As the industry norm, the visitors of the museums define the time. The museums open at a certain time in the morning and they close at the evening also at a particular time. Visitors choose to stay inside the museums as long as they like within the operating hours of the museums. While the majority of museums sell one-time admission tickets, 36% of them charge no admission fee; therefore, the number of visit is unlimited within a day.

2. How is the space defined?
The space is most likely defined by the museums or the external force such as the length of certain special exhibition.

For example, most of the museums have two different areas: one area exhibits permanent collections while the other exhibits special exhibition. The area of permanent exhibition is somehow fixed unless there is major renovation works; areas of special exhibition changes according to length of the certain exhibition. These areas have to be closed for the renewal of other exhibitions.

Madame Tussauds Wax Museum (http://www.madametussauds.com/)
This museum showcases elegant wax figures in their exhibition. One of their museums in Hong Kong charges admission fee for one-time visit, which is typical. However, it offers some bundles packages, for example: Peak Tram + Admission Ticket or Admission + Peak Tram + Sky Terrace (another scenic spot on The Peak) to attract visitors.

Smithsonian Institutution (http://www.si.edu/)
Smithsonian Institution, the world's largest museum complex and research organization composed of 19 museums, 9 research centers, and the National Zoo. Most of its museums are located in Washington DC. The Institution is not a for-profit organization. All the 19 museums are free to the public. However, some of its museums do have some revenue generators such as gift shops, IMAX theaters, and rental space to F&B (McDonald’s in the case of Smithsonian National Air and Space Museum).

Eastern State Penitentiary in Philadelphia (http://www.easternstate.org/)
Eastern State Penitentiary opened on October 25, 1829. It was the world's most expensive and high-tech prison. This historical site is now opened to the public. This museum defines the time differently as visitors join a tour, walking around the prison with guides. The time is defined by the length of the tour and each tour has maximum people capacity. This museum transformed implicit time, which normal museums do, to explicit time where the staff of the museum has control over the time of visit.

United States Holocaust Memorial Museum ( http://www.ushmm.org/visit/)
The Holocaust Memorial Museum a living memorial to the Holocaust. It stimulates leaders and citizens to confront hatred, prevent genocide, promote human dignity, and strengthen democracy. The museum has a public-private partnership, and it supported by the federal government. This museum has a practice of giving out free admission ticket in the morning, before the operational hours. Visitors have to get a free admission ticket and come back at the designed time on the same day. The visitors still defines the time implicitly because once they are in, they can stay as long as they like before the closing hours. However, the distribution of admission tickets from the museum takes back some control over the time issue.

[1] Museums in the US, November 14 2008, IBIS World Database