An attacker wearing an Afghan military uniform shot at service members from the NATO-led coalition. A U.S. official says one service member was killed and 15 were injured.
After Tuesday's African summit sessions, the White House is preparing to host the 50 heads of state and the chairman of the African Union for dinner. What goes into preparing a formal dinner for 400?
Gannett said the move will give the two new companies more "flexibility" to "pursue growth." Time Warner and Tribune Co. have made similar moves.
Baroness Sayeeda Warsi was the first Muslim member of the prime minister's cabinet. She resigned over what she said was the U.K.'s "morally indefensible" position on the conflict in Gaza.
On Tuesday, Missouri voters are headed to the ballot booth to decide on whether to increase the state’s sales tax. The additional revenue would be used to fund the maintenance and construction of roads and bridges.
The state of disrepair of the nation’s transportation infrastructure has been a known problem for quite a while now. What isn't known is who's going to pay to fix it.
Phil Oliff, who researches infrastructure issues for the Pew Charitable Trust, says traditionally, “states get a lot of money that they spend on highway and transit infrastructure from the federal government.” Most of that money comes from the Federal Highway Trust Fund, but the fund is running out of money, and Congress has been doling out funding in short-term increments. That's bad news for states, who need more certainty about their financial situation when they commit to long term projects. Many states are taking it upon themseves to raise the money independently.
That could mean tolls on roads and bridges. It could mean borrowing from the bond market. In Missouri, lawmakers are proposing a three-quarter-of-a-cent increase in the sales tax.
Tom Shrout, of the advocacy group Missourians for Better Transportation, says says the tax is unfair to locals.
“Big trucks passing through Missouri, they would be asked to pay nothing while a senior citizen who doesn’t use the roads much will be asked to pay more,” he points out.
As Missourians head to the polls, the Associated Press says nearly a quarter of the states have already instituted similar taxes, fees or fines to pay for infrastructure projects.
Last week was a pretty crummy stretch for stocks, and today doesn't look much better. So how is the stock market really doing? Plus, does the public have the right to know how much a retailer takes in through the federal food stamp program, or is it a trade secret? More on that debate. Also, Missouri voters are headed to the polls today to decide whether to increase sales tax. Money raised would be used to fund roads and bridges. We tell you why your state might be next.
The move may not mean the end of the current conflict. The Israel Defense Forces said its troops would maintain a defensive position and respond to any attacks.
If you’ve ever called a customer service line, you’ve likely talked to someone in India, the Philippines, or Mexico. Now, some U.S. companies are bringing their call centers home and changing the way they do business.
Have you ever been stuck in a phone tree so long you just lost it and started ranting on Twitter?
“In a call center, somebody’s calling to talk to you. In social media, somebody is talking about you,” says Paul Stockford, research director at the National Association of Call Centers.
Stockford says the industry has been growing in the U.S. since 2008, and more than half of contact centers here now have social media programs.
Kymberlaine Banks is a social media program manager with Telvista, which runs contact centers in Mexico, but also in Texas and Virginia. Her "small but mighty" stateside social media crew monitors the web for complaints.
“They’re reaching out to people who are saying, ‘You suck, you failed, you whatever,’" she says. "It is not a happy thing.”
She says social media representatives need more writing and problem-solving skills than people who answer phones. It’s a different skill set because they also respond to positive comments.
“If someone says, ‘I love you,’ we say, ‘We love you, too,’” Banks says.
General Motors brought back a number of customer service jobs from Argentina last year.
Just don't call them "call center" jobs. Now, the catch phrase is "customer engagement."
Terri Still has lived in Camden, New Jersey since she was in second grade. But these days, as she walks around her neighborhood, she tries not to look around her to avoid seeing the blight that surrounds her.
“It’s depressing seeing it all constantly,” she says. “You try not to think about it.”
Across the street, Christopher Toepfer pokes around inside an abandoned warehouse. There are stacks of broken palettes and scattered food wrappers, evidence of squatters. The building used to house a porta-potty company, but it’s been vacant for several decades.
“We call [these] ‘abando-miniums’ in the vacant building business,” he says.
But outside, the warehouse is getting a facelift. A small crew is painting the exterior dove grey, covering up years of graffiti. They're employed by Toepfer’s nonprofit, The Neighborhood Foundation, and the warehouse is one of about 40 buildings the Foundation has boarded up and painted in Camden this summer. Across the country, they’ve done about 1,500 similar projects, focusing primarily on residential buildings in 21 different cities.
Local officials who have to deal with large tracts of vacant and abandoned buildings often resort to one of two options: fix 'em up or tear 'em down.
Toepfer represents middle ground. His foundation paints the boarded-up buildings to look as though they have real, working windows and doors. Occasionally the painters even draw plants or pets in the window.
“Sometimes, we even do facades of trees, like silhouettes of trees, to cover graffiti,” he says.
Once an urban area falls into decline, there is a spiral effect. Abandonded houses fall into disrepair and are often used by vagrants or criminals. That depresses the value of occupied homes and makes the neighborhood less desirable. Property values decline, the remaining residents sell up or move out, and landlords find it difficult to rent the housing stock. Those houses fall into disrepair, and the downcycle continues.
The idea is that a makeover, even one that’s just skin deep, can stop this spiral and stabilize a neighborhood. The Neighborhood Foundation charges $500 to paint and secure a house or $2,500 for a larger commercial building. It's a lot cheaper than a renovation, or even a demolition, which could cost $10,000 or $15,000.
It's not just that a paint job can have a beneficial economic effect; it can raise peoples' spirits, too.
“I think when they fix things up, it gives people more encouragement,” says Terri Still, the Camden resident. “It makes them want to take pride in where they live.”
Beautification does work, agrees Susan Wachter, a professor of real estate and finance at the University of Pennsylvania’s Wharton School. “Small investments can have large returns."
It’s a strategy realtors and developers have long used.
“In the 'burbs, when you’re selling a property that hasn’t been lived in for a while, the first thing the realtor will say is 'mow the lawn',” says Wachter, adding that simple fix can boost property values as much as 20 percent.
Of course, securing and painting a property isn’t a permanent solution — it’s a Band-Aid, literally plastering over the wounds of a city.
But hopefully, that Band-Aid gives it the chance to heal.
The suburb of San Leandro sits just east of Oakland, California, within striking distance of San Francisco and Silicon Valley. Underneath the city lies a loop of ultrafast fiber optic cable known as Lit San Leandro. Data speeds through these cables about 2,000 times faster than a typical internet hookup.
The cable exists because of one guy: Pat Kennedy.
Kennedy runs OSIsoft, a company based in San Leandro. A few years ago, he was looking to expand, but he wanted the kind of infrastructure he saw in towns like Palo Alto. So he put down $3 million of his own money to make it happen in his backyard.
“The reason I did it is that I’ve actually been a 40-year resident of San Leandro," Kennedy says.
It became clear to him that industrial cities like his were never going to be top picks for things like broadband or fiber. "We’re really going to suffer as a result,” Kennedy says.
Can broadband speed up the economic of industrial towns?
San Leandro was already struggling. It used to be a manufacturing town, but those jobs dried up in the '70s and '80s.
At one time, there were more than 20,000 manufacturing jobs in San Leandro. In 2013, fewer than 7,000 of those remained. Industrial-zoned land, much of it now used for storage, makes up nearly a quarter of the city. A 2013 report calls these areas “neither memorable nor particularly pleasant to get around.”
On the other hand, a presentation by City Manager Chris Zapata calls broadband “a laser cheetah with explosive power accelerating economic growth.”
Deborah Acosta, San Leandro’s new Chief Innovation Officer, frames the issue differently: “How do we re-energize this industrial space to actually become alive again?” Her job is to convince businesses that San Leandro is the place to be.
That starts with the bright red streaks running through her hair. They put people on notice, Acosta says.
“When they see my red hair, they’re going, ‘Holy smokes! Something’s different here, I think I need to pay attention,’” she says.
Investment in fiber and infrastructure — now at more than $13 million — wouldn’t have happened if Pat Kennedy hadn’t put down that initial money, Acosta says.
Analyst Craig Settles says private investment, like Kennedy's, is one way for cities to get broadband.
“The idea of going to local businesses and saying ‘can you contribute to the network?’ is one of the more viable options, in my book,” Settles says. Local businesspeople have helped get broadband off the ground in places far away from tech centers, like Emporia, Kansas; Fredericton, New Brunswick; Keene, New York.
In San Leandro, Pat Kennedy’s investment has paid off with buzzing and whirring on the second floor of the West Gate shopping mall. The sound comes from 3-D printers, manufactured by Type A Machines.
Based in San Francisco, Type A moved its manufacturing operations to San Leandro earlier this year. They’re currently based above a Sports Authority at the mall, a massive building that was once a Dodge auto plant. If all goes well this year, Type A’s workforce here could more than double, to about 50.
Since San Leandro first installed broadband a couple of years ago, the initiative has created about 90 jobs. But Acosta and Kennedy think they’re on to something. They’re doubling down, and point to half a million square feet of office space going up, with those ultrafast connections.
Comcast is expanding its "Internet Essentials" program, which lets low-income Americans apply to receive broadband internet for ten dollars a month. The move to draw attention to the program has been part of a campaign to convince regulators to approve its merger with Time Warner Cable. Comcast says, if approved, the merger would extend Internet Essentials to millions more low-income people.
Comcast is also announcing is that they're changing their eligibility requirements so that former customers who still owe payments on their bills will be able to use the program.
“If your bill to Comcast is more than a year old, you will be able to apply for Internet Essentials,” says Brian Fung, technology reporter for the Washington Post.
While Comcast has touted the 1.4 million Americans currently enrolled in the program, critics counter that up to 2.6 million households would be eligible for the program, were it not for the current enrollment criteria -- A household is eligible for Internet Essentials if it has a child eligible for free or reduced school lunches.
What the program does make clear, according to Fung, is that there is now an understanding that internet access, especially for poorer families with children, is essential.
In Cleveland, a public hospital may be succeeding at the seemingly impossible: saving money while making patients healthier. It's doing so by giving patients personalized attention.
And, what the adults in their lives should do about it.
What do sitcoms, dramas and reality TV say about poor people? For our yearlong series exploring poverty, NPR's Elizabeth Blair takes a look at the television shows that place the poor center stage.
Nancy Writebol, a missionary from North Carolina, will be treated at the same hospital where an American doctor with Ebola already has been taken.
The European Space Agency's Rosetta Mission has taken the long way to reach Comet 67/P. Later this week, it will finally arrive.
Chris McDaniel fell short in his bid to take the GOP nomination from Sen. Thad Cochran. He has complained for weeks that the runoff vote was a sham and on Monday asked the party for a hearing.
Why do cinemas charge so much for popcorn? Wouldn't they make more money if they lowered the price because, presumably, many more people would purchase it for $4 instead of $7?
- Basil Utter, Maryland
This is a question with some easy answers and some surprisingly complicated ones.
First the easy — and incomplete — answer...
Because they can.
This is what we all intuitively assume, that theaters are shooting fish in a barrel by charging high prices to a captive audience.
“They’re basically in a monopoly selling position,” says Russell Winer, chair of the marketing department at NYU’s Stern School of Business. “Since they don’t allow you, theoretically, to bring food into theaters, they can pretty much charge what they feel the market will bear.”
Indeed, they do.
In theory, they will charge a price for popcorn where the spread between what it costs them to make another box of popcorn, and what consumers will pay for that box of popcorn is at its highest level.
Movie theater owners aren’t residing in some dark turret behind the screens, stroking a cat and reveling in the injustice they are inflicting upon hapless moviegoers. Ask movie theater owners, and they’ll tell you they charge so much for concessions. . .
Because they must.
Jack Oberleitner, a 55-year veteran of movie theaters, is now a consultant. He quotes a friend whose family has been in the business since 1908, with a line he says summarizes the situation of theater owners: “We left the movie business and we’re now in the popcorn business."
Movie theaters don’t make much money from movies. Movie studios do.
“The film industry will charge movie theaters upwards of 70 percent of the box office revenue,” Oberleitner says. Revenue sharing schemes change over the years – sometimes studios take a peak percentage from the first few weeks and then adjust downward, sometimes they take a peak percentage from the best few weeks regardless of when they occur – but the outcome is the same: Studios take far and away the biggest chunk of ticket proceeds.
On top of that, he says, studios place a lot of conditions on playing their movies.
“So they’ll say if you have 14 screens, for instance, we want the latest film from our company to show on three of those screens for the first three weeks. If you’re not getting people into those screens, well, sorry about your luck.”
Being forced to fill screens with movies nobody’s watching can be a revenue suck, but if the theater says no, the studio can turn around and say, "Fine that’s the last MGM or Warner Brothers or Disney movie you ever screen."
At the same time, costs like rent, air conditioning and heating for large spaces are significant. And every few years there’s some new amenity or technology no theater can do without: surround sound, stadium seating, digital and 3D projection systems. Each requires hefty investment that brings down profit margins.
Theaters could raise ticket prices, but with 70 percent of any increase going to studios, it isn't particularly appealing. Plus, price competition between theaters is fierce.
The one thing that does not have to be shared with studios: concessions.
While concessions account for only about 20 percent of gross revenues, they represent some 40 percent of theaters’ profits. Even with $10 tubs of popcorn, and profit margins on concessions of 85 percent, profit margins for a whole theater average around 4.3 percent for the industry, according to IbisWorld.
“I would say the '70s is when it first started to change,” says Oberleitner. “The quarter cup of popcorn increased to 50 cents, 75 cents and then $1. This all happened pretty rapidly through the course of the '70s, and by the time we hit the '80s it was in full gear completely.”
Which do you prefer: expensive concessions, or expensive movie tickets?
Some consumers are paying a lot for concessions, but on the other hand, this means that all consumers are paying less for movie tickets than they otherwise might. If you factor in inflation, admission prices are actually about the same as they were 40 years ago. Those $10 buckets of popcorn are subsidizing everyone’s tickets.
But any good movie has a twist, and in this case it falls under the second part of our question: If they lowered the price of the popcorn wouldn’t they increase sales and profits?
The immediate answer is no.
Popcorn is a tool to get you to pay more.
Simply put, it’s quite possible for the profit from a few moviegoers who pay an obscene amount for popcorn to be worth more than dozens of people who pay a reasonable price. You can also think about it this way: A monopolist has a sweet spot between price, demand, and cost that lets it maximize profits. There is nothing in economics that requires that sweet spot to be reasonable for most people. And, in fact, it is pretty much always higher than a situation where there is competition.
But high-priced popcorn also is a valuable tool.
“Movie theaters use this to price discriminate across moviegoers,” says Ricard Gil, associate professor of economics at Johns Hopkins’ Carey School of Business. He says popcorn lets theaters charge different consumers different prices for going to the movies, which helps maximize profits.
“Different movie viewers have different willingness to pay for the experience of watching a movie. When you’re on a date, you know you’re gonna spend some money.”
From a theater’s perspective, it would be fantastic if the theater could find out who would pay a lot to see a movie and charge them extra. But theaters can’t stop everyone in line and look at their tax returns. So, instead, they offer something only the spenders will buy: Really overpriced popcorn.
Voilà: Some people get charged extra for going to the movies.
This is, incidentally, the same principle by which lot of other products operate. Video game manufacturers, for example, will sell a console at cost or even at a loss, but then charge a high mark-up on video games. Some people will only buy one or two video games, and others will buy a ton. By setting a low barrier for getting a console, and then charging a ton for games, the firm can extract profit from all different kinds of people.
Coupons operate the same way. Some people are willing to pay full price because the idea of saving, organizing and coordinating coupons is too much of a bother. So the store captures them at the highest price. Others won’t pay those prices, but they are willing to save and look for coupons, so the store is able to capture them too.
Some people are complete coupon fanatics, who won’t pay a penny more than they have to, will spend hours accumulating discounts, and the store can get them in the door as well.
Economic jargon at your local theater: Mixed bundling.
Not only does the selling of high-priced concessions allow a theater to locate which consumers can pay more for a movie experience, it also allows theaters to zero in on those consumers and figure out who is willing to pay more for certain types and combinations of snacks, says Daniel Vincent, professor of economics at the University of Maryland in College Park.
They do this through what’s called “mixed bundling” in economic jargon. Bundling is where you combine one product with another – like the popcorn-soda combo. Mixed bundling is where you offer combos like that, but also let people buy products – popcorn and soda – individually.
Here’s how it works: The theater charges the highest price it possibly can for soda and popcorn individually. But it offers a slight discount on the combo.
Some people really just want a Coke and nothing else, and they’ll be willing to pay that price. Maybe they’re really wealthy, or maybe they’re allergic to popcorn. Vice versa, there are some people who love popcorn but would rather get free water than soda. The theater captures them no problem.
However, there are some other high value consumers who are willing to pay a lot, but not that much. “The guy who is on the fence, he sees the current monopoly price for Coke and he’s willing to buy that. He sees the monopoly price for popcorn and says, 'Ehhh, I’m not willing to buy that for that price.'”
By offering the combo at a slight discount, the theater captures that guy and all the people who are on the fence. They’re still paying an arm and a leg for popcorn and soda, but not quite as much as the people the theater captured who are willing to pay even crazier prices for an individual item.
“Selling combos has as its ultimate goal the role of forcing the population to separate into different groups of people,” says Vincent, so they can be charged different prices.
Maybe there’s just something about popcorn?
Gil has an additional thought about pricing and popcorn. It has to do with the popcorn itself: It’s super salty and buttery. Which means, you can’t really buy just popcorn. You’d die of thirst. So if you want popcorn, you kind of have to commit to a soda, too. Maybe possibly to something sweet, as well.
So all of a sudden, a consumer isn’t choosing between buying no snacks and maybe just one little thing. They’re choosing between buying no snacks, and buying an armful of concessions.
If the choice is go big or go home, there are suddenly two types of consumers.
“The consumers that want to go all out, and the consumers that are very price sensitive,” says Gil.
Perhaps, he supposes, it helps that most people see a movie either before dinner or after dinner, so they’re either very hungry or not hungry at all.
Either way, once a theater has found a price where it can get all or most of the all-out consumers buying popcorn and soda and candy, if it lowers that price... it won’t get many new takers. There just won’t be that many more all-out people left. To get everyone else, they’d have to hit rock bottom prices – which just aren’t worth it.
“Theaters realize this and price accordingly,” Gil says.
Why ask why
There are a quite a few reasons consumers pay so much for concessions at the movies. So if you find yourself staring at the board of concession prices and shaking your head, just remember that basically, this is how theaters make their money.
You could also just remember to sneak your snacks in next time.
Special thanks to 'Voice of Hollywood' Ben Patrick Johnson for doing the voice-over in the audio version of this story.
Here's your lexicographic update for the week.
Merriam-Webster has released some of the new words for the Official Scrabble Players Dictionary, due out next Monday. Standard rules apply: the word must be found in a standard dictionary, it can't require capitalization, it can't have hyphens or apostrophes, and it can't be an abbreviation.
"Bromance," "chillax," "hashtag," and "selfie" are just a few of the words that are now challenge-proof.
Now what about "synergy" or "deliverables"?