Are Actors and Professional Athletes Paid Too Much Essay

Are Actors and Professional Athletes Paid Too Much - Essay Example However, when these payments are compared to other classes of labor in the American labor market, it becomes evident that celebrities are paid far more than other classes of labor. This phenomenon has resulted in an active debate that seems unbridgeable – are actors and professional athletes paid too much? One extreme end of the debate believes that actors and professional athletes are paid too much compared to the services they offer while the other extreme end holds that such compensation is fair because it is based on market principles. This text will deconstruct the debate from either end in order to find a more manageable stance on the issue. 2. Background The compensation provided to actors, professional athletes and other celebrities exceeds average payment figures for the top CEOs in corporate America. Not only this, these celebrities continue to receive large sums of money after their retirement from professional careers using means such as branding, advertising and p romotion of goods and services. It could therefore be surmised that these celebrities continue to be paid exuberantly throughout the course of their lives. In contrasts to these celebrities, the average American professional worker is paid far less by a large order of magnitude. Increasing economic pressure in the wake of the global economic crunch has forced many professional workers to consider their income levels as low. Critics argue that professionals who are more critical to the functioning of society such as law enforcement professionals, doctors, nurses, lawyers, teachers etc. should be paid more for their services. 3. Body One of the primary causes for high payments doled out to celebrities is disparity between demand and supply of professionally excellent celebrities. Hundreds of thousands of actors and professional athletes dot the United States but only a few are able to achieve demigod status based on their performance. The structure of the sports and entertainment mark ets also favors the more competent celebrities (Rosen and Sanderson). A common observation in the entertainment and sports industry is that celebrities are able to develop a personal following that allows them to bring in crowds of spectators to movie theaters and sports stadiums (Hausman and Leonard). Based on this â€Å"cult† following of celebrities their value addition to business processes becomes critical. This reason mandates for different teams to buy the most glamorous athletes and for movie producers to cast the most glamorous of actors. When overall business evaluation is carried out, it becomes obvious that the share of these celebrities in improving business revenues is undeniable (Fort and Quirk) and so it is common for them to be paid highly. The more affluent celebrities can be thought of as business partners – the investor provides the requisite fiscal liquidity while the celebrities provide the requisite market in the form of fans and followers. Hence , celebrities are a critical part of the equation that determines returns in the entertainment and sports industries so they are compensated highly in order to hold their interests in place. In contrast, others argue that paying celebrities highly is not rational and tends to distort the society and labor market structures badly. The glorification of celebrities as well as their glamorous ways tends to attract a lot of attention which is their selling point. This selling point means that many young

Internet Marketing Report Essay Example | Topics and Well Written Essays - 1000 words

Internet Marketing Report - Essay Example They only achieved to reach 100.000 paying customers which represented revenue of $15 million in 2002. It is nothing compared to the millions of users who roam the web daily in search of new music content. Nevertheless, rapidly the music industry understood that the Internet is not actually the enemy, but a new, alternative, means of music distribution and that this new vehicle will grow over time. Thus the need for each member of the industry to implement on the Internet and to make its artists available as the forecasts predict that the Internet will represent 20 percent of the music business by 2007. One of the major competitive advantages of the internet over the traditional music CD sales is the number of titles available. For example in a Virgin Megastore you can find around 100.000 titles. On the internet, even a small provider such as CDnow offers over 200.000 CDs. In consequence, several record labels have decided to offer their entire song catalog online. Finally, the music industry also understood that the price would be an issue especially because you can get all the songs for free. This is the main reason why Sony and Universal Music for example, decided to lower their prices to 99 cents the single download. Even though, the market analysts remain skeptical regarding the users' shift from free to single fee music. However, the Recording Industry Association of America (RIAA) claims that with more awareness of the legal threats of downloading music without paying any right to either the artists or the labels and to the poor quality of pirated music files, the customers will ultimately chose the single fee option, especially since portable devices such as the Ipod are designed to be fully compatible to the online distribution and guarantee a high sound quality. An evaluation of different positioning of existing players (competitors) within the marketplace Today there are 4 major websites - each one of them connected to one or several of the "Big Five" of the music industry (five record labels which are the global giants in the music industry: Universal Music Group, Sony Music Entertainment, EMI Group, Warner Brothers Music, BMG Entertainment) - which are leading the market of downloadable music on the Internet: iTunes Music Store, MusicMatch, Napster and Rhapsoy. Each one of these websites is associated to a larger company: iTunes with Apple, MusicMatch with Yahoo, Rhapsody with Real and Napster with the RIAA and offers to the customer an application that can be used on the pc to download and read the music files and this application can also be adapted to the portable device in order to directly download the music file "to go". This meaning that the competitive forces - Bargaining power of suppliers, Bargaining power of buyers, Barriers to entry, Threat of substitute, Rivalry among existing competitors - that were driving the traditional music industry have changed: bargaining power of suppliers decreased as it is now possible for the artists to go online with their own music without having to pass through the old channels of distributions, bargaining power of buyers has largely increased as it is possible for them to get music for free and thus the record companies have to align in order to offer good