6 ms·

I gotta be honest, I'm not sure what was expected? They spent $2b building this thing, it's brand new tech, it didn't host many shows last quarter (it was open

I gotta be honest, I'm not sure what was expected? They spent $2b building this thing, it's brand new tech, it didn't host many shows last quarter (it was open for 1? full month of the quarter). I still think The Sphere is super damn cool and I can't wait to go to an event there.

extraduder_ire 3y ago
The loss seems surprisingly low, considering the cost of building the thing. I don't expect this to end up like Brand-Briesen Airfield, or other massive buildings built and quickly sold at bankruptcy, anytime soon.
- alexstore06 3y ago
  I would assume that operating loss wouldn't include the initial cost of building. Could be wrong though.
  - lacksconfidence 3y ago
    Could be loan repayments are rolled into the loss? Not that I have any particular knowledge.
  - mvdtnz 3y ago
    You don't need to assume, it's confirmed in the very first sentence of the article.
aplummer 3y ago
Yeah if this was a stock, I’d be buying it today. The thing is great.
- toomuchtodo 3y ago
  You'd want to wait to be part of recapitalization after a reorg is required. The deal is made on the buy, not buying someone else's bags. EDIT: See gosub100's comment [1]. (not investing advice, educational purposes only) [1] https://news.ycombinator.com/item?id=38206727 https://news.ycombinator.com/item?id=38206727
  - nonethewiser 3y ago
    Sure sounds like investing advice
    - jon-wood 3y ago
      Yes, but they’ve said it isn’t, which is apparently sufficient even if you run an ad saying “InvestCo is great, you can make a ton of money from them [terms & conditions apply, you may actually lose money instead, not investment advice]”
      - maxerickson 3y ago
        It's a silly affectation rooted in lawyers commenting about a generality in a context where specifics might be inferred.
    - maxerickson 3y ago
      Not English, just looks like it. Assume meanings of words at your own risk.
  - LastTrain 3y ago
    I have a feeling this one’s a bit different, the operating costs to keep that ball of one-off technology running have to be insane.
- Satam 3y ago
  Apparently it is a stock? https://www.google.com/finance/quote/SPHR:NYSE?sa=X&ved=2ahUKEwik8te-pbeCAxULSUEAHaxgCwcQ3ecFegQIJRAf https://www.google.com/finance/quote/SPHR:NYSE?sa=X&ved=2ahU...
- LastTrain 3y ago
  It is, which is why they have to report the loss. SPHR - let us know how it goes!
  - jeffnappi 3y ago
    Fascinating, a brand new entity that effectively went public the day it began generating revenue. Are there other examples of this?
    - joezydeco 3y ago
      Pixar IPOed a week after Toy Story was released in theatres.
    - chollida1 3y ago
      > Fascinating, a brand new entity that effectively went public the day it began generating revenue. This isn't correct. THe stock has been public since 2020. It just happens to own the Sphere.
      - jeffnappi 3y ago
        Thank you for pointing that out. Also it was a spinoff of Madison Square Gardens which makes sense how it IPO'd pre revenue- https://www.sec.gov/Archives/edgar/data/1952073/000119312523084013/d357108dex991.htm https://www.sec.gov/Archives/edgar/data/1952073/000119312523...
glitcher 3y ago
Same reaction here. For such a huge investment wouldn't you expect it to take some time before it becomes profitable? Live shows are only one piece of the puzzle. I really want to go see the "postcard from earth" short film they made especially for the Sphere. The filming required all kinds of specialized camera gear to take full advantage of the resolution and 3d viewing inside, so it's no wonder there isn't going to be an immediate catalog of titles to choose from for selling more tickets.
derefr 3y ago
It hosts shows? And here I had assumed it was just a big weirdly-shaped billboard, and that their business model was "selling ads on it."
- jimt1234 3y ago
  https://www.youtube.com/watch?v=7VuQHSVnnvs https://www.youtube.com/watch?v=7VuQHSVnnvs
- kodt 3y ago
  You can go inside it, it is a large concert venue with a 360 screen/light show basically. U2 played there, but I heard retail on the tickets was nearly $500.
tw04 3y ago
They're also basically killing any locals going with the cost of concessions and probably driving a lot of people to just not spend any money there. At $40 for a double shot and $20 for a beer, I'd be drinking before I got to the venue if that were my thing. https://www.outkick.com/drink-prices-vegas-sphere-beer-liquor/ https://www.outkick.com/drink-prices-vegas-sphere-beer-liquo...
- cflewis 3y ago
  It's the Strip, I'd assume you were pretty buzzed before you rolled up. That's probably part of the math here.
  - s3p 3y ago
    That doesn't make any sense. If you were already buzzed before going, then you would need a cheaper price to continue drinking, since you already have some in you. If you were dead sober and wanted to drink, then it makes sense to shell out the money.
    - sfitz 3y ago
      If you were already buzzed before going, you're probably not making super sound financial decisions inside.
      - I_Am_Nous 3y ago
        It's Vegas, people don't go there to make sound financial decisions :P Possible counter-strategy is that the prices are high so people stay relatively tame inside. Who wants to pay ($20/unit of alcohol) to even try to get drunk?
        ryandrake 3y ago
        Yea anyone who's visited Vegas knows that from the time your plane lands to when you takeoff, you're basically just spewing money to everyone constantly. I think there are at least 5-10 people just between your airline gate and your hotel room door with their hands out looking for tips. Not a place to go if you're frugal.
ToucanLoucan 3y ago
Not only is it brand new, any prospective performance looking to book there is going to have to essentially create a bespoke show for that single venue only, that will not be able to be played anywhere else what with the big ass spherical screen being the primary differentiator. In my mind this is like if you were to build the first IMAX theater if IMAX wasn't already a thing. You'd basically be asking Hollywood to create a special version of a movie for your single venue. Like... I'm sure some will take that up, as evident by it hosting a few shows. But it can't possibly be an "open every night" situation, the economics just don't make sense for that.
- rdelpret 3y ago
  While your team would still need to be involved creatively, I would hope the sphere has an in house team to create content as well?
  - ToucanLoucan 3y ago
    I would assume so but that means the venue itself is then subsidizing the cost of the performance, which means the tickets/refreshments/etc have to be more expensive. And like, I want to emphasize: this thing is extremely cool. I love shit like this. I wish we could have more really cool things like this. But when your entire thrust is to make money... I mean I wish them all the success in the world but you'll have to put me down as a skeptic if they'll be able to, especially given how razor thin margins tend to be in the entertainment sector when the venue can just host regular ass shows that any venue can.
  - enragedcacti 3y ago
    yep, they have a team and a studio in Burbank, including a functional (internal) miniature of the sphere and an in-house camera system: https://www.reviewjournal.com/business/tourism/sphere-technologists-develop-special-camera-for-upcoming-films-2792784/ https://www.reviewjournal.com/business/tourism/sphere-techno... https://www.google.com/maps/place/5MV2%2B4M,+Burbank,+CA https://www.google.com/maps/place/5MV2%2B4M,+Burbank,+CA
gadders 3y ago
This seems to be a pattern for expensive infra projects: - Original company builds expensive piece of infrastructure - Original company fails to make money on expensive piece of infrastructure - Original company goes bust - New company buys infrastructure cheap - New company manages to run a profitable business See Eurotunnel, Iridium, probably others I've forgotten.
- jjkeddo199 3y ago
  It goes further back than this -- What do you think happened to the "joint stock companies" that funded English settlers going to the Americas? ;)
- raverbashing 3y ago
  It's almost like MBAs teach C-level "executives" to have a goldfish time range understanding of profits
- userinanother 3y ago
  Started with the railroads
- didgetmaster 3y ago
  Makes you wonder if that wasn't the plan all along. The original company has a lot of investors who would share a big percentage of the profits if it is successful. Those in charge fix things so that those investors are shed and all the profits are instead funneled to entities they control exclusively.
tootie 3y ago
I can imagine a ton of logistical constraints. They have U2 doing a residence, and I'd guess that residences are going to be the only options. Designing visuals on such a unique and complex display to match a specific artist is at least a few person-months of effort. You have to plan shows very far in advance and spend a lot of money on show production. This likely excludes anyone but the top-tier performers. And the exterior is basically just a giant ad. It's not a revenue-generator since you don't need tickets to see it.
- brewdad 3y ago
  Yes the design of the Sphere means it will never be a successful venue for touring acts. Any entertainer performing there will have to be committed to at least a month of shows, probably more. That said, it's a unique concert experience even setting the visuals aside. The sound is immersive, coming from all around you rather than the wall of sound typical of most concerts. As such, while still plenty loud, your ears are not completely destroyed by the end of the night should you forget your hearing protection.
- andy800 3y ago
  The fact that the exterior is a giant ad is exactly what makes it a revenue generator
tonyjin 3y ago
I saw both the U2 show and Postcard from Earth movie. Both were amazing in their own way, but the movie was a better demonstration of the technology if you have to choose one (and if you're not a big U2 fan). The Sphere partnered with an immersive sound company Holoplot to design and build the sound system (https://holoplot.com/news/sphere-immersive-sound-powered-by-holoplot https://holoplot.com/news/sphere-immersive-sound-powered-by-...) - this was very impressive during the movie and you could locate sound coming from exactly where the objects were on the screen in a way that I've not experienced before. The experience was similar to wearing a VR headset since the screen covers almost your entire field of view, but the sound system significantly improved the feeling of immersion. During the movie, the system also pushed air onto the audience to simulate wind in a convincing way.
- fanf2 3y ago
  Sounds like an IMAX Dome.

extraduder_ire 3y ago

The loss seems surprisingly low, considering the cost of building the thing. I don't expect this to end up like Brand-Briesen Airfield, or other massive buildings built and quickly sold at bankruptcy, anytime soon.

alexstore06 3y ago
I would assume that operating loss wouldn't include the initial cost of building. Could be wrong though.
- lacksconfidence 3y ago
  Could be loan repayments are rolled into the loss? Not that I have any particular knowledge.
- mvdtnz 3y ago
  You don't need to assume, it's confirmed in the very first sentence of the article.

aplummer 3y ago

Yeah if this was a stock, I’d be buying it today. The thing is great.

toomuchtodo 3y ago
You'd want to wait to be part of recapitalization after a reorg is required. The deal is made on the buy, not buying someone else's bags. EDIT: See gosub100's comment [1]. (not investing advice, educational purposes only) [1] https://news.ycombinator.com/item?id=38206727 https://news.ycombinator.com/item?id=38206727
- nonethewiser 3y ago
  Sure sounds like investing advice
  - jon-wood 3y ago
    Yes, but they’ve said it isn’t, which is apparently sufficient even if you run an ad saying “InvestCo is great, you can make a ton of money from them [terms & conditions apply, you may actually lose money instead, not investment advice]”
    - maxerickson 3y ago
      It's a silly affectation rooted in lawyers commenting about a generality in a context where specifics might be inferred.
  - maxerickson 3y ago
    Not English, just looks like it. Assume meanings of words at your own risk.
- LastTrain 3y ago
  I have a feeling this one’s a bit different, the operating costs to keep that ball of one-off technology running have to be insane.
Satam 3y ago
Apparently it is a stock? https://www.google.com/finance/quote/SPHR:NYSE?sa=X&ved=2ahUKEwik8te-pbeCAxULSUEAHaxgCwcQ3ecFegQIJRAf https://www.google.com/finance/quote/SPHR:NYSE?sa=X&ved=2ahU...
LastTrain 3y ago
It is, which is why they have to report the loss. SPHR - let us know how it goes!
- jeffnappi 3y ago
  Fascinating, a brand new entity that effectively went public the day it began generating revenue. Are there other examples of this?
  - joezydeco 3y ago
    Pixar IPOed a week after Toy Story was released in theatres.
  - chollida1 3y ago
    > Fascinating, a brand new entity that effectively went public the day it began generating revenue. This isn't correct. THe stock has been public since 2020. It just happens to own the Sphere.
    - jeffnappi 3y ago
      Thank you for pointing that out. Also it was a spinoff of Madison Square Gardens which makes sense how it IPO'd pre revenue- https://www.sec.gov/Archives/edgar/data/1952073/000119312523084013/d357108dex991.htm https://www.sec.gov/Archives/edgar/data/1952073/000119312523...

glitcher 3y ago

Same reaction here. For such a huge investment wouldn't you expect it to take some time before it becomes profitable? Live shows are only one piece of the puzzle. I really want to go see the "postcard from earth" short film they made especially for the Sphere. The filming required all kinds of specialized camera gear to take full advantage of the resolution and 3d viewing inside, so it's no wonder there isn't going to be an immediate catalog of titles to choose from for selling more tickets.

derefr 3y ago

It hosts shows? And here I had assumed it was just a big weirdly-shaped billboard, and that their business model was "selling ads on it."

jimt1234 3y ago
https://www.youtube.com/watch?v=7VuQHSVnnvs https://www.youtube.com/watch?v=7VuQHSVnnvs
kodt 3y ago
You can go inside it, it is a large concert venue with a 360 screen/light show basically. U2 played there, but I heard retail on the tickets was nearly $500.

tw04 3y ago

They're also basically killing any locals going with the cost of concessions and probably driving a lot of people to just not spend any money there. At $40 for a double shot and $20 for a beer, I'd be drinking before I got to the venue if that were my thing. https://www.outkick.com/drink-prices-vegas-sphere-beer-liquor/ https://www.outkick.com/drink-prices-vegas-sphere-beer-liquo...

cflewis 3y ago
It's the Strip, I'd assume you were pretty buzzed before you rolled up. That's probably part of the math here.
- s3p 3y ago
  That doesn't make any sense. If you were already buzzed before going, then you would need a cheaper price to continue drinking, since you already have some in you. If you were dead sober and wanted to drink, then it makes sense to shell out the money.
  - sfitz 3y ago
    If you were already buzzed before going, you're probably not making super sound financial decisions inside.
    - I_Am_Nous 3y ago
      It's Vegas, people don't go there to make sound financial decisions :P Possible counter-strategy is that the prices are high so people stay relatively tame inside. Who wants to pay ($20/unit of alcohol) to even try to get drunk?
      - ryandrake 3y ago
        Yea anyone who's visited Vegas knows that from the time your plane lands to when you takeoff, you're basically just spewing money to everyone constantly. I think there are at least 5-10 people just between your airline gate and your hotel room door with their hands out looking for tips. Not a place to go if you're frugal.

ToucanLoucan 3y ago

Not only is it brand new, any prospective performance looking to book there is going to have to essentially create a bespoke show for that single venue only, that will not be able to be played anywhere else what with the big ass spherical screen being the primary differentiator. In my mind this is like if you were to build the first IMAX theater if IMAX wasn't already a thing. You'd basically be asking Hollywood to create a special version of a movie for your single venue. Like... I'm sure some will take that up, as evident by it hosting a few shows. But it can't possibly be an "open every night" situation, the economics just don't make sense for that.

rdelpret 3y ago
While your team would still need to be involved creatively, I would hope the sphere has an in house team to create content as well?
- ToucanLoucan 3y ago
  I would assume so but that means the venue itself is then subsidizing the cost of the performance, which means the tickets/refreshments/etc have to be more expensive. And like, I want to emphasize: this thing is extremely cool. I love shit like this. I wish we could have more really cool things like this. But when your entire thrust is to make money... I mean I wish them all the success in the world but you'll have to put me down as a skeptic if they'll be able to, especially given how razor thin margins tend to be in the entertainment sector when the venue can just host regular ass shows that any venue can.
- enragedcacti 3y ago
  yep, they have a team and a studio in Burbank, including a functional (internal) miniature of the sphere and an in-house camera system: https://www.reviewjournal.com/business/tourism/sphere-technologists-develop-special-camera-for-upcoming-films-2792784/ https://www.reviewjournal.com/business/tourism/sphere-techno... https://www.google.com/maps/place/5MV2%2B4M,+Burbank,+CA https://www.google.com/maps/place/5MV2%2B4M,+Burbank,+CA

gadders 3y ago

This seems to be a pattern for expensive infra projects: - Original company builds expensive piece of infrastructure - Original company fails to make money on expensive piece of infrastructure - Original company goes bust - New company buys infrastructure cheap - New company manages to run a profitable business See Eurotunnel, Iridium, probably others I've forgotten.

jjkeddo199 3y ago
It goes further back than this -- What do you think happened to the "joint stock companies" that funded English settlers going to the Americas? ;)
raverbashing 3y ago
It's almost like MBAs teach C-level "executives" to have a goldfish time range understanding of profits
userinanother 3y ago
Started with the railroads
didgetmaster 3y ago
Makes you wonder if that wasn't the plan all along. The original company has a lot of investors who would share a big percentage of the profits if it is successful. Those in charge fix things so that those investors are shed and all the profits are instead funneled to entities they control exclusively.

tootie 3y ago

I can imagine a ton of logistical constraints. They have U2 doing a residence, and I'd guess that residences are going to be the only options. Designing visuals on such a unique and complex display to match a specific artist is at least a few person-months of effort. You have to plan shows very far in advance and spend a lot of money on show production. This likely excludes anyone but the top-tier performers. And the exterior is basically just a giant ad. It's not a revenue-generator since you don't need tickets to see it.

brewdad 3y ago
Yes the design of the Sphere means it will never be a successful venue for touring acts. Any entertainer performing there will have to be committed to at least a month of shows, probably more. That said, it's a unique concert experience even setting the visuals aside. The sound is immersive, coming from all around you rather than the wall of sound typical of most concerts. As such, while still plenty loud, your ears are not completely destroyed by the end of the night should you forget your hearing protection.
andy800 3y ago
The fact that the exterior is a giant ad is exactly what makes it a revenue generator

tonyjin 3y ago

I saw both the U2 show and Postcard from Earth movie. Both were amazing in their own way, but the movie was a better demonstration of the technology if you have to choose one (and if you're not a big U2 fan). The Sphere partnered with an immersive sound company Holoplot to design and build the sound system (https://holoplot.com/news/sphere-immersive-sound-powered-by-holoplot https://holoplot.com/news/sphere-immersive-sound-powered-by-...) - this was very impressive during the movie and you could locate sound coming from exactly where the objects were on the screen in a way that I've not experienced before. The experience was similar to wearing a VR headset since the screen covers almost your entire field of view, but the sound system significantly improved the feeling of immersion. During the movie, the system also pushed air onto the audience to simulate wind in a convincing way.

fanf2 3y ago
Sounds like an IMAX Dome.