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Business
Sports tourism brings in $5.8 million to Floyd County so far this year

Two events on the weekend of Sept. 11-12 highlight the roll Floyd County has been on this year, as sports tourism continues to thrive — even during a pandemic.

Georgia Cycling’s first race of the season at Kingston Downs and the Southern Ozaki Junior Cup at the Rome Tennis Center at Berry College are the most recent examples of that success.

The mountain bike race featured middle and high school riders from all over the state and brought in just under 864 participants over two days and over 3,000 event attendees, according to organizer Kenny Griffin. The tennis tournament, which was formerly the Junior Davis/Fed Cup, drew over 200 of the top tennis teens from across nine southeastern states.

That’s an estimated economic impact of more than $300,000 for Rome and Floyd County this past weekend; just a drop in the bucket for 2021.

Year to date, sports tourism has brought in $5,831,403 for this area, according to figures compiled by Rome Sports Commission Director Ann Hortman.

Georgia’s Rome Office of Tourism Director Lisa Smith and Hortman have been optimistic this year, and it’s paid off.

“Sports tourism is 91% of our business,” Hortman said.

Tennis has been a sports tourism driver for several years. The economic impact of tennis alone in Floyd County had been in the range of $4.8 million to $4.9 million in each of the three years prior to 2020.

That dropped off in 2020 to $1.7 million as 36 tournaments were canceled due to the COVID-19 pandemic.

But so far this year, we’re back.

Another tennis-specific note is the likelihood that the management of the Rome Tennis Center at Berry College will be changing.

While the tourism office took over operation of the tennis center in June of last year, this past week Rome city commissioners approved a measure to allow a contract with Cliff Drysdale Tennis.

CDT is under the same umbrella company that manages Stonebridge Golf Course, a relationship that City Manager Sammy Rich described as successful.

The proposal, which is not finalized, would be a $10,000-a-month fee alongside a 3% bonus based on profits.

Saying the center would be the flagship of the management company’s portfolio, Rich said they’ll be aggressive in recruiting tournaments and events. On top of that, he said, they specialize in creating tennis programming for locals.

“There will be something for everyone,” Rich said.


Business
Georgia farmers finding new market in rural hospitals

A legislative committee looking for ways to improve rural Georgia’s economy was presented with discouraging statistics depicting losses in population, failing schools and inadequate health care.

But in the midst of that gloom and doom, members of the Georgia House Rural Development Council got a glimpse of fledgling efforts by a nonprofit that is helping farmers find new markets for their products and could help reinvigorate Georgia’s textile industry.

The Georgia Rural Hospital Food Collaborative was launched last May to provide fresh fruits and vegetables, pork and beef, and even medical scrubs to rural hospitals and nursing homes.

“Not only is it good for hospitals. It’s good for nursing homes,” said Jimmy Lewis, CEO of HomeTown Health Care, which represents rural hospitals in Georgia. “It’s good economic development.”

The food collaborative is a byproduct of the coronavirus pandemic, which has disrupted supply chains Georgia fruit and vegetable farmers rely on to get their highly perishable crops to market.

HomeTown Health Care has partnered with Healthcare Services Group, which manages hospital dining and nutritional services, to cut out the middleman and supply fruits and vegetables directly to hospitals and nursing homes.

Sixteen rural hospitals and nursing home are participating in the program, David Bridges, interim director of the Georgia Center for Rural Prosperity, told members of the Rural Development Council Sept. 1.

Offering fruits and vegetables at reasonable prices boosts the bottom lines of rural facilities often operating on thin margins, said Bridges, who also serves as president of Abraham Baldwin Agricultural College in Tlfton.

“If they have to choose between paying for food or nurses, we want them to pay the nurses,” he said.

“The patients in the hospitals love it,” Lewis added. “It’s doing really well.”

The same supply chain issues face Georgia beef and pork producers, making it difficult to ship cattle and pigs raised here to out-of-state processers in a timely manner.

Lewis said the Miller County Development Authority provided the solution, offering to purchase a local slaughterhouse and lease it to the food collaborative.

“We’ve got farms lined up to have their beef processed,” Lewis said.

Another project HomeTown Health and the Georgia Center for Rural Prosperity are involved in holds potential for reviving a textile industry that has lost thousands of jobs to overseas outsourcing for decades.

Working with Swainsboro-based textile manufacturer America Knits, the two have launched Field to Closet, an initiative to provide 100% cotton medical scrubs to Georgia hospitals at no cost. Thus far, 16 rural hospitals have signed on.

The project spins Georgia-grown cotton into yarn at Parkdale Mills in Rabun Gap, weaves the yarn into fabric in North Carolina, and arrives at the America Knits plant for final production. As an additional benefit, the fabric is treated with an antimicrobial chemical that inhibits the growth of bacteria and has been shown in lab tests to destroy viruses.

“There was a time when an end-to-end U.S. supply chain for cotton garments would have been considered a pipedream,” said Steve Hawkins, CEO of America Knits.

“Working on this project aligns perfectly with our focus on providing prosperity for rural smaller communities and creating quality, environmentally sustainable products in the United States.”

Lewis envisions expanding the medical scrubs project to all sorts of cotton clothing as a way to “reshore” cotton production back from overseas. He said several major companies are interested in investing, including Ralph Lauren and Nike.

“If we could track (cotton) from the point of the seed all the way to a new cotton product … we can bring cotton back to the United States,” Lewis said. “We’ve got every part of the cluster to make re-shoring a reality.”


Business
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Consumer Confidential|
Consumer Confidential: As Hulu's price rises, how much is too much for a streaming service?

Disney’s decision this week to raise the price of its Hulu streaming service by $1 isn’t just a money grab, although it’s definitely that. With roughly 43 million paying Hulu subscribers, that’s as much as $43 million a month in extra revenue.

But it’s not just about the money.

Disney, like all the streaming services that now play an outsized role in people’s lives amid the never-ending pandemic, is also testing the waters. It’s trying to determine how much consumers will pay, and for how long, in an increasingly crowded marketplace.

“Every one of these streaming services is competing for our time and wallets,” said Dan Rayburn, a digital-media analyst with the business consulting firm Frost & Sullivan.

“The entire industry is trying to figure out how high it can raise rates before it increases churn,” he told me.

“Churn,” if you’re not familiar with the term, is common to all subscription-based businesses. It’s the volume of turnover in any given month as some people cancel their subscriptions and take their time and wallets elsewhere.

“None of these companies make you sign a contract,” Rayburn observed. “So people can leave any time they want. And they do.”

For consumers, this raises some interesting questions.

How much will most people be willing to pay for a streaming service?

How many services will most people subscribe to?

How does an industry remain solvent when its customers repeatedly cycle from one provider to another?

“These are good questions,” Rayburn said. “We don’t yet know the answers.”

Disney — no slouch when it comes to gauging consumer behavior — is playing things carefully.

The company made an incredibly canny move when it introduced its Disney+ streaming service in 2019 at a bargain-basement price of $6.99 a month — about half what Netflix charged at the time for its standard plan.

That relatively low price attracted millions of subscribers.

Then, in March of this year, Disney raised the price by $1 a month, yet still managed to attract more than 12 million new subscribers in the most recent quarter.

The company hasn’t said it will boost the fee for Disney+ again any time soon, but another increase seems inevitable. Clearly, millions of people still think they’re getting good value for their money.

Disney would be foolish not to test that proposition by seeing how high the price of Disney+ can go before subscribers start heading for the door.

The company is apparently making the same calculation with its ESPN+ streaming service, which last month similarly went up in price by $1 a month.

“I would argue that Disney came out with artificially low prices, especially for Disney+, in order to drive huge subscriber demand, which frankly worked,” said Jeffrey Wlodarczak, a senior analyst at Pivotal Research Group.

“Now they are just starting to normalize their pricing,” he told me.

Every industry analyst I spoke with agreed that things are going to get messy, at least for service providers.

“There will likely be higher churn industrywide for the next year given the enormous investments all are making into content,” said Alexia Quadrani, a media analyst with JPMorgan Chase.

This higher churn will give a better sense of which streaming services are in it for the long haul and which ones may end up as digital roadkill.

“I have no doubt Disney will end up with a seat at the winner’s table,” Quadrani said.

I’d agree with that. Let’s also figure that Netflix will keep its seat, as will Amazon Prime Video and possibly Hulu.

That leaves a whole bunch of streaming services — Apple TV+, HBO Max, Peacock, Paramount+, etc. — jockeying for whatever seats remain.

And don’t forget the music side of things. Spotify, Tidal, Apple Music, Pandora and others also want subscription fees that can run as high as $15 a month.

It’s unclear how many streaming services most people will commit to on an ongoing basis.

A recent J.D. Power survey found that the average American now subscribes to four or five streaming services, up from three at the start of the pandemic. On average, households spend a total of $55 a month, the survey found, or about half the average cable and internet bill.

Rayburn at Frost & Sullivan predicted the average will rise to five or six streaming services per household in coming months, but he said consumers will grow pickier to prevent their entertainment budgets from exploding.

He foresees four tiers of streaming services emerging. At the top of the pecking order in terms of cost will be services offering live TV, such as YouTube TV ($65 monthly), Hulu Plus Live TV ($65) and Sling TV ($35).

Next will come big dogs such as Netflix and HBO Max, running in the $15 range. Then there will be services priced closer to $10 a month, including Amazon, Disney+ and Hulu.

In the bottom tier, Rayburn said, will be smaller, more niche-oriented services such as Crunchyroll ($8) and Acorn TV ($6). Their futures are uncertain.

Let’s say Netflix, Amazon and Disney+ will be on most people’s subscription lists. Let’s also factor in at least one streaming music service. That leaves just one or two openings if most households subscribe to no more than half a dozen services.

Talk about your Darwinian struggles. And I’m not even stirring in newspaper, magazine and other journalism subscriptions, which theoretically are chasing the same dollars.

Prices for streaming services won’t go down any time soon. As Quadrani noted, it’s now all about who has the most (and best) content, and content is expensive. Higher prices are all but inevitable.

“Raising prices too quickly, or too high, can increase churn, so operators have to be judicious with price hikes,” cautioned Seth Shafer, a media analyst at S&P Global Market Intelligence’s Kagan research group.

“Each service has a different break-even and profitability point, based on content libraries and programming costs,” he said, “so it’s unlikely that the industry will converge to a single price point.”

Most analysts I spoke with believe savvy consumers will get into the habit of subscribing to two or three streaming services, chewing through their libraries of content, and then canceling and signing up for different services.

Or they’ll wait until something they really want to see comes online, subscribe to that service for a month, and then move on.

Shafer said a likely scenario is that many people will maintain Netflix and Amazon as their “anchor services,” and will then rotate through an additional three to five services each month.

Rayburn predicted that, to discourage endless churn, some services may introduce rewards programs that offer discounts or bonus content in return for extended subscriptions.

I agree that rotating services seems like the smart play for consumers. I’ve been doing that for months and it’s worked out just fine. (I don’t think I left any “Star Trek” untouched by the time I decamped from Paramount+.)

I also note that “Dune” is slated to arrive on HBO Max on Oct. 22.

I look forward to being a subscriber next month. And only next month.


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