Thursday, January 7, 2010

The Convention Business Is Dying - Why Bother?

The Music City Center will force Nashville taxpayers to invest hugely in a dying industry. The mayor's own consultants wrote in their 2008 white paper "Convention Centers: Is the Industry Overbuilt?":
...the supply of convention centers now exceeds the demand for such facilities nationally... There is not enough business to go around.
And this is from 2008, before the US economy took a 30% haircut -- clearly, the situation is worse now than 18 months ago.

The chart explains it all: Demand (green) is down; Supply (red) is up -- way up. If you recall Econ 101, that means prices for the supply will go down. In the case of the MCC, we know for a fact that there are major convention centers under construction right now that will increase that supply. And even if the economy recovers to 2007 levels, there will still be more convention space than convention-goers.

This enormous gap in supply and demand will only get worse because of a perfect storm of three social trends:
  • Sustainability -- the carbon footprint of a convention and its attendees is astonishing. Imagine 3,000 people traveling to Nashville for a national convention. According to the TerraPass carbon footprint calculator, it's 2.84 million pounds of CO2 (over 660,000 cubic meters, which is a football field-size cube over 120 feet deep.)
  • Technology -- USA Today featured an article recently on virtual trade shows, and there's a tech buzz around the possibilities of immersive, 3-D computer displays. The meteoric rise of virtual meeting spaces and online collaboration tools give most companies a much more cost-effective business-development opportunity.
  • Corporate Spending -- in a new era of cost-cutting and cash conservation, traditional conventions are on the chopping block. Companies are realizing that for many purposes, conventions and trade shows do not deliver the return on investment they need.
So why is the mayor so intent on building the MCC? Conventions are a dying business, and there is no reason to gamble a billion dollars (and yes, folks, it WILL be a billion before this thing is over) on this losing proposition. The MCC Coalition has done a fine job finding a solution for a 1999 problem, but we live in a different world now.

There are a few things you can do to help stop this train-wreck:
- sign the online petition and make your voice heard in opposition to this terrible business deal.
- come to the public meetings - 1/11 is the big one at the courthouse, and there are more dates posted at our website.
- call your council members and the mayor's office.

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