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GEOG102 Week 9 1
Lab week 9: A Pacific Northwest Geologic Mystery
Lab Purpose and learning objectives
1. Report, describe, and interpret your observations of several
features found in the Pacific
NW.
2. Formulate a hypothesis explaining how several landform
features relate to each other and
explain what took place to create them (Your story).
3. Use the scientific method to structure your exploration and
explanations.
Instructions and Overview
Step 1. a. You are going to investigate and solve a mystery
about a geological phenomenon in
our “backyard”. You will be given several pieces of evidence
and multiple clues and
hints containing geologic information for you to observe,
formulate hypotheses about,
and interpret.
b. Using the eight pieces of evidence provided, and the large
map of the Northwest with
their locations, make observations and interpretations and
record these in the table
provided (see page 6). You will type these up and upload these
to Canvas.
c. Hints are provided along with the evidence to help guide your
group and should be
used for discussion when making your observations and
interpretations. You do not need
answer these questions in your report. However, discuss each
question as a group to
learn about each piece of evidence so that you can come up with
plausible interpretations
and observations.
Step 2. Once you have investigated all eight pieces of
geological evidence and have recorded
your observations and thoughts, sit down with your group and
develop a narrative of
what you think happened based on the evidence. Include the
ways each piece of evidence
supports your description, i.e., what does your clue indicate
about the larger picture. For
example, the presence of a sesame seed on my shirt might mean
that I recently ate a Big
Mac, but it could also mean I ate a sesame bagel.
Step 3. Using the scientific method (see page 5) write,
independently of the group, a clear 500-
600 word lab report compiling this information into a narrative
explaining, or solving, the
Pacific Northwest Geologic Mystery. Note the typed tables of
should be attached as
Name:
_____________________________________________________
Lab Day:_________________________ Lab
Time:____________________
GEOG102 Week 9 2
appendices and can be referred to in the report, but do not count
towards the 500-600
words.
Grading:
10% Neatness, spelling, and grammar
30% Your observations and interpretation must be typed
following the attached sheet
(page 6)
60% The 500-600 typed summary connecting the hints into a
cohesive explanation of the
Pacific Northwest Geologic Mystery
What to hand in at Wednesday lecture during the last week of
class
□ Typed observations and interpretations on attached sheet.
□ 500-600 word typed lab report
Lab Report Requirements
1. Lab reports must be typed. Standard one inch margins,
double spaced, size 12 fonts are
required (either Times New Roman or Calibri). Your
observations and interpretation sheets
can be size 10 font and single spaced.
2. A title, brief introduction and several well-organized
paragraphs are mandatory. Use the
following headings to subdivide your report: Introduction (~50 -
75 words), Method (~50-75
words), Observations and Interpretations (main body of the
paper) (300-400 words), and
Conclusion (~50-100words). Attach the typed
observation/interpretation tables from the lab
period as an appendix.
3. See the discussion of the scientific method on page 5 and use
this to guide the observations
and interpretation section of your lap report.
4. Each paragraph should contain a topic sentence and the other
sentences should support that
topic sentence. Each sentence must be complete, grammatically
correct and use correctly
spelled words. Sentences and paragraphs must be clear in their
meaning, not sloppy or
vague.
5. Reports must be uploaded to Canvas for your TA to grade.
6. Professional language should be used throughout the report.
The report should be written in
the 3rd person (not 1st). Words should be technical and
professional, not colloquial or slang.
Contractions ("they're", "we're", "it's") should be avoided.
7. The meaning of each sentence and paragraph must be clear.
Do not assume that your TA
will understand your meaning if you use vague language,
incomplete sentences, or if
sentences are not put together in a coherent manner. Your TA
has been instructed not to try
to make sense out of sentences or paragraphs that lack
organization or are poorly organized.
GEOG102 Week 9 3
Relief Map of the Pacific Northwest (locations are approximate)
The Hints – Questions to Ponder… Where were glaciers present
15,000 years ago?
Do not answer these questions directly in your lab report. They
are hints to help you
interpret what you observe at each station
1. McMinneville, Oregon
• How could a jökulhlaup (a subglacial outburst flood) have
occurred in the Willamette
Valley? What does the distribution of erratics in the Willamette
Valley tell you about
how they got there?
• What is the importance of identifying the rock type of an
erratic? What does this tell you
about the history of the rock?
1
2
3 4 5
6
7
8
8
GEOG102 Week 9 4
2. Eastern Washington
• What processes (and how much force) result in rocks being
stripped of soil? What
processes result in rocks being submerged in sediment?
• What is the relationship between the present day Columbia
River and the Scabland
channels?
GEOG102 Week 9 5
3. Spokane, Washington
• When is a puddle muddy? When is it clear? How might that
result in production of
rhythmites? A rhythmite consists of layers of sediment or
sedimentary rock which are
laid down with an obvious periodicity and regularity.
• What does the number of layers in rhythmites tell you?
GEOG102 Week 9 6
4. Coulee City, Washington
• What processes can create rounded boulders like these? What
natural processes can move
boulders from one place on the earth to another?
• What does the rock type tell you about where these boulders
came from? What does it
mean if these rocks were a rock type very different than the
rock near where they were
found?
• What if these rocks look very similar to rocks found in
Montana?
•
5. Missoula, Montana
• What processes create a shoreline along a lake or reservoir?
• What does the presence of shorelines high on a mountainside
above a valley mean? What
must have been present to create shorelines in these locations?
GEOG102 Week 9 7
6. Corvallis, Oregon
• The Willamette series of soils consists of very deep, well
drained soils that formed in
silty glaciolacustrine deposits.
• What processes contribute to the sudden deposition of large
amounts of similar-sized
material?
• How is it possible that Reser Stadium has had both mammoth
bones found beneath it
while also having been some 400 feet underwater all within the
same geologic time?
• What processes could create very flat valleys, such as the
Willamette Valley?
• What are some possible sources of the material that makes up
Willamette Valley soils?
•
GEOG102 Week 9 8
7. Camas Prairie, Montana
• What processes create ripples in sand? What determines how
big a ripple is?
• How could you get giant ripples in Montana?
8. Dry Falls, Washington
• Do waterfalls have enough energy to carry large rock or pull
large rock out of the
ground? Do waterfalls move over time?
• What does the size of the waterfall tell you about the size of
the river?
• What is the relationship between the modern river
(Columbia?) and the scoured
channels?
GEOG102 Week 9 9
The Scientific Method
Einstein once said, “Imagination is more important than
knowledge. Knowledge is limited. Imagination encircles the
world.”
Use the following figures describing and illustrating the
scientific
method to think about the Pacific Northwest Geologic Mystery
The right hand side of the figure below describing the use
scientific method to study the effects of dust on mountain
snowpack is a good template for the observation and
interpretation section of your lab report
GEOG102 Week 9 10
Hint
Location
Observations
(Just the facts)
Interpretations
(What do the facts mean?)
1
2
3
GEOG102 Week 9 11
Clue
Location Observations (Just the facts)
Interpretations
(What do the facts mean?)
4
5
6
GEOG102 Week 9 12
Clue
Location
Observations
(Just the facts)
Interpretations
(What do the facts mean?)
7
8
Additional
thoughts
(if
needed)
Look through this paper, and the section of conclusion is still
blank, please write a half page conclusion.
Table of Content
Introduction… 3
Problems Statement… 4
Research Questions… 4
Methodology… 5
Results and Findings … 5
Conclusions
Recommendations (2)
References
Introduction:
Employee benefits are awarded and/or given to exceeding salary
and wage employees that recompense for injury, loss, or simply
incentive compensation and may differ upon full-time and part-
time employees. Some benefits are legally required to be
compensated and others are discretionary, where employers are
not required to provide particular benefits to their employees,
such as disability insurance, retirement plans, and life
insurance. Employee benefits affect both the well-being of the
employee and the employer. It becomes the critical systematic
organization of a business to meet their growing expectations in
efforts to accomplish their objectives. In regards to the
discretionary benefit of tuition reimbursement, companies offer
employees the opportunity to cover learning tuition costs while
employees work towards earning their degree.
When offering tuition reimbursement or tuition assistance, many
employers as well as employees gain profit from these
programs. Employers obtain their financial gain by attracting
motivated and dedicated employees who have the opportunity to
grow and develop in strengthening their skills. Tuition
reimbursement demonstrates the company’s investment in high-
value candidates and their professional and educational growth.
“The idea is to attract and keep employees longer, while
cultivating a new crop of managers from within hotel
companies' ranks” (2019, 1). This allows for the company to
save on the expenses of recruitment and turnover costs.
When companies offer tuition reimbursement, their retention
rate becomes higher and it is less likely for employees to
proceed to another company. However, when employees
subsequently earn their degrees, they will presumably leave the
company for higher paying positions elsewhere. This problem
creates a risk of investment for the companies. By creating jobs
with tuition reimbursement, it creates clear value of the degree
obtained by the employees.
Problem Statement:
Providing tuition reimbursement contributes to the successful
organization of the company.
Research Questions:
How does the reimbursement program contribute to employee
productivity?
Why does tuition and loan reimbursement contribute to reduced
employee turnover rates?
What incentives do employees gain from participating in tuition
reimbursement programs?
Methodology:
Our group gathered information from the UCR library online
database, specifically Business Source Complete. We also found
some articles online from trusted sources. We would often meet
after class to evaluate our findings and discuss potential
solutions for our topic.
Research and Findings:
Question 1: How does the reimbursement program contribute to
employee productivity?
In today's competitive workforce, companies are encouraging
employees to further their education to improve employee
productivity. Firms are providing the tuition reimbursement
program because they allow employers to attract, motivate, and
retain knowledgeable employees. Employers that invest in
employees help employees develop the knowledge and skills
needed in this competitive and growing economy. Additionally,
large investment in tuition reimbursement develops positive
attitudes and retention among employees. As part of the
educational skills, employees gain positive attitudes and
retention. Employees that hold a positive attitude tend to be
more open-minded and recognize different opportunities within
their work, and retention gives them control of something in
their work. Finally, graduation of furthering education is a
signal to employers to be potentially productive because
employees expanded their knowledge and know more positive
skills in this growing workforce.
Moreover, participating in the reimbursement program
creates sorting from the program's overall retention effect.
According to Manchester, he examined the difference between
participants and nonparticipants in their propensities to separate
from the institution (Manchester 959). Participants that take
part in the reimbursement program are more likely to still be
employed at their work than those who did not participate.
Participation also lowers the propensity to leave the employer
(Manchester 962). Employees who remain and are looking for
other jobs also contribute to employee productivity because
they are focused on their job and are satisfied by the benefits
that the employers are offering them. At different institutions,
employees also have access to funds that can be used towards
classes that are offered on campus as part of a community
education program (Manchester 962). Those programs are non-
degree classes like painting and wellness classes that encourage
employees to participate in reimbursement programs because
they learn more skills in college classes. Therefore, additional
exposure to skills increases employees' knowledge.
On the other hand, reimbursement programs also create
human capital through the effect of retention of sorting. Since
tuition and loan reimbursement programs create effects on the
composition of workers, it provides increasing retention
amongst workers due to worker sorting. In other words, worker
sorting gives workers sort access based on their preferences for
nonwage characteristics through the tuition reimbursement
(Manchester 956). High-ability employees work in firms that
provide tuition reimbursement programs because they rely on
learning costs being paid. Then, employees are motivated to
invest in human capital that increases retention. The returns to
investing in human capital are higher for individuals who have
lower discount rates because the benefits to human capital
investment accrue in the future whereas the costs are immediate
(Manchester 957). Employees with lower discount rates place a
higher value on future consumption in workplaces. Lower
discount rates help employees with productivity because they
will have lower mobility risk since they place greater weight on
opportunities offered by companies. Finally, human capital
increases retention of employees because it contributes to the
knowledge and personality needed to perform in the labor
force.
Overall, we concluded that the tuition and loan
reimbursement program contributes to productivity because it
increases retention and the value for employees to invest in
human capital. Employers who invest in reimbursement
programs for their employees have a high return on knowable,
skillful, and positive attitudes with employees.
Question 2: Why does tuition and loan reimbursement
contribute to high employee turnover rates?
Tuition reimbursement is a valuable benefit for the employee
and the company. Employers invest in their employees’ future
goals and accomplishments by supporting their educational and
social development. In turn, the employees’ will develop the
notion that they are efficiently utilizing their obtained
knowledge by contributing to the success and prosperity of the
company for which they are employed. The employees are
incentivized to remain in their specified position for an
extended period of time, reducing the turnover rate. For
example, according to the book,The Wiley Handbook of Global
Workplace Learning, it states that “UPS invested a fraction of
the potential cost of relocation into 50% tuition coverage, book
reimbursements, and academic bonuses for student workers. In
turn, turnover among employees was cut by 70%, and the
partnership resulted in over 2,500 postsecondary credentials.”
(Clark 73) The company will retain their profits by decreasing
the need to continually expend their wealth on constantly hiring
and training new staff. This generates a sense of loyalty
between employee and employer.
Participation in the tuition reimbursement program will
strengthen the skills and knowledge of the employees as well as
providing the company with work efficient personnel and
valuable human capital specific to the firm. The benefits of
obtaining job specific skills free of charge will raise retention
rates in which the productivity of the employee will continue to
persist even after the complimentary education has been
completed. Companies that provide complimentary resources,
such as tuition reimbursement, are investing in the quality of
their employees in addition to the success of their agency. The
author, Clark, further states that “The envisioned new learning
economy provides working learners with improved access to
relevant learn and earn opportunities, better connections to
work pathways, clearer and more attainable learning outcomes,
and increased life satisfaction.” (Clark 71) The working learners
opportunity is significant in serving the new hires, the company,
and the communities that become involved in the economic
success of the agency.
In a way, companies who offer tuition reimbursement
Question 3: What incentives do employees gain from
participating in tuition reimbursement programs?
A recent 2018 survey revealed that as many as 92% of
companies in the U.S. tend to offer some type of education
assistance (TalentCulture). With such a high participation rate,
belonging to a company that offers an education benefit such as
tuition reimbursements comes with many incentives. Tuition
reimbursement for an employee comes with the incentive of an
education opportunity that was once unaffordable or
unattainable due the unwillingness to pay for one (Martocchio
254). Also, a incentive of tuition reimbursement is the ability
to enroll in courses the employee wishes to take at a time they
would like to take them (Martocchio 259). The time committed
to fulfilling the degree incentivizes the employee to take up
courses either related to the employee’s current job or
something totally opposite. The educational opportunity
employers provide motivates employees to be part of continual
skill development and a workforce that seeks adaptable skills
(Pattie 438). Ultimately, tuition reimbursement with its
incentives can be a beneficial opportunity for employees.
Obtaining a college education or an advanced degree grants
employees with greater human capital. Not only have employees
now developed new skill sets, but they have the education and
experience for access to future promotions, compensation, job
roles, etc. Participating in tuition reimbursement programs
allow employees to gain marketable skills other than the skills
obtained through traditional human resources (HR) classroom or
on the job training (Pattie 424). Not to mention, Human
Resources run programs tend to only last a couple of days
whereas employees develop a greater depth of skills through a
wider range and extent of the education assistance programs.
With the greater human capital obtained through participating in
the tuition reimbursement program, employees now have the
option of deciding whether their current position fits their new
acquired skill set. If the employee’s current position no longer
fits their new developed skills, employees become attractive to
alternative jobs. Employees can feel as if their new skills now
actually help switching companies easier than before. On the
other hand, if the employee's degree relates to their current
position or possible benefit returns, the employee can stay and
obtain an increase in salary (Pattie 428). In the end, employees
who participate in tuition reimbursement programs tend to
respond in a positive manner as they are aware of the voluntary
benefit their employers are providing in terms of investing in
employees and seeking to foster a sense of professional
development within the organization. There exist no greater
incentive for employees than obtaining professional growth and
development with the aid of one's employer.
Conclusion:
Recommendations:
References
Fuhrmans, V. (2018, Mar 01). Free tuition: Hotels' latest
attempt to stem employee turnover;
the american hotel & lodging association and education
company pearson PLC are
pairing up to launch a pilot program that will foot the bill for
hotel-industry workers to
get degrees. Wall Street Journal (Online) Retrieved from
https://search.proquest.com/docview/2009007317?accountid=14
521
Manchester, Colleen F. “General Human Capital and Employee
Mobility: How Tuition
Reimbursement Increases Retention Through Sorting and
Participation .” ILR Review,
vol. 65, no. 4, Oct. 2012, pp. 951–974. Sage Publications, Inc.,
https://www.jstor.org/stable/24368505.
Pattie, Marshall, et al. “Tuition Reimbursement, Perceived
Organizational Support, and
Turnover Intention among Graduate Business School Students.”
Human Resource
Development Quarterly, vol. 17, no. 4, 2006, pp. 423–442,
doi:10.1002/hrdq.1184. Martocchio, Joseph J. Employee
Benefits: A Primer for Human Resource Professionals.
McGraw-Hill Education, 2018.TalentCulture Team. “What Does
Tuition Assistance
Look Like in 2018?” TalentCulture, TalentCulture LLC, 24 May
2018,
talentculture.com/tuition-assistance-look-like-2018/.
Clark, Hope, et al. “The New Learning Economy and the Rise of
the Working Learner.” Wiley
Online Library, John Wiley & Sons, Ltd, 25 Mar. 2019,
onlinelibrary.wiley.com/doi/pdf/10.1002/9781119227793.ch4.
******Talk about your idea on both sides*****
Write a short position paper (one or two pages) that supports
either the shareholder primacy or stakeholder answer to the
question, “For whom should the corporation exist?” Your paper
should include responses to the main arguments of the opposing
side.
9 - 7 0 9 - 4 1 1
R E V : F E B R U A R Y 1 0 , 2 0 1 0
_____________________________________________________
________________________________________________
Professor Ramon Casadesus-Masanell and Maxime Aucoin
(MBA 2008) prepared this case. HBS cases are developed solely
as the basis for class
discussion. Cases are not intended to serve as endorsements,
sources of primary data, or illustrations of effective or
ineffective management.
Copyright © 2009, 2010 President and Fellows of Harvard
College. To order copies or request permission to reproduce
materials, call 1-800-545-
7685, write Harvard Business School Publishing, Boston, MA
02163, or go to www.hbsp.harvard.edu/educators. This
publication may not be
digitized, photocopied, or otherwise reproduced, posted, or
transmitted, without the permission of Harvard Business School.
R A M O N C A S A D E S U S - M A S A N E L L
M A X I M E A U C O I N
Cirque du Soleil—The High-Wire Act of Building
Sustainable Partnerships
The headline was grim: “Fat cats at Cirque du Soleil lose their
way—new Cirque show is as
creative as a Hollywood sequel.” As he glanced up from his
morning newspaper, Daniel Lamarre,
Cirque du Soleil’s president and CEO, noticed an e-mail on his
PDA from Jim Murren, CEO of MGM
Mirage, Cirque’s biggest partner: “Daniel, I’m sorry but we
found a new, more creative partner for
our new shows. We are closing all our Vegas shows with Cirque
as of today.” Lamarre turned toward
Guy Laliberté, founder and majority owner of Cirque du Soleil,
who looked at him and said, “Daniel,
nobody wants to be known as the first to have produced a bad
Cirque du Soleil show.”
Suddenly, Lamarre woke up at his home in Montreal. It was all
a bad dream.
Lamarre smiled. Although the possibility of Cirque losing its
creative edge was never too far
away, he knew that the company was better positioned than ever
to keep its competitive advantage
in show business. Cirque du Soleil had always put creativity
first. Every year, Cirque reinvested more
than 40% of its profits in its creative processes.1 In 2006,
Lamarre had devised a new organizational
structure based on independent creative cells for the
development of every new show. Four executive
producers reported directly to him, with each producer in charge
of a set of creative cells. The new
structure ensured increased accountability and scalability.
Lamarre would explain it by saying, “Each
cell member eats and breathes their show 24/7. They’re not
bothered by anyone else and can be fully
dedicated to their show.” Finally, Lamarre had established
criteria for all new developments: a) Is
there a creative challenge? b) Can the partnership be sustainable
in the long run? c) Is there a good
return to be made? and d) Will the partner adhere to Cirque’s
social responsibility parameters?2
Cirque had discarded many lucrative opportunities when it
could not maintain full creative control
or when a creative challenge was not met. “In show business,”
Lamarre said, “show comes before
business.”3
Since Laliberté had retired from the day-to-day operations in
the early 2000s, Lamarre had been
heading the company’s operations and negotiations with
potential partners. Lamarre, a journalist by
trade, had spent most of his career in public relations and
television broadcasting, serving for four
years (1997 to 2001) as CEO of the TVA Group, the largest
private television broadcasting company in
For the exclusive use of L. BING, 2020.
This document is authorized for use only by LINTING BING in
BUS 109-030 taught by Paul Kirwan, University of California -
Riverside from Jan 2020 to Mar 2020.
709-411 Cirque du Soleil—The High-Wire Act of Building
Sustainable Partnerships
2
Quebec. In 2001, he joined Cirque du Soleil to head up the New
Ventures division. In 2003, he became
COO, and in 2006, president and CEO.
Since its humble beginnings as a group of artists putting on a
summer festival in Quebec (the
French-speaking province of Canada) in the early 1980s, Cirque
du Soleil had sold more than 70
million tickets in more than 250 cities. Of its 4,000 permanent
employees, more than 1,000 were artists
representing more than 40 nationalities.4 Revenues in 2007
were estimated at $700 million with 15
productions presented on four continents.5 As of April 2008,
Cirque had six big-top touring shows
(two in North America, two in Europe, one in Japan, and one in
South America); two arena touring
shows (one in Europe and one in North America); and seven
resident shows (five in Las Vegas; one
in Orlando, Florida; and one seasonal show in New York).
According to Forbes magazine, Guy
Laliberté was worth $1.7 billion, effectively putting the value
of Cirque at just under $2.0 billion.6 (See
Exhibits 1 and 2 for more information on Cirque productions,
revenues, and number of tickets sold.)
With creativity as the cornerstone of its success, Cirque still
had to ensure that its business model
fit its strategy. Could the company support its spurt of new
projects? With so many opportunities
available, was Cirque truly entering the right markets? And
would its new partnerships be as
successful as the one with MGM Mirage?
Cirque du Soleil History
Nomadic Performers
In the early 1980s, a group of street performers in Baie-St-Paul,
a small town 100km northeast of
Quebec City in Canada, had a vision of a new modern circus,
one that would break away from the
traditional circus while keeping the cachet of its traveling big
top and spectacular acrobatics. They
founded Le Club des Talons Hauts in 1981, performed for the
La Fête Foraine in 1982, and finally, in
1984, founded Cirque du Soleil, the culmination of their ideals
and talents. Guy Laliberté, a 25-year-
old fire-breather, became the creative force and visionary
behind the group, while long-time friend
Daniel Gauthier, a computer programmer, became the manager
and business-savvy partner.
Ownership of the company was split 50/50 between the two
friends. Other key creative people joined
Laliberté and Gauthier in their endeavor, notably Gilles-St-
Croix, a stilt-walker, currently executive
vice president of Creation at Cirque, and Franco Dragone, a
Belgian theater director, who directed 10
Cirque productions from 1985 to 1998.
From the start, several elements differentiated Cirque du Soleil
from traditional circuses. The
founding artists were mostly street performers rather than circus
performers, and they never
imagined integrating animals into their shows. “I’d rather feed
three acrobats than one elephant,”
Guy Laliberté once said.7 Because the group was born from
modest means (and an inability to pay
hefty salaries for famed performers), the Cirque du Soleil name
was always the promotional vehicle
rather than the artists. Although each production would
eventually have its own name, it would
always be “presented by Cirque du Soleil.”
From 1984 to 1987, with the help of government funding,
Cirque du Soleil toured successfully in
the province of Quebec with its first production, Le Grand Tour
du Cirque du Soleil. With no money for
advertising, it then made a few perilous, and unsuccessful,
stints outside Quebec in Niagara Falls and
Toronto with La Magie Continue. Money was scarce, and
funding an ongoing challenge. In the midst
of these financial difficulties, Cirque du Soleil was invited to
the 1987 Los Angeles Arts Festival.
Because the festival did not have the funds to pay an advance to
Cirque, Laliberté negotiated a deal:
Cirque would be the opening show of the festival and would do
its own promotion, but would keep
all box-office receipts. As a result of the deal, the company had
literally just enough money for a one-
For the exclusive use of L. BING, 2020.
This document is authorized for use only by LINTING BING in
BUS 109-030 taught by Paul Kirwan, University of California -
Riverside from Jan 2020 to Mar 2020.
Cirque du Soleil—The High-Wire Act of Building Sustainable
Partnerships 709-411
3
way trip to Los Angeles. Cirque’s new show, Cirque Réinventé,
had to be a resounding success at the
festival; otherwise, Cirque would not have had enough money to
come back to Quebec. “I’m not
going to wait 20 years to see if we can make it,” said Laliberté
at the time. “Cirque du Soleil will live
or die in Los Angeles.”8
Not only was Cirque a critical and financial success in Los
Angeles, but it attracted many
producers who wanted to put their hands on the creative
enterprise. At the time, Cirque almost
signed a deal with Columbia Pictures to make a movie centered
on Cirque characters. Columbia’s
president, Dawn Steel, threw a party to announce the joint
venture, but Laliberté didn’t stay long.
“They were seating all the stars, and I was basically put aside,”
he said. “They just wanted to lock up
our story and our brand name and walk around like they owned
Cirque du Soleil. I walked right out
of the party, called my lawyer, and told him to get me out of the
deal.”9
The festival also produced a first encounter with Michael
Eisner, CEO of Disney, that would prove
fruitful in years to come. As Eisner recalled, “From the moment
I saw the show in L.A. until I finally
made a deal with Guy Laliberté, I was obsessed by Cirque du
Soleil.”10 From the time of the festival
on, Laliberté and Gauthier would be regularly courted by
companies wanting to partner with or buy
out Cirque du Soleil. Determined to keep their artistic and
commercial independence, both vowed to
always remain a privately held organization and to choose their
future business partners wisely and
parsimoniously.
Following its success in California, Cirque du Soleil toured
across the United States and
internationally, producing and presenting a second touring show
called Nouvelle Expérience.
A Flower in the Desert
Cirque’s first attempt to establish a resident venue came in Las
Vegas in 1992, when it held
discussions with Caesars Palace to develop a resident show. But
when Cirque presented excerpts of
its new show to the Caesars board, the management found the
show too “risqué” and esoteric for
Vegas. Instead of toning down its artistic ambitions, Cirque
crossed the street and went to see Mirage
Resorts. Steve Wynn, chairman of Mirage Resorts, and Bobby
Baldwin, then second-in-command,
had seen Cirque du Soleil in Chicago the year before and knew
Vegas was ready for Cirque du Soleil.
Mirage Resorts signed an initial two-year deal to have Cirque
perform Nouvelle Expérience under a big
top next to the Mirage Resort for a full year, while at the same
time developing a new show to be
called Mystère for a permanent theater at the new Treasure
Island resort. The permanent venue, a $20
million, 1,525-seat theater, gave Cirque a new creative
platform, allowing the company to double the
size of its traditional shows, with a 120-foot-wide oblong stage,
more than 70 cast members, and the
ability to present shows 10 times a week, 48 weeks a year.11
Cirque du Soleil had planted a flower in
the desert.
In the following years, Cirque du Soleil continued to expand its
footprint, adding touring shows
every two years (Saltimbanco in 1992, Alegria in 1994, and
Quidam in 1996) and growing the number of
cities and countries visited. It also refined its creative process,
evolving from an assortment of
performances and acts to shows centered around a diffused
storyline where theatricality played an
increasingly important role. Franco Dragone, with his theatrical
background, was masterful at
creating links between acts and performances, letting each
audience member develop a personal
interpretation of what he or she saw.
By 1997, Cirque had three shows touring simultaneously and
one resident show. It employed
1,200 people, including 260 performers, and had sold more than
15 million tickets.
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709-411 Cirque du Soleil—The High-Wire Act of Building
Sustainable Partnerships
4
A Growing Production House
From 1997 to 1999, Cirque du Soleil went through an intense
period of production, creating three
new shows at the same time. Building on the success of Mystère
at Treasure Island, Mirage Resorts
secured a second Cirque du Soleil show for its new 3,000-room,
$1.6 billion Bellagio resort project.
The new show, called “O,” would be presented in an 1,800-seat
theater with a 1.5M (million) gallon
pool of water as a stage. The cost of the theater alone was $70
million; production costs were
estimated at $20M.12 (See Exhibits 3 and 4 for comparisons of
various theater and production costs.)
Almost 10 years after meeting Eisner in Los Angeles, Cirque
finally signed a deal with Disney to
produce a resident show, La Nouba, at Downtown Disney, the
entertainment venue of Walt Disney
World Resort in Orlando, Florida. Again, the question of artistic
control was at the heart of the
negotiations, but Cirque didn’t let go and, in the end, kept total
control. The 10-year deal, loosely
based on terms similar to those with Mirage Resorts, called for
an $18 million production with 60
artists, a 1,650-seat purpose-built theater at a cost of $52
million, and showings twice an evening, five
evenings a week.13 The show opened in December 1998, a mere
two months after the opening of “O.”
Finally, Cirque du Soleil produced another touring show,
Dralion, set to open in Montreal in April
1999. With Franco Dragone already directing La Nouba and
“O,” Laliberté turned to a new team of
creators for the first time in a decade. Guy Caron, an old
collaborator of Cirque, came back as stage
director.
Through the massive growth of the late 1990s, Cirque du Soleil
resisted the temptation to
duplicate its productions, that is, to have different troupes
presenting the same production (à la
Andrew Lloyd Webber, Blue Man Group, or Mamma Mia). “We
very deliberately chose a strategy of
exclusivity,” said Daniel Lamarre. “We’ve been approached by
corporations around the world who
would like us to do copies but we always say, ‘No. If you want
to see “O,” you have to go to Las
Vegas. Clowns, yes. Clones, no.”14
By the end of 1999, the growth strategy and the multiple
productions had left the entire
organization exhausted. Creative team members debated on
topics such as royalty structures,
creative control, and future artistic direction. In 2000, Franco
Dragone and a few other creators left
Cirque du Soleil and started a new production company simply
called Dragone.a Laliberté
understood that Cirque had grown increasingly dependent on a
few key creative individuals. From
that time on, Laliberté made sure that the heart of Cirque’s
creative process was its organization, not
a particular group of people. Cirque would tolerate neither
prima donna artists nor prima donna
creators. Cirque formalized certain aspects of its creative
process to ensure that its hundreds of
permanent artists and creators would always give the Cirque du
Soleil “feel” to every production,
thus allowing for a rotation of stage directors.
On the organizational front, Cirque was overextended. The
Montreal headquarters were
overflowing with new productions and increased support
activities; mobile offices burgeoned on the
front lawn for excess staff. Unwilling to compromise on quality
or artistic integrity, Cirque would not
outsource any activity. At the time, more than 200 employees
worked at creating and maintaining the
more than 1,000 costumes for all of the shows. They would even
dye their own fabrics, ensuring a
continuous supply for long-running shows. With each new show
in operation, the complexity of
Cirque grew exponentially.
a Since 2000, Dragone productions have had mixed results, with
successes such as Celine Dion’s three-year run at Caesars
Palace and disappointments such as Le Reve at the Wynn
Resort.
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5
Eventually, Gauthier and Laliberté disagreed on the future
direction of the company. Gauthier,
more conservative by nature, recognized the risks of
overextending, while Laliberté envisioned
moving beyond staged performances. In May 2000, Gauthier,
co-founder and 50% owner of Cirque,
decided to leave. Cirque bought back his shares through a
banking syndicate financing for an
undisclosed amount. (Gauthier was valued at C$400M in 2000
by the National Post prior to his
departure.)15 Laliberté was now the sole owner of Cirque du
Soleil.
Extending the Creative Platform
In the early 2000s, Cirque du Soleil sought to extend its
creative presence outside staged
performances. Building on the power of its brand and track
record in Las Vegas, Cirque sought out
partnerships with real-estate promoters to develop mix-used
complexes centered on Cirque du
Soleil–created environments. At the core of each project would
be a Cirque show. In addition, the
complex would include Cirque du Soleil–inspired restaurants,
spas, and as Laliberté envisioned,
“interactive museums, nightclubs where customers dance in
water and hotels that add a ’surreality to
five-star service.’”16 Cirque would have its creative hands in
every aspect of project development.
The first of these endeavors would be in London, in the iconic
Battersea Power Station, held by
Parkview International, the real-estate arm of the Taiwanese
Hwang family. The partnership, which
was announced publicly in December 2000, entailed
refurbishing the Power Station into a high-end
retail, restaurant, and entertainment center with a 2,000-seat
resident Cirque du Soleil theater at its
core. In addition, the facility would include two hotels, office
space, a convention center, a rail link to
Victoria Station, and a ferry dock on the Thames. The total cost
of the project would exceed a billion
pounds.17 But after a year of negotiations, Cirque du Soleil
pulled out of the deal because of lack of
creative control over the project and slowness of developments.
Similar projects were considered but
finally dropped in Hong Kong and New York.
In late 2001, Cirque decided that the best way to prove the
viability of it complexes was to create a
first version, a laboratory of sorts, at home in Montreal. The
project, a scaled-down version of the
London project, had a 100-room hotel, spa, restaurant, and
multi-use theater where Cirque would
perform for a part of the year. Cirque estimated a total cost of
C$100M. After one year of
development and negotiation with local partners, the project
was abandoned. “Our vision of a Cirque
Complex was a tough sell,” said Lamarre. “Prospective partners
would ask: What does Cirque know
in hotels or restaurants?” In the end, the adventure in new
ventures encouraged Cirque management
to redirect its efforts. “We realized that we needed to
concentrate on what we are good at: creating
incredible shows,” said Lamarre.18
The Creative Content Provider
Following its venture into real-estate development, Cirque
closed its regional offices in
Amsterdam and Singapore and concentrated on content creation.
Cirque then extended itself on stage
rather than off, diversifying its show base. In Las Vegas, with
MGM Mirage (MGM Grand and
Mirage Resorts merged in 2000) as its exclusive partner, Cirque
developed three new and completely
different shows.
Zumanity, the sensual side of Cirque du Soleil, was the
organization’s first cabaret-style,
adult-themed show. It was presented at the New York-New York
Hotel and Casino. Its theater,
smaller and more intimate, held 1,250 seats and opened in
September 2003.
Kà, a gravity-defying production, featured an innovative blend
of acrobatic feats, Capoeira
dance, puppetry, projections, and martial arts. It was by far the
most technically advanced
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709-411 Cirque du Soleil—The High-Wire Act of Building
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6
production Cirque had ever made and the most costly, with a
price tag of $165 million. The
show opened in November 2004 at MGM Grand in a 2,000-seat
theater.
Love, a celebration of the musical legacy of the Beatles, was
born from the friendship
between the late George Harrison and Guy Laliberté. It was co-
produced with Sir George
Martin, the legendary producer of the Beatles. The production,
showcased in a 2,000-seat
theatre at The Mirage, premiered in June 2006.
For the first time in ten years, Cirque opened a resident show in
a new city. Cirque signed a four-
year deal with Madison Square Garden Entertainment to
produce Wintuk, a family-oriented show
about a boy’s quest for snow. The show was the first seasonal
performance of Cirque, playing every
autumn for a period of 12 weeks at the WaMu Theater at New
York’s Madison Square Garden.
At the same time, Cirque expanded its touring-show business.
Varekai in 2002, Corteo in 2005, and
Kooza in 2007 were big-top touring shows produced in
Montreal on a 10- to 12-year touring schedule.
All three enjoyed critical and financial success, opening to great
reviews in every city and averaging
an occupancy rate of more than 80% overall. In 2006, Cirque
entered the arena-touring show market,
producing, in partnership with Live Nation, Delirium, an urban
tale and state-of-the-art mix of music,
dance, theater, and multimedia. Finally, in 2007, it revamped its
1992 production Saltimbanco to tour
in arenas.
Cirque du Soleil’s Main Activities
Cirque du Soleil never abandoned its nomadic roots. It always
toured from city to city,
performing under its colorful big tops. Its touring operations
traveled across four continents and to
more than 100 cities. A touring show typically consisted of a
two-and-a-half-hour show (with a 30-
minute intermission) comprised of 50 to 60 artists, 70 to 80
support staff (including technicians, cooks,
medical staff, and teachers for children), 40 to 50 trucks of
equipment, and a 2,500-seat big top that
could be put up and ready for performance in five or six days. A
touring show usually performed an
average of seven weeks per city, presenting eight to ten shows a
week. Depending on the city, top
tickets commanded $100 and VIP packages, more than $200
(including drinks in a VIP tent before the
show, during the intermission, and after the show; front-row
seats; and a gift package). All touring
shows premiered in Montreal and toured North America for four
to five years before moving to
Europe for three years, Asia for two to three, Australia for one,
and South America for one. The
upfront time and capital investment for a new touring
production were significant. For a production
like Varekai or Corteo, the creative process usually started two
to three years before each premiere,
and production costs ran to $30 million each.19 Cirque then
acquired $7 million of scenic and
transportation equipment and finally a big top for another $13
million.20 The profitability of a touring
show depended largely on the occupancy rate of each
performing night, as it is a mostly fixed-cost
business from night to night. Although each show had different
operating costs (these costs vary
from country to country), break-even occupancy usually stood
at around 65%.21
For its resident shows, Cirque always partnered with
organizations willing to invest in the overall
production of the show and theater. Resident shows were
stationed in tourist destinations (Orlando
and Las Vegas) that attracted tens of millions of tourists
annually,b enabling Cirque shows to run for
extended periods of time. With the exception of a two-year run
of Alegria in Biloxi, Mississippi, no
resident show had ever been closed. Resident shows had roughly
the same number of artists as a
touring show but would usually have many more technicians
(Kà had more than 150 technicians).22
b Las Vegas 2007 visitors: 39 million
Orlando 2007 visitors: 47 million
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Cirque du Soleil—The High-Wire Act of Building Sustainable
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Resident shows presented on average 10 performances a week,
but gave many more performances a
year than a touring show, because they could play up to 48
weeks a year (versus 35 to 38 weeks for a
touring show). Finally, Las Vegas resident shows commanded
high ticket prices, with top tickets for
Kà, “O,” and Love at $150.23 Although operating costs for
resident shows might be higher due to their
technical sophistication, these costs were more than offset by
ticket prices and an average occupancy
(90% to 95%) higher than those of touring shows. Break-even
for resident shows averaged 60%.24
Resident shows in Las Vegas represented more than 50% of
Cirque revenues but a much larger share
of its bottom line.
Starting in 2006, Cirque began presenting arena touring shows.
A partnership with Live Nation
gave Cirque du Soleil access to new audiences, as it performed
in arenas and amphitheaters with
capacities of 8,000 to 12,000. Its first arena touring show,
Delirium, was deliberately produced for
large venues (see Exhibit 5 for Delirium spring/summer 2008
tour plan).
At each show and on its website, Cirque du Soleil sold
merchandising, from Cirque du Soleil t-
shirts and umbrellas to exclusive art and sculpture.
Merchandising represented 10% of Cirque’s
overall revenues.25 Cirque produced documentaries, DVDs of
its shows, TV shows (with its partner
Bravo), and two feature movies. In 2004, Cirque developed a
series of Cirque du Soleil animated
lounges for Celebrity Cruises.
The Joint Venture with MGM Mirage
MGM Mirage Background
In the early 1990s, Las Vegas was a gambling destination
devoted almost exclusively to gaming,
usually offering poor ancillary services ($49 hotel rooms, all-
you-can-eat buffets, and French cancan
entertainment). Steve Wynn, owner of the Golden Nugget, set
about to change the face of Las Vegas
by enhancing quality and service and adding even more
extravagance. His company, Mirage Resorts,
built the $630 million The Mirage, which was one of the first
high-end casinos and resorts in Las
Vegas. Building on the success of his first greenfield
development, he went on to develop the $540
million Treasure Island Hotel and Casino in 1993 and the $1.6
billion Bellagio in 1998. In 2000, Mirage
Resorts merged with Kirk Kerkorian’s MGM Grand in a $6.4
billion deal. Following the deal, Wynn
left the company and developed the $2.7 billion Wynn Las
Vegas in 2005 and won one of three
gaming concessions in Macao, China.
MGM Mirage continued Wynn’s vision of a high-end Las
Vegas, concentrating its efforts on
making each of its businesses profitable (casinos, hotels,
restaurants, clubs, spas, and entertainment).
In 2004, it bought Mandalay Bay Resort Group for $7.9
billion.26 Following the merger, MGM Mirage
controlled 49% of hotel guestrooms, 44% of gaming tables, and
40% of slot machines on the Las Vegas
Strip.27 In 2007, MGM Mirage had revenues of $7.7 billion,
67,000 employees, 20 wholly owned
resorts, and new developments in Las Vegas, Macao, Abu
Dhabi, Atlantic City, and Detroit.28
Cirque du Soleil–MGM Mirage Deal
In 1992, Cirque du Soleil and Mirage Resorts signed their first
deal, a two-year contract for a one-
year presentation of Nouvelle Expérience in a big top on The
Mirage parking lot, and a one-year
contract with a 10-year extension for a new resident show,
Mystère, at the opening Treasure Island
resort. “Even before [Nouvelle Expérience] opened, we made
the deal to build Treasure Island and put
in Mystère,” said Bobby Baldwin at the time. “It was a huge
financial risk. But we just had a lot of
confidence in Guy [Laliberté].”29 Unlike Caesars Palace
management earlier that year, Wynn was
willing to hand over full creative control, thus sealing the deal.
Still, when Steve Wynn saw a
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709-411 Cirque du Soleil—The High-Wire Act of Building
Sustainable Partnerships
8
rehearsal of the dark, moody, and dramatic Mystère, he
apparently threatened to delay the opening.
Cirque management would not relinquish artistic control and
decided to present what it believed
would be the best show possible. The premiere went on as
planned, and in a matter of weeks Mystère
was a huge hit.30 A mutual trust and respect grew between the
new partners.
Cirque du Soleil quickly made an impact on the Treasure Island.
With more than 3,000 guests
coming in five nights a week, Mirage Resorts recognized the
drawing power of Cirque and its effect
on ancillary activities at the casino. As Bobby Baldwin said to
BusinessWeek in 2004, referring to
Cirque shows at the three Mirage properties, “only 20% of them
[showgoers] actually stay at the
casino hotel that hosts the show, but showgoers drop an average
of $30 apiece on dinner or drinks at
the property… [Cirque du Soleil showgoers are] sophisticated,
and they have high incomes.’’31To
ensure that Mirage Resorts could eventually capitalize on the
Cirque du Soleil effect at its other
casinos, the initial deal with Cirque du Soleil stipulated that
Mirage Resorts (and eventually MGM
Mirage) would stay the exclusive house of Cirque du Soleil in
Las Vegas.
Since its first deal in 1992, Cirque and MGM Mirage opened
four more shows: “O” in 1998,
Zumanity in 2003, Kà in 2004, and Love in 2006. An additional
two were in development: a show with
magician Criss Angel at Luxor Resort & Casino in Las Vegas
was scheduled to open in summer 2008
and an Elvis-themed show at City Center in Las Vegas, in
autumn 2009.
Since Mystère, the Cirque du Soleil effect became increasingly
apparent. The New York–New York
Resort opened prior to the arrival of Zumanity; after the show’s
arrival, it was clear that Cirque had
made a difference, as described in the MGM Mirage 2003 10-K
SEC filling:
New York-New York experienced a 23% increase in net
revenues due to the addition of
Zumanity, the newest show from Cirque du Soleil, which
opened in August 2003 and other
amenities, including a new Irish pub, Nine Fine Irishmen, which
opened in July 2003.
In 2004, MGM Grand, the biggest Las Vegas resort at the time
with more than 5,000 rooms,
opened Kà. “After seeing the Zumanity effect, if you will, on
the property results, I think you can
more clearly understand why we are excited about the new
Cirque show at the MGM Grand and the
momentum it will create in the second half of ‘04,” said John
Redmon, president and CEO of MGM
Grand Resorts, at the time of the opening.32 A year later,
Reuters stated that “MGM also cited
increased visitor traffic generated by Cirque du Soleil’s
acrobatic show Kà and other new amenities at
MGM Grand Las Vegas for boosting slot revenue at that resort
by 13 percent.”33
Finally, with Love opening at The Mirage in 2006, Bobby
Baldwin reported to Wall Street analysts
in a 2005 fourth-quarter-earnings conference call that “the
EBITDA impact of the show, the new
Beatles show, and the expected traffic from that show would be
calculated at 12.5 million for 2006
and 25 million in EBITDA impact for 2007 and beyond.”34 (See
Exhibits 7 and 8 for MGM Mirage
Income Statement and resort-specific EBITDA analysis.)
All Cirque du Soleil-MGM Mirage deals followed the same
principles (see Table A for a
representation of a typical deal structure). MGM Mirage paid
for theater construction and all show
equipment (e.g., a $150 million investment). Production costs
(e.g., $30 million) were split in half
between MGM Mirage and Cirque du Soleil,35 for a total
investment of $165 million for MGM Mirage
and $15 million for Cirque. Once the show was in operation,
box-office receipts, net of all show and
theater expenses, were split 50/50.36 The theater seated roughly
1,900, and the show was presented 10
times a week, 48 weeks a year. Assuming an occupancy rate of
90%, the number of guests totalled
17,000 a week, or 820,000 a year. At an average price of $120,
that adds up to a box-office of $100M a
year. MGM Mirage operated the theater and, therefore, charged
the cost of most technicians, box
office, ushers, cleaning, general facility management, and
utilities. MGM also charged a box-office
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Cirque du Soleil—The High-Wire Act of Building Sustainable
Partnerships 709-411
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rent to cover its initial investment. Cirque du Soleil on its side
charged for show operating expenses,
including artist compensation, costume and artistic supply
maintenance, show management, and
artistic follow-up. Cirque also charged box-office royalties for
the creative concept. It retained a
portion of the royalty and paid its creators (who were paid per
show or as a percentage of box office).
The resulting profit was split 50/50.37
MGM Mirage Cirque du SoleilShow
$150M
$15M $15M
$150M theatre construction
& show equipment
$30M production
$100M box-office
$10M theatre operations
$35M show operations
$30M operating profit
100%
50% 50%
50%50%
$180M capital investment
+
-
-
$165M $15M
$15M $15M
Table A - Simplified Deal Structure*
$13M creative royalty- 100% $13M
(prior to paying
creators)$12M rent-100%$12M
* For illustration purposes only
Source: Compiled by casewriters.
Throughout more than 15 years of partnership, the organizations
experienced little conflict.
Although MGM Mirage management did not always agree with
its partner’s vision, it trusted Cirque
and respected the initial agreement. “Guy hires very intelligent
people. They’re very creative and
highly disciplined. We’ve never had a dispute over money or
the books,” said Baldwin.38 The
partnership was based on an “open book” policy, where each
partner could ask to review the books
of the other. “In 2007, MGM Mirage was concerned by the
increase in costume and training costs.
They came to Montreal, looked at our books, and toured the
facilities to better understand our cost
structure. They then felt comfortable with the increases,” said
Robert Blain, Cirque’s CFO. Following
the visit, Blain initiated a quarterly meeting with the CFOs of
each of the MGM Mirage properties
where Cirque had a show. “We openly discuss issues and
exchange ideas on how to improve the
bottom line. We’ve recently reviewed ticketing processes across
properties, which should improve
each show’s bottom line significantly,” said Blain.39
Over the years, Cirque developed a deep understanding of the
Las Vegas market. “MGM Mirage
sees us as more than just a content provider, we are truly a
partner on every front,” said Lamarre.
Looking Forward
Lamarre went through in his mind the deals Cirque was working
on (see Exhibit 6 for planned
Cirque productions). The two new MGM Mirage shows in Vegas
were in production and scheduled
for summer 2008 and autumn 2009. Cirque’s first resident show
in Asia was scheduled to open
during the summer of 2008 at Tokyo Disney Resort. Cirque was
also entering the Macao market
(dubbed the Las Vegas of the East). Finally, Guy Laliberté had
announced in the summer 2008 that
Cirque had signed a partnership with two subsidiaries of Dubai
World, the sovereign wealth fund of
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709-411 Cirque du Soleil—The High-Wire Act of Building
Sustainable Partnerships
10
the booming Emirate, where he would sell a 10% stake of the
company to each partner (20% in total).
In addition to a planned resident show in Dubai in 2010, the
new partnership could lead to future
projects in the region. Lamarre was glad to see Cirque diversify
geographically. Still, all these new
shows were in similar markets (gambling or destinations cities).
New York, London, Berlin, and
Sydney were all cities where Cirque eventually wanted a
permanent foothold as well. But could
Cirque find a model as profitable as it had with a casino
operator? Should Cirque be willing to
capture less value to enter these markets? Should it seek out
new types of partners, as it had with the
Dubai deal?
At the same time, how many more Cirque du Soleil shows could
be absorbed in Las Vegas? With
seven shows in 2009, would Cirque finally feel cannibalization?
MGM Mirage certainly felt there was
still room to grow, investing $217 million in the theater alone
for the Elvis-themed show at its new
CityCenter.”40 And what about the touring shows? Cirque
seemed to be moving away from its
traditional big-top touring show to more arena touring shows.
Was it diluting its brand by extending
the show experience from big tops to theaters and now arenas?
Should it go back to its roots and
expand its big-top touring shows?
Cirque received almost weekly offers to open resident shows
around the world. But choosing the
right partner was a delicate process. Lamarre was confident that
putting the creative challenge at the
top of his list was the right way to go. “I will not be the one
remembered for producing the first bad
Cirque du Soleil show,” mused Lamarre.41
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Cirque du Soleil—The High-Wire Act of Building Sustainable
Partnerships 709-411
11
Exhibit 1 Cirque du Soleil Productions as of Spring 2008
Show Opening Date Type of Show Stage Directora
Production Cost
(excluding tents
for touring)b
Tickets Sold
to Date
(as of
August 07)c
Saltimbanco April 1992 Touring show, arena touring
show since 2007
Franco Dragone $2.0Md 9.9M
Mystère December 1993 Resident show at Treasure
Island, Las Vegas
Franco Dragone $35M
($20M theater)e
9.2M
Alegria April 1994 Touring show; was resident
in Biloxi, MI, from 1999 to
2000
Franco Dragone $3.0M 10M
Quidam April 1996 Touring show Franco Dragone N/A 8.8M
“O” October 1998 Resident show at Bellagio,
Las Vegas
Franco Dragone $92Mf
($70M theater)
7.2M
La Nouba December 1998 Resident show at Disney,
Orlando, Florida
Franco Dragone $70Mg
($52M theater)
5.4M
Dralion April 1999 Touring show Guy Caron $15Mh 6.6M
Varekai April 2002 Touring show Dominic Champagne N/A
4.3M
Zumanity September
2003
Resident show at New York-
New York, Las Vegas
René Richard Cyr
and Dominic
Champagne
$50Mi 1.9M
Kà November 2004 Resident show at MGM
Grand, Las Vegas
Robert Lepage $165Mj
($135M theater)
1.8M
Corteo April 2005 Touring show Daniele Finzi Pasca N/A 1.8M
Delirium January 2006 Arena touring show Michel Lemieux and
Victor Pilon
N/A 1.2M
Love June 2006 Resident show at The
Mirage, Las Vegas
Dominic Champagne N/A 1.8M
Kooza April 2007 Touring show David Shiner N/A 500k
Wintuk November 2007 Seasonal resident show at
Madison Square Garden,
New York City
Richard Blackburn $20Mk N/A
TOTAL ~70M
Source: Compiled by casewriters.
aCirque du Soleil website, www.cirquedusoleil.com.
bSteve Friess, “‘Cirque Dreams Big,” Newsweek, July 14, 2003.
cKonrad Yakabuski, “The Greatest Canadian Company on
Earth: From hippies on stilts to global champion: How Cirque
du Soleil
became a model for reviving the hollowed heart of Canadian
business,” The Globe and Mail, August 31 2007.
dThomas O’Connor, “AMUSEMENTS // It’s fanciful, it’s new
age, it’s a circus // Cirque du Soleil sets up tent in OC,” The
Orange
County Register, January 24, 1993.
eMurray Campbell, “Cirque du Soleil takes a gamble: Why is a
cerebral, postmodern circus troupe settling down in the garish
heart
of the Las Vegas Strip?” The Globe and Mail, November 14,
1992.
fJoyce Cohen, “Cirque Du Soleil’s Production ‘0’ Making Quite
A Splash In Las Vegas,” Amusement Business, November 23,
1998.
gMark Anderson, “Circus to the Stars: How a few buskers
named the Cirque du Soleil became the biggest big top of them
all,”
The Ottawa Citizen, May 13, 2006.
hRobert Pogrebin, “Along the Hudson, A Tent of Dreams,” The
New York Times, April 6, 2001.
iSteve Friess, “‘Cirque’ Dreams Big,” Newsweek, July 14,
2003.
jWendell Brock, “Flight of fancy: Cirque du Soleil,” The
Atlanta Journal- Constitution, December 15, 2006.
k”Le Cirque du Soleil a présenté ‘Wintuk’ en grande première
mondiale,” Nouvelles Tele-Radio, November 8, 2007.
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709-411 Cirque du Soleil—The High-Wire Act of Building
Sustainable Partnerships
12
Exhibit 2 Revenues and Tickets Sold
Revenues
(in Canadian $)
Annual
Tickets Sold
Cumulative
Tickets Sold
1992a $ 35M 0.5M 3M
1993b,c $ 50M 1M 4M
1994d $ 80M* 2M* 6M*
1995e $100M 2M* 8M*
1996f $140M 2.5M 10M
1997g $150M 2.5M* 13M*
1998h $180M 2.5M* 15M*
1999i $300M 4M* 19M*
2000j $380M* 4M* 23M
2001k $420M 5M* 28M*
2002l $450M 6M 34M
2003m $475M* 7M 41M*
2004n $500M 7M 48M*
2005 $590M* 7M* 54M
2006o $630M 8M* 61M*
2007p $700M 10M 71M
Source: Compiled by casewriters.
*Casewriters’ estimate.
aMurray Campbell, “Cirque du Soleil takes a gamble: Why is a
cerebral, postmodern circus troupe settling down in the garish
heart of the Las Vegas Strip?” The Globe and Mail, November
14, 1992.
bSallye Salter, “Strong ticket sales keep Cirque du Soleil flying
high,” Atlanta Constitution, December 9, 1993.
cBrian Dunn, “Cirque du Soleil success built on word of
mouth,” The Toronto Star, March 7, 1993.
dNina Munk, “A high-wire act: Cirque du Soleil is circus as
high art, circus as therapy. And it's profitable,” Forbes,
September 22, 1997.
ePeter Kuitenbrouwer, “Quebec’s Cirque du Soleil is spinning
off troupes like nobody's business, a cash cow generating
millions in revenue while wowing audiences all over the world,”
The Financial Post, June 22, 1996.
fRod McQueen, “Canada’s 50 best managed private companies,
Balancing act finds its place in the sun,” The Financial Post,
December 14, 1996.
gAngela Tan, “Cirque du Soleil aims for C$300 mln in global
sales,” Reuter News, May 26, 1998.
hIbid.
iMatthews Hays, “Cirque du Soleil makes the leap from the big
top to the big screen,” The Globe and Mail, May 7, 1999.
jZena Olijnyk, “It's showtime for Cirque du Soleil: High-flying
troupe sets the stage to brand its image around the globe,”
Financial Post, February 26, 2001.
kIbid.
l“Bread and Cirque—Once a small, struggling company,
Canadian circus has soared to new, profitable heights,” The San
Francisco Chronicle, November 6, 2002.
mMatthew Miller, “The Acrobat: Cirque Du Soleil's Guy
Laliberte's trip from busker to billionaire,” Forbes, March 15,
2004.
n“Lord of the rings— Face value,” The Economist, February 5,
2005.
oNatalia Williams, “Top global marketer: Mario D'Amico
Marketing,” Strategy, March 1, 2008.
pKonrad Yakabuski, “The Greatest Canadian Company on
Earth: From hippies on stilts to global champion: How Cirque
du
Soleil became a model for reviving the hollowed heart of
Canadian business,” The Globe and Mail, August 31 2007.
For the exclusive use of L. BING, 2020.
This document is authorized for use only by LINTING BING in
BUS 109-030 taught by Paul Kirwan, University of California -
Riverside from Jan 2020 to Mar 2020.
Cirque du Soleil—The High-Wire Act of Building Sustainable
Partnerships 709-411
13
Exhibit 3 Selected Theater Construction Costs
Location Performance Details
Construction
Cost Year
Kodak Theater Los Angeles Academy Awards 3,100 seats
$95Ma 2001
Colosseum
Theater
Caesar’s Palace,
Las Vegas
Celine Dion 4,100 seats $95Mb 2003
Aqua Theater Wynn Resort,
Las Vegas
Le Reve, by
Franco Dragone
3,000 seats $100Mc
(including. show
production)
2005
Wynn Theater Wynn Resort,
Las Vegas
Avenue Q 1,200 seats $40Md 2005
Arts Center
(planned)
University of
Connecticut
N/A 800-seat hall,
500-seat theater, &
200-seat studio
$65Me 2005
Phantom of the
Opera Theater
Venetian Hotel-
Casino, Las Vegas
Phantom of
the Opera
1,800 seats $40Mf 2006
Source: Compiled by casewriters.
aRockwell Group website, www.rockwellgroup.com.
bPeter Henderson, “Celine Dion opens 3-year Las Vegas show,”
Reuter News, March 26, 2003.
cRobert Hanashiro, “‘Phantom’ is here, in a $40M haunt,” USA
Today, June 19, 2006.
dBruce Camenga, “Vegas changes its acts/‘Spamalot,’ ‘Phantom
of the Opera’ and a wild west production on the marquee,”
The Press-Enterprise, May 12, 2006.
e“New $65 Million University Arts Center for Connecticut;
Plans are set for a performing arts center in Danbury,” New
York
Construction News, November 1, 2005.
fRobert Hanashiro, “‘Phantom’ is here, in a $40M haunt.”
For the exclusive use of L. BING, 2020.
This document is authorized for use only by LINTING BING in
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Riverside from Jan 2020 to Mar 2020.
709-411 Cirque du Soleil—The High-Wire Act of Building
Sustainable Partnerships
14
Exhibit 4 Selected Production Costs
Performance Type/location Details Production cost Year
The Lion King Broadway,
New York
At the time, most expensive
production on Broadway
$15–$20Ma 1997
Sleeping Beauty Ballet,
New York
Estimated cost for American
Ballet Theater
$1.5Mb 2001
La Boheme Broadway,
New York
Baz Luhrmann's restaging of
Puccini classic
$8.5M
($2M over
budgetc
2002
Celine Dion Pop music,
Las Vegas
Produced by Franco Dragone $30Md 2003
Phantom of the Opera Musical,
Las Vegas
More than 3x what it would
cost to produce Phantom on
Broadway ($10M)
$35Me 2004
The Woman in White Broadway,
New York
Failed Lloyd Webber
production (only 120
presentations)
$8.5Mf 2006
Oz Can Go to Rio Musical,
Australia
Touring musical with Hugh
Jackman
$10Mg 2006
Metropolitan Opera Opera,
New York
Cost for six new 2008
productions at the Met
$9.0Mh
($1.5M /show)
2008
Source: Compiled by casewriters.
a“Broadway version of ’The Lion King’ seduces critics,”
Agence France-Presse, November 24, 1997.
bDoreen Carvajal, “High Staff Turnover Underlines Offstage
Turmoil at Ballet Theater,” The New York Times, April 19,
2001.
cJesse McKiney, “La Boheme Is to Close After 228
Performances,” The New York Times, June 3, 2003.
dAdam Goldman, “Celine Dion takes stage for three-year run in
Vegas,” Associated Press, March 23, 2003.
eJesse McKinley, “A Revised 'Phantom' Going to Las Vegas as
a New Lure,” The New York Times, July 25, 2004.
fJesse McKiney, “The Woman in White to Close,” The New
York Times, February 4, 2006.
gChristine Sams, “It'll take $21 million before the producers
from Oz can go to Rio,” The Sun-Herald, May 21, 2006.
hJudith H. Dobrzynski “A Knight at the Opera: Big Plans—
Large Bills,” The Wall Street Journal, April 24, 2008.
For the exclusive use of L. BING, 2020.
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Cirque du Soleil—The High-Wire Act of Building Sustainable
Partnerships 709-411
15
Exhibit 5 Excerpt of U.S. and Canada Spring/Summer 2008
Saltimbanco Tour Plan
City Dates Number of Shows Ticket Price*
Cedar Rapids, IA April 23–April 27 8 $40–$60 Level 3-2
$70–$90 Level 1-0
Albuquerque, NM May 14– May17 6 $40–$60 Level 3-2
$70–$90 Level 1-0
Boise, ID May 21–May 25 8 $40–$60 Level 3-2
$70–$90 Level 1-0
Victoria, BC May 29–June 1 8 $40–$60 Level 3-2
$70–$90 Level 1-0
Kelowna, BC June 4–June 8 7 $40–$60 Level 3-2
$70–$90 Level 1-0
Kamloops, BC June 11–June 15 9 $40–$60 Level 3-2
$70–$90 Level 1-0
Edmonton, AB June 18–June 22 9 $40–$60 Level 3-2
$70–$90 Level 1-0
Saskatoon, SK June 25–June 29 7 $40–$60 Level 3-2
$70–$90 Level 1-0
Regina, SK July 2–July 6 8 $40–$60 Level 3-2
$70–$90 Level 1-0
Winnipeg, MB July 9–July 13 9 $40–$60 Level 3-2
$70–$90 Level 1-0
Kansas City, MO July 16–July 20 7 $40–$60 Level 3-2
$70–$90 Level 1-0
Toronto, ON Aug 13–Aug 24 16 $40–$60 Level 3-2
$70–$90 Level 1-0
Hamilton, ON Aug 27–Aug 31 8 $40–$60 Level 3-2
$70–$90 Level 1-0
Amherst, MA Sept 3–June 7 8 $40–$60 Level 3-2
$70–$90 Level 1-0
* Ticket categories are: Premium (Level 0), Level 1, Level 2,
and Level 3.
Source: Cirque du Soleil website, www.cirquedusoleil.com,
accessed April 24, 2008.
For the exclusive use of L. BING, 2020.
This document is authorized for use only by LINTING BING in
BUS 109-030 taught by Paul Kirwan, University of California -
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709-411 Cirque du Soleil—The High-Wire Act of Building
Sustainable Partnerships
16
Exhibit 6 Cirque du Soleil Planned Productions as of Spring
2008
Show Opening Date Type of Show Partner Stage Director
Venetian Macao Summer 2008 Resident Las Vegas Sands
Gilles Maheu
Criss Angel Summer 2008 Resident show at Luxor
Resort, Las Vegas
MGM Mirage Serge Denoncourt
Tokyo Disney Summer 2008 Resident Disney François Girard
Touring 2009 April 2009 Touring None Deborah Colker
Elvis-themed
show
Autumn 2009 Resident show at City
Center, Las Vegas
MGM Mirage
and CKX
N/A
Touring 2010 2010 Touring None N/A
Macao #2 2010 Resident Las Vegas Sands René Simard
Dubai 2010 2010 Resident Nakheel (Dubai
World)
Guy Caron and
Michael Curry
Source: Cirque du Soleil website, www.cirquedusoleil.com,
accessed June 17, 2008.
For the exclusive use of L. BING, 2020.
This document is authorized for use only by LINTING BING in
BUS 109-030 taught by Paul Kirwan, University of California -
Riverside from Jan 2020 to Mar 2020.
Cirque du Soleil—The High-Wire Act of Building Sustainable
Partnerships 709-411
17
Exhibit 7 MGM Mirage Inc. Annual Income Statement ($ in
thousands)
31-Dec-07 31-Dec-06 31-Dec-05 31-Dec-04 31-Dec-03
Casino $3,239.1 $3,130.4 $2,764.5 $2,080.8 $2,037.5
Rooms 2,130.5 1,991.5 1,634.6 889.4 833.3
Food & Beverage 1,651.7 1,483.9 1,271.7 807.5 757.3
Entertainment/Other 560.9 459.5 426.2 268.6 256.0
Retail 296.1 278.7 253.2 181.6 180.9
Other 519.4 452.7 339.4 184.2 210.8
Less Promotional Allowance -706.0 -620.8 -560.8 -410.3 -413.0
Total Revenue $7,691.6 $7,176.0 $6,128.8 $4,001.8 $3,862.7
Casino $1,677.9 $1,613.0 $1,422.5 $1,028.4 $1,050.4
Rooms 570.2 539.4 454.1 237.8 235.9
Food & Beverage 984.3 902.3 782.4 462.9 436.9
Entertainment 399.1 333.6 305.8 191.3 183.1
Retail 190.1 179.9 164.2 116.6 115.2
Other 317.6 245.1 188.0 101.8 130.7
General & Administrative 1,140.4 1,070.9 889.8 565.4 585.2
Corporate Expenses 193.9 161.5 130.6 77.9 61.5
Preopening & Start-Up Expenses 92.1 36.4 15.8 10.3 29.3
Restructuring Costs 0.0 1.0 -0.1 5.6 6.6
Gain on CityCenter transaction -1,029.7 0.0 0.0 - -
Property Transactions -186.3 -41.0 37.0 8.2 -18.9
Depreciation & Amortization 700.3 629.6 560.6 382.8 400.8
Unconsolidated Affiliate -222.2 -254.2 -151.9 -119.7 -53.6
Total Operating Expense $4,827.7 $5,417.7 $4,798.8 $3,069.2
$3,163.0
Interest Income $17.2 $11.2 $12.0 $5.7 $4.1
Interest Expense -924.3 -882.5 -670.3 -390.6 -337.6
Interest Capitalized 216.0 122.1 29.5 23.0 -
Non-opts. Affiliate -18.8 -16.1 -15.8 -12.3 -10.4
Other, Net 4.4 -15.1 -18.4 -9.6 -12.2
Net Income Before Taxes $2,158.4 $977.9 $667.1 $548.8 $343.7
Provision for Income Taxes $757.9 $341.9 $231.7 $203.6
$113.4
Net Income After Taxes $1,400.5 $636.0 $435.4 $345.2 $230.3
Net Income Before Extra. Items $1,400.5 $636.0 $435.4 $345.2
$230.3
Gain on Disposal of
Discontinued Operations 265.8 0.0 0.0 - -
Discontinued Operations 10.5 18.5 11.8 101.2 13.4
Tax—Discontinued Operations -92.4 -6.2 -3.9 -34.1 -
Net Income $1,584.4 $648.3 $443.3 $412.3 $243.7
Source: MGM Mirage Annual Reports, www.mgmmirage.com,
accessed February 12, 2009.
For the exclusive use of L. BING, 2020.
This document is authorized for use only by LINTING BING in
BUS 109-030 taught by Paul Kirwan, University of California -
Riverside from Jan 2020 to Mar 2020.
709-411 Cirque du Soleil—The High-Wire Act of Building
Sustainable Partnerships
18
Exhibit 8 MGM Mirage EBITDA Analysis on Selected Resorts
Trailing Twelve Month EBITDA - New York-New York
(in thousands of $)
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
$160,000
2002 Q1
2002 Q2
2002 Q3
2002 Q4
2003 Q1
2003 Q2
2003 Q3
2003 Q4
2004 Q1
2004 Q2
2004 Q3
2004 Q4
2005 Q1
2005 Q2
2005 Q3
2005 Q4
2006 Q1
2006 Q2
2006 Q3
2006 Q4
2007 Q1
2007 Q2
2007 Q3
2007 Q4
Opening of CdS
show Zumanity
Sept. 20, 2003
Trailing Twelve Month EBITDA - MGM Grand
(in thousands of $)
$0
$50,000
$100,000
$150,000
$200,000
$250,000
$300,000
$350,000
$400,000
$450,000
2002 Q1
2002 Q2
2002 Q3
2002 Q4
2003 Q1
2003 Q2
2003 Q3
2003 Q4
2004 Q1
2004 Q2
2004 Q3
2004 Q4
2005 Q1
2005 Q2
2005 Q3
2005 Q4
2006 Q1
2006 Q2
2006 Q3
2006 Q4
2007 Q1
2007 Q2
2007 Q3
2007 Q4
Opening of CdS
show Kö
Nov. 26, 2004Upgrade of rooms
and increased room
rate
Source: MGM Mirage 10-K SEC filings from www.sec.gov and
supplementary financial reports from
www.mgmmirage.com, accessed February 12, 2009.
For the exclusive use of L. BING, 2020.
This document is authorized for use only by LINTING BING in
BUS 109-030 taught by Paul Kirwan, University of California -
Riverside from Jan 2020 to Mar 2020.
Cirque du Soleil—The High-Wire Act of Building Sustainable
Partnerships 709-411
19
Exhibit 8 (continued)
Trailing Twelve Month EBITDA - The Mirage
(in millions of $)
$0
$50,000
$100,000
$150,000
$200,000
$250,000
$300,000
2002 Q1
2002 Q2
2002 Q3
2002 Q4
2003 Q1
2003 Q2
2003 Q3
2003 Q4
2004 Q1
2004 Q2
2004 Q3
2004 Q4
2005 Q1
2005 Q2
2005 Q3
2005 Q4
2006 Q1
2006 Q2
2006 Q3
2006 Q4
2007 Q1
2007 Q2
2007 Q3
2007 Q4
Opening of CdS
show Love
June 30, 2006
Closing of Siegried &
Roy show
October 3, 2003
Trailing Twelve Month EBITDA for MGM Grand, Mirage and
NY-NY
$449
$470
$482
$472 $466
$482 $481
$498
$536
$551 $553
$609
$620
$652
$688 $690 $693
$400
$450
$500
$550
$600
$650
$700
$750
$800
t-10 t-9 t-8 t-7 t-6 t-5 t-4 t-3 t-2 t-1 t0 t+1 t+2 t+3 t+4 t+5 t+6
Quarters from the opening of Cirque du Soleil show
(t0 = opening show quarter)
TT
M
E
B
IT
D
A
(
in
m
ill
io
ns
o
f $
)
Source: MGM Mirage 10-K SEC filings from www.sec.gov and
supplementary financial reports from
www.mgmmirage.com.
For the exclusive use of L. BING, 2020.
This document is authorized for use only by LINTING BING in
BUS 109-030 taught by Paul Kirwan, University of California -
Riverside from Jan 2020 to Mar 2020.
709-411 Cirque du Soleil—The High-Wire Act of Building
Sustainable Partnerships
20
Endnotes
1 Bertrand Marotte, “Report on Business: Keep your growth and
uniqueness in balance,” The Globe and Mail,
April 29, 2006.
2 Casewriters’ interview with François Macerola, Montreal,
May 2008.
3 Casewriters’ interview with Daniel Lamarre, Montreal, May
2008.
4 Konrad Yakabuski, “The Greatest Canadian Company on
Earth: From hippies on stilts to global champion:
How Cirque du Soleil became a model for reviving the hollowed
heart of Canadian business,” The Globe and
Mail, August 31, 2007.
5 Ibid.
6 Forbes website, 2008 list of billionaires,
www.forbes.com/lists.
7 Christopher Palmeri, “The $600 Million Circus Maximus;
How Cirque du Soleil keeps the blockbusters
coming,” BusinessWeek, December 13, 2004.
8 Tony Babinski, Cirque du Soleil 20 ans sous le soleil,
Hurtubise editions, 2004, p. 95.
9 Matthew Miller, “The Acrobat: Cirque Du Soleil’s Guy
Laliberté’s trip from busker to billionaire,” Forbes,
March 15, 2004.
10 Tony Babinski, Cirque du Soleil 20 ans sous le soleil, p. 96.
11 Michael Paskevich, “Stars turn out for Treasure Island’s
‘Mystere’ opening,” The Las Vegas Review-Journal,
January 23, 1994.
12 Joyce Cohen, “Cirque Du Soleil’s Production ‘0’ Making
Quite A Splash In Las Vegas,” Amusement
Business, November 23, 1998.
13 Mark Anderson, “Circus to the Stars: How a few buskers
named the Cirque du Soleil became the biggest
big top of them all,” The Ottawa Citizen, May 13, 2006.
14 Bertrand Marotte, “Report on Business: Keep your growth
and uniqueness in balance,” The Globe and Mail,
April 29, 2006.
15 Foster Smith, “Circus founder, doughnut maker, among
richest 100: Thomson retains no. 1 spot,” National
Post, July 24, 2000.
16 Christopher J. Chipello, “All the World Is a Stage for Cirque
du Soleil—Circus Company Seeks
Partnerships to Create Entertainment Centers,” The Wall Street
Journal, July 18, 2001.
17 Alan Freeman, “Cirque boss plans global complexes:
Theatres, galleries, hotels, restaurants and spas slated
for centres to be built over next decade,” The Globe and Mail,
December 12, 2000.
18 Casewriters’ interview with Daniel Lamarre, Montreal, May
2008.
19 Bertrand Marotte, “Report on Business.”
20 Glenn Collins, “In Center Ring: Randalls Island?” The New
York Times, April 24, 2003.
21 Nina Munk, “A high-wire act: Cirque du Soleil is circus as
high art, circus as therapy. And it’s profitable,”
Forbes, September 22, 1997.
22 Christina Almeida, “KA the latest Cirque du Soleil
extravaganza—opens in Vegas,” Associated Press,
February 4, 2005.
23 Cirque du Soleil website, www.cirquedusoleil.com, accessed
April 24, 2008.
24 Based on casewriter’s calculations.
For the exclusive use of L. BING, 2020.
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BUS 109-030 taught by Paul Kirwan, University of California -
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Cirque du Soleil—The High-Wire Act of Building Sustainable
Partnerships 709-411
21
25 Christopher Palmeri, “The $600 Million Circus Maximus.”
26 Bruce Adams, “Rolling the dice: MGM Mirage, Mandalay
merger would create world’s largest gaming
and leisure company,” Hotel & Motel Management, July 19,
2004.
27 Ibid.
28 Hoovers, www.hoovers.com.
29 Konrad Yakabuski, “The Greatest Canadian Company on
Earth.”
30 Matthew Miller, “The Acrobat.”
31 Christopher Palmeri, “The $600 Million Circus Maximus.”
32 MGM Mirage Q4 2004 Earnings Conference Call.
33 Deena Beasley, “MGM Mirage second-quarter profit rises 34
percent,” Reuters News, July 28, 2005.
34 MGM Mirage Q4 2005 Earnings Conference Call.
35 Casewriters’ interview with Robert Blain, Montreal, May
2008.
36 Ibid.
37 Ibid.
38 Konrad Yakabuski, “The Greatest Canadian Company on
Earth.”
39 Casewriters’ interview with Robert Blain, Montreal, May
2008.
40 Konrad Yakabuski, “The Greatest Canadian Company on
Earth.”
41 Casewriters’ interview with Daniel Lamarre, Montreal, May
2008.
For the exclusive use of L. BING, 2020.
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  • 1. GEOG102 Week 9 1 Lab week 9: A Pacific Northwest Geologic Mystery Lab Purpose and learning objectives 1. Report, describe, and interpret your observations of several features found in the Pacific NW. 2. Formulate a hypothesis explaining how several landform features relate to each other and explain what took place to create them (Your story). 3. Use the scientific method to structure your exploration and explanations. Instructions and Overview Step 1. a. You are going to investigate and solve a mystery about a geological phenomenon in our “backyard”. You will be given several pieces of evidence and multiple clues and hints containing geologic information for you to observe, formulate hypotheses about, and interpret.
  • 2. b. Using the eight pieces of evidence provided, and the large map of the Northwest with their locations, make observations and interpretations and record these in the table provided (see page 6). You will type these up and upload these to Canvas. c. Hints are provided along with the evidence to help guide your group and should be used for discussion when making your observations and interpretations. You do not need answer these questions in your report. However, discuss each question as a group to learn about each piece of evidence so that you can come up with plausible interpretations and observations. Step 2. Once you have investigated all eight pieces of geological evidence and have recorded your observations and thoughts, sit down with your group and develop a narrative of what you think happened based on the evidence. Include the ways each piece of evidence supports your description, i.e., what does your clue indicate about the larger picture. For example, the presence of a sesame seed on my shirt might mean that I recently ate a Big Mac, but it could also mean I ate a sesame bagel. Step 3. Using the scientific method (see page 5) write, independently of the group, a clear 500- 600 word lab report compiling this information into a narrative explaining, or solving, the
  • 3. Pacific Northwest Geologic Mystery. Note the typed tables of should be attached as Name: _____________________________________________________ Lab Day:_________________________ Lab Time:____________________ GEOG102 Week 9 2 appendices and can be referred to in the report, but do not count towards the 500-600 words. Grading: 10% Neatness, spelling, and grammar 30% Your observations and interpretation must be typed following the attached sheet (page 6) 60% The 500-600 typed summary connecting the hints into a cohesive explanation of the Pacific Northwest Geologic Mystery What to hand in at Wednesday lecture during the last week of class □ Typed observations and interpretations on attached sheet. □ 500-600 word typed lab report
  • 4. Lab Report Requirements 1. Lab reports must be typed. Standard one inch margins, double spaced, size 12 fonts are required (either Times New Roman or Calibri). Your observations and interpretation sheets can be size 10 font and single spaced. 2. A title, brief introduction and several well-organized paragraphs are mandatory. Use the following headings to subdivide your report: Introduction (~50 - 75 words), Method (~50-75 words), Observations and Interpretations (main body of the paper) (300-400 words), and Conclusion (~50-100words). Attach the typed observation/interpretation tables from the lab period as an appendix. 3. See the discussion of the scientific method on page 5 and use this to guide the observations and interpretation section of your lap report. 4. Each paragraph should contain a topic sentence and the other sentences should support that topic sentence. Each sentence must be complete, grammatically correct and use correctly spelled words. Sentences and paragraphs must be clear in their meaning, not sloppy or vague. 5. Reports must be uploaded to Canvas for your TA to grade. 6. Professional language should be used throughout the report. The report should be written in the 3rd person (not 1st). Words should be technical and
  • 5. professional, not colloquial or slang. Contractions ("they're", "we're", "it's") should be avoided. 7. The meaning of each sentence and paragraph must be clear. Do not assume that your TA will understand your meaning if you use vague language, incomplete sentences, or if sentences are not put together in a coherent manner. Your TA has been instructed not to try to make sense out of sentences or paragraphs that lack organization or are poorly organized. GEOG102 Week 9 3 Relief Map of the Pacific Northwest (locations are approximate) The Hints – Questions to Ponder… Where were glaciers present 15,000 years ago? Do not answer these questions directly in your lab report. They are hints to help you interpret what you observe at each station 1. McMinneville, Oregon • How could a jökulhlaup (a subglacial outburst flood) have occurred in the Willamette
  • 6. Valley? What does the distribution of erratics in the Willamette Valley tell you about how they got there? • What is the importance of identifying the rock type of an erratic? What does this tell you about the history of the rock? 1 2 3 4 5 6 7 8 8 GEOG102 Week 9 4 2. Eastern Washington • What processes (and how much force) result in rocks being stripped of soil? What processes result in rocks being submerged in sediment? • What is the relationship between the present day Columbia River and the Scabland
  • 7. channels? GEOG102 Week 9 5 3. Spokane, Washington • When is a puddle muddy? When is it clear? How might that result in production of rhythmites? A rhythmite consists of layers of sediment or sedimentary rock which are laid down with an obvious periodicity and regularity. • What does the number of layers in rhythmites tell you? GEOG102 Week 9 6 4. Coulee City, Washington • What processes can create rounded boulders like these? What natural processes can move boulders from one place on the earth to another? • What does the rock type tell you about where these boulders came from? What does it
  • 8. mean if these rocks were a rock type very different than the rock near where they were found? • What if these rocks look very similar to rocks found in Montana? • 5. Missoula, Montana • What processes create a shoreline along a lake or reservoir? • What does the presence of shorelines high on a mountainside above a valley mean? What must have been present to create shorelines in these locations? GEOG102 Week 9 7 6. Corvallis, Oregon • The Willamette series of soils consists of very deep, well drained soils that formed in silty glaciolacustrine deposits. • What processes contribute to the sudden deposition of large amounts of similar-sized material? • How is it possible that Reser Stadium has had both mammoth bones found beneath it
  • 9. while also having been some 400 feet underwater all within the same geologic time? • What processes could create very flat valleys, such as the Willamette Valley? • What are some possible sources of the material that makes up Willamette Valley soils? • GEOG102 Week 9 8 7. Camas Prairie, Montana • What processes create ripples in sand? What determines how big a ripple is? • How could you get giant ripples in Montana? 8. Dry Falls, Washington • Do waterfalls have enough energy to carry large rock or pull large rock out of the ground? Do waterfalls move over time? • What does the size of the waterfall tell you about the size of the river? • What is the relationship between the modern river (Columbia?) and the scoured channels?
  • 10. GEOG102 Week 9 9 The Scientific Method Einstein once said, “Imagination is more important than knowledge. Knowledge is limited. Imagination encircles the world.” Use the following figures describing and illustrating the scientific method to think about the Pacific Northwest Geologic Mystery The right hand side of the figure below describing the use scientific method to study the effects of dust on mountain snowpack is a good template for the observation and interpretation section of your lab report GEOG102 Week 9 10 Hint Location Observations (Just the facts)
  • 11. Interpretations (What do the facts mean?) 1 2 3 GEOG102 Week 9 11 Clue Location Observations (Just the facts) Interpretations (What do the facts mean?) 4 5 6
  • 12. GEOG102 Week 9 12 Clue Location Observations (Just the facts) Interpretations (What do the facts mean?) 7 8 Additional thoughts (if needed) Look through this paper, and the section of conclusion is still blank, please write a half page conclusion. Table of Content
  • 13. Introduction… 3 Problems Statement… 4 Research Questions… 4 Methodology… 5 Results and Findings … 5 Conclusions Recommendations (2) References Introduction: Employee benefits are awarded and/or given to exceeding salary and wage employees that recompense for injury, loss, or simply incentive compensation and may differ upon full-time and part- time employees. Some benefits are legally required to be compensated and others are discretionary, where employers are not required to provide particular benefits to their employees, such as disability insurance, retirement plans, and life insurance. Employee benefits affect both the well-being of the employee and the employer. It becomes the critical systematic organization of a business to meet their growing expectations in efforts to accomplish their objectives. In regards to the discretionary benefit of tuition reimbursement, companies offer employees the opportunity to cover learning tuition costs while employees work towards earning their degree. When offering tuition reimbursement or tuition assistance, many employers as well as employees gain profit from these programs. Employers obtain their financial gain by attracting motivated and dedicated employees who have the opportunity to grow and develop in strengthening their skills. Tuition reimbursement demonstrates the company’s investment in high- value candidates and their professional and educational growth. “The idea is to attract and keep employees longer, while cultivating a new crop of managers from within hotel companies' ranks” (2019, 1). This allows for the company to save on the expenses of recruitment and turnover costs.
  • 14. When companies offer tuition reimbursement, their retention rate becomes higher and it is less likely for employees to proceed to another company. However, when employees subsequently earn their degrees, they will presumably leave the company for higher paying positions elsewhere. This problem creates a risk of investment for the companies. By creating jobs with tuition reimbursement, it creates clear value of the degree obtained by the employees. Problem Statement: Providing tuition reimbursement contributes to the successful organization of the company. Research Questions: How does the reimbursement program contribute to employee productivity? Why does tuition and loan reimbursement contribute to reduced employee turnover rates? What incentives do employees gain from participating in tuition reimbursement programs? Methodology: Our group gathered information from the UCR library online database, specifically Business Source Complete. We also found some articles online from trusted sources. We would often meet after class to evaluate our findings and discuss potential solutions for our topic. Research and Findings: Question 1: How does the reimbursement program contribute to employee productivity? In today's competitive workforce, companies are encouraging employees to further their education to improve employee productivity. Firms are providing the tuition reimbursement program because they allow employers to attract, motivate, and retain knowledgeable employees. Employers that invest in employees help employees develop the knowledge and skills needed in this competitive and growing economy. Additionally,
  • 15. large investment in tuition reimbursement develops positive attitudes and retention among employees. As part of the educational skills, employees gain positive attitudes and retention. Employees that hold a positive attitude tend to be more open-minded and recognize different opportunities within their work, and retention gives them control of something in their work. Finally, graduation of furthering education is a signal to employers to be potentially productive because employees expanded their knowledge and know more positive skills in this growing workforce. Moreover, participating in the reimbursement program creates sorting from the program's overall retention effect. According to Manchester, he examined the difference between participants and nonparticipants in their propensities to separate from the institution (Manchester 959). Participants that take part in the reimbursement program are more likely to still be employed at their work than those who did not participate. Participation also lowers the propensity to leave the employer (Manchester 962). Employees who remain and are looking for other jobs also contribute to employee productivity because they are focused on their job and are satisfied by the benefits that the employers are offering them. At different institutions, employees also have access to funds that can be used towards classes that are offered on campus as part of a community education program (Manchester 962). Those programs are non- degree classes like painting and wellness classes that encourage employees to participate in reimbursement programs because they learn more skills in college classes. Therefore, additional exposure to skills increases employees' knowledge. On the other hand, reimbursement programs also create human capital through the effect of retention of sorting. Since tuition and loan reimbursement programs create effects on the composition of workers, it provides increasing retention amongst workers due to worker sorting. In other words, worker sorting gives workers sort access based on their preferences for nonwage characteristics through the tuition reimbursement
  • 16. (Manchester 956). High-ability employees work in firms that provide tuition reimbursement programs because they rely on learning costs being paid. Then, employees are motivated to invest in human capital that increases retention. The returns to investing in human capital are higher for individuals who have lower discount rates because the benefits to human capital investment accrue in the future whereas the costs are immediate (Manchester 957). Employees with lower discount rates place a higher value on future consumption in workplaces. Lower discount rates help employees with productivity because they will have lower mobility risk since they place greater weight on opportunities offered by companies. Finally, human capital increases retention of employees because it contributes to the knowledge and personality needed to perform in the labor force. Overall, we concluded that the tuition and loan reimbursement program contributes to productivity because it increases retention and the value for employees to invest in human capital. Employers who invest in reimbursement programs for their employees have a high return on knowable, skillful, and positive attitudes with employees. Question 2: Why does tuition and loan reimbursement contribute to high employee turnover rates? Tuition reimbursement is a valuable benefit for the employee and the company. Employers invest in their employees’ future goals and accomplishments by supporting their educational and social development. In turn, the employees’ will develop the notion that they are efficiently utilizing their obtained knowledge by contributing to the success and prosperity of the company for which they are employed. The employees are incentivized to remain in their specified position for an extended period of time, reducing the turnover rate. For example, according to the book,The Wiley Handbook of Global Workplace Learning, it states that “UPS invested a fraction of the potential cost of relocation into 50% tuition coverage, book reimbursements, and academic bonuses for student workers. In
  • 17. turn, turnover among employees was cut by 70%, and the partnership resulted in over 2,500 postsecondary credentials.” (Clark 73) The company will retain their profits by decreasing the need to continually expend their wealth on constantly hiring and training new staff. This generates a sense of loyalty between employee and employer. Participation in the tuition reimbursement program will strengthen the skills and knowledge of the employees as well as providing the company with work efficient personnel and valuable human capital specific to the firm. The benefits of obtaining job specific skills free of charge will raise retention rates in which the productivity of the employee will continue to persist even after the complimentary education has been completed. Companies that provide complimentary resources, such as tuition reimbursement, are investing in the quality of their employees in addition to the success of their agency. The author, Clark, further states that “The envisioned new learning economy provides working learners with improved access to relevant learn and earn opportunities, better connections to work pathways, clearer and more attainable learning outcomes, and increased life satisfaction.” (Clark 71) The working learners opportunity is significant in serving the new hires, the company, and the communities that become involved in the economic success of the agency. In a way, companies who offer tuition reimbursement Question 3: What incentives do employees gain from participating in tuition reimbursement programs? A recent 2018 survey revealed that as many as 92% of companies in the U.S. tend to offer some type of education assistance (TalentCulture). With such a high participation rate, belonging to a company that offers an education benefit such as tuition reimbursements comes with many incentives. Tuition reimbursement for an employee comes with the incentive of an education opportunity that was once unaffordable or unattainable due the unwillingness to pay for one (Martocchio 254). Also, a incentive of tuition reimbursement is the ability
  • 18. to enroll in courses the employee wishes to take at a time they would like to take them (Martocchio 259). The time committed to fulfilling the degree incentivizes the employee to take up courses either related to the employee’s current job or something totally opposite. The educational opportunity employers provide motivates employees to be part of continual skill development and a workforce that seeks adaptable skills (Pattie 438). Ultimately, tuition reimbursement with its incentives can be a beneficial opportunity for employees. Obtaining a college education or an advanced degree grants employees with greater human capital. Not only have employees now developed new skill sets, but they have the education and experience for access to future promotions, compensation, job roles, etc. Participating in tuition reimbursement programs allow employees to gain marketable skills other than the skills obtained through traditional human resources (HR) classroom or on the job training (Pattie 424). Not to mention, Human Resources run programs tend to only last a couple of days whereas employees develop a greater depth of skills through a wider range and extent of the education assistance programs. With the greater human capital obtained through participating in the tuition reimbursement program, employees now have the option of deciding whether their current position fits their new acquired skill set. If the employee’s current position no longer fits their new developed skills, employees become attractive to alternative jobs. Employees can feel as if their new skills now actually help switching companies easier than before. On the other hand, if the employee's degree relates to their current position or possible benefit returns, the employee can stay and obtain an increase in salary (Pattie 428). In the end, employees who participate in tuition reimbursement programs tend to respond in a positive manner as they are aware of the voluntary benefit their employers are providing in terms of investing in employees and seeking to foster a sense of professional development within the organization. There exist no greater incentive for employees than obtaining professional growth and
  • 19. development with the aid of one's employer. Conclusion: Recommendations: References Fuhrmans, V. (2018, Mar 01). Free tuition: Hotels' latest attempt to stem employee turnover; the american hotel & lodging association and education company pearson PLC are pairing up to launch a pilot program that will foot the bill for hotel-industry workers to get degrees. Wall Street Journal (Online) Retrieved from https://search.proquest.com/docview/2009007317?accountid=14 521 Manchester, Colleen F. “General Human Capital and Employee Mobility: How Tuition Reimbursement Increases Retention Through Sorting and Participation .” ILR Review, vol. 65, no. 4, Oct. 2012, pp. 951–974. Sage Publications, Inc., https://www.jstor.org/stable/24368505. Pattie, Marshall, et al. “Tuition Reimbursement, Perceived Organizational Support, and Turnover Intention among Graduate Business School Students.” Human Resource Development Quarterly, vol. 17, no. 4, 2006, pp. 423–442, doi:10.1002/hrdq.1184. Martocchio, Joseph J. Employee Benefits: A Primer for Human Resource Professionals. McGraw-Hill Education, 2018.TalentCulture Team. “What Does Tuition Assistance Look Like in 2018?” TalentCulture, TalentCulture LLC, 24 May 2018, talentculture.com/tuition-assistance-look-like-2018/. Clark, Hope, et al. “The New Learning Economy and the Rise of
  • 20. the Working Learner.” Wiley Online Library, John Wiley &amp; Sons, Ltd, 25 Mar. 2019, onlinelibrary.wiley.com/doi/pdf/10.1002/9781119227793.ch4. ******Talk about your idea on both sides***** Write a short position paper (one or two pages) that supports either the shareholder primacy or stakeholder answer to the question, “For whom should the corporation exist?” Your paper should include responses to the main arguments of the opposing side. 9 - 7 0 9 - 4 1 1 R E V : F E B R U A R Y 1 0 , 2 0 1 0 _____________________________________________________ ________________________________________________ Professor Ramon Casadesus-Masanell and Maxime Aucoin (MBA 2008) prepared this case. HBS cases are developed solely as the basis for class discussion. Cases are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective management. Copyright © 2009, 2010 President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-800-545- 7685, write Harvard Business School Publishing, Boston, MA 02163, or go to www.hbsp.harvard.edu/educators. This publication may not be digitized, photocopied, or otherwise reproduced, posted, or transmitted, without the permission of Harvard Business School.
  • 21. R A M O N C A S A D E S U S - M A S A N E L L M A X I M E A U C O I N Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships The headline was grim: “Fat cats at Cirque du Soleil lose their way—new Cirque show is as creative as a Hollywood sequel.” As he glanced up from his morning newspaper, Daniel Lamarre, Cirque du Soleil’s president and CEO, noticed an e-mail on his PDA from Jim Murren, CEO of MGM Mirage, Cirque’s biggest partner: “Daniel, I’m sorry but we found a new, more creative partner for our new shows. We are closing all our Vegas shows with Cirque as of today.” Lamarre turned toward Guy Laliberté, founder and majority owner of Cirque du Soleil, who looked at him and said, “Daniel, nobody wants to be known as the first to have produced a bad Cirque du Soleil show.” Suddenly, Lamarre woke up at his home in Montreal. It was all a bad dream. Lamarre smiled. Although the possibility of Cirque losing its creative edge was never too far away, he knew that the company was better positioned than ever to keep its competitive advantage in show business. Cirque du Soleil had always put creativity
  • 22. first. Every year, Cirque reinvested more than 40% of its profits in its creative processes.1 In 2006, Lamarre had devised a new organizational structure based on independent creative cells for the development of every new show. Four executive producers reported directly to him, with each producer in charge of a set of creative cells. The new structure ensured increased accountability and scalability. Lamarre would explain it by saying, “Each cell member eats and breathes their show 24/7. They’re not bothered by anyone else and can be fully dedicated to their show.” Finally, Lamarre had established criteria for all new developments: a) Is there a creative challenge? b) Can the partnership be sustainable in the long run? c) Is there a good return to be made? and d) Will the partner adhere to Cirque’s social responsibility parameters?2 Cirque had discarded many lucrative opportunities when it could not maintain full creative control or when a creative challenge was not met. “In show business,” Lamarre said, “show comes before business.”3 Since Laliberté had retired from the day-to-day operations in the early 2000s, Lamarre had been heading the company’s operations and negotiations with potential partners. Lamarre, a journalist by trade, had spent most of his career in public relations and television broadcasting, serving for four years (1997 to 2001) as CEO of the TVA Group, the largest private television broadcasting company in For the exclusive use of L. BING, 2020. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California -
  • 23. Riverside from Jan 2020 to Mar 2020. 709-411 Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships 2 Quebec. In 2001, he joined Cirque du Soleil to head up the New Ventures division. In 2003, he became COO, and in 2006, president and CEO. Since its humble beginnings as a group of artists putting on a summer festival in Quebec (the French-speaking province of Canada) in the early 1980s, Cirque du Soleil had sold more than 70 million tickets in more than 250 cities. Of its 4,000 permanent employees, more than 1,000 were artists representing more than 40 nationalities.4 Revenues in 2007 were estimated at $700 million with 15 productions presented on four continents.5 As of April 2008, Cirque had six big-top touring shows (two in North America, two in Europe, one in Japan, and one in South America); two arena touring shows (one in Europe and one in North America); and seven resident shows (five in Las Vegas; one in Orlando, Florida; and one seasonal show in New York). According to Forbes magazine, Guy Laliberté was worth $1.7 billion, effectively putting the value of Cirque at just under $2.0 billion.6 (See Exhibits 1 and 2 for more information on Cirque productions, revenues, and number of tickets sold.) With creativity as the cornerstone of its success, Cirque still had to ensure that its business model
  • 24. fit its strategy. Could the company support its spurt of new projects? With so many opportunities available, was Cirque truly entering the right markets? And would its new partnerships be as successful as the one with MGM Mirage? Cirque du Soleil History Nomadic Performers In the early 1980s, a group of street performers in Baie-St-Paul, a small town 100km northeast of Quebec City in Canada, had a vision of a new modern circus, one that would break away from the traditional circus while keeping the cachet of its traveling big top and spectacular acrobatics. They founded Le Club des Talons Hauts in 1981, performed for the La Fête Foraine in 1982, and finally, in 1984, founded Cirque du Soleil, the culmination of their ideals and talents. Guy Laliberté, a 25-year- old fire-breather, became the creative force and visionary behind the group, while long-time friend Daniel Gauthier, a computer programmer, became the manager and business-savvy partner. Ownership of the company was split 50/50 between the two friends. Other key creative people joined Laliberté and Gauthier in their endeavor, notably Gilles-St- Croix, a stilt-walker, currently executive vice president of Creation at Cirque, and Franco Dragone, a Belgian theater director, who directed 10 Cirque productions from 1985 to 1998. From the start, several elements differentiated Cirque du Soleil from traditional circuses. The founding artists were mostly street performers rather than circus performers, and they never
  • 25. imagined integrating animals into their shows. “I’d rather feed three acrobats than one elephant,” Guy Laliberté once said.7 Because the group was born from modest means (and an inability to pay hefty salaries for famed performers), the Cirque du Soleil name was always the promotional vehicle rather than the artists. Although each production would eventually have its own name, it would always be “presented by Cirque du Soleil.” From 1984 to 1987, with the help of government funding, Cirque du Soleil toured successfully in the province of Quebec with its first production, Le Grand Tour du Cirque du Soleil. With no money for advertising, it then made a few perilous, and unsuccessful, stints outside Quebec in Niagara Falls and Toronto with La Magie Continue. Money was scarce, and funding an ongoing challenge. In the midst of these financial difficulties, Cirque du Soleil was invited to the 1987 Los Angeles Arts Festival. Because the festival did not have the funds to pay an advance to Cirque, Laliberté negotiated a deal: Cirque would be the opening show of the festival and would do its own promotion, but would keep all box-office receipts. As a result of the deal, the company had literally just enough money for a one- For the exclusive use of L. BING, 2020. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California - Riverside from Jan 2020 to Mar 2020. Cirque du Soleil—The High-Wire Act of Building Sustainable
  • 26. Partnerships 709-411 3 way trip to Los Angeles. Cirque’s new show, Cirque Réinventé, had to be a resounding success at the festival; otherwise, Cirque would not have had enough money to come back to Quebec. “I’m not going to wait 20 years to see if we can make it,” said Laliberté at the time. “Cirque du Soleil will live or die in Los Angeles.”8 Not only was Cirque a critical and financial success in Los Angeles, but it attracted many producers who wanted to put their hands on the creative enterprise. At the time, Cirque almost signed a deal with Columbia Pictures to make a movie centered on Cirque characters. Columbia’s president, Dawn Steel, threw a party to announce the joint venture, but Laliberté didn’t stay long. “They were seating all the stars, and I was basically put aside,” he said. “They just wanted to lock up our story and our brand name and walk around like they owned Cirque du Soleil. I walked right out of the party, called my lawyer, and told him to get me out of the deal.”9 The festival also produced a first encounter with Michael Eisner, CEO of Disney, that would prove fruitful in years to come. As Eisner recalled, “From the moment I saw the show in L.A. until I finally made a deal with Guy Laliberté, I was obsessed by Cirque du Soleil.”10 From the time of the festival on, Laliberté and Gauthier would be regularly courted by companies wanting to partner with or buy out Cirque du Soleil. Determined to keep their artistic and
  • 27. commercial independence, both vowed to always remain a privately held organization and to choose their future business partners wisely and parsimoniously. Following its success in California, Cirque du Soleil toured across the United States and internationally, producing and presenting a second touring show called Nouvelle Expérience. A Flower in the Desert Cirque’s first attempt to establish a resident venue came in Las Vegas in 1992, when it held discussions with Caesars Palace to develop a resident show. But when Cirque presented excerpts of its new show to the Caesars board, the management found the show too “risqué” and esoteric for Vegas. Instead of toning down its artistic ambitions, Cirque crossed the street and went to see Mirage Resorts. Steve Wynn, chairman of Mirage Resorts, and Bobby Baldwin, then second-in-command, had seen Cirque du Soleil in Chicago the year before and knew Vegas was ready for Cirque du Soleil. Mirage Resorts signed an initial two-year deal to have Cirque perform Nouvelle Expérience under a big top next to the Mirage Resort for a full year, while at the same time developing a new show to be called Mystère for a permanent theater at the new Treasure Island resort. The permanent venue, a $20 million, 1,525-seat theater, gave Cirque a new creative platform, allowing the company to double the size of its traditional shows, with a 120-foot-wide oblong stage, more than 70 cast members, and the ability to present shows 10 times a week, 48 weeks a year.11 Cirque du Soleil had planted a flower in
  • 28. the desert. In the following years, Cirque du Soleil continued to expand its footprint, adding touring shows every two years (Saltimbanco in 1992, Alegria in 1994, and Quidam in 1996) and growing the number of cities and countries visited. It also refined its creative process, evolving from an assortment of performances and acts to shows centered around a diffused storyline where theatricality played an increasingly important role. Franco Dragone, with his theatrical background, was masterful at creating links between acts and performances, letting each audience member develop a personal interpretation of what he or she saw. By 1997, Cirque had three shows touring simultaneously and one resident show. It employed 1,200 people, including 260 performers, and had sold more than 15 million tickets. For the exclusive use of L. BING, 2020. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California - Riverside from Jan 2020 to Mar 2020. 709-411 Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships 4 A Growing Production House
  • 29. From 1997 to 1999, Cirque du Soleil went through an intense period of production, creating three new shows at the same time. Building on the success of Mystère at Treasure Island, Mirage Resorts secured a second Cirque du Soleil show for its new 3,000-room, $1.6 billion Bellagio resort project. The new show, called “O,” would be presented in an 1,800-seat theater with a 1.5M (million) gallon pool of water as a stage. The cost of the theater alone was $70 million; production costs were estimated at $20M.12 (See Exhibits 3 and 4 for comparisons of various theater and production costs.) Almost 10 years after meeting Eisner in Los Angeles, Cirque finally signed a deal with Disney to produce a resident show, La Nouba, at Downtown Disney, the entertainment venue of Walt Disney World Resort in Orlando, Florida. Again, the question of artistic control was at the heart of the negotiations, but Cirque didn’t let go and, in the end, kept total control. The 10-year deal, loosely based on terms similar to those with Mirage Resorts, called for an $18 million production with 60 artists, a 1,650-seat purpose-built theater at a cost of $52 million, and showings twice an evening, five evenings a week.13 The show opened in December 1998, a mere two months after the opening of “O.” Finally, Cirque du Soleil produced another touring show, Dralion, set to open in Montreal in April 1999. With Franco Dragone already directing La Nouba and “O,” Laliberté turned to a new team of creators for the first time in a decade. Guy Caron, an old collaborator of Cirque, came back as stage director.
  • 30. Through the massive growth of the late 1990s, Cirque du Soleil resisted the temptation to duplicate its productions, that is, to have different troupes presenting the same production (à la Andrew Lloyd Webber, Blue Man Group, or Mamma Mia). “We very deliberately chose a strategy of exclusivity,” said Daniel Lamarre. “We’ve been approached by corporations around the world who would like us to do copies but we always say, ‘No. If you want to see “O,” you have to go to Las Vegas. Clowns, yes. Clones, no.”14 By the end of 1999, the growth strategy and the multiple productions had left the entire organization exhausted. Creative team members debated on topics such as royalty structures, creative control, and future artistic direction. In 2000, Franco Dragone and a few other creators left Cirque du Soleil and started a new production company simply called Dragone.a Laliberté understood that Cirque had grown increasingly dependent on a few key creative individuals. From that time on, Laliberté made sure that the heart of Cirque’s creative process was its organization, not a particular group of people. Cirque would tolerate neither prima donna artists nor prima donna creators. Cirque formalized certain aspects of its creative process to ensure that its hundreds of permanent artists and creators would always give the Cirque du Soleil “feel” to every production, thus allowing for a rotation of stage directors. On the organizational front, Cirque was overextended. The Montreal headquarters were overflowing with new productions and increased support activities; mobile offices burgeoned on the
  • 31. front lawn for excess staff. Unwilling to compromise on quality or artistic integrity, Cirque would not outsource any activity. At the time, more than 200 employees worked at creating and maintaining the more than 1,000 costumes for all of the shows. They would even dye their own fabrics, ensuring a continuous supply for long-running shows. With each new show in operation, the complexity of Cirque grew exponentially. a Since 2000, Dragone productions have had mixed results, with successes such as Celine Dion’s three-year run at Caesars Palace and disappointments such as Le Reve at the Wynn Resort. For the exclusive use of L. BING, 2020. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California - Riverside from Jan 2020 to Mar 2020. Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships 709-411 5 Eventually, Gauthier and Laliberté disagreed on the future direction of the company. Gauthier, more conservative by nature, recognized the risks of overextending, while Laliberté envisioned moving beyond staged performances. In May 2000, Gauthier, co-founder and 50% owner of Cirque, decided to leave. Cirque bought back his shares through a
  • 32. banking syndicate financing for an undisclosed amount. (Gauthier was valued at C$400M in 2000 by the National Post prior to his departure.)15 Laliberté was now the sole owner of Cirque du Soleil. Extending the Creative Platform In the early 2000s, Cirque du Soleil sought to extend its creative presence outside staged performances. Building on the power of its brand and track record in Las Vegas, Cirque sought out partnerships with real-estate promoters to develop mix-used complexes centered on Cirque du Soleil–created environments. At the core of each project would be a Cirque show. In addition, the complex would include Cirque du Soleil–inspired restaurants, spas, and as Laliberté envisioned, “interactive museums, nightclubs where customers dance in water and hotels that add a ’surreality to five-star service.’”16 Cirque would have its creative hands in every aspect of project development. The first of these endeavors would be in London, in the iconic Battersea Power Station, held by Parkview International, the real-estate arm of the Taiwanese Hwang family. The partnership, which was announced publicly in December 2000, entailed refurbishing the Power Station into a high-end retail, restaurant, and entertainment center with a 2,000-seat resident Cirque du Soleil theater at its core. In addition, the facility would include two hotels, office space, a convention center, a rail link to Victoria Station, and a ferry dock on the Thames. The total cost of the project would exceed a billion pounds.17 But after a year of negotiations, Cirque du Soleil
  • 33. pulled out of the deal because of lack of creative control over the project and slowness of developments. Similar projects were considered but finally dropped in Hong Kong and New York. In late 2001, Cirque decided that the best way to prove the viability of it complexes was to create a first version, a laboratory of sorts, at home in Montreal. The project, a scaled-down version of the London project, had a 100-room hotel, spa, restaurant, and multi-use theater where Cirque would perform for a part of the year. Cirque estimated a total cost of C$100M. After one year of development and negotiation with local partners, the project was abandoned. “Our vision of a Cirque Complex was a tough sell,” said Lamarre. “Prospective partners would ask: What does Cirque know in hotels or restaurants?” In the end, the adventure in new ventures encouraged Cirque management to redirect its efforts. “We realized that we needed to concentrate on what we are good at: creating incredible shows,” said Lamarre.18 The Creative Content Provider Following its venture into real-estate development, Cirque closed its regional offices in Amsterdam and Singapore and concentrated on content creation. Cirque then extended itself on stage rather than off, diversifying its show base. In Las Vegas, with MGM Mirage (MGM Grand and Mirage Resorts merged in 2000) as its exclusive partner, Cirque developed three new and completely different shows. Zumanity, the sensual side of Cirque du Soleil, was the
  • 34. organization’s first cabaret-style, adult-themed show. It was presented at the New York-New York Hotel and Casino. Its theater, smaller and more intimate, held 1,250 seats and opened in September 2003. Kà, a gravity-defying production, featured an innovative blend of acrobatic feats, Capoeira dance, puppetry, projections, and martial arts. It was by far the most technically advanced For the exclusive use of L. BING, 2020. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California - Riverside from Jan 2020 to Mar 2020. 709-411 Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships 6 production Cirque had ever made and the most costly, with a price tag of $165 million. The show opened in November 2004 at MGM Grand in a 2,000-seat theater. Love, a celebration of the musical legacy of the Beatles, was born from the friendship between the late George Harrison and Guy Laliberté. It was co- produced with Sir George Martin, the legendary producer of the Beatles. The production, showcased in a 2,000-seat theatre at The Mirage, premiered in June 2006.
  • 35. For the first time in ten years, Cirque opened a resident show in a new city. Cirque signed a four- year deal with Madison Square Garden Entertainment to produce Wintuk, a family-oriented show about a boy’s quest for snow. The show was the first seasonal performance of Cirque, playing every autumn for a period of 12 weeks at the WaMu Theater at New York’s Madison Square Garden. At the same time, Cirque expanded its touring-show business. Varekai in 2002, Corteo in 2005, and Kooza in 2007 were big-top touring shows produced in Montreal on a 10- to 12-year touring schedule. All three enjoyed critical and financial success, opening to great reviews in every city and averaging an occupancy rate of more than 80% overall. In 2006, Cirque entered the arena-touring show market, producing, in partnership with Live Nation, Delirium, an urban tale and state-of-the-art mix of music, dance, theater, and multimedia. Finally, in 2007, it revamped its 1992 production Saltimbanco to tour in arenas. Cirque du Soleil’s Main Activities Cirque du Soleil never abandoned its nomadic roots. It always toured from city to city, performing under its colorful big tops. Its touring operations traveled across four continents and to more than 100 cities. A touring show typically consisted of a two-and-a-half-hour show (with a 30- minute intermission) comprised of 50 to 60 artists, 70 to 80 support staff (including technicians, cooks, medical staff, and teachers for children), 40 to 50 trucks of equipment, and a 2,500-seat big top that
  • 36. could be put up and ready for performance in five or six days. A touring show usually performed an average of seven weeks per city, presenting eight to ten shows a week. Depending on the city, top tickets commanded $100 and VIP packages, more than $200 (including drinks in a VIP tent before the show, during the intermission, and after the show; front-row seats; and a gift package). All touring shows premiered in Montreal and toured North America for four to five years before moving to Europe for three years, Asia for two to three, Australia for one, and South America for one. The upfront time and capital investment for a new touring production were significant. For a production like Varekai or Corteo, the creative process usually started two to three years before each premiere, and production costs ran to $30 million each.19 Cirque then acquired $7 million of scenic and transportation equipment and finally a big top for another $13 million.20 The profitability of a touring show depended largely on the occupancy rate of each performing night, as it is a mostly fixed-cost business from night to night. Although each show had different operating costs (these costs vary from country to country), break-even occupancy usually stood at around 65%.21 For its resident shows, Cirque always partnered with organizations willing to invest in the overall production of the show and theater. Resident shows were stationed in tourist destinations (Orlando and Las Vegas) that attracted tens of millions of tourists annually,b enabling Cirque shows to run for extended periods of time. With the exception of a two-year run of Alegria in Biloxi, Mississippi, no resident show had ever been closed. Resident shows had roughly
  • 37. the same number of artists as a touring show but would usually have many more technicians (Kà had more than 150 technicians).22 b Las Vegas 2007 visitors: 39 million Orlando 2007 visitors: 47 million For the exclusive use of L. BING, 2020. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California - Riverside from Jan 2020 to Mar 2020. Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships 709-411 7 Resident shows presented on average 10 performances a week, but gave many more performances a year than a touring show, because they could play up to 48 weeks a year (versus 35 to 38 weeks for a touring show). Finally, Las Vegas resident shows commanded high ticket prices, with top tickets for Kà, “O,” and Love at $150.23 Although operating costs for resident shows might be higher due to their technical sophistication, these costs were more than offset by ticket prices and an average occupancy (90% to 95%) higher than those of touring shows. Break-even for resident shows averaged 60%.24 Resident shows in Las Vegas represented more than 50% of Cirque revenues but a much larger share of its bottom line.
  • 38. Starting in 2006, Cirque began presenting arena touring shows. A partnership with Live Nation gave Cirque du Soleil access to new audiences, as it performed in arenas and amphitheaters with capacities of 8,000 to 12,000. Its first arena touring show, Delirium, was deliberately produced for large venues (see Exhibit 5 for Delirium spring/summer 2008 tour plan). At each show and on its website, Cirque du Soleil sold merchandising, from Cirque du Soleil t- shirts and umbrellas to exclusive art and sculpture. Merchandising represented 10% of Cirque’s overall revenues.25 Cirque produced documentaries, DVDs of its shows, TV shows (with its partner Bravo), and two feature movies. In 2004, Cirque developed a series of Cirque du Soleil animated lounges for Celebrity Cruises. The Joint Venture with MGM Mirage MGM Mirage Background In the early 1990s, Las Vegas was a gambling destination devoted almost exclusively to gaming, usually offering poor ancillary services ($49 hotel rooms, all- you-can-eat buffets, and French cancan entertainment). Steve Wynn, owner of the Golden Nugget, set about to change the face of Las Vegas by enhancing quality and service and adding even more extravagance. His company, Mirage Resorts, built the $630 million The Mirage, which was one of the first high-end casinos and resorts in Las Vegas. Building on the success of his first greenfield development, he went on to develop the $540
  • 39. million Treasure Island Hotel and Casino in 1993 and the $1.6 billion Bellagio in 1998. In 2000, Mirage Resorts merged with Kirk Kerkorian’s MGM Grand in a $6.4 billion deal. Following the deal, Wynn left the company and developed the $2.7 billion Wynn Las Vegas in 2005 and won one of three gaming concessions in Macao, China. MGM Mirage continued Wynn’s vision of a high-end Las Vegas, concentrating its efforts on making each of its businesses profitable (casinos, hotels, restaurants, clubs, spas, and entertainment). In 2004, it bought Mandalay Bay Resort Group for $7.9 billion.26 Following the merger, MGM Mirage controlled 49% of hotel guestrooms, 44% of gaming tables, and 40% of slot machines on the Las Vegas Strip.27 In 2007, MGM Mirage had revenues of $7.7 billion, 67,000 employees, 20 wholly owned resorts, and new developments in Las Vegas, Macao, Abu Dhabi, Atlantic City, and Detroit.28 Cirque du Soleil–MGM Mirage Deal In 1992, Cirque du Soleil and Mirage Resorts signed their first deal, a two-year contract for a one- year presentation of Nouvelle Expérience in a big top on The Mirage parking lot, and a one-year contract with a 10-year extension for a new resident show, Mystère, at the opening Treasure Island resort. “Even before [Nouvelle Expérience] opened, we made the deal to build Treasure Island and put in Mystère,” said Bobby Baldwin at the time. “It was a huge financial risk. But we just had a lot of confidence in Guy [Laliberté].”29 Unlike Caesars Palace management earlier that year, Wynn was willing to hand over full creative control, thus sealing the deal.
  • 40. Still, when Steve Wynn saw a For the exclusive use of L. BING, 2020. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California - Riverside from Jan 2020 to Mar 2020. 709-411 Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships 8 rehearsal of the dark, moody, and dramatic Mystère, he apparently threatened to delay the opening. Cirque management would not relinquish artistic control and decided to present what it believed would be the best show possible. The premiere went on as planned, and in a matter of weeks Mystère was a huge hit.30 A mutual trust and respect grew between the new partners. Cirque du Soleil quickly made an impact on the Treasure Island. With more than 3,000 guests coming in five nights a week, Mirage Resorts recognized the drawing power of Cirque and its effect on ancillary activities at the casino. As Bobby Baldwin said to BusinessWeek in 2004, referring to Cirque shows at the three Mirage properties, “only 20% of them [showgoers] actually stay at the casino hotel that hosts the show, but showgoers drop an average of $30 apiece on dinner or drinks at the property… [Cirque du Soleil showgoers are] sophisticated, and they have high incomes.’’31To
  • 41. ensure that Mirage Resorts could eventually capitalize on the Cirque du Soleil effect at its other casinos, the initial deal with Cirque du Soleil stipulated that Mirage Resorts (and eventually MGM Mirage) would stay the exclusive house of Cirque du Soleil in Las Vegas. Since its first deal in 1992, Cirque and MGM Mirage opened four more shows: “O” in 1998, Zumanity in 2003, Kà in 2004, and Love in 2006. An additional two were in development: a show with magician Criss Angel at Luxor Resort & Casino in Las Vegas was scheduled to open in summer 2008 and an Elvis-themed show at City Center in Las Vegas, in autumn 2009. Since Mystère, the Cirque du Soleil effect became increasingly apparent. The New York–New York Resort opened prior to the arrival of Zumanity; after the show’s arrival, it was clear that Cirque had made a difference, as described in the MGM Mirage 2003 10-K SEC filling: New York-New York experienced a 23% increase in net revenues due to the addition of Zumanity, the newest show from Cirque du Soleil, which opened in August 2003 and other amenities, including a new Irish pub, Nine Fine Irishmen, which opened in July 2003. In 2004, MGM Grand, the biggest Las Vegas resort at the time with more than 5,000 rooms, opened Kà. “After seeing the Zumanity effect, if you will, on the property results, I think you can more clearly understand why we are excited about the new Cirque show at the MGM Grand and the
  • 42. momentum it will create in the second half of ‘04,” said John Redmon, president and CEO of MGM Grand Resorts, at the time of the opening.32 A year later, Reuters stated that “MGM also cited increased visitor traffic generated by Cirque du Soleil’s acrobatic show Kà and other new amenities at MGM Grand Las Vegas for boosting slot revenue at that resort by 13 percent.”33 Finally, with Love opening at The Mirage in 2006, Bobby Baldwin reported to Wall Street analysts in a 2005 fourth-quarter-earnings conference call that “the EBITDA impact of the show, the new Beatles show, and the expected traffic from that show would be calculated at 12.5 million for 2006 and 25 million in EBITDA impact for 2007 and beyond.”34 (See Exhibits 7 and 8 for MGM Mirage Income Statement and resort-specific EBITDA analysis.) All Cirque du Soleil-MGM Mirage deals followed the same principles (see Table A for a representation of a typical deal structure). MGM Mirage paid for theater construction and all show equipment (e.g., a $150 million investment). Production costs (e.g., $30 million) were split in half between MGM Mirage and Cirque du Soleil,35 for a total investment of $165 million for MGM Mirage and $15 million for Cirque. Once the show was in operation, box-office receipts, net of all show and theater expenses, were split 50/50.36 The theater seated roughly 1,900, and the show was presented 10 times a week, 48 weeks a year. Assuming an occupancy rate of 90%, the number of guests totalled 17,000 a week, or 820,000 a year. At an average price of $120, that adds up to a box-office of $100M a year. MGM Mirage operated the theater and, therefore, charged
  • 43. the cost of most technicians, box office, ushers, cleaning, general facility management, and utilities. MGM also charged a box-office For the exclusive use of L. BING, 2020. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California - Riverside from Jan 2020 to Mar 2020. Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships 709-411 9 rent to cover its initial investment. Cirque du Soleil on its side charged for show operating expenses, including artist compensation, costume and artistic supply maintenance, show management, and artistic follow-up. Cirque also charged box-office royalties for the creative concept. It retained a portion of the royalty and paid its creators (who were paid per show or as a percentage of box office). The resulting profit was split 50/50.37 MGM Mirage Cirque du SoleilShow $150M $15M $15M $150M theatre construction & show equipment $30M production
  • 44. $100M box-office $10M theatre operations $35M show operations $30M operating profit 100% 50% 50% 50%50% $180M capital investment + - - $165M $15M $15M $15M Table A - Simplified Deal Structure* $13M creative royalty- 100% $13M (prior to paying creators)$12M rent-100%$12M * For illustration purposes only Source: Compiled by casewriters.
  • 45. Throughout more than 15 years of partnership, the organizations experienced little conflict. Although MGM Mirage management did not always agree with its partner’s vision, it trusted Cirque and respected the initial agreement. “Guy hires very intelligent people. They’re very creative and highly disciplined. We’ve never had a dispute over money or the books,” said Baldwin.38 The partnership was based on an “open book” policy, where each partner could ask to review the books of the other. “In 2007, MGM Mirage was concerned by the increase in costume and training costs. They came to Montreal, looked at our books, and toured the facilities to better understand our cost structure. They then felt comfortable with the increases,” said Robert Blain, Cirque’s CFO. Following the visit, Blain initiated a quarterly meeting with the CFOs of each of the MGM Mirage properties where Cirque had a show. “We openly discuss issues and exchange ideas on how to improve the bottom line. We’ve recently reviewed ticketing processes across properties, which should improve each show’s bottom line significantly,” said Blain.39 Over the years, Cirque developed a deep understanding of the Las Vegas market. “MGM Mirage sees us as more than just a content provider, we are truly a partner on every front,” said Lamarre. Looking Forward Lamarre went through in his mind the deals Cirque was working on (see Exhibit 6 for planned Cirque productions). The two new MGM Mirage shows in Vegas were in production and scheduled for summer 2008 and autumn 2009. Cirque’s first resident show
  • 46. in Asia was scheduled to open during the summer of 2008 at Tokyo Disney Resort. Cirque was also entering the Macao market (dubbed the Las Vegas of the East). Finally, Guy Laliberté had announced in the summer 2008 that Cirque had signed a partnership with two subsidiaries of Dubai World, the sovereign wealth fund of For the exclusive use of L. BING, 2020. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California - Riverside from Jan 2020 to Mar 2020. 709-411 Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships 10 the booming Emirate, where he would sell a 10% stake of the company to each partner (20% in total). In addition to a planned resident show in Dubai in 2010, the new partnership could lead to future projects in the region. Lamarre was glad to see Cirque diversify geographically. Still, all these new shows were in similar markets (gambling or destinations cities). New York, London, Berlin, and Sydney were all cities where Cirque eventually wanted a permanent foothold as well. But could Cirque find a model as profitable as it had with a casino operator? Should Cirque be willing to capture less value to enter these markets? Should it seek out new types of partners, as it had with the Dubai deal?
  • 47. At the same time, how many more Cirque du Soleil shows could be absorbed in Las Vegas? With seven shows in 2009, would Cirque finally feel cannibalization? MGM Mirage certainly felt there was still room to grow, investing $217 million in the theater alone for the Elvis-themed show at its new CityCenter.”40 And what about the touring shows? Cirque seemed to be moving away from its traditional big-top touring show to more arena touring shows. Was it diluting its brand by extending the show experience from big tops to theaters and now arenas? Should it go back to its roots and expand its big-top touring shows? Cirque received almost weekly offers to open resident shows around the world. But choosing the right partner was a delicate process. Lamarre was confident that putting the creative challenge at the top of his list was the right way to go. “I will not be the one remembered for producing the first bad Cirque du Soleil show,” mused Lamarre.41 For the exclusive use of L. BING, 2020. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California - Riverside from Jan 2020 to Mar 2020. Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships 709-411 11
  • 48. Exhibit 1 Cirque du Soleil Productions as of Spring 2008 Show Opening Date Type of Show Stage Directora Production Cost (excluding tents for touring)b Tickets Sold to Date (as of August 07)c Saltimbanco April 1992 Touring show, arena touring show since 2007 Franco Dragone $2.0Md 9.9M Mystère December 1993 Resident show at Treasure Island, Las Vegas Franco Dragone $35M ($20M theater)e 9.2M Alegria April 1994 Touring show; was resident in Biloxi, MI, from 1999 to 2000 Franco Dragone $3.0M 10M Quidam April 1996 Touring show Franco Dragone N/A 8.8M
  • 49. “O” October 1998 Resident show at Bellagio, Las Vegas Franco Dragone $92Mf ($70M theater) 7.2M La Nouba December 1998 Resident show at Disney, Orlando, Florida Franco Dragone $70Mg ($52M theater) 5.4M Dralion April 1999 Touring show Guy Caron $15Mh 6.6M Varekai April 2002 Touring show Dominic Champagne N/A 4.3M Zumanity September 2003 Resident show at New York- New York, Las Vegas René Richard Cyr and Dominic Champagne $50Mi 1.9M Kà November 2004 Resident show at MGM Grand, Las Vegas Robert Lepage $165Mj
  • 50. ($135M theater) 1.8M Corteo April 2005 Touring show Daniele Finzi Pasca N/A 1.8M Delirium January 2006 Arena touring show Michel Lemieux and Victor Pilon N/A 1.2M Love June 2006 Resident show at The Mirage, Las Vegas Dominic Champagne N/A 1.8M Kooza April 2007 Touring show David Shiner N/A 500k Wintuk November 2007 Seasonal resident show at Madison Square Garden, New York City Richard Blackburn $20Mk N/A TOTAL ~70M Source: Compiled by casewriters. aCirque du Soleil website, www.cirquedusoleil.com. bSteve Friess, “‘Cirque Dreams Big,” Newsweek, July 14, 2003. cKonrad Yakabuski, “The Greatest Canadian Company on Earth: From hippies on stilts to global champion: How Cirque du Soleil became a model for reviving the hollowed heart of Canadian business,” The Globe and Mail, August 31 2007. dThomas O’Connor, “AMUSEMENTS // It’s fanciful, it’s new age, it’s a circus // Cirque du Soleil sets up tent in OC,” The
  • 51. Orange County Register, January 24, 1993. eMurray Campbell, “Cirque du Soleil takes a gamble: Why is a cerebral, postmodern circus troupe settling down in the garish heart of the Las Vegas Strip?” The Globe and Mail, November 14, 1992. fJoyce Cohen, “Cirque Du Soleil’s Production ‘0’ Making Quite A Splash In Las Vegas,” Amusement Business, November 23, 1998. gMark Anderson, “Circus to the Stars: How a few buskers named the Cirque du Soleil became the biggest big top of them all,” The Ottawa Citizen, May 13, 2006. hRobert Pogrebin, “Along the Hudson, A Tent of Dreams,” The New York Times, April 6, 2001. iSteve Friess, “‘Cirque’ Dreams Big,” Newsweek, July 14, 2003. jWendell Brock, “Flight of fancy: Cirque du Soleil,” The Atlanta Journal- Constitution, December 15, 2006. k”Le Cirque du Soleil a présenté ‘Wintuk’ en grande première mondiale,” Nouvelles Tele-Radio, November 8, 2007. For the exclusive use of L. BING, 2020. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California - Riverside from Jan 2020 to Mar 2020. 709-411 Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships 12
  • 52. Exhibit 2 Revenues and Tickets Sold Revenues (in Canadian $) Annual Tickets Sold Cumulative Tickets Sold 1992a $ 35M 0.5M 3M 1993b,c $ 50M 1M 4M 1994d $ 80M* 2M* 6M* 1995e $100M 2M* 8M* 1996f $140M 2.5M 10M 1997g $150M 2.5M* 13M* 1998h $180M 2.5M* 15M* 1999i $300M 4M* 19M* 2000j $380M* 4M* 23M 2001k $420M 5M* 28M* 2002l $450M 6M 34M 2003m $475M* 7M 41M* 2004n $500M 7M 48M* 2005 $590M* 7M* 54M 2006o $630M 8M* 61M* 2007p $700M 10M 71M Source: Compiled by casewriters. *Casewriters’ estimate. aMurray Campbell, “Cirque du Soleil takes a gamble: Why is a
  • 53. cerebral, postmodern circus troupe settling down in the garish heart of the Las Vegas Strip?” The Globe and Mail, November 14, 1992. bSallye Salter, “Strong ticket sales keep Cirque du Soleil flying high,” Atlanta Constitution, December 9, 1993. cBrian Dunn, “Cirque du Soleil success built on word of mouth,” The Toronto Star, March 7, 1993. dNina Munk, “A high-wire act: Cirque du Soleil is circus as high art, circus as therapy. And it's profitable,” Forbes, September 22, 1997. ePeter Kuitenbrouwer, “Quebec’s Cirque du Soleil is spinning off troupes like nobody's business, a cash cow generating millions in revenue while wowing audiences all over the world,” The Financial Post, June 22, 1996. fRod McQueen, “Canada’s 50 best managed private companies, Balancing act finds its place in the sun,” The Financial Post, December 14, 1996. gAngela Tan, “Cirque du Soleil aims for C$300 mln in global sales,” Reuter News, May 26, 1998. hIbid. iMatthews Hays, “Cirque du Soleil makes the leap from the big top to the big screen,” The Globe and Mail, May 7, 1999. jZena Olijnyk, “It's showtime for Cirque du Soleil: High-flying troupe sets the stage to brand its image around the globe,” Financial Post, February 26, 2001. kIbid. l“Bread and Cirque—Once a small, struggling company, Canadian circus has soared to new, profitable heights,” The San Francisco Chronicle, November 6, 2002. mMatthew Miller, “The Acrobat: Cirque Du Soleil's Guy Laliberte's trip from busker to billionaire,” Forbes, March 15, 2004. n“Lord of the rings— Face value,” The Economist, February 5, 2005. oNatalia Williams, “Top global marketer: Mario D'Amico Marketing,” Strategy, March 1, 2008.
  • 54. pKonrad Yakabuski, “The Greatest Canadian Company on Earth: From hippies on stilts to global champion: How Cirque du Soleil became a model for reviving the hollowed heart of Canadian business,” The Globe and Mail, August 31 2007. For the exclusive use of L. BING, 2020. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California - Riverside from Jan 2020 to Mar 2020. Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships 709-411 13 Exhibit 3 Selected Theater Construction Costs Location Performance Details Construction Cost Year Kodak Theater Los Angeles Academy Awards 3,100 seats $95Ma 2001 Colosseum Theater Caesar’s Palace, Las Vegas Celine Dion 4,100 seats $95Mb 2003
  • 55. Aqua Theater Wynn Resort, Las Vegas Le Reve, by Franco Dragone 3,000 seats $100Mc (including. show production) 2005 Wynn Theater Wynn Resort, Las Vegas Avenue Q 1,200 seats $40Md 2005 Arts Center (planned) University of Connecticut N/A 800-seat hall, 500-seat theater, & 200-seat studio $65Me 2005 Phantom of the
  • 56. Opera Theater Venetian Hotel- Casino, Las Vegas Phantom of the Opera 1,800 seats $40Mf 2006 Source: Compiled by casewriters. aRockwell Group website, www.rockwellgroup.com. bPeter Henderson, “Celine Dion opens 3-year Las Vegas show,” Reuter News, March 26, 2003. cRobert Hanashiro, “‘Phantom’ is here, in a $40M haunt,” USA Today, June 19, 2006. dBruce Camenga, “Vegas changes its acts/‘Spamalot,’ ‘Phantom of the Opera’ and a wild west production on the marquee,” The Press-Enterprise, May 12, 2006. e“New $65 Million University Arts Center for Connecticut; Plans are set for a performing arts center in Danbury,” New York Construction News, November 1, 2005. fRobert Hanashiro, “‘Phantom’ is here, in a $40M haunt.” For the exclusive use of L. BING, 2020. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California - Riverside from Jan 2020 to Mar 2020.
  • 57. 709-411 Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships 14 Exhibit 4 Selected Production Costs Performance Type/location Details Production cost Year The Lion King Broadway, New York At the time, most expensive production on Broadway $15–$20Ma 1997 Sleeping Beauty Ballet, New York Estimated cost for American Ballet Theater $1.5Mb 2001 La Boheme Broadway, New York Baz Luhrmann's restaging of Puccini classic $8.5M ($2M over budgetc
  • 58. 2002 Celine Dion Pop music, Las Vegas Produced by Franco Dragone $30Md 2003 Phantom of the Opera Musical, Las Vegas More than 3x what it would cost to produce Phantom on Broadway ($10M) $35Me 2004 The Woman in White Broadway, New York Failed Lloyd Webber production (only 120 presentations) $8.5Mf 2006 Oz Can Go to Rio Musical, Australia Touring musical with Hugh Jackman
  • 59. $10Mg 2006 Metropolitan Opera Opera, New York Cost for six new 2008 productions at the Met $9.0Mh ($1.5M /show) 2008 Source: Compiled by casewriters. a“Broadway version of ’The Lion King’ seduces critics,” Agence France-Presse, November 24, 1997. bDoreen Carvajal, “High Staff Turnover Underlines Offstage Turmoil at Ballet Theater,” The New York Times, April 19, 2001. cJesse McKiney, “La Boheme Is to Close After 228 Performances,” The New York Times, June 3, 2003. dAdam Goldman, “Celine Dion takes stage for three-year run in Vegas,” Associated Press, March 23, 2003. eJesse McKinley, “A Revised 'Phantom' Going to Las Vegas as a New Lure,” The New York Times, July 25, 2004. fJesse McKiney, “The Woman in White to Close,” The New York Times, February 4, 2006. gChristine Sams, “It'll take $21 million before the producers from Oz can go to Rio,” The Sun-Herald, May 21, 2006. hJudith H. Dobrzynski “A Knight at the Opera: Big Plans— Large Bills,” The Wall Street Journal, April 24, 2008. For the exclusive use of L. BING, 2020.
  • 60. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California - Riverside from Jan 2020 to Mar 2020. Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships 709-411 15 Exhibit 5 Excerpt of U.S. and Canada Spring/Summer 2008 Saltimbanco Tour Plan City Dates Number of Shows Ticket Price* Cedar Rapids, IA April 23–April 27 8 $40–$60 Level 3-2 $70–$90 Level 1-0 Albuquerque, NM May 14– May17 6 $40–$60 Level 3-2 $70–$90 Level 1-0 Boise, ID May 21–May 25 8 $40–$60 Level 3-2 $70–$90 Level 1-0 Victoria, BC May 29–June 1 8 $40–$60 Level 3-2 $70–$90 Level 1-0 Kelowna, BC June 4–June 8 7 $40–$60 Level 3-2 $70–$90 Level 1-0 Kamloops, BC June 11–June 15 9 $40–$60 Level 3-2 $70–$90 Level 1-0
  • 61. Edmonton, AB June 18–June 22 9 $40–$60 Level 3-2 $70–$90 Level 1-0 Saskatoon, SK June 25–June 29 7 $40–$60 Level 3-2 $70–$90 Level 1-0 Regina, SK July 2–July 6 8 $40–$60 Level 3-2 $70–$90 Level 1-0 Winnipeg, MB July 9–July 13 9 $40–$60 Level 3-2 $70–$90 Level 1-0 Kansas City, MO July 16–July 20 7 $40–$60 Level 3-2 $70–$90 Level 1-0 Toronto, ON Aug 13–Aug 24 16 $40–$60 Level 3-2 $70–$90 Level 1-0 Hamilton, ON Aug 27–Aug 31 8 $40–$60 Level 3-2 $70–$90 Level 1-0 Amherst, MA Sept 3–June 7 8 $40–$60 Level 3-2 $70–$90 Level 1-0 * Ticket categories are: Premium (Level 0), Level 1, Level 2, and Level 3. Source: Cirque du Soleil website, www.cirquedusoleil.com, accessed April 24, 2008. For the exclusive use of L. BING, 2020. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California -
  • 62. Riverside from Jan 2020 to Mar 2020. 709-411 Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships 16 Exhibit 6 Cirque du Soleil Planned Productions as of Spring 2008 Show Opening Date Type of Show Partner Stage Director Venetian Macao Summer 2008 Resident Las Vegas Sands Gilles Maheu Criss Angel Summer 2008 Resident show at Luxor Resort, Las Vegas MGM Mirage Serge Denoncourt Tokyo Disney Summer 2008 Resident Disney François Girard Touring 2009 April 2009 Touring None Deborah Colker Elvis-themed show Autumn 2009 Resident show at City Center, Las Vegas MGM Mirage and CKX
  • 63. N/A Touring 2010 2010 Touring None N/A Macao #2 2010 Resident Las Vegas Sands René Simard Dubai 2010 2010 Resident Nakheel (Dubai World) Guy Caron and Michael Curry Source: Cirque du Soleil website, www.cirquedusoleil.com, accessed June 17, 2008. For the exclusive use of L. BING, 2020. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California - Riverside from Jan 2020 to Mar 2020. Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships 709-411 17 Exhibit 7 MGM Mirage Inc. Annual Income Statement ($ in thousands) 31-Dec-07 31-Dec-06 31-Dec-05 31-Dec-04 31-Dec-03
  • 64. Casino $3,239.1 $3,130.4 $2,764.5 $2,080.8 $2,037.5 Rooms 2,130.5 1,991.5 1,634.6 889.4 833.3 Food & Beverage 1,651.7 1,483.9 1,271.7 807.5 757.3 Entertainment/Other 560.9 459.5 426.2 268.6 256.0 Retail 296.1 278.7 253.2 181.6 180.9 Other 519.4 452.7 339.4 184.2 210.8 Less Promotional Allowance -706.0 -620.8 -560.8 -410.3 -413.0 Total Revenue $7,691.6 $7,176.0 $6,128.8 $4,001.8 $3,862.7 Casino $1,677.9 $1,613.0 $1,422.5 $1,028.4 $1,050.4 Rooms 570.2 539.4 454.1 237.8 235.9 Food & Beverage 984.3 902.3 782.4 462.9 436.9 Entertainment 399.1 333.6 305.8 191.3 183.1 Retail 190.1 179.9 164.2 116.6 115.2 Other 317.6 245.1 188.0 101.8 130.7 General & Administrative 1,140.4 1,070.9 889.8 565.4 585.2 Corporate Expenses 193.9 161.5 130.6 77.9 61.5 Preopening & Start-Up Expenses 92.1 36.4 15.8 10.3 29.3 Restructuring Costs 0.0 1.0 -0.1 5.6 6.6 Gain on CityCenter transaction -1,029.7 0.0 0.0 - - Property Transactions -186.3 -41.0 37.0 8.2 -18.9 Depreciation & Amortization 700.3 629.6 560.6 382.8 400.8 Unconsolidated Affiliate -222.2 -254.2 -151.9 -119.7 -53.6 Total Operating Expense $4,827.7 $5,417.7 $4,798.8 $3,069.2 $3,163.0 Interest Income $17.2 $11.2 $12.0 $5.7 $4.1 Interest Expense -924.3 -882.5 -670.3 -390.6 -337.6 Interest Capitalized 216.0 122.1 29.5 23.0 - Non-opts. Affiliate -18.8 -16.1 -15.8 -12.3 -10.4 Other, Net 4.4 -15.1 -18.4 -9.6 -12.2
  • 65. Net Income Before Taxes $2,158.4 $977.9 $667.1 $548.8 $343.7 Provision for Income Taxes $757.9 $341.9 $231.7 $203.6 $113.4 Net Income After Taxes $1,400.5 $636.0 $435.4 $345.2 $230.3 Net Income Before Extra. Items $1,400.5 $636.0 $435.4 $345.2 $230.3 Gain on Disposal of Discontinued Operations 265.8 0.0 0.0 - - Discontinued Operations 10.5 18.5 11.8 101.2 13.4 Tax—Discontinued Operations -92.4 -6.2 -3.9 -34.1 - Net Income $1,584.4 $648.3 $443.3 $412.3 $243.7 Source: MGM Mirage Annual Reports, www.mgmmirage.com, accessed February 12, 2009. For the exclusive use of L. BING, 2020. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California - Riverside from Jan 2020 to Mar 2020. 709-411 Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships 18 Exhibit 8 MGM Mirage EBITDA Analysis on Selected Resorts
  • 66. Trailing Twelve Month EBITDA - New York-New York (in thousands of $) $0 $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 $140,000 $160,000 2002 Q1 2002 Q2 2002 Q3 2002 Q4 2003 Q1 2003 Q2 2003 Q3
  • 67. 2003 Q4 2004 Q1 2004 Q2 2004 Q3 2004 Q4 2005 Q1 2005 Q2 2005 Q3 2005 Q4 2006 Q1 2006 Q2 2006 Q3 2006 Q4 2007 Q1 2007 Q2 2007 Q3 2007 Q4 Opening of CdS show Zumanity
  • 68. Sept. 20, 2003 Trailing Twelve Month EBITDA - MGM Grand (in thousands of $) $0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 $400,000 $450,000 2002 Q1 2002 Q2 2002 Q3 2002 Q4 2003 Q1
  • 69. 2003 Q2 2003 Q3 2003 Q4 2004 Q1 2004 Q2 2004 Q3 2004 Q4 2005 Q1 2005 Q2 2005 Q3 2005 Q4 2006 Q1 2006 Q2 2006 Q3 2006 Q4 2007 Q1 2007 Q2 2007 Q3
  • 70. 2007 Q4 Opening of CdS show Kö Nov. 26, 2004Upgrade of rooms and increased room rate Source: MGM Mirage 10-K SEC filings from www.sec.gov and supplementary financial reports from www.mgmmirage.com, accessed February 12, 2009. For the exclusive use of L. BING, 2020. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California - Riverside from Jan 2020 to Mar 2020. Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships 709-411 19 Exhibit 8 (continued) Trailing Twelve Month EBITDA - The Mirage (in millions of $) $0 $50,000
  • 71. $100,000 $150,000 $200,000 $250,000 $300,000 2002 Q1 2002 Q2 2002 Q3 2002 Q4 2003 Q1 2003 Q2 2003 Q3 2003 Q4 2004 Q1 2004 Q2 2004 Q3 2004 Q4 2005 Q1
  • 72. 2005 Q2 2005 Q3 2005 Q4 2006 Q1 2006 Q2 2006 Q3 2006 Q4 2007 Q1 2007 Q2 2007 Q3 2007 Q4 Opening of CdS show Love June 30, 2006 Closing of Siegried & Roy show October 3, 2003 Trailing Twelve Month EBITDA for MGM Grand, Mirage and NY-NY
  • 73. $449 $470 $482 $472 $466 $482 $481 $498 $536 $551 $553 $609 $620 $652 $688 $690 $693 $400 $450 $500 $550 $600 $650 $700 $750 $800
  • 74. t-10 t-9 t-8 t-7 t-6 t-5 t-4 t-3 t-2 t-1 t0 t+1 t+2 t+3 t+4 t+5 t+6 Quarters from the opening of Cirque du Soleil show (t0 = opening show quarter) TT M E B IT D A ( in m ill io ns o f $ ) Source: MGM Mirage 10-K SEC filings from www.sec.gov and supplementary financial reports from www.mgmmirage.com. For the exclusive use of L. BING, 2020.
  • 75. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California - Riverside from Jan 2020 to Mar 2020. 709-411 Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships 20 Endnotes 1 Bertrand Marotte, “Report on Business: Keep your growth and uniqueness in balance,” The Globe and Mail, April 29, 2006. 2 Casewriters’ interview with François Macerola, Montreal, May 2008. 3 Casewriters’ interview with Daniel Lamarre, Montreal, May 2008. 4 Konrad Yakabuski, “The Greatest Canadian Company on Earth: From hippies on stilts to global champion: How Cirque du Soleil became a model for reviving the hollowed heart of Canadian business,” The Globe and Mail, August 31, 2007. 5 Ibid. 6 Forbes website, 2008 list of billionaires, www.forbes.com/lists.
  • 76. 7 Christopher Palmeri, “The $600 Million Circus Maximus; How Cirque du Soleil keeps the blockbusters coming,” BusinessWeek, December 13, 2004. 8 Tony Babinski, Cirque du Soleil 20 ans sous le soleil, Hurtubise editions, 2004, p. 95. 9 Matthew Miller, “The Acrobat: Cirque Du Soleil’s Guy Laliberté’s trip from busker to billionaire,” Forbes, March 15, 2004. 10 Tony Babinski, Cirque du Soleil 20 ans sous le soleil, p. 96. 11 Michael Paskevich, “Stars turn out for Treasure Island’s ‘Mystere’ opening,” The Las Vegas Review-Journal, January 23, 1994. 12 Joyce Cohen, “Cirque Du Soleil’s Production ‘0’ Making Quite A Splash In Las Vegas,” Amusement Business, November 23, 1998. 13 Mark Anderson, “Circus to the Stars: How a few buskers named the Cirque du Soleil became the biggest big top of them all,” The Ottawa Citizen, May 13, 2006. 14 Bertrand Marotte, “Report on Business: Keep your growth and uniqueness in balance,” The Globe and Mail, April 29, 2006. 15 Foster Smith, “Circus founder, doughnut maker, among richest 100: Thomson retains no. 1 spot,” National Post, July 24, 2000. 16 Christopher J. Chipello, “All the World Is a Stage for Cirque du Soleil—Circus Company Seeks Partnerships to Create Entertainment Centers,” The Wall Street
  • 77. Journal, July 18, 2001. 17 Alan Freeman, “Cirque boss plans global complexes: Theatres, galleries, hotels, restaurants and spas slated for centres to be built over next decade,” The Globe and Mail, December 12, 2000. 18 Casewriters’ interview with Daniel Lamarre, Montreal, May 2008. 19 Bertrand Marotte, “Report on Business.” 20 Glenn Collins, “In Center Ring: Randalls Island?” The New York Times, April 24, 2003. 21 Nina Munk, “A high-wire act: Cirque du Soleil is circus as high art, circus as therapy. And it’s profitable,” Forbes, September 22, 1997. 22 Christina Almeida, “KA the latest Cirque du Soleil extravaganza—opens in Vegas,” Associated Press, February 4, 2005. 23 Cirque du Soleil website, www.cirquedusoleil.com, accessed April 24, 2008. 24 Based on casewriter’s calculations. For the exclusive use of L. BING, 2020. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California - Riverside from Jan 2020 to Mar 2020.
  • 78. Cirque du Soleil—The High-Wire Act of Building Sustainable Partnerships 709-411 21 25 Christopher Palmeri, “The $600 Million Circus Maximus.” 26 Bruce Adams, “Rolling the dice: MGM Mirage, Mandalay merger would create world’s largest gaming and leisure company,” Hotel & Motel Management, July 19, 2004. 27 Ibid. 28 Hoovers, www.hoovers.com. 29 Konrad Yakabuski, “The Greatest Canadian Company on Earth.” 30 Matthew Miller, “The Acrobat.” 31 Christopher Palmeri, “The $600 Million Circus Maximus.” 32 MGM Mirage Q4 2004 Earnings Conference Call. 33 Deena Beasley, “MGM Mirage second-quarter profit rises 34 percent,” Reuters News, July 28, 2005. 34 MGM Mirage Q4 2005 Earnings Conference Call. 35 Casewriters’ interview with Robert Blain, Montreal, May 2008. 36 Ibid.
  • 79. 37 Ibid. 38 Konrad Yakabuski, “The Greatest Canadian Company on Earth.” 39 Casewriters’ interview with Robert Blain, Montreal, May 2008. 40 Konrad Yakabuski, “The Greatest Canadian Company on Earth.” 41 Casewriters’ interview with Daniel Lamarre, Montreal, May 2008. For the exclusive use of L. BING, 2020. This document is authorized for use only by LINTING BING in BUS 109-030 taught by Paul Kirwan, University of California - Riverside from Jan 2020 to Mar 2020. << /ASCII85EncodePages false /AllowTransparency false /AutoPositionEPSFiles true /AutoRotatePages /None /Binding /Left /CalGrayProfile (Gray Gamma 2.2) /CalRGBProfile (sRGB IEC61966-2.1) /CalCMYKProfile (U.S. Web Coated 050SWOP051 v2) /sRGBProfile (sRGB IEC61966-2.1) /CannotEmbedFontPolicy /Error /CompatibilityLevel 1.3 /CompressObjects /Off /CompressPages true /ConvertImagesToIndexed true /PassThroughJPEGImages true
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