Damned subtle wordings....

[McPerth]

Where in canon did you read that?? Library Data A-M: "Tukera Lines operates a vast fleet of passenger and freight vessels throughout the Imperium, following the xboat lines. In some subsectors (particularly the older, more established regions of the Imperium) Tukera Lines has a virtual monopoly on long distance shipping and travel." How does one manage a monopoly on shipping without shipping other people's goods?

I don't know to what extent it can be considered canon, and it's MT, not CT, but IIRC (I have not my book handy now) in Starship Operator Manual there was quoted that those megacorporation are not freight companies, but trade companies that buy and sell goods, instead of only freighting them.

Of course I guess they also handle freight, but, as I understand them, I agree with Mike that most of its profit comes from speculation, not from freight/passenger transport (but I agree that's my guess and understanting, not canon)

Fine, now support your assertion in a manner that speaks to the examples given - namely, how a jump-4 transport comes into existence and becomes "typical of its [Tukera's] fleet" (Traveller Adventure) when it takes up to a century for the thing to earn back the money spent to build it while other alternatives could return the investment in 20 years. Clever debating phrases like "pat 'logic'" do not take the place of evidence, and saying things are "interconnected" and "humans are't universally logical" are handwavium, not explanations. Note my discussion of possible sociological explanations below.

Not to this extreme; most investors expect to at least make the money back in their lifetimes, not their grandchildrens'. Some investments don't pan out, some experiments fail, but something which is described as "typical of its fleet" is supposed to be successful.

This goes beyond design. It is impossible to make a jump-4 merchantman that returns a reasonable profit in a reasonable time - reasonable being interpreted as anything that might persuade a potential investor to put his money there instead of in any one of a billion other potential ventures. Not a case of poor design - it's a case of the rules making it impossible. Whether it's big returns for big risk or small returns for small risk, someone investing for profit does tend to expect a return in their lifetime.

I have entertained the notion of significant cultural differences: that these people make their billions in some other way and then enforce fiat pricing rules and sink money into things like jump-4 merchantment out of some sense of noblesse oblige or "rich man's burden" rather than in pursuit of profit, in an effort to actively promote an interstellar economy and society. In short, they are more social engineers than yankee traders. Perhaps history has taught them that actively promoting interstellar trade results in fewer wars and fewer bombs being dropped from orbit, an unhealthy state of affairs for any billionaire's investments.

I have not run the numbers, but I guess those same jump 3/4 ships would do some profit if paid in full, without financing (financing the ship acounts for a 120% ship cost increase). If so, I guess a megacorp like Tukera could well buy its ships without financing them, investin part of its profits on it, and so the main cost will be forfeited (or, if you want to be precise, reduced to a 41.66% of what rules say, and so paying the initial investment in the usual 40 years) allowing it, along with some speculation, to make some profit.

 

[BytePro]

Carlobrand,

I've worked for several near Fortune 500 companies. I won't mention names, but from them I can provide plenty of RW examples related to this discussion - though I will limit this here for, er, brevity...

Once worked for a publicly traded company that grossed ~$1.8 billion annually with 98% margin. We were not supposed to make a profit. The family that basically owned them used it as a 'tax sump'. We 'updated' $180 million in unused warehoused computers several times, just to spend our budget. Leased facilities to IBM at a loss. Bought and didn't use for 3 years an $18 million+ massively parallel supercomputer. Advertised in every market in the country regardless of not having locations or competition. That company has been operating that way for over 20 years. It has at least 60% of the market sector and could easily have it all. The family who basically controls the strings does this with other companies in very diverse markets. They have been doing such for over 200 years.

Lowe's, Home Depot, and the like sell lumber at extremely low margins, if not net losses. Yet, if they don't sell lumber they won't sell hammers, nails, power tools, paint, paneling, etc. Worked for an outfit that paid 6 figures every year for 'research' to determine if lumber should be sold because some new genius looked at the margins. I.e. pat 'logic' based on an oversimplification of an interconnected system. (Feel free to wave hands.)

So, selling lumber for basically nothing is required to make profits elsewhere - prices became fixed somewhere along the line. Inadvertent collusion between the big players and perceived market perception. If one raises the price of lumber to make a competitive profit with other goods - they will lose in the market.

Exceptional? Sure. But, it exists nonetheless, and I see no reason similar 'illogical' situations couldn't exist in the settings Traveller canon creates...

THE J-4 example:

For J-4 routes it doesn't matter a darn if the ships can't 'make a profit' - high margin goods can't move otherwise. Not disagreeing with the low margin math - rather the presumption that such is the overriding factor in all markets or endeavors. Such routes would have to compete with other routes, irrespective of parsecs... so, by the logic provided, that would remove the incentive to even have J-4 routes. The J-4 example becomes a case of market pressure causing 'price fixing'.

Getting goods to market is an integral part of trade. A megacorp does not have to own the goods - the 'owners' (majority) could, and likely would, have a vested interest in trade. This is probably even more the case in a 'nobility' run setting. If only one of these special cases sets the price point low - nobody else is going to be able to 'compete' with higher prices. Those who want to, and can live (or think they can) with the low margins will have little choice but to stick to the 'fixed prices'.

RE: Canon

Sure, the quoted text stated Player Characters - but not only did it not exclude NPCs explicitly, the follow on canon text did not limit itself to PCs. You didn't address the full text of that post - notably:

Then there is the next paragraph about working passages; captains serving as pilots or navigators and drawing pay from profits; not all crew positions being required on all ships; crew performing multiple positions.

Then, there is the canon that provides ships shares in char gen that seems to be completely forgotten in these discussions...

That is canon and directly contradicts your 'At the point where you're doing the math with a fraction of the standard salaries, you're already non-canon'. Canon supports such things as a 2 person crew where 4 would otherwise be required, but with only one drawing a salary... thus, a fraction of the standard salaries. If the crew are PCs, they may each take a lower salary or none. If some crew are taken on for working passage (NPC or PC), they can be paid no salary for upto three trips. Its all spelled out in LBB 2 and most definitely canon.

BTW: Another option that isn't speculative nor freight - a J-4 ship making a J-2 run can have half its tanks holding sell-able refined fuel (HG provides for a profit scenario), or even other, higher margin, liquid cargoes... don't recall any canon stating L-Hyd tanks can only be used for L-Hyd, nor that they are one big tank.

For my part, I don't use any fixed pricing except the passage tickets from chargen. However, I handle 'passages' as vouchers for a particular travel line (government run) - independents and local lines all have different rates - though the tickets are treated like cash, since the government run banks will trade them in for credits. I don't worry about the economy of the setting - that takes care of itself. Fixed, mixed-profit freight rules and such are much more believable than being able to go to any number of worlds and buy widget X for price Z regardless of quantity...

 

[BytePro]

P.S. - something non-canon breaking, perhaps...

In the U.S., one's 'salary' usually refers to the annual gross, not one's net. Taxes, retirement and medical insurance typically come out of that - an appreciable amount. (Of course, companies have overhead - their portion of payroll taxes and other contributions plus facilities, equipment, utilities, etc.)

Starship crews, working in shifts, are still making use of lifesupport, meals, lodging and medical in their 'off hours'. Nothing says, esp. with megacorps, that their salaries don't have monies taken out for these 'benefits'.

Ex: take monthly life support and 1/2 or 2/3 of a day not onduty and that is a nice chunk of change deducted from a paycheck. Then there could be some per stateroom, per medical personnel benefit charges and a surcharge for lodging aboard ship during shore leave. Then there are other ways (unfortunately employed in the RW) to nickel and dime personnel - such as a clothing (uniform) charge and laundering fee (given policy requiring clean, company uniforms while on duty) and upfront fee to be employed (in case of breach of contract and/or travel back to a home port). I can easily see the actual net outlay to a corporation for crew salaries being 50% or less than the listed salaries. Lines that can't adequately profit in a fixed price market will invariable seek to make up the difference in other areas - taking advantage of crew is an obvious one.

This is not spelled out in the rules and I'm just throwing it out there for those who like to play math games with the rules - however, neither is who pays for LS and maintenance, IIRC.

 

[christopher.boote]

For example ... and I trust you aren't going to point to governments, because we've already suggested that some of the illogical rules stemmed from government fiat. What examples do you have of profit-making private enterprises colluding in ways counter to their self-interests?.

Cigarette manufacturers in the 1970s
They colluded over their ad spend, knowing full well that this was wasted money, as almost no one ever switched brand after starting smoking
The reason was that they judged that any 'new upstart' that came along and didn't spend money on advertising wouldn't get a foothold in their market (this turned out not to be true in Europe with the 'Death' brand that had zero advertising and plain white packets*)

Note that the product the sold was more-or-less identical in manufacturing & distribution costs, and sold for more-or-less the same price to the retailer & consumer, so the only things that they could see to differentiate themselves from each other was advertising, sponsorship and packaging

When cigarette advertising started to be banned throughout the western world,they once again colluded - this time to their advantage - to reduce their spend by the same percentages, thus increasing their profits with no appreciable change in market share

* and like all true megacorporations, they bought the brand out and divvied it up between themselves

 

[BillDowns]

So, ignoring the side trip on program testing, or cigarette companies, what is being discussed? Whether per parsec pricing is allowed, or whether J-4 (or other higher jump) ships can be profitable?

 

[Cryton]

So, ignoring the side trip on program testing, or cigarette companies, what is being discussed? Whether per parsec pricing is allowed, or whether J-4 (or other higher jump) ships can be profitable?

Yes. Sorry if my answer confuses.

 

[far-trader]

So, ignoring the side trip on program testing, or cigarette companies, what is being discussed? Whether per parsec pricing is allowed, or whether J-4 (or other higher jump) ships can be profitable?

Originally, that the rules as written can be interpreted to have two possible contradictory meanings. Pricing per jump vs pricing per parsec.

I still don't see it myself.

 

[BytePro]

I see it only if you take one possible interpretation of a single sentence out of context (even ignoring all other sources). The context includes clarifications that explicitly narrow the meaning down to just price per jump, not price per parsec.

A similar thing can happen with a good many rules as written.

The price per jump vs price per parsec question is directly tied to the age old J-4, etc. profitability question...

 

[rancke]

I can't see that there's any room for doubt that the rules are talking about per-jump pricing. I just think the rules are talking through their hat when they talk about per-jump pricing.

Though, it's possible to come up with a fix that introduces per-parsec pricing while retaining high, middle, and low passages.


Hans

 

[BillDowns]

Well, if I was restricted to per-jump pricing, but wanted a J3 freighter, I would only do long-range shipping by charter. Then, I can set my own price, and all by the rules.

Whomever is paying for the shipping costs benefits by getting it quicker, and for anything over 3 parsecs, cheaper, than by per-jump pricing.

So, one way or another, I get per-parsec pricing.

 

[BillDowns]

Okay, let me rephrase this part

Whomever is paying for the shipping costs benefits by getting it quicker, and for anything over 3 parsecs, cheaper, than by per-jump pricing.

Its cheaper for any system that is NOT on a J1 main. And even then, it sometimes will be. The only systems that benefit from per-jump pricing would be those on a J1 main and only when shipping short distances.

 

[BillDowns]

Speaking of subtle wordings, for Passenger generation, Book 2, p 11, says "Tech Level: add (or subtract) difference between origin and destination ."

So, does that mean subtract Destination Tech Level from Origin Tech Level, or the other way around?

 

[robject]

As with many things in the CT rules a lot is open to interpretation, and there were mistakes made.

My top 4 are:

[...]
4- getting the jump drive % and manoeuvre drive % numbers transposed in HG1st edition

I've said it before, but that is a fascinating topic-starter.

 

[Carlobrand]

I don't know to what extent it can be considered canon, and it's MT, not CT, but IIRC (I have not my book handy now) in Starship Operator Manual there was quoted that those megacorporation are not freight companies, but trade companies that buy and sell goods, instead of only freighting them..

Ooh, I have that one. That would be a comment by the "Old Timer" about Tukera: "Let me fill you in on a little secret. Tukera Lines isn't a transport company. Sure, they transport things, [emphasis added] but that's not where they make their money. Tukera Lines is a trading company. Most of their loads consist of goods that they own, bought at one world and resold at the next for profit."

That's DGP, which I think is generally considered canon. It's an off the cuff remark by the "Old Timer", which doesn't exactly make it scripture, but as canon sources go, a seasoned NPC insider is pretty close to the top of the list. It's a great explanation for how a jump 3-4 transport can make a profit; they still transport, and they present themselves as a transport company, but the majority of their income comes from speculative trade - a potentially lucrative trade, as we all know. Tukera's certainly better capitalized for that kind of game than the smaller operators, and they have the depth to do things like own warehouses and run marketing and distributing operations for the goods they're selling.

Doesn't mention the other Megas, but it's a safe bet they follow a similar pattern.

...I have not run the numbers, but I guess those same jump 3/4 ships would do some profit if paid in full, without financing (financing the ship acounts for a 120% ship cost increase). If so, I guess a megacorp like Tukera could well buy its ships without financing them, investin part of its profits on it, and so the main cost will be forfeited (or, if you want to be precise, reduced to a 41.66% of what rules say, and so paying the initial investment in the usual 40 years) allowing it, along with some speculation, to make some profit.

My numbers say a shipper can make a very healthy profit if the ship's paid in full - he gets his profit plus the money that would usually go to the bank. He can also show a nice profit in circumstances that would otherwise be break-even - again, he gets the money that would otherwise go to the bank. So, marginal ships are profitable for a company that can buy them outright. Then too, as someone pointed out, if you own a construction yard outright, you're buying the ship for "wholesale" cost instead of cost plus whatever profit the yard might seek - your ship costs a bit less. So, megas can turn a profit where smaller enterprises might face a loss.

Still, that fails - in my opinion - when the ship can't earn back its base cost in a reasonable time. 40 years is a reasonable time to at least pay off the base cost of the ship, since there's no interest to worry about. On that score, the jump-4 models are a seriously troubled breed - one of the examples took a century to earn back its price. On the other hand, jump-4 puts a lot of potentially lucrative trade routes on the table for speculative trading - I've never factored that in before. Combined with the no-interest thing, it could indeed make a fair profit on the right routes.

Curses. Gotta go re-evaluate my assumptions now.

 

[McPerth]

Ooh, I have that one. That would be a comment by the "Old Timer" about Tukera: "Let me fill you in on a little secret. Tukera Lines isn't a transport company. Sure, they transport things, [emphasis added] but that's not where they make their money. Tukera Lines is a trading company. Most of their loads consist of goods that they own, bought at one world and resold at the next for profit."

That's DGP, which I think is generally considered canon. It's an off the cuff remark by the "Old Timer", which doesn't exactly make it scripture, but as canon sources go, a seasoned NPC insider is pretty close to the top of the list. It's a great explanation for how a jump 3-4 transport can make a profit; they still transport, and they present themselves as a transport company, but the majority of their income comes from speculative trade - a potentially lucrative trade, as we all know. Tukera's certainly better capitalized for that kind of game than the smaller operators, and they have the depth to do things like own warehouses and run marketing and distributing operations for the goods they're selling.

This will be (IMHO) akin to the old honored practice of some (most?) subsized mershant skippers to buy some of their own ship's hold tonnage to carry speculative goods, so that the proffits will be their's not ship's, and so they don't have th share them with the subsider.

My numbers say a shipper can make a very healthy profit if the ship's paid in full - he gets his profit plus the money that would usually go to the bank. He can also show a nice profit in circumstances that would otherwise be break-even - again, he gets the money that would otherwise go to the bank. So, marginal ships are profitable for a company that can buy them outright. Then too, as someone pointed out, if you own a construction yard outright, you're buying the ship for "wholesale" cost instead of cost plus whatever profit the yard might seek - your ship costs a bit less. So, megas can turn a profit where smaller enterprises might face a loss.

Still, that fails - in my opinion - when the ship can't earn back its base cost in a reasonable time. 40 years is a reasonable time to at least pay off the base cost of the ship, since there's no interest to worry about. On that score, the jump-4 models are a seriously troubled breed - one of the examples took a century to earn back its price. On the other hand, jump-4 puts a lot of potentially lucrative trade routes on the table for speculative trading - I've never factored that in before. Combined with the no-interest thing, it could indeed make a fair profit on the right routes.

If this example took a century to earn back its price and the price you had for the numbers included financing (you didn't specify that), then having to pay just 41.66% of this price puts it quite close to the 40 years you say.

If you add that megacorps

1) may build themselves their ships (as you said);
2) may own the producing centers (so lowering the buying prices);
3) may own storehouses in planets where they make scheduled routes, allowing them to shorten the stops in a system (someone said in another thread they could make up to 3 jumps a month, instead than 2);
4) may own shipyards to make the maintenance, lowering its costs

and probably more, you'll see that probably jump 4 is profitable to them, while not for the ocasional independent trader.

Curses. Gotta go re-evaluate my assumptions now.

My apologies for any additional work that gives to you

 

[mike wightman]

Megacorps also have that most useful of NPCs as an employee - the broker.

 

[McPerth]

Megacorps also have that most useful of NPCs as an employee - the broker.

Well, I assumed them on the storehouses, as part of its staff...

The only systems that benefit from per-jump pricing would be those on a J1 main and only when shipping short distances.

And here might be one of the reasons Imperial Regulations make the prices per jump and not per parsec. By benefiting the J1 ships as tramp freighters, they force them to visit some planets that probably will be otherwise ignored, so helping their trade and keeping them in touch with the rest of the Imperium (even if in a limited way).

 

[BillDowns]

And here might be one of the reasons Imperial Regulations make the prices per jump and not per parsec. By benefiting the J1 ships as tramp freighters, they force them to visit some planets that probably will be otherwise ignored, so helping their trade and keeping them in touch with the rest of the Imperium (even if in a limited way).

I could almost agree with that, except I don't think it would actually work that way, and there are plenty of important systems that are too unreachable. Take Jewell, for example. The only way it can be reached by a J2 ship from Regina is through a very circuitous route through extra-Imperial systems - 8 jumps at best with 6 out of the Imperium. But with J3, 4 jumps, all inside the Imperium.

 

[BillDowns]

Just as an experiment, I am working on an example fixed-route try at a J4 passenger liner to see what the profit/loss would be. From Junidy to Aramis and back. Will post back when I have a ship designed to meet the workload. Here's what I came up with for a projected workload.

Route  Leg  Start     End      Distance HighBerths MiddleBerths LowBerths
1      1    Junidy    Aramanx  4        33.5       44           65
1      2    Aramanx   Patinir  3        34.5       45           66
1      3    Patinir   Aramis   3         9.5        9.5         16.5
2      1    Aramis    Patinir  3         7.5        7.5         18
2      2    Patinir   Aramanx  3        14.5       14.5         32
2      3    Aramanx   Junidy   4        19         22.5         29.5

 

[aramis]

Las night, Cryton and I cranked out a 5KTd Bk2 J2 freighter...


J2 5KTd
5000 _550 SL Hull *
_100 __25 Bridge
___1 ___4 Mod/1bis
_125 _240 JD Z=1
__47 __96 MD W=1
__84 _192 PP W=1
__20 ___0 PFuel
1000 ___0 JFuel
_200 __25 Crew SRx50
3423 ___0 Cargo
5000 1132 Totals
MCr1018.8 Std Disc

8E 3xP, N M 3A R24

4245000 MP
__84900 Ann. Maint Reserve
1010000 Fuel 2j2+4wkPP2
__18600 CO XO P
___5000 N
___4000 M
__32400 10xE
___6000 3xA
__24000 22xRatings (Tot Crew Sal 90K)
_200000 LSx50
5629900 Monthly Op Cost
6846000 Income/mo maximum

Cr822.37/Td/Jump
Cr411.19/Td/Pc


Now, if it only does J1, the cost/Td/Jump goes to Cr749.33/Td/J1, as fuel per month doing J1's drops to 510,000/mo

And the comparable J1 version:

5000 _550 SL Hull *
_100 __25 Bridge
___1 ___2 Mod/1
_110 _210 JD W=1
__41 __84 MD W=1
__84 _168 PP W=1
__10 ___0 PFuel
_500 ___0 JFuel
_200 __25 Crew SRx50
3954 ___0 Cargo
5000 1064 Totals
MCr957.6 Std Disc

7E 3xP, N M 3A R25

3990000 MP
__79800 Ann. Maint Reserve
_505000 Fuel/Mo 2j1+4wkPP1
__18600 CO XO P
___5000 N
___4000 M
__28400 10xE
___6000 3xA
__25000 22xRatings (Tot Crew 102000/mo)
_200000 LSx50
4867800 Monthly Op Cost

Cr615.56/Td/j1

Note that BOTH can charge Cr1000/Jump and make money.
(Note also: A J3 version can't be done under Bk2 due to drive table limits.)