ROI Accounting Assumptions

Financial Considerations

  Fixed Costs

    Assumptions

    Encoder Vendors

  Variable Costs:

    Labor

    Maintenance

    Stock

  Payback Period

  Make vs. Buy

No "Add-Ons"

Great Support

1,440 productive hours in an employee year

• Nominal work week is 40 hours.
• 48 week year allows two weeks for vacation and two weeks for sick leave accrual.
• 30 hour productive work week leaves room for employee interaction.

$29.76/hr weighted labor cost per hour captioning

• $30,000 annual "take home" wage.
• 30% additionally to weight for benefits and employer contributions [$30,000 take home + $12,857 in benefits/contributions = $42,857 annual employee cost].
• 1,440 of 2,080 hours annually are directly productive [$42,857 annual employee cost ÷ 1,440 productive hours per year = $29.76 weighted cost per productive hour].

8 year straight-line depreciation

• Most computer and professional video equipment has a practical economic life of 5 years.
• 8 years of straight line depreciation allows some recovery value.

$12,930 capital investment

• $8,000 for AutoCaption II
• $1,400 for a Windows 2000® computer with 512Meg RAM, 1.4 GHz Pentium CPU and monitor (Note: on the secondary market Windows 2000® is less expensive than XP®).
• $2,500 for a VHS/SVHS VTR with a built-in time code reader and RS-422 remote control port.
• $30 for cables.

It takes 6 hours to caption 1 hour of video

But in the real world this isn't a constant number.  Depending on the complexity of the project captioning an hour of video can take from a "mere" four hours to a rare (thankfully) 10 hours.

• And that excludes transcription time because the client typically provides a script or transcript.  Add 4 hours per hour of video for transcription by a competent transcriptionist.
• 2 hours are typically spent editing captions and checking the spelling of names and terms-of-art used in the video.
• 1.5 hours are spent deciding when and where each caption will appear.
• 1 hour is spent in client care, unplanned activities, setup, and training.  For example, figuring out how to effectively describe a comic's falsetto voice to deaf viewers.
• 0.5 hours making client changes.
• 1 hour encoding the video.

The market price for 1 hour of captioning is $800

There's a wide range in both caption quality and what's charged for captioning.

A casual quote from a large captioning enterprise may be $1,200 for a half hour, a high-end independent captioner might quote $450 for a half hour, and a low end captioner may advertise rates as low as $275 for a half hour.

But based on our relationships with professional captioners, we believe $800 per hour is an appropriately conservative estimate for this exercise.

Important Legal Notice:  Information herein is based on generalizations, estimates, and educated guesses.  Your actual experience may vary, so it is important to perform and rely on your own management analysis.