Atoms or electrons: How does Hasbro make money?

The global supply chain reaches all the way from Rhode Island to China and back.  Tonka trucks, GI Joe action figures and my Little Pony are all real products sold to real kids.

The global supply chain reaches all the way from Rhode Island to China and back.  Tonka trucks, GI Joe action figures and my Little Pony are all real products sold to real kids.  People who obsess about "good manufacturing jobs" fret about how nothing is made in the USA anymore, and toys like these were among the first to move offshore.  The question however, is where does the money get made?  Thousands of Chinese toy factories have closed since the recession started and millions of workers are now cooling their heels back home. 

Meanwhile, Hasbro just announced a deal with Discovery Communications to launch a children's channel and is prepared to put $425M into the effort.  They also have a film coming out based on GI Joe from Paramount and video game deals with Electronic Arts that have increased sales of Monopoly by 40% in recent years.  Ralph Nader's lobbying group is whining that the Discovery deal amounts to "nothing more than a scheme to deliver programme-length advertisements over television".  Imagine how they must hate the GI Joe movie or the sinister addictiveness of online Scrabble!

The thing is, value happens when someone plays.  Whether they do so by watching TV or a movie or by gaming on their iPhone, the outcome is the same - pleasure for the consumer.  Hasbro isn't just trying to get us to load up on stuff - they are trying to engage our sense of humor, curiosity, or competition.  Credit the creative geniuses of Pawtucket to understand this while also recognizing that technology and the global supply chain means alot more than track-and-trace IT systems.  The digital supply chain, which moves electrons is faster, cheaper, and for some products better, than the physical supply chain built to ship atoms.  AMR's spring supply chain conference is all about this and its almost sold out.  I guess the supply chain folks see it coming.