linear acoustic is an american company based in lancaster , pennsylvania that develops technology and manufacturers equipment used by television stations , cable television and satellite television services providers , post-production facilities and other content services providers to control , measure , manage and monitor multi-channel digital audio .

the company has been especially active in areas related to automated upmixing and downmixing of multichannel broadcast audio , and with issues related to relative loudness of broadcast audio .

the company was founded in 2002 by tim carroll , who had previously worked as product manager for the professional audio division of dolby laboratories in san francisco .

while at dolby , carroll contributed to the development of dolby digital ( ac-3 ) and dolby e encoding systems for dvd and high-definition television ( hdtv ) applications .

christina carroll is the vice president and executive director of linear acoustic and is responsible for managing day-to-day company operations .

the company ’s products can be broadly broken down into three categories : loudness controllers designed to help television broadcasters maintain consistent audio levels ; monitors and meters that measure digital audio levels , including loudness ; and stand-alone encoding and transcoding products for handling the various data compression technologies commonly found in digital television plants .

the subject of controlling loudness in television broadcasts has garnered considerable publicity since the fcc moved to implement enforcement of the commercial advertisement loudness mitigation or calm act on december 13 , 2012 .

while consumer complaints about overly loud television commercials are almost as old as the medium itself , the calm act began as legislation was first sponsored by representative anna eshoo , a democratic congresswoman in california , in 2008 .

the law was passed in 2010 and went into full effect in 2011 and 2012 .

the linear acoustic aero line of audio processors effectively measures and manages shifts in loudness and controls discrepancies between program and commercial audio without unnecessarily degrading the quality of the audio or significantly affecting the dynamic range that adds impact to digital television audio .

when used in combination with a meter capable of measuring loudness by the itu-r bs .1770 standard ( or derivatives of this standard , such as ebu r128 ) u.s. broadcasters will be able to achieve calm compliance by effectively managing and monitoring audio levels .

linear acoustic also manufacturers the upmax 5.1-channel upmixer , which creates multi-channel surround sound audio from 2-channel ( stereo ) sources .

nbc utilized this product during the 2008 beijing summer olympics , and relied upon the company ’s aero.qc products during the 2010 vancouver winter olympics .

in 2008 , linear acoustic became part of the telos alliance , based in cleveland , ohio .

the telos alliance comprises telos systems , axia audio , omnia audio , and 25-seven systems that manufacture broadcast telephone systems , consoles and audio over ip gear , audio processors , and audio time management hardware for radio stations .

frank foti , founder of omnia audio , is the telos alliance ceo .

at the 2012 nab show in las vegas , linear acoustic announced a co-branding agreement with dolby laboratories under which the company will manufacture stand-alone dolby-centric professional products such as audio codecs and audio bitstream test tools .

linear acoustic

2008 tv technology – superior technology award – linear acoustic aeromax 5 . 1 - xl
linear acoustic president and founder , tim carroll , gives a brief history of television audio .
audio engineers suggested investigating equipment from linear acoustic for a solution . after a lot of research and the evaluation of numerous products from several manufacturers , they have determined that linear acoustic’s aero . 100 dtv audio processor was the correct solution .
linear acoustic offers a comprehensive lineup of loudness measurement and control products to help you achieve calm and r - 128 compliance .
renowned linear acoustic loudness control and upmixing for compliance and viewer - pleasing quality , but with incredible cost - savings for pcm - only applications .
a compact and space - efficient 1ru loudness management platform for hosting linear acoustic® aeromax® processing , upmax® - ii upmixing / downmixing , dolby® coding , and nielsen® watermark encoding .
linear acoustic was founded in 2001 with the introduction of the octimax 5 . 1 audio processor . with the onset of digital television came myriad problems involving loudness and digital audio control . linear acoustic turned their attentions to solving these problems at every stage of the digital audio chain and soon developed a product range that made digital broadcast sound and work as it should .
a 2ru loudness management platform with front panel controls and color display for hosting linear acoustic® aeromax® processing , upmax® - ii upmixing / downmixing , dolby® coding , and nielsen® watermark encoding .
newbay media’s tv technology magazine honored the telos alliance tv solutions group ( tvsg ) with a best of show award for its linear acoustic ams at the 2017 nab show held this week in las vegas . linear acoustic ams is a comprehensive solution for real - time authoring , rendering and monitoring of advanced audio programs for the atsc 3 . 0 digital television system .
linear acoustic ams authoring and monitoring system is a comprehensive solution for real - time authoring , rendering , and monitoring of advanced audio programs for the atsc 3 . 0 digital television system .
minnetonka audio and linear acoustic are both part of the foundation of the tv solutions group of the telos alliance . more information on the tv solutions group is available here . for general sales inquiries , contact inquiry @ urltoken . for television technical support , please e - mail support @ urltoken or call + 1 - 717 - 735 - 3611 . to locate a dealer for linear acoustic or other telos alliance brands , visit the telos alliance dealer directory .
“we’re honored to be recognized by newbay media with a best of show award for our linear acoustic ams , ” saidjohn schur , president , the telos alliance tv solutions group . “we created ams to deliver the full vision of an advanced consumer audio experience for digital television . ”
ams is equipped with linear acoustic apto , the state - of - the - art loudness adaptation technology designed to carefully control audio levels in a way that preserves the transients , sonic image and artistic intent of the source , while ensuring loudness consistency and compliance for any desired target .
audio over ip ( aoip ) connectivity via livewire + / aes67 enables enterprise - wide audio access . audio from any video source can be put on the aoip network using a wide variety of livewire + / aes67 compliant devices available from linear acoustic , axia audio , and other 3rd party vendors .
linear acoustic has been the go - to manufacturer of processors and meters for television networks and local stations worldwide for more than a decade , but their products definitely have a place on the production side as well . the aero . 100 has proven to be an invaluable tool for them since then .
the linear acoustic ams offers a web interface , which controls the interactive features of mpeg - h offered to the viewer . the web interface allows viewers to build presets for different listening experiences , enabling viewers to personalize their sound experience for optimal playback on any platform , from mobile devices to immersive home theaters .
audio over ip ( aoip ) has been embraced by the radio side of broadcasting for many years where the myriad advantages of networked audio via the livewire + aes67 standard is well known . now , aoip is available for television audio thanks to linear acoustic aero . soft™ . the linear acoustic sdi xnode de - embeds two separate hd / sd - sdi inputs , converts it to up to 16 channels of livewire + aes67 audio , makes it available for processing , upmixing , and encoding in the brand - new aero . soft processing engine , and then re - embeds the audio into two independent sdi outputs . this provides unmatched flexibility , scalability and channel density .
linear acoustic ams can be used in production to actively author and monitor metadata , or in other parts of the broadcast chain to monitor and validate audio streams containing a control track which were authored upstream . in both scenarios , ams is capable of outputting 15 - channels of discrete audio with a metadata control track , a 5 . 1 - channel rendered output , 2 - channel rendered output , and a dedicated monitoring output , all simultaneously .
aero . 8000 runs on the new linear acoustic aero . 8000 processing engine hardware . each processing engine is capable of handling up to eight amx processing instances and 16 stereo pairs of aes67 / livewire i / o . the eight amx instances can be any combination of amx5 . 1 ( 5 . 1 + 2 + 2 ) , amx2 . 0 ( 2 + 2 + 2 ) or amx5x2 ( 2 + 2 + 2 + 2 + 2 ) . all amx instances support sap / dvs , loro / ltrt downmix , local audio insertion , and optional audio description ( warble tone ) functionality . itu - r bs . 1770 - 3 or ebu r128 meters are present on each audio program output . linear acoustic crowd control™ , which eliminates viewer complaints about “missing” or “hard to hear” dialogue , is now available for both 2 . 0 - and 5 . 1 - channel sources .
linear acoustic ams authoring and monitoring system is a comprehensive solution for real - time authoring , rendering , and monitoring of advanced audio programs for the atsc 3 . 0 digital television system . the audio system in atsc 3 . 0 provides listeners with a personalized , immersive audio experience using next generation audio ( nga ) technologies , including mpeg - h . ams simultaneously delivers advanced audio for atsc 3 . 0 broadcasts and 5 . 1 - / 2 - ch audio for atsc 1 . 0 broadcasts .
among the many features that can be completed using the web interface are device configuration and status , monitoring control , input / output routing , audio mixing and object panning , loudness processing and more . linear acoustic ams also makes authoring an mpeg - h audio stream using the web interface as simple as assigning the 15 available mono inputs to the 10 available channel groups , providing full user control . additionally , the solution simultaneously delivers advanced audio for atsc 3 . 0 broadcasts and 5 . 1 / 2 - channel audio for atsc 1 . 0 broadcasts .
the ams web interface controls the interactive features of mpeg - h offered to the viewer . using smart metadata and linear acoustic apto loudness control , ams facilitates easy audio mixing and authoring operations , even in the most demanding production scenarios . individual audio elements are combined with user specified metadata to create immersive and personalized audio programs for the viewer . the ams web interface allows the authoring engineer to easily control the interactive features of mpeg - h offered to the viewer , and build presets for different listening experiences . this enables viewers to personalize their sound experience for optimal playback , from mobile devices to immersive home theatres .
in 2010 , linear received a technical emmy® for
the pioneering development of an audio / metadata processor for conforming audio to the atsc standard ,
and has provided upmixing , loudness metering , encoding products , and technical support for nbc’s coverage of the 2008 bejing summer games , the 2010 vancouver winter games , the london 2012 summer games , the 2014 sochi winter games , and most recently , the 2016 summer games in rio .
for three decades , the brands of the telos alliance have revolutionized radio and television by pioneering disruptive , cutting - edge audio technology with the goal of helping global networks and local stations produce better programming , improve audience engagement , and bolster ratings . the telos alliance is made up of six brands—telos ® systems , omnia ® audio , axia ® audio , linear acoustic ® , 25 - seven ® systems , and minnetonka™ audio—that raise the bar for quality and innovation in the radio and television industries . the telos alliance invented audio over ip for broadcast and contributed time and resources to the effort that led to the aes67 standard . headquartered in cleveland , ohio , usa , with additional offices and dealers around the world , the telos alliance offers an industry - leading five - year warranty , and backs users ' critical on - air needs with worldwide 24 / 7 round - the - clock support for all customers .
fighting ignorance since 1973 . ( it ' s taking longer than we thought . )
just when i get the tv volume adjusted to the optimum level , a commercial comes on and rattles the house like a sonic boom . who ' s the einstein who decided i should listen to commercials at a level loud enough to rupture my eardrums ?
rick graydear cecil : for as long as i can remember , home theater has had the same problem , namely , while the parts of a movie or tv show full of explosions are loud enough to strip varnish off a coffee table , dialogue at the same volume is barely comprehensible because it ' s too damn quiet . thus you either have to constantly adjust the volume or resign yourself to the possibility of permanent ear damage every time you watch an action movie . what ' s the deal ? dan rosenbluth
several audio techniques are at work here , two of which , interestingly , work in opposite ways . but the motive is the same : noise sells .
viewers have complained about loud tv commercials since the 1950s but advertisers paid no heed , figuring people couldn’t ignore your message if you screamed it in their ears . in the 1960s the fcc began warning broadcasters to lower the volume but made no serious attempt at regulation , and industry efforts to self - police didn’t accomplish much either .
things got worse in the era of digital tv , with improved technology greatly increasing the range of discernible sound volume , better known as dynamic range . eventually congress stepped in , passing the commercial advertisement loudness mitigation ( calm ) act in 2010 . the law directed the fcc to set advertising loudness standards for broadcasters , cable operators and other video distributors . by december 13 , 2012 , a commercial’s average sound level must be the same as the average loudness of the surrounding programming . the idea is that once you get the tv volume adjusted to a comfortable level you won’t risk having your eardrums ruptured by a sales pitch .
human ingenuity being what it is , the new rule may not entirely solve the problem . imagine a commercial skillfully interweaving tranquil footage of bunnies and butterflies with equal intervals of air raid siren - level noise . on average , the result is 100 percent fcc compliant . improved tv technology works both ways , however . check your owner’s manual to see if you have a function called automatic gain control , audio compression , or peak limiting . if you do , and you have the moxie to navigate through the byzantine array of menus and options on the average tv , they’ll enable you to control the peak noise level . my assistants una and fierra discovered their five - year - old television had two of the aforementioned options , so there’s a decent chance yours might too .
that brings us to the related problem of loud movies . increased dynamic range during regular programming was designed to enhance the vividness of the home theatre experience by reproducing the gamut of sounds you experience in real life . unfortunately for your hearing , the approximation of real life favored by hollywood tends to fixate on the whispers of the bedroom on the one hand and battling robots on the other .
action movies are particularly problematic . audio researchers found that whereas a typical episode of the sitcom friends had a nontaxing dynamic range of 6 . 6 “loudness units , ” the 1999 film the matrix had a range of 25 units . the eruption of noise during the matrix ‘s action sequences is part of its charm , of course , but such extreme dynamic range pushes the limits of what even the most sophisticated home system can reproduce , making it virtually impossible to find a comfortable volume level .
once again , though , technology is your friend . the dolby 5 . 1 system , for example , includes a “midnight mode” that compresses the dynamic range , lowering the sound peaks and raising the valleys to make a concussive soundtrack more listenable .
but here’s the surprising part . where the movie industry uses increased dynamic range to make more noise , the music industry uses dynamic range compression to do the same thing . dynamic compression is a major weapon in what’s been called the “loudness war , ” the steady increase in the volume of rock and pop music . going back at least to phil spector’s “wall of sound , ” music producers and engineers have always been trying to make their records sound bigger and more exciting than the competition’s , and one way of getting a song to jump off a jukebox is simply to make the recording itself louder .
because you can only turn the sound up so far before it becomes distorted , it eventually became standard practice to compress the dynamic range while cranking the gain until the song was uniformly loud — never mind the loss of sound quality . since the mid - 1980s the average loudness of cds has increased by a factor of 10 , a trend if anything exacerbated by the shift to mp3 players . how better to make a track really pop in shuffle mode than to torque its effective volume ? thus the curious paradox : a century of technological progress has culminated in popular recordings with less dynamic range than an edison phonograph cylinder of 1909 .
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fusion aoip mixing console iq aoip mixing console radius 8 - fader aoip mixing console desq compact desktop ip - audio console raq rack - mount ip - audio console powerstation integrated console engine studioengine dsp mixing engine qor . 32 integrated console engine qor . 16 integrated console engine
aero . 2000 - audio / loudness manager aero . 100 - dtv audio processor aero . 10 - dtv audio processor aero . 8000
surcode for dolby pro logic ii surcode for dolby digital plus 5 . 1 encoder for adobe premiere pro cc surcode for dolby digital plus for avid surcode for dolby e surcode for dolby digital 5 . 1 standalone surcode encoder for dts - hd for compressor surcode for dts dvd / cd
the sdi xnode brings hd / sd - sdi signals into the axia livewire aoip ( audio over ip ) domain for use in audio processing or other applications .
enterprise - wide audio and loudness management deployed on a dedicated aero . 8000 processing engine , featuring the same algorithms as aero . 100 / 1000 / 2000 .
comprehensive itu - r bs . 1770 and ebu r128 loudness and peak level metering and logging for eight channels ( 5 . 1 + 2 ) plus downmix via aes or hd - sd / sdi audio .
drawing upon the success of its predecessors , upmax v4 - d produces engaging 5 . 1 - channel audio from two - and three - channel sources with ease and seamlessly transitions between discrete and upmixed audio .
a portable , handheld diagnostic tool that can monitor and generate dolby digital , dolby digital plus , dolby e , and pcm bitstreams anytime , anywhere .
using aero . 10 / 100 / 2000 / soft to create a ‘cleared’ feed .
an explanation of audio metadata , including a look at dialog level ( dialnorm ) , dynamic range control ( drc ) , and downmixing .
a more in - depth look at how audio metadata is created and distributed .
getting audio into the plant , moving it around , and encoding it in preparation for distribution .
what happens to the audio as it leaves the plant and gets to the viewer .
a detailed explanation of how audio coding works , both technically , and in relation to human hearing .
how the major terrestrial networks distribute multi - channel audio to their affiliate stations .
a closer look at how different networks have chosen to get their audio to the affiliates .
a high - level look at the status of multi - channel audio at the major networks .
now ! puts the latest broadcast audio technologies from the telos alliance in your hands .
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rep . anna eshoo , left , introduced the calm act in the house in june 2008 . … ( j . scott applewhite / associated… )
calm act , the commercial advertisement loudness mitigation law , which limits the volume of tv commercials , took effect thursday . it requires broadcasters to ensure that tv commercials maintain the same volume as the entertainment programming in which they are contained .
the legislative effort was begun more than four years ago by rep . anna g . eshoo ( d - menlo park ) , who was blasted by blaring ads on tv during a family holiday gathering .
“this has been a top consumer complaint for decades , ” eshoo said during a news conference thursday in washington . “i never dreamed that this would strike the chord that it did with the american public . ”
it would seem like an easy enough fix for broadcasters , but turning down the volume turned into a frustrating odyssey for lawmakers and regulators . the solution required a convention of engineers from around the world , rewriting broadcast standards and advances in audio technology . tv stations and cable and satellite tv operators have spent the last two years upgrading their equipment to better detect sound fluctuations .
normal listening levels are about 70 decibels for a television show , but levels can vary . the switch to digital television in 2009 made the problem worse because the higher fidelity sound made the commercials seem even louder , industry officials said .
sound metering equipment long used by broadcasters was not sensitive enough to discern fluctuations in volume .
“the old type of meter measured volts . they were just looking for technical indications of loudness , and those indications did not always relate to human perception , ” thomas lund , a development manager of denmark ' s tc electronic , said in a telephone interview . “levels and loudness are not always the same . ”
for example , high levels of sound for sustained periods come across to the ear as louder than for short duration . the old meters , lund said , did not measure that dimension of sound .
“the people who were creating the commercials learned how to exploit the meters and fly below the radar , ” lund said . the result : blaring ads .
the calm legislation marked an unusual case study of bipartisan support in washington . rep . eshoo introduced a one - page bill called the calm act in the house in june 2008 . two years later , a companion bill authored by sen . sheldon whitehouse ( d - r . i . ) unanimously passed the senate .
in december 2010 , the house passed the legislation and president obama signed the bill into law on dec . 15 , 2010 . the federal communications commission adopted its rules implementing the law a year ago , and provided a yearlong grace period so that stations could install the new equipment .
viewers can report super - loud commercials to the fcc on the agency ' s website or by calling 1 - 888 - tell - fcc ( 1 - 888 - 225 - 5322 ) .
hugh hefner will like the calm act . other boomers ? maybe . . .
cable industry needs to stop its noise over law on loud tv . . .
processing instances ( at least one is required ) providing real time adaptive wideband and / or multiband processing including an advanced itu limiter . output levels are consistent and compliant without compromising audio quality .
our hollywood - approved upmax ® - ii upmixing / downmixing algorithm creates engaging 5 . 1 - channel audio from 2 - channel sources and provides a downmix that is nearly indistinguishable from the original source .
available configurations for each instance include amx5 . 1 ( one 5 . 1 channel and two 2 - channel processing engines ) , amx2 . 0 ( three 2 - channel processing engines , one with 5 . 1 - channel downmixing ) and amx5x2 ( five 2 - channel processing engines ) . flexible signal routing is provided for main and secondary audio programs plus eas and local emergency audio insertion .
designed and built in the usa , the aero . 100 platform itself supports 8 audio pairs via sdi i / o with sdi video delay and 4 pairs via aes . failover bypass relays maintain signal continuity and dual auto - ranging power supplies enable redundancy and worldwide compatibility .
the included nfremote software provides comprehensive control over system settings and processing parameters remotely from any pc including access to the built - in http server for automated control or retrieval of loudness logs .
provides control over all system settings , processing and coding parameters plus extensive metering of signal presence , processing and coding activity , and audio loudness . system status reports physical i / o details along with system , power supply and environmental health . the remote application also delivers remote audio , up to 5 . 1 channels , to the user so that signal quality can be auditioned anywhere link bandwidth permits . http server is also included for simple get / set control of all parameters and status .
generates revenue - critical nielsen naes ii and the new nielsen watermark audience measurement codes . aero . 100 precisely inserts these signals for maximum code recovery after audio decoding and processing and before transmission encoding .
- ii 2 - channel to 5 . 1 - channel upmixing / downmixing with automatic detection and automatic downmix replacement
eight main inputs plus reference via 75 - ohm bnc female connectors . eight main outputs plus encoder output . all digital inputs are 75 ohm internally terminated , unbalanced . signal levels per smpte
auto - sensing hd / sd - sdi ( smpte 292m / 259m ) inputs , up to 1080i / 60 / 59 . 94 / 50hz . de - embed up to 16 channels from applied sdi signal , process and / or encode , re - embed up to 16 channels . supports smpte 2020 a and b vanc metadata
9 - pin female d connector ; 115 . 2 kbps ; pinout per smpte 207m ( rs - 485 ) ; designed to directly interface with dolby serial metadata ( smpte rdd6 )
windows® - compatible tcp / ip remote control included application for full setup and control , itu - r bs . 1770 metering for all programs , encoder statistics , and return audio for remote monitoring ( network speed permitting ) . http server allows get / set control from pc
dual power supplies , each rated at 100 - 264 vac , 50 / 60hz , auto - sensing , 150w max . total
net weight : 15 lbs . ( 6 . 80 kg ) , approximate .
north america : fcc and ce tested and compliant , power supply is ul approved .
europe : complies with the european union directive 2002 / 95 / ec on the restriction of the use of certain hazardous substances in electrical and electronic equipment ( rohs ) , as amended by commission decisions 2005 / 618 / ec , 2005 / 717 / ec , 2005 / 747 / ec ( rohs directive ) , and weee .
aero manual addendum 3 . 15 . 26 and 3 . 16 . 02 - snmp
aero manual addendum 3 . 15 . 26 and 3 . 16 . 02 - latency
hybrid dynamic range and loudness control with advanced itu limiter provide set - and - forget compliance and viewer - pleasing quality while included features deliver incredible cost - savings .
watermark encoding , and the ability to add a second processing instance are not required .
standard configurations are your choice of either a 5 . 1 + 2 + 2 or 2 + 2 + 2 channel configuration ; a 2 + 2 + 2 + 2 + 2 channel configuration is optional .
available in either a 5 . 1 + 2 + 2 or 2 + 2 + 2 channel configuration , or optionally , in a 2 + 2 + 2 + 2 + 2 channel configuration for processing up to 5 stereo programs
highest quality industry standard audio control has never been more affordable . aero . 10 is a fully - featured audio processor supporting up to ten channels of audio and featuring a processing engine identical to those in the aero . 100 / 1000 / 2000 products . tools such as loudness and dynamic range control , upmixing , downmixing , plus itu and ebu compliant loudness metering and logging makes the aero . 10 an extremely powerful solution for nearly any application at an extremely low cost .
to this , the aero . 10 adds a simple lcd front panel gui and stereo analog i / o . the headphone output has been designed to provide plenty of level even for difficult loads or quiet sources and is useful for checking audio or adjusting processing .
new with aero . 10 is the addition of stereo analog inputs and outputs which serve to support facilities amidst transition from analog to digital as well as interface with any analog device or signal path .
comprehensive tcp / ip remote provides control over all system settings and processing parameters plus extensive metering of loudness . system status reports physical i / o details along with system , power supply and environmental health . the remote application also delivers remote audio , up to 5 . 1 channels , so the user can audition signal quality anywhere link bandwidth permits . an http server is also included for simple get / set control of all parameters and retrieval of status and logging information . constantly active logging captures 7 . 5 day rolling weekly reports as well as specific time slots controlled by start / stop . loudness with multiple integration times as well as true peak measurements are captured and available for download .
designed and built in the usa , the lightweight and rugged single rack - unit aero . 10 is a solid investment in performance and flexibility . though all current features are standard , future options can be enabled by simply entering a factory provided key . failover bypass relays on all i / o maintain signal continuity and dual auto - ranging power supplies enable redundancy and worldwide compatibility .
available in either a 5 . 1 + 2 + 2 or 2 + 2 + 2 channel configuration with local / eas insertion , or optionally in a 2 + 2 + 2 + 2 + 2 channel configuration for up to 5 stereo programs .
dual upmax ii two - channel to 5 . 1 channel upmixers plus main channel downmixing , automatic bypass of discrete content ( in 5 . 1 + 2 + 2 configuration , downmix only in 2 + 2 + 2 processing configuration )
auto - sensing hd / sd - sdi ( smpte 292m / 259m ) inputs , up to 1080i / 60 / 59 . 94 / 50hz , access to audio and vanc metadata
dual power supplies , each rated at 100 - 264 vac , 50 / 60hz , auto - sensing , 100w max . total
one rack unit - 1 . 75”h x 19”w x 15 . 5”d ( 44 x 483 x 394 mm ) net weight : 9 lbs ( 4 kg ) ; shipping : 12 lbs
fan cooled . operating : 0 to 50 degrees c , non - operating –20 to 70 degrees c .
aero . 8000 is enterprise - wide audio and loudness management software for high - density applications featuring the trusted aeromax® adaptive wideband and multiband , multistage , itu - compliant , loudness control algorithm . an advanced itu limiter ( ai ) and itu bs . 1770 - 3 metering guarantees fast , accurate and measureable compliance with atsc and ebu r - 128 loudness recommended practices while maintaining the highest possible audio quality .
upmixing is provided by the hollywood - approved upmax® ii algorithm which delivers engaging 5 . 1 - channel audio from two - channel sources . automax™ detection and switching between 2 . 0 and 5 . 1 surround sources makes full time 5 . 1 surround output easy to achieve with viewer - pleasing results .
dolby® digital , dolby digital plus , and dolby e decoding and encoding are optionally available for each amx instance as is nielsen® watermark encoding for amx5 . 1 and amx2 . 0 instances .
an included comprehensive tcp / ip remote control application provides control over all system settings , processing and dolby digital coding parameters , per - channel signal presence , and loudness metering from any windows pc . multiple logs of lkfs loudness values , true peak , and dolby dialnorm and acmod values are provided for each program output . the remote control application also delivers remote audio monitoring so the user can audition signal quality anywhere link bandwidth permits . an http server is also included for log retrieval and provides control of all parameters and retrieval of status via network commands .
very high channel capacity software runs real - time on aero . 8000 processing engine
upmax ii automatic upmixing and downmixing with automax 5 . 1 surround / 2 . 0 detection and switching
extensive remote gui over ip control enables metering , control , and local audio monitoring ( up to 5 . 1 channels )
since 2003 , broadcast facilities have been using axia livewire aoip ( audio over ip ) technology to route hundreds of audio channels using standard ethernet switches , cables , and other components . with thousands of devices on the air every day , reliability is proven .
livewire is lightning fast , simple to implement , easy to manage , and now as livewire + , fully compliant with the aes67 standard and ready to incorporate new standards as they are developed . it significantly reduces the number of cables and wires needed to transport and share audio throughout the broadcast plant .
nearly any audio source – analog or aes , and now sdi – and myriad equipment from phone systems to codecs to satellite receivers – can be a part of the aoip network .
aeromax multistage adaptive wideband and multiband loudness and dynamic range control with itu - r bs . 1770 - 3 loudness metering
upmax ii two - channel to 5 . 1 channel upmixing and downmixing , automatically bypasses discrete content
aero . air user guide ( software v1 . 16 . 02 and later )
aero . air user guide ( software v1 . 18 . 01 2u and later )
aero . air user guide ( software v1 . 23 . 01 2u and later )
aero . lite aero . lite manual ( software v0 . 00 . 10 )
aero . qc aero . qc manual ( software v1 . 00 . 00 and later )
frame synchronizer ( la - 5448 ) la - 5448 manual ( software v1 . 00 . 21 and later )
metamax ( la - 5180 ) la - 5180 manual ( software v00 . 00 . 33 and later )
upmax : neo ( la - 5190 ) upmax : neo user guide ( software v00 . 57 and later )
authoring an mpeg - h audio stream using the web interface is as simple as assigning the 15 available mono inputs to the 10 available channel groups . from defining music beds , identifying independent objects , or grouping objects to be switched by the user , full control is available .
the telos alliance xnode family of aoip devices offer optional analog , aes / ebu , gpio logic , and sdi i / o , all with full livewire + aes67 audio over ip support .
telos alliance sdi xnodes can de - embed 3g / hd / sd - sdi inputs , extracting up to 16 channels of audio to the livewire + aes67 port . the audio can be re - embedded into the sdi output stream with full video delay compensation for each sdi input , ensuring that audio video synchronization is maintained .
using the web interface , up to 36 outputs may be configured , including 16 channels of authored audio plus control channels , up to 12 channels for monitoring , and two additional sets of output channels for rendered broadcast outputs .
- ii upmixing / downmixing algorithm creates engaging 5 . 1 - channel audio from 2 - channel sources and provides a downmix that is nearly indistinguishable from the original source .
designed and built in the usa , the aero . 2000 platform itself supports 8 audio pairs via sdi i / o with sdi video delay and 8 pairs via aes . failover bypass relays maintain signal continuity and dual auto - ranging power supplies enable redundancy and worldwide compatibility .
front panel controls , color display , and headphone output offer the ability to monitor and adjust the unit locally while the included nfremote software provides comprehensive control over system settings and processing parameters remotely from any pc including access to the built - in http server for automated control or retrieval of loudness logs .
capable of hosting one or two aeromax® processing instances in amx5 . 1 , amx2 . 0 or amx5x2 configurations
provides control over all system settings , processing and coding parameters plus extensive metering of signal presence , processing and coding activity , and audio loudness . system status reports physical i / o details along with system , power supply and environmental health . the remote application also delivers remote audio , including 5 . 1 channels , to the user so that signal quality can be auditioned anywhere link bandwidth permits . the built - in http server provides for simple get / set control of all parameters and status .
generates revenue - critical nielsen naes ii and the new nielsen watermarks audience measurement codes . aero . 2000 precisely inserts these signals for maximum code recovery – after audio decoding and processing and before transmission encoding .
48khz via aes dars ( or any aes signal applied to the ref in connector ) , aes in 1 , sdi , or from the internal 48khz clock ( standalone use only ) .
eight main inputs plus reference via 75 - ohm bnc female connectors . eight main outputs plus encoder output . eight additional channels of auxiliary digital i / o on db - 25 female connector . all digital inputs are 75 ohm internally terminated , unbalanced . signal levels per smpte 276m / aes - 3id - 2001 .
auto - sensing hd / sd - sdi ( smpte 292m / 259m ) inputs , up to 1080i / 60 / 59 . 94 / 50hz . de - embed up to 16 channels from applied sdi signal , process and / or encode , re - embed up to 16 channels . supports smpte 2020 a and b vanc metadata .
1 / 4’’ ( 6 . 35mm ) front panel connector with volume control .
9 - pin female d connector ; 115 . 2 kbps ; pinout per smpte 207m ( rs - 485 ) ; designed to directly interface with dolby serial metadata ( smpte rdd6 ) ethernet
gigabit ethernet via rj45 supports included tcp / ip remote control application ; http server included for get / set control of all parameters .
windows® - compatible tcp / ip remote control included application for full setup and control , itu - r bs . 1770 metering for all programs , encoder statistics , and return audio for remote monitoring ( network speed permitting ) . http server allows get / set control from pc front panel controls and indicators .
net weight : 13 lbs . ( 5 . 9 kg ) , approximate .
net weight : 18 lbs . ( 8 . 2 kg ) , approximate .
our aero™ series of transmission audio loudness managers includes aero . 2000™ , aero . one® , aero . lite™ , aero . mobile™ and the flexible high - density aero . 1000™ loudness platform .
the lq - 1000™ loudness quality monitor , lq - 1™ loudness meter and lambda™ digital audio and metadata monitor allow you to carefully and conveniently monitor audio , loudness level , and metadata throughout your station .
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we have access to a large variety of products . send us your request and will confirm we can quote your request within 24hrs .
each of our brands excel in their own areas and are frequently recognized by organizations within the industry . here is a look at some of the awards and honors that they have received :
2010 broadcast engineering award ibc 2010 – broadcast engineering pick hit award – aero . file
2000 16th annual technical excellence & creativity awards - minnetonka audio mx51 v2 . 0 - nominated for computer software and peripherals - outstanding technical achievement
newbay media’s best of show awards are evaluated by a panel of engineers and industry experts , and are selected based on innovation , feature set , cost efficiency and performance in serving the industry .
gbs alliance is an authorised distributor and system integrator for several international reputable brands in the am / fm / sw / tv broadcast equipment market .
has had a significant impact on broadcasters , as they now have to pay closer attention to their audio levels . however , compliance regulations have also reinforced the importance of correct audio levels to content creators and production houses as well .
most post - production company have already increased their attention towards audio , making sure that the content created is not only engaging , but also loudness - compliant . that focus has not been without its challenges .
this is relatively new ground for most people and companies of the broadcast chain . for many years , emphasis has been primarily on video , not audio , but nowadays , it’s not uncommon to see some pretty inconsistent audio levels between different programs , and even within a single piece of content . this has been a pondering issue for the industries .
a much needed audio measurement and processing device with sdi i / o , a good user interface and the ability to produce compliant audio with an emphasis on audio quality . that’s where the aero . 100 really stands out . the processed audio from it is not only compliant , but also is top - notch in quality , providing compelling and clear audio for the viewers at home .
among the more useful features of the aero . 100 in common application are the built - in itu - r bs . 1770 lfks meters . content runs though the unit without processing it , just to measure the levels . there are four separate meters , each with a user - selectable integration time , so they can look at short - term dynamics and the mid - and long - term averages at the same time . this lets the production crews identify exactly where the content is inconsistent or non - compliant , they can use aero . 100 processing to bring everything into compliance for their clients thus allowing them to facilitate their client’s needs with complete confidence .


volume risk is a commodity risk which refers to the fact that a player in the commodity market has uncertain quantities of consumption or sourcing , i.e. production of the respective commodity .

examples of other circumstances which can cause large deviations from a volume forecast are weather ( e.g. temperature-changes for gas consumption ) , the plant-availability , the collective customer outrage , but also regulatory interventions .

volume risk

volume risk is one of the core components of business risk ( revenue risk ) , the another being price risk ( or margin risk ) .
patients at high risk of death after lung - volume - reduction surgery . - pubmed - ncbi
volume risk is the risk that product origination ( sales ) volumes will materially deviate from the planned / budgeted / expected amounts due to external or internal factors . the volume metric may be referencing the number of transactions , the total size of transactions etc .
when limiting the private partner’s exposure to volume risk , the contract should provide access for the authority to the upside if demand is greater than expected .
in social infrastructure projects , higher use of the facility is generally not a natural policy objective and volume / use risk should be removed from the contract .
lung - volume - reduction surgery is a proposed treatment for emphysema , but optimal selection criteria have not been defined . the national emphysema treatment trial is a randomized , multicenter clinical trial comparing lung - volume - reduction surgery with medical treatment .
home > appendix structuring and drafting the tender and contract - describing main risks > 1 . 2 describing main risks during the operations phase and potential allocation > 1 . 2 . 1 revenue risk – demand or volume risk [ 3 ]
forward fixing your prices and accepting volume flexibility on that fixing , protects you against budgetary catastrophe in times of high consumption . in many cases , spot contracts are less expensive than forward fixings with volume flexibility . this clearly illustrates that with a forward fixing contract with volume flexibility , risk is shifted from the client to the supplier and not the other way around . and that makes the claim that spot contracts are less risky absurd .
most of a company’s costs are fixed costs that occur regardless of sales volume . as long as a business earns a substantial profit on each sale and sustains adequate sales volume , fixed costs are covered and profits are earned . other company costs are variable costs incurred when sales occur . the business earns less profit on each sale but needs a lower sales volume for covering fixed costs .
javier orlando pantoja robayo & andrea roncoroni , 2012 .
optimal static hedging of energy price and volume risk : closed - form results ,
documentos de trabajo cief 010668 , universidad eafit .
same thing when a period of larger than expected consumption coincides with high energy spot prices . in those cases , you will experience that the old contract with its volume conditions wasn’t such a bad idea after all . in such contracts , the volume issue only starts to bite once you’ve hit the threshold volumes . for this reason we recommend any clients that want to have a high degree of certainty over what their future energy prices will be to sign traditional forward fixing contracts , even if they come with volume conditions ( nowadays some suppliers offer consumers of smaller volumes forward fixing contracts without volume conditions ) . if you want to sign a spot contract , only do it when you are willing to keep the price of at least 20 % of your volume unfixed and open for the spot market . and if you have a high volume uncertainty , you should keep the price open for the spot market for even higher parts of the volume .
measures of risk - adjusted performance revise accounting earnings to take into consideration the level of risk a company assumed to generate them .
“no volume risk” is often cited as one of the advantages of a spot energy contract . and indeed , these contracts don’t have “volume conditions” in the sense of minimum or maximum volumes that have to be / can be consumed . many buyers of energy have gone through agonizing experiences when they ran into the threshold levels of such traditional volume conditions . this was particularly a problem in 2009 . many industrial consumers of energy saw their consumption drop below levels that they hadn’t anticipated even in their worst nightmares .
high concentrations of risk aren’t necessarily bad . everything depends on the company’s appetite for it . unfortunately , many companies have never articulated a risk strategy .
we define risk broadly to include any event that might push a company’s financial performance below expectations . typically , the measure used is capital at risk , earnings at risk , or cash flow at risk , depending upon whether the focus is on the balance sheet , the income statement , or cash flows .
a company must not only understand the types of risk it bears but also know the amount of money at stake . less obviously , it should understand how the risks different business units take might be linked and the effect on its overall level of risk . in other words , companies need an integrated view . american express , for example , might discover that a sharp slump in the airline industry had exposed it to risk in three ways : business - volume risk in its travel - related services business , credit risk in its card business ( the risk of reimbursing unused but paid - for tickets ) , and market risk from investments made in airline bonds or aircraft leases by its own insurance unit .
board processes . boards need to review the effectiveness of their own risk - management processes periodically . they should look at committee structures and charters , how well board members understand risk policies , and the value of their interactions with management on risk . some companies use a formal self - assessment tool that allows directors to rate the effectiveness of board - level risk - management processes in areas such as risk transparency and reporting , committee meetings , and risk expertise . reviews should take place about once a year .
the first risk is what we refer to as volume risk . there are a lot of good and bad things that can happen on any one lease . the possible good things include anything that increases output , such as : new horizontal or vertical wells may be drilled , new technology can be implemented , shallower zones can be opened up , etc .
this is the 19th year of asia risk magazine ' s awards , which recognise best practice in risk management and derivatives use by banks and financial institutions around the region .
formal modelling of business risk ( and its components ) is in a rather nascent stage . it is not one of the recognized regulatory risk types that attract capital requirements .
to create a risk culture , companies need a formal , company - wide process to review risk , with each business unit developing its own risk profile that is then aggregated by the corporate center . the reviews are a way of ensuring that managers at every level understand the key risk issues and how they should be dealt with . drawing up a monthly heat map is one way of establishing a formal risk - review process .
[ 5 ] in some light rail schemes based on volume payments , the risk is also shared by a system of bands as in some shadow toll roads . for example , this is the case for a number of light rail transport ( lrt ) ppps in spain .
after evaluation and pulmonary rehabilitation , we randomly assigned patients to undergo lung - volume - reduction surgery or receive medical treatment . outcomes were monitored by an independent data and safety monitoring board .
readers of my previous blog article ( in dutch ) will have remarked that i was quite agitated by misleading sales of spot contracts to end consumers . i would want to come back on a specific issue , the volume risk , and write a separate blog article in english on .
companies must also provide education and training in risk management , which for many managers is quite unfamiliar , and establish effective incentives to encourage the right risk - return decisions at the front line . judging the performance of business - unit heads on net income alone , for instance , could encourage excessive risk taking ; risk - adjusted performance should be assessed , too . ultimately , people must be held accountable for their behavior . good risk behavior should be acknowledged and rewarded and clear penalties handed out to anyone who violates risk policy and processes .
segregation of duties . companies must separate employees who set risk policy and monitor compliance with it from those who originate and manage risk . salespeople , for instance , are transaction driven—not the best choice for defining a company’s appetite for risk and determining which customers should receive credit .
risk ownership . the existence of a corporate risk organization doesn’t absolve business units of the need to assume full ownership of , and accountability for , the risks they assume . business units understand their risks best and are a company’s first line of defense against undue risk taking .
disaster risk reduction ( drr ) and climate change adaption ( cca ) in international cooperation .
one way of gaining a transparent , integrated view is to use a heat map : a simple diagram showing the risks ( broken down by risk category and amount ) each business unit bears and an overall view of the corporate earnings at risk . the heat map tags exposures in different colors to highlight the greatest risk concentrations ; red might indicate that a business unit’s risk accounted for more than 10 percent of a company’s overall capital , green for more than 5 percent . ( exhibit 2 shows a risk heat map that flags high credit risk in two units . ) to make risks transparent—and to draw up an accurate heat map—companies need an effective system for reporting risk , and this requires a high - performing risk - management organization .
finally , business - volume risk , stemming from changes in demand or supply or from competition , is exposure to revenue volatility . the leading us carrier united airlines , for instance , filed for protection under chapter 11 of the us bankruptcy code this year after falling demand hit its revenues .
caution is warranted in the use of lung - volume - reduction surgery in patients with emphysema who have a low fev1 and either homogeneous emphysema or a very low carbon monoxide diffusing capacity . these patients are at high risk for death after surgery and also are unlikely to benefit from the surgery .
each industry faces its own variations on the four types of risks ; each company should thus develop a taxonomy that builds on these broad risk categories . in pharmaceuticals , for instance , a company could face business - volume risk if a rival introduced a superior drug and higher operational risk if an unexpected product recall cut into revenues . in addition , the company would have to consider how to categorize and assess its r & d ; risk—if a new drug failed to win approval by the us food and drug administration , say , or to meet safety requirements during clinical trials .
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top - notch talent . risk executives at both the corporate and the business - unit level must have the intellectual power to advise managers in a credible way and to insist that they integrate risk - return considerations into their business decisions . risk management should be seen as an upward career move . a key ingredient of many successful risk - management organizations is the appointment of a strong chief risk officer who reports directly to the ceo or the cfo and has enough stature to be seen as a peer by business - unit heads .
the directors’ unfamiliarity with risk management is often mirrored by senior managers , who traditionally focus on relatively simple performance metrics , such as net income , earnings per share , or wall street’s growth expectations . risk - adjusted performance
in public transport projects , assuming a vertical integrated approach ( i . e . service to the user is included in the scope of the infrastructure dbfom ) , it is clear that higher utilization is a success in terms of public strategy . however , providing the public with a safe mobility option is essential . most of the best ppp structures for large integrated transport infrastructure ppps are based on a mixed revenue regime . part of the payments are linked to volume / actual use , but with volume risk being tempered with a portion of payments based on quality or availability [ 5 ] .
to manage risk properly , companies must first understand what risks they are taking . to do so , they need to make all of their major risks transparent and to define the types and amounts of risk they are willing to take—goals often facilitated by the creation of a high - performing risk - management organization that accurately identifies and measures risk and provides an independent assessment of it to the ceo and the board . although these steps will go a long way toward improving corporate risk management , companies must also go beyond formal controls to develop a culture in which all managers automatically look at both risks and returns . rewards should be based on an individual’s risk - adjusted—not simply financial—performance .
) and the integration of risk management into day - to - day decision making . companies that fail to improve their risk - management processes face a different kind of risk : unexpected and sometimes severe financial losses ( exhibit 1 ) that make their cash flows and stock prices volatile and harm their reputation with customers , employees , and investors .
clear individual responsibilities . risk - management functions call for clear job descriptions , such as setting , identifying , and controlling policy . linkages and divisions of responsibility also need to be defined , particularly between the corporate risk - management function and the business units . should the corporate center have the right to review their risk - return decisions , for example ? should corporate risk - management policies define specific mandatory standards , such as reporting formats , for the business units ?
this report updates the chartis report solvency ii technology solutions 2014 , focussing on risk management systems for the insurance industry .
seldom figures in these managers’ targets . improving risk management thus entails both the provision of effective oversight by the board (
the amount of debt and equity that makes up a company ' s capital structure has many risk and return implications .
the task of the risk organization is to identify , measure , and assess risk consistently in every business unit and then to provide an integrated , corporate - wide view of these risks , ensuring that their sum is a risk profile consistent with the company’s risk strategy . the structure of the organization will vary according to the type of company it serves . in a complex and diverse conglomerate , such as ge , each business might need its own risk - management function with specialized knowledge . more integrated companies might keep more of the function under the corporate wing . whatever the structure , certain principles are nonnegotiable .
chartis is the leading provider of research and analysis on the global market for risk technology and is part of incisive media .
the common cause of lower demand is an economic down - turn which as a general business risk should be borne by the private partner . however , lower demand may also depend on competing facilities , network risks , or other subtle risk events .
but more needs to be done . by focusing on risk - adjusted performance , not just on traditional accounting measures , business managers will develop a better understanding of the risk implications of their decisions . for businesses that require large amounts of risk capital , suitable metrics include shareholder value analysis and risk - adjusted returns on capital . a risk - adjusted lens helped one credit card company understand , contrary to expectations , that returns from new customers and customers about whom it had little information were more volatile than returns from existing customers , even if these groups had the same expected customer value . historically , that had been the key metric for approving new customers . now the approval process also takes into account the higher risk that is associated with new customers .
[ 6 ] for a definition and deeper explanation of “network risks” , see partnerships victoria ( risk allocation and contractual issues , 2001 ) . other examples of network risk , according to partnerships victoria are when a government agency controlling bulk water distribution may be unable or unwilling to supply raw water to the ppp water treatment facility in the necessary quantity or quality . a more abstract example of network risk is the risk that government will enter into other arrangements for accommodation services competing with those supplied under the contract .
board risk reporting . reports to the board and its committees must go beyond raw data by setting out , for example , what the key risk - return trade - offs might be . data alone probably won’t reveal the real issues or promote proper debate .
in the swiss alps , risk management professionals regard the implementation of new climate change adaptation strategies , such as the swiss integrated risk management approach national platform for natural hazards ( planat ) as the right step forward . planat is a comprehensive and holistic approach , which considers a broad range of preparedness , response , and recovery strategies on a societal level for natural hazard risk reduction ( planat
reichel , c . & frömming , u . u . int j disaster risk sci ( 2014 ) 5 : 41 . urltoken
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risk comes in four main varieties . the first , market risk , takes the form of exposure to adverse market price movements , such as the value of securities , exchange rates , interest rates or spreads , and commodity prices . ford , for instance , was hit by market risk in 2002 , when palladium prices tumbled and it had to take a $ 952 million write - down on its stockpile .
on a theoretical level , local environmental knowledge is increasingly being recognized as an important component in risk management . however , through our research it became apparent that professional actors of risk management do not yet fully implement the potential of local frames of reference and strategies of action into their risk management plans , even though this kind of knowledge contains various prevention , coping , and adaptation strategies that deal with expected future uncertainties ( frömming
demand risk may occur in a contradictory form : the higher the demand , the higher the risk . this happens in projects where the revenue is based on availability . in such contexts , a volume of use higher than anticipated by the government , in terms of the design of the facility , may seriously impact the service quality or even the availability . a compensation mechanism should be established in these cases so as to restore the economic equation of the project contract . this can be done by including in the payment mechanism a portion linked to the use of the service or other measures .
as for defining the level of risk companies will accept , one common approach for them is to decide on a target credit rating and then assess the amount of risk they can bear given their capital structure . credit ratings serve as a rough barometer , reflecting the probability that companies can bear the risks they face and still meet their financial obligations . the greater the level of risk and the lower the amount of capital and future earnings available to absorb it , the lower the credit ratings of companies and the more they will need to pay their lenders . companies that have lower credit ratings than they desire will likely need to reduce their risk exposure or to raise costly additional capital as a cushion against that risk .
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demand risk transfer should be always be considered with caution . significant transfer of the risk , with no mitigation or sharing mechanisms , should only be considered when boosting demand is essential to the success of the project from the government’s perspective ( see section 4 . 9 ) . another general rule for deciding the allocation of use / demand is the scope of the project . if the essence of the ppp is to operate institute tariffs or collect tolls , some exposure to risk should naturally be included in the contract . however , if the contract does not provide the necessary tools for managing the demand risk ( basically , the ability to influence the management of the service provision to the user ) , the risk should not be transferred .
the head of market risk unit leads a team in charge of contributing to the optimization of the liquidity , funding and lending functions of the bank .
, the proposal of a contract without any such volume obligations sounds very tempting . and indeed , a spot contract is a ‘you only pay what you consume’ type of contract . some such contracts really look at what you consume on an hourly basis and multiply that with the spot price for that hour . most spot contracts look at the monthly consumption and multiply that with the average spot price for that month . so , even if your consumption drops to zero , no problem , no energy will be billed . if your consumption doubles , you’ll pay the spot price for that extra energy . no more thresholds to keep an eye on , just simply pay for what you consume . i can understand why some people call that ‘no volume risk’ . but i don’t agree with them . not at all .
finally , to convey the message that the potential downside of every decision must be considered as carefully as the potential rewards , ceos should be heard talking about risk as often as they talk about markets or customers . the ceo’s open recognition of the importance of good risk management will influence the entire company .
even world - class risk management won’t eliminate unforeseen risks , but companies that successfully put the four best - practice elements in place are likely to encounter fewer and smaller unwelcome surprises . moreover , these companies will be better equipped to run the risks needed to enhance the returns and growth of their businesses . without adequate risk - management programs , companies may inadvertently take on levels of risk that leave them vulnerable to the next risk - management disaster , or , alternatively , they may pursue
recklessly conservative
strategies , forgoing attractive opportunities that their competitors can take . either approach will surely be penalized by investors .
a wholesale insurance firm is looking for a compliance analyst to join their growing business in this newly created role as the risk & compliance e . . .
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these elements will go a long way toward improving risk management but are unlikely to prevent all undue risk taking . companies might thus impose formal controls—for instance , trading limits . indeed , the recently adopted sarbanes - oxley act , in the united states , makes certifying the adequacy of the formal controls a legal requirement . yet since today’s businesses are so dynamic , it is impossible to create processes that cover every decision involving risk . to cope with it , companies need to nurture a risk culture . the goal is not just to spot immediately the managers who take big risks but also to ensure that managers instinctively look at both risks and returns when making decisions .
the ceo , with the help of the board , should define the company’s risk strategy . but more often than not , it is determined inadvertently , every day , by dozens of business and financial decisions . one executive , for example , might be more willing to take risks than another or have a different view of a project’s level of risk . the result may be a risk profile that makes the company uncomfortable or can’t be managed effectively . a shared understanding of the strategy is therefore vital .
in such an environment , companies not only protect themselves against unforeseen risks but also enjoy the competitive advantage that comes from taking on more risk more safely . the ceo of one fortune 500 corporation , asked to explain his company’s declining performance , fingered the
lack of a culture of risk taking
; its absence , he explained , meant that the company was unable to create innovative , successful products . by contrast , a senior partner of a leading investment bank with excellent risk - management capabilities noted ,
our trading operation has created a series of controls that enable us to take more risk with more entrepreneurialism and , in the end , make more profits .
1 . 2 describing main risks during the operations phase and potential allocation up 1 . 2 . 2 revenue risk – tariff levels ( only in user - pays ppps )
education and expertise . training programs might be needed for current and new board members . boards should also look at whether they need new members with risk - management expertise .
companies might also be tempted to adopt a more risk - averse model of business in an attempt to protect themselves and their share prices . william h . donaldson , the chairman of the us securities and exchange commission ( sec ) , acknowledged this trend when he told an interviewer that he was concerned about a
loss of risk - taking zeal .
the way we mitigate against this type risk is by buying thousands of interests in thousands of properties . we make estimates about the projected future output of a property in the process of making an offer or buying a deal , but those are guesses based on historical production ; and they’re always wrong . oil and gas do not grow under the ground ; these fluids are trapped there . as you remove volume , there is less fluid in the reservoir and thus less pressure to push the fluids to the
low pressure sink
that is created around the well bore . thus , in the absence of any other risk factors , the production volume normally goes down over time . this is what we mean by the term decline . so to make a guess as to what future volumes are going to be , we plot the recent historic production against time and simply project the
decline curve
forward into future periods to see what those volumes might be if the current decline holds . usually , the assumption is that whatever the decline is now will be the decline for the life of the property under our
guesstimates .
the temperature increase also means that small glaciers are expected to disappear , while larger glaciers will suffer a volume decrease of up to 70 % by 2050 . although the period between 1985 and 2000 experienced particularly hot summers , the swiss glaciers have lost 20 % of their mass within only the last 15 years . in addition to a decrease of water resources , the decline of ice is leading to a loss of stability of adjacent slopes ( rebetez
the heat map gives a top - level indication of whether a company is sticking to its strategy and provides for corrective action . but both depend upon the next two elements of this risk - management program .
in transport projects , if the transport service to the user is not included in the scope of the contract , but the contract relates only to the infrastructure , transferring demand risk does not provide value for money .
sometimes these guesses are off only a little bit and sometimes by a lot , but they are always off . but what happens is that the ones that do better than we guessed and the ones that do worse tend to offset each other . so our guess on any one property is always wrong , but as a group , we are usually pretty close . so our
volume
risk goes way down by owning a lot of properties relative to someone who owns one or a few . out of a thousand leases , if one goes down , hopefully another increases and unless one or two leases make up the majority of the income , they tend to balance out .
professional stakeholders in risk and hazard management are becoming increasingly aware of the progressive potential of the resilience concept , instead of simply trying to keep social - ecological systems as stable as possible and in balance . with the exploration of local knowledge and its integration into risk and hazard management , one can develop an approach that directs attention to the acquisition of local skills and knowledge that help the local population adapt to and cope with future environmental changes .
the second type of risk is simple price risk . the price of oil goes up and down and whoever holds a property is subject to the variances of the markets that set prices . one thing that happens though to me as a buyer is that if i use the same source of price guesses for future periods every day , then the valuations i used over , say the last five years , should be the same as the average price over the previous five years . which is probably not a bad price to use today . going forward with the portfolio we have , same thing though . who knows ? none of us can get away from price risk .
a company’s board of directors should understand and oversee the major risks it takes and ensure that its executives have a robust risk - management capability in place . to assure appropriate oversight , the board must address a few key issues .
in other words , every second company was struck at least once , and some more frequently , by a severe risk event . such events are thus a reality that management must deal with rather than an unlikely
tail event .
an example of a subtle network risk is the risk related to traffic light priority in light rail transport ( lrt ) projects . usually , a government will grant priority at intersections and traffic lights for the lrt vehicles to maintain the commercial speed levels as prescribed . so when the mobility authority does not provide traffic light priority to the light rail and this affects the commercial speed , the private partner should be given relief from punctuality obligations and an excuse for certain payment deductions .
taking and managing risk is part of what companies must do to create profits and shareholder value . but the corporate meltdowns of recent years suggest that many companies neither manage risk well nor fully understand the risks they are taking . moreover , our research indicates that the problem goes well beyond a few high - profile scandals . mckinsey analyzed the performance of about 200 leading financial - services companies from 1997 to 2002 and found some 150 cases of significant financial distress at 90 of them .
in a few industries , companies have already begun to invest in developing sound risk - management processes . for example , many financial institutions—prodded by regulators and shaken by periodic crises such as the us real - estate debacle of 1990 , the emerging - markets crisis of 1997 , and the bursting of the technology and telecommunications bubble in 2001—have worked to upgrade their risk - management capabilities over the past decade . in other sectors , such as energy , basic materials , and manufacturing , most companies still have much to learn .
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if your consumption is higher than 5 . 000 mwh , you will pay the spot price for those extra volumes . if at the end of the year the aggregated volume of the months is 60 . 000 mwh , the volumes you haven’t consumed and for which you got back the spot price ( in certain months ) will equal the extra volumes bought at spot price ( in certain months ) . if you’re lucky , you might have consumed less in exactly those months when the spot prices were high and more in the months with low prices . you could actually make some extra money that way . but it could also be the other way around . the opportunity and risk are even higher when you have a contract that settles on an hourly basis . it should be remarked that in that case , an extra problem occurs of checking such bills based on hourly consumptions , fixed levels and rates .
owning oil and gas interests has two main types of risk that an owner needs to be aware of . factors outside of your control may result in large and unexpected gains , or may lead to sudden loss of income . in this blog post , i’ll explain how i view these factors .
sébastien chaumont & peter imkeller & matthias müller & ulrich horst , 2005 .
a simple model for trading climate risk ,
vierteljahrshefte zur wirtschaftsforschung / quarterly journal of economic research , diw berlin , german institute for economic research , vol . 74 ( 2 ) , pages 175 - 195 .
first of all , it should be remarked that the zero energy volume risk proposition only holds as long as you keep everything open for the spot market . many such spot contracts also have clauses that allow you to forward fix your prices . such fixings are then always made for capacity blocks . let’s say you are a client with such a spot contract and you expect you will consume 60 . 000 mwh next year and you want to fix your price 100 % . your supplier will come back to you with something like ‘ok , your load duration is 6 . 000 hours on an annual basis , so i’m going to fix a 10 mw calendar year block for you’ . if your contract is then regulated based on monthly consumption times the average spot price for that month , every month that you consume less than 5 . 000 mwh , you will pay the fix price and get back the spot price for the unconsumed volumes .
directors confirm this view . a 2002 survey by mckinsey and the newsletter directorship showed that 36 percent of participating directors felt they didn’t fully understand the major risks their businesses faced . an additional 24 percent said their board processes for overseeing risk management were ineffective , and 19 percent said their boards had no processes .
operational risk is exposure to losses due to inadequate internal processes and systems and to external events . for example , allfirst , a baltimore - based subsidiary of allied irish banks , lost $ 691 million at the hands of a single rogue trader whose practices went undetected for five years until he was caught in 2002 .
the level of returns required will vary according to the risk appetite of the ceo and the board . some might be happy taking higher risks in pursuit of greater rewards ; others might be conservative , setting an absolute ceiling on exposure regardless of returns . at a minimum , the returns should exceed the cost of the capital needed to finance the various risks .
credit risk is exposure to the possibility that a borrower or counterparty might fail to honor its contractual obligations . in 2002 , for instance , the bank of new york announced that it would increase its loan - loss provision by $ 185 million , to a total of $ 225 million , for the third quarter of 2002 , largely because of loans it had made to telecom companies .
operating leverage is the degree to which a firm or project can increase operating income by increasing revenue . a business that generates sales with a high gross margin and low variable costs has high operating leverage . the higher the degree of operating leverage , the greater the potential danger from forecasting risk , where a relatively small error in forecasting sales can be magnified into large errors in cash flow projections .
[ 4 ] however , there may be situations where user payments are considered as a source of funds for the project , but where maximizing the use is not the highest priority of the authority ( for example , some dynamic tolling aimed to manage traffic congestion ) . therefore , the authority may decide to remove the demand risk and assume it by structuring the revenue regime under an availability payment scheme .
if a competing facility promoted by the authority ( or by the government in general ) , which was not announced or planned at the time of the tender , causes a down - turn in traffic compared to previous projections , this is commonly ( or should be ) considered a retained risk event . competing facilities are the clearest case of network risks [ 6 ] that should be taken back by the authority .
as with any strategy , a company’s risk strategy should be
stress - tested
against different scenarios . a life insurance company , for example , should examine how its returns would vary under different economic conditions and ensure that it felt comfortable with the potential market and credit losses ( or with its ability to restructure the portfolio quickly ) in difficult economic times . if it isn’t comfortable , the strategy needs refining .
board structures . the board must decide whether risk oversight should be vested in an existing committee ( such as the audit or finance committee ) , in a new committee , or divided among a number of committees . the audit committee might seem the natural choice , but as it already faces expanded responsibility to ensure the accuracy of financial reporting , it might not be able to cope with a further expansion of its charter .
professional actors in hazard management frequently raised the argument that local environmental knowledge is too “subjective” for complementing existing “objective” scientific knowledge used by hazard and risk management plans . but from our point of view , instead of dichotomizing local knowledge and scientific knowledge , we should look for their affinities . “objective” scientific knowledge and its underlying values are much less neutral than often claimed , ignoring certain values and issues and favoring others . as foucault (
it is the taking of risks that ultimately creates shareholder value . the right response , therefore , is to strike a balance that protects the company from the costs of financial distress while allowing space for entrepreneurship . management should have the freedom to work in an environment where the potential rewards of any business decision are consciously weighed against the risks and where the company is happy with the level of risk - adjusted returns resulting from that decision .
based on a holistic approach , the anthropological data not only showed local perceptions of climate change , but also what different coping strategies in agriculture and forestry were used in order to face related natural hazards . these local frames of reference and coping strategies both have an impact on how vulnerable or resilient local communities are in times of climate change . this in turn is important for adaptive risk management dealing with new uncertainties in an ecological and societal change .
to manage risk properly , companies need to know exactly what risks they face and the potential impact on their fortunes . often they don’t . one north american life insurance company had to write off hundreds of millions of dollars as a result of its investments in credit products that were high - yielding but structured in a risky manner . these instruments yielded good returns during the economic boom of the 1990s , but the severity of subsequent losses took top management by surprise .
triggered by the climate change discourse , professionals in risk management , such as scientific advisors and political actors , increasingly realize that these new uncertainties related to environmental changes have to be included into their calculations , instead of maintaining current action plan routines . as dr . ruedi haller , the head of the research and geospatial information section at the only swiss national park , indicated with regard to the significant changes in weather patterns in recent years , which he related to climate change :
) . the multimedia map format that we used allows end users of the map to choose between various map features to access multimedia information such as digital video , digital photos , and written text , which were georeferenced before being integrated into the map . the final map thereby helps users to compare , analyze , and present qualitative and quantitative spatial information . in addition , it creates a platform that visualizes local spatial knowledge and makes it directly comparable with official hazard maps in risk management .
formulating such a strategy is one of the most important activities a company can undertake , affecting all of its investment decisions . a good strategy makes clear the types of risks the company can assume to its own advantage or is willing to assume , the magnitude of the risks it can bear , and the returns it demands for bearing them . defining these elements provides clarity and direction for business - unit managers who are trying to align their strategies with the overall corporate strategy while making risk - return trade - offs .
the data from the safien valley show that a wide range of local environmental knowledge exists in the fieldwork area . much of this knowledge is directly relevant to the local population’s ability to protect against and cope with natural hazards , the occurrence and intensity of which are likely to increase in times of climate change . however , an important finding of our research is that these bodies of local environmental knowledge are rarely taken into account by professionals in disaster control , and they generally do not inform avalanche records . almost all key informants complained that their often highly differentiated knowledge about avalanches or mudflows was rarely considered in the creation of risk and hazard plans :
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as much as we hope for these positive developments , negative events do occur very frequently . the production casing can collapse , wells can
water out
, the operator can take off with everyone ' s money , and so forth .
the most common negative event is that wells get plugged out as non - commercial . remember , with the exception of taxes , you own a non - cost - bearing interest . let ' s say for example way back you or your predecessor in interest signed an oil and gas lease with an exploration company . that lease granted the company and its partners ( the working interest owners ) the right to drill a well . the mineral owner ( s ) received a royalty interest under the lease or leases , thus creating the royalty owners . the company and / or the working interest owners paid 100 % of the cost of drilling , completing , and producing the well or wells and you paid and pay nothing to keep the well producing . they get 100 % of the revenue less the royalty interest , which means they are receiving something like 75 % to 87 . 5 % of the income , but paying all of the bills .
when the working interest owners make less money from the production than the lease is costing them to produce it , and all or most of the possible opportunities have been tried or studied , they will plug the wells and walk away . this means you could be getting $ 1000 a month on a well that is very important to you but that is uneconomic or non commercial for the operator . these companies will not produce a money losing well for very long . so you go from a big check to nothing when non commercial well gets plugged and it can be a nasty surprise . leases all have an economic life ; some are shorter and some are longer ; but eventually the costs are going to exceed the revenues .
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for this analysis , we defined financial distress as a bankruptcy filing , a ratings - agency downgrade of two or more notches , a sharp decline in earnings ( 50 percent or more below analysts’ consensus estimates six months earlier ) , or a sharp decline in total returns to shareholders ( at least 20 percent worse than the overall market in any one month ) .