Careers

# Here’s what it would theoretically cost to operate 'Westworld'

HBO

On April 22, HBO's hit series "Westworld" returns for another season of scandal, murder and seduction, but the show's math may be just as interesting. (Stay with me for a second.)

In the show, guests pay to stay overnight in a Wild West-style theme park where they can gamble in the Mariposa Saloon, face off against villainous robbers or embark on steamy affairs. The park is filled with sophisticated lifelike robotic "hosts" that can be tortured or murdered but are prohibited by their programming from inflicting harm.

Guests are paying for custom-made bespoke clothing, immersive nostalgia and the power to do whatever their hearts desire — at no risk.

Would running Westworld be worth it? That depends on how much the park stands to lose — and how much it takes in.

HBO

Revenue = guest rate x number of guests

The park charges each guest \$40,000 for each overnight stay and that, it turns out, is just the base rate. There are also Silver (\$75,000) and Gold (\$200,000) rates, which offer additional amenities and privileges.

For now, let us assume that all guests are paying the standard rate of \$40,000.

In the first episode, Westworld's Head of Quality Assurance Theresa Cullen (Sidse Babett Knudsen) notes that there are 1,400 guests in the park. The official Westworld website indicates that there is a very long wait list, so we will assume the park is always open, always full and that there are no returns or refunds.

\$40,000 x 1,400 guests per day = \$56,000,000 a day

\$56,000,000 a day x 365 days = \$20,440,000,000 a year in revenue

If all 1,400 guests pay the only standard rate of \$40,000 a day, then the park is bringing in over \$20 billion a year in revenue.

HBO

But how much of that is profit?

In the U.S., the industry with the highest net profit margin is the accounting industry, at 19.6 percent. Since investors are apparently clamoring to get involved in the Westworld business and the company's majority shareholder is astronomically wealthy, we will assume that Westworld's profit margin should be similar. Let's say 20 percent.

20 percent x \$20,440,000,000 = \$4,088,000,000

That leads us to believe that the camp should bring in over \$4 billion in profit annually. To put that in perspective, together all 11 of the Disney theme parks generate about \$15 billion in revenue and \$2.2 billion in profit.

Does it hit that mark?

Lawrence K. Ho | Getty Images

Operating cost = revenue - profit

If the park generates \$20 billion in revenue and makes \$4 billion in profit, its operating costs must be the difference between the two numbers, or \$16 billion.

Based on these assumptions, it takes over \$16 billion to run Westworld for one year and \$44,800,000 to keep the lights on for one day — scandal, murder and seduction come at a cost.

Of course there are many variables not included in these calculations. Maintenance, insurance and other considerations would add up. Let's take a look at those big-ticket items.

Artificial intelligence

Creating artificial intelligence is expensive. Facebook's Mark Zuckerberg spent 100 hours building his AI butler Jarvis, and Jarvis is limited to simple voice commands and texts. He can start your toaster, turn off your lights, and play you some music. That pales in comparison to what the hosts of Westworld can do.

Leading AI start-up Sentient Technologies has \$144 million in funding. Sentient has been around for less a decade, so it is safe to say that Westworld would likely need to spend more than \$144 million to develop its near-perfect artificial intelligence.

Facebook CEO and co-founder Mark Zuckerberg.
Mangel Ngan | Getty Images

Mechanical engineering

Creating the physical structure of the Westworld hosts would also be an expensive challenge. Honda's Asimo can hop on one foot and serve you a drink, but it still has far fewer abilities than the Westworld hosts. A previous generation of Asimo reportedly cost \$1 million to manufacture back in 2006. In 2002 a few Asimo models were leased for \$150,000 a month.

Boston Dynamic's Atlas robot is more powerful than Asimo but is far from realistic and weighs 330 pounds. Since all of Westworld's hosts must be lifelike, weight would be a major design hurdle. Atlas has a price tag well above \$1 million as of 2014.

Neither of these robotic examples meets the mechanical sophistication of the Westworld hosts. \$1.5 million is therefore a conservative estimation of the cost to manufacture each of the park's robots.

The show mentions that there is a 10:1 host to guest ratio. It would therefore cost \$21 billion to manufacture the 14,000 hosts. Though perhaps some of the costs of manufacturing could be brought down by show's 3-D-printing-like technique.

NurPhoto | Getty Images

Maintenance

The Westworld hosts are abused and repaired almost daily by a team of medical/mechanical engineering technicians. Hospitals such as these are very expensive to operate. Johns Hopkins Hospital reported nearly \$7 billion in expenses in 2015. The operating costs of Westworld could be commensurate.

Exteriors and interiors of camp buildings, and items of furniture, would also need replacement and repair.

HBO

Insurance

Mitchel Kalmanson, president of insurance company Lester Kalmanson Agency, mused that a real world Jurassic Park (another brainchild of Michael Crichton's) would probably have a \$1.5 million annual premium and would likely be responsible for the first \$5 million claim or so.

According to the Terms and Conditions on the Westworld site, guests have died from "buffalo stampede, self-cannibalism, accidental hanging, drowning, 3rd-degree burns, auto-erotic asphyxiation, blunt force trauma, allergic reaction to non-native plant life, falling from great heights, common manslaughter, and tumbleweeds." With all of these risks, Westworld's insurance plan would likely be as expensive as Jurassic Park's.

Getty Images

Time

The final unaccounted factor is time. Westworld takes place in the future, so technology has likely improved, lowering manufacturing and repair costs. Perhaps the hardest calculation to make is just how far in the future Westworld lies. Technological advancements happening today could be leading us toward a Westworld reality in which life is cheap and robots are even cheaper.

HBO

Final Numbers

Westworld's investors have over \$22.5 billion in sunk costs, including the \$1.5 billion it probably took to construct, assuming it was roughly as expensive to build as Jurassic Park. Considering operating costs, maintenance and insurance, Westworld likely spends over \$24 billion annually.

It seems unlikely that, given those figures, any endeavor could turn a profit, but the park just might do it, at least as long as it operates without competition.

If every guest is only paying the standard rate, Westworld brings in over \$20 billion in revenue a year. Some guests probably pay Silver and Gold rates, and the park offers "a number of shops where guests can purchase a wide selection of gifts, souvenirs, and items." With these additional sources of revenue, the park probably brings in more than the additional \$3 billion needed to cover their operating costs.

Science fiction may be a safe investment after all.

This is an updated version of a post that appeared previously.

Like this story? Like CNBC Make It on Facebook!

Don't miss:

VIDEO1:2201:22
Billion-dollar businesses that didn’t exist before Obama took office