{"id":3181,"date":"2010-07-28T14:33:59","date_gmt":"2010-07-28T22:33:59","guid":{"rendered":"http:\/\/lefsetz.com\/wordpress\/index.php\/archives\/2010\/07\/28\/state-of-the-touring-industry\/"},"modified":"2010-07-28T14:36:42","modified_gmt":"2010-07-28T22:36:42","slug":"state-of-the-touring-industry","status":"publish","type":"post","link":"https:\/\/lefsetz.com\/wordpress\/2010\/07\/28\/state-of-the-touring-industry\/","title":{"rendered":"State Of The Touring Industry"},"content":{"rendered":"

MUSIC OR THE ECONOMY?<\/span><\/p>\n

No one knows for sure.\u00c2\u00a0 Is business bad because ticket prices are too high for acts that have been on the road too often playing old material while new acts are ever-harder to develop or is it just that the economy sucks?<\/p>\n

It’s unclear.<\/p>\n

But you can’t trust the prognostications.<\/p>\n

"Pollstar" says revenue in the first half of 2010 is off 17%.\u00c2\u00a0 Live Nation cries foul, claiming that the grosses of the Eagles weren’t included, and that brings the number down much lower…and are the statistics even accurate to begin with?<\/p>\n

One thing we can all agree on is it’s much harder to develop an act with no medium, not radio, television or any one Website, having dominance.<\/p>\n

Then again, more people are listening to more music than ever before.<\/p>\n

I don’t think the economy is the main factor.\u00c2\u00a0 Other retail industries are not off as much.<\/p>\n

THE DARK SIDE<\/span><\/p>\n

Used to be the touring industry was a subsidiary of the labels.\u00c2\u00a0 Not literally, but labels created demand and promoters mopped up on the road.\u00c2\u00a0 Now the labels are close to impotent and crying that they deserve road income.\u00c2\u00a0 But because of their lessened importance, no one is listening to the labels, they’re listening to the promoters, and if labels were always scummy, promoters have historically been bottom of the barrel.\u00c2\u00a0 What I mean by that is at least labels pay by check and the checks don’t bounce.\u00c2\u00a0 Whereas touring has always been about cash, and you’re always worried, especially now that checks are prevalent, that you’re going to get stiffed.<\/p>\n

In other words, do you work for Live Nation because you can get paid?\u00c2\u00a0 Remember Jack Utsick? Everyone was afraid to book a national tour with his company for fear it would blow up.\u00c2\u00a0 It did.<\/p>\n

LIVE NATION<\/span><\/p>\n

Each and every acquisition Rapino has made has not borne fruit.\u00c2\u00a0 One can even argue that it was a bad idea to purchase House of Blues, never mind Trunk, etc.\u00c2\u00a0 Pursuing dominance, streamlining to own the concert industry, Rapino has ended up with too much capacity and not enough profit. Some say he never should have gotten rid of the legitimate theatre and motor sports divisions.\u00c2\u00a0 We can second guess his efforts all day long, but the point remains, none of his purchases have paid off.\u00c2\u00a0 Makes you wonder, right?<\/p>\n

As for Irving…\u00c2\u00a0 Best manager ever.\u00c2\u00a0 Best Chairman?\u00c2\u00a0 Mmm…\u00c2\u00a0 He built MCA Records essentially from scratch, but it took Al Teller to make it truly profitable.\u00c2\u00a0 And Giant Records never really found its way.\u00c2\u00a0 Can he steer Live Nation to profitability?<\/p>\n

Then again, he controls all the acts.\u00c2\u00a0 Fuck with Irving, and you incur his wrath.\u00c2\u00a0 His problem is he’s got too many unwieldy, sometimes diametrically opposed assets.\u00c2\u00a0 His strength is he’s got all those assets.\u00c2\u00a0 For all those who want Live Nation to die, you’ll be stunned at the Holy War you will unleash.<\/p>\n


THE COMPETITION<\/span><\/p>\n

For all the talk of a Live Nation monopoly in touring, agents can book an entire arena tour using independent promoters.\u00c2\u00a0 Live Nation is not necessary, which speaks to Rapino’s point that he’s got to pay or someone else will.\u00c2\u00a0 The only problem is everybody else is not public, they can afford to pass.\u00c2\u00a0 Whereas Live Nation’s got overhead and is a public company.\u00c2\u00a0 The best way to solve Live Nation’s problems would be to refuse to overpay for talent.\u00c2\u00a0 But that might make investors nervous.<\/p>\n

Then again, SFX\/Clear Channel\/Live Nation has never worked.\u00c2\u00a0 Billions were written off.\u00c2\u00a0 The company was spun-off.\u00c2\u00a0 It appears the road to success is via new products.\u00c2\u00a0 Irving keeps telling us he’s got them in the pipeline, that we’re gonna be wowed.\u00c2\u00a0 We’ll just have to wait and see.\u00c2\u00a0 The music business is full of hype, and hype means less than ever before, but Irving controls all those artists, and he can get a critical mass to say yes whereas his competitors cannot.<\/p>\n

AEG<\/span><\/p>\n

While trumpeting the success of Bon Jovi, the Internet is rife with discount offers.\u00c2\u00a0 Most recently, the Groupon offer for the Bon Jovi\/Kid Rock show in Chicago <\/p>\n

\n
$30 for One 300-Level Ticket to See Bon Jovi and Kid Rock at Soldier Field on Saturday, July 31, at 7 p.m. ($66.50 Value)<\/a><\/div>\n<\/blockquote>\n

We can debate demand all day long, but we know two things…<\/p>\n

1. AEG overbooked.<\/p>\n

2. AEG is ignorant when it comes to the Web.\u00c2\u00a0 Fuck up online and everybody knows.\u00c2\u00a0 Just like everybody knew overnight about Napster and started stealing music, everyone knows about concert deals in a matter of minutes.\u00c2\u00a0 Begging the question how savvy AEG truly is.\u00c2\u00a0 In a world where Zynga is triumphant, does Randy Philips even know what Zynga is?<\/p>\n

PROBLEMS<\/span><\/p>\n

All-in ticketing.<\/p>\n

The acts don’t want it.<\/p>\n

The acts love Ticketmaster, it takes the heat.\u00c2\u00a0 See, we price our tickets low, it’s Ticketmaster ripping you off!\u00c2\u00a0 But Ticketmaster is kicking back to the promoter, so he can make a profit.\u00c2\u00a0 So where’s the truth?<\/p>\n

The truth is the promoter has two sets of books.\u00c2\u00a0 One for the artists, another for themselves.\u00c2\u00a0 They’re at a loss in one and a profit in the other.\u00c2\u00a0 The acts drove them to this.\u00c2\u00a0 Then again, promoters have overspent, which brings us to buying…<\/p>\n


TICKETING COMPETITORS<\/span><\/p>\n

There’s just not enough money in it.\u00c2\u00a0 Gripe about Ticketmaster all you want, but at least its system works.\u00c2\u00a0 Live Nation went with Eventim and it was a disaster.\u00c2\u00a0 So who’s going to invest in the infrastructure to create a system that works, that can sell that many tickets quickly, at such small margins?\u00c2\u00a0 Yes, you want a competitor that will sell tickets cheaper, when a competitor would have to charge more!\u00c2\u00a0 And costs include not only infrastructure, but generous deals for facilities and promoters.\u00c2\u00a0 And needless to say Ticketmaster will compete for that business.\u00c2\u00a0 But more importantly, where is the deep pocket that’s going to pony up all that cash for such a meager return?\u00c2\u00a0 Speak with venture capitalists, they want exorbitant profits, and they’re just not there in ticketing, certainly not without raising fees.<\/p>\n

BUYING<\/span><\/p>\n

Some think the problem with Live Nation is in the buying.\u00c2\u00a0 That they’re overpaying and they’re not allowing local decision-makers to do their jobs.\u00c2\u00a0 In other words, is all promotion local?\u00c2\u00a0 Prior to now, superstars would sell out everywhere.\u00c2\u00a0 Now we’ve seen even the Eagles can’t fill stadiums.\u00c2\u00a0 End result, concert promotion is no longer solely about money, but creativity.\u00c2\u00a0 Which acts do you put in which buildings on which day at which price?\u00c2\u00a0 It can’t be done on a centralized\/national basis, because no one individual has that knowledge.\u00c2\u00a0 In other words, you’ve got to trust Michael Belkin and Danny Zelisko to do their thing, let them promote, no one knows their markets better.\u00c2\u00a0 Or, their contracts run out and they go independent and eat your lunch…\u00c2\u00a0 Because now that everything doesn’t sell out, and buying requires intense innate knowledge, he who runs nationally is in trouble. We’ve seen this happen in radio.\u00c2\u00a0 Centralized programming allows you to cut costs and make a short term profit, but your audience decreases, because people no longer like the product.<\/p>\n

SOLUTIONS<\/span><\/p>\n

Irving Azoff has to get everybody on the same page.<\/p>\n

Or else chaos will continue to reign.<\/p>\n

Live Nation is the biggest buyer of talent, Live Nation is the only entity that can effect change.\u00c2\u00a0 And never forget that Live Nation controls so much talent.\u00c2\u00a0 All-in ticketing?\u00c2\u00a0 Must be instituted to regain consumer confidence, but few agents and acts are willing to get on board.\u00c2\u00a0 It’s got to get done.\u00c2\u00a0 And only Irving can bring ticket prices down.<\/p>\n


THE FUTURE<\/span><\/p>\n

Live music will continue to be played.\u00c2\u00a0 It’s just a matter of which acts will be presented and by whom.<\/p>\n

Demand is key.<\/p>\n

But acts must be willing to leave something on the table, not go after every last dollar with endless touring at high prices. Then again, legacy acts need to tour every year for the income…they literally need the money.\u00c2\u00a0 So how you fix that problem…<\/p>\n

And the problem of consumer confidence.\u00c2\u00a0 How do you get people to buy early at a high price? Only by making all seats available and instituting either price protection or refusing to allow discounting.<\/p>\n

As for airline seat pricing, the so-called "dynamic pricing"…\u00c2\u00a0 That’s fucked.\u00c2\u00a0 It shouldn’t be about extricating the most dollars from the marketplace and putting it in the hands of artists, it should be about insuring that hard core fans get good seats at fair prices.\u00c2\u00a0 Paperless ticketing allows this.<\/p>\n

America for too long has been about winners and losers.\u00c2\u00a0 The gulf between rich and poor is so wide you can’t even see across.\u00c2\u00a0 And now we want to institute this in the concert business?\u00c2\u00a0 Music was always cheap.\u00c2\u00a0 It was for everybody.\u00c2\u00a0 Didn’t matter how big your bank account was, you had equal access.\u00c2\u00a0 And unless you resort to Bulldog gigs, few customers at exorbitant prices, and that certainly didn’t work, you’re gonna have to draw a lot of people.\u00c2\u00a0 So those people have to have a great experience.\u00c2\u00a0 People play the lottery because they think they’ve got an equal chance of winning.\u00c2\u00a0\u00c2\u00a0 What if every week a rich person won?\u00c2\u00a0 Or $1000 lottery tickets had much better odds than $1 ones?\u00c2\u00a0 How many would play then?\u00c2\u00a0 It’s all about the aggregate.\u00c2\u00a0 This is what screwed up the labels.\u00c2\u00a0 They wanted few people to pay a lot.\u00c2\u00a0 Whereas it’s about getting a lot of people to pay a little.\u00c2\u00a0 In other words, you don’t want to be the airline industry, but the cell phone industry.\u00c2\u00a0 And in wireless, you don’t get a better connection if you pay more.\u00c2\u00a0 And in wireless they’re always looking forward, to better service, i.e. 4G and new products, i.e. data as opposed to voice.\u00c2\u00a0 In music it’s all about new acts.\u00c2\u00a0 But where are these new acts?\u00c2\u00a0 And it’s about a better experience.\u00c2\u00a0 Better food, treating the consumer with respect as opposed to ripping him off.<\/p>\n

Live Nation is riddled with problems.\u00c2\u00a0 But the company is an easy target.\u00c2\u00a0 Everybody in the food chain must look at himself for solutions to gain traction.\u00c2\u00a0 From the acts to the managers to the agents to the promoters.\u00c2\u00a0 Right now, no one trusts anyone and it’s all about the dough.\u00c2\u00a0 Once upon a time it was about the music.\u00c2\u00a0 Decades ago.\u00c2\u00a0 But thankfully, the big players in music are getting older by the minute and nimble-minded youngsters will eat their lunch.\u00c2\u00a0 Just watch.<\/p>\n

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MUSIC OR THE ECONOMY? No one knows for sure.\u00c2\u00a0 Is business bad because ticket prices are too high for acts that have been on the road too often playing old material while new acts are ever-harder to develop or is it just that the economy sucks? It’s unclear. But you can’t trust the prognostications. "Pollstar" […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[2],"tags":[],"class_list":["post-3181","post","type-post","status-publish","format-standard","hentry","category-music-business"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p96vPs-Pj","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/posts\/3181","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/comments?post=3181"}],"version-history":[{"count":2,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/posts\/3181\/revisions"}],"predecessor-version":[{"id":3182,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/posts\/3181\/revisions\/3182"}],"wp:attachment":[{"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/media?parent=3181"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/categories?post=3181"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/tags?post=3181"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}