ONTD

7:50 pm - 02/09/2013

Can the Concert Industry Survive After Mick Jagger, Bruce Springsteen and Madonna Retire?



This critical mass of such "legacy acts" might push 2013's totals beyond 2012's record sales numbers, estimated at $4.7 billion. That figure was boosted by sold-out tours from very familiar faces, with the three top-grossing performers -- Madonna, Roger Waters and Springsteen -- all card-carrying members of the Rock Hall and long since qualified for AARP membership as well. In fact, six of the top 10 touring acts in 2012 were age 54 or older, and they took in 67 percent of the box office among the industry's leaders.
But here's the rub. While North American grosses hit an all-time high in 2012, fewer seats were filled. The total number of tickets purchased by concertgoers -- 36.7 million -- was down 9 percent from the industry's banner year of 2009. So what's at work here? You guessed it: Ticket prices are reaching new heights, thanks largely to legacy acts, whose average ticket cost more than $100 in 2012. Paul McCartney, Van Halen, Rod Stewart, Aerosmith, Waters and Madonna were in this company last year, headed by The Rolling Stones, whose stupefying average ticket price exceeded $500 (a back-of-the-house, obstructed-view seat at Brooklyn's Barclays Center fetched $176).


Given the fact that revenues are padded by these long-established artists -- even as attendance drops -- should the live entertainment industry be concerned that some of these groups will retire in the not-too-distant future, taking with them their deep-pocketed supporters? These music fans have grown comfortable paying hundreds of dollars for a chance to watch their favorite rockers give it one more go. Will their children do the same? How about their grandchildren?
We're at a fascinating crossroads. The modern touring rock industry emerged in the late '60s, during the heyday of such venues as Bill Graham's Fillmore East and West in New York and San Francisco, respectively, Jack Boyle's The Cellar Door in Washington, D.C., and Don Law's Tea Party in Boston. Rock music didn't move into arenas until the early '70s, a development that prompted Graham to close his clubs, announcing his decision via a letter to the Village Voice that decried "the unreasonable and totally destructive inflation of the live concert scene."
So how are the smartest people in the industry preparing for the next big shift?
"We need fresh acts to appeal to new generations," says Michael Rapino, president and CEO of Live Nation, the world's dominant tour promoter. "The Rolling Stones was an epic tour, but it's not a long-term business." Rapino suggests that this process already is in motion, as six of the top 10 Live Nation tours of 2012 were by artists whose first hit was in the 2000s, including Lady Gaga, Coldplay, Jason Aldean, Drake, Rascal Flatts and Nickelback. "The beauty of this industry is there are always new acts to win our hearts."
Chip Hooper, worldwide head of music at Paradigm, echoes this sentiment: "Today you're talking about one group of bands, but what is contemporary and what is heritage just keeps changing as time goes marching on. If you took a snapshot of today, yeah, there'll be some older artists who won't be touring in a couple years, but then there'll be new older artists because younger artists are getting older."

Still, it remains an open question as to whether today's concertgoers will continue to follow a singles artist like Rihanna into her dotage and whether they will pony up for the ever-escalating price for a live-concert experience. "As concertgoers age and inflation increases the price of nearly everything, ticket prices will rise in conjunction," says industry analyst Dan Greenhaus, chief global strategist at BTIG. "When Coldplay play Madison Square Garden with a crowd averaging 50 years old rather than 30 years old, the higher-income-earning crowd will part with more money. The transition from The Eagles and CSN to Bon Jovi and U2 to Coldplay and Foo Fighters might be difficult for some interested parties -- but the transition will occur."
The answer might be to think smaller, says Tom Windish of The Windish Agency, which reps more than 500 acts including Foster the People, Gotye and 20 of the performers at the 2012 Coachella festival. "If I was a promoter, I would be analyzing which markets could use a 2,000- to 5,000-capacity venue and what obstacles are in the way to creating one," Windish says. "As an agent, there are many cities where there is just not a suitable venue for a band who can sell this number of tickets. It takes time to open a venue of this size for many cities, and it can't happen soon enough."

Andrew Dreskin, co-founder and CEO of Ticketfly, one of the nation's largest independent ticket companies, also suggests smaller is better. "We are experiencing what I call the democratization of music," he says. "Today there are fewer arena and stadium acts, but there are more midsize artists, thanks to social media. Today we find out about new artists via what our friends are sharing on Facebook and listening to on Spotify. This is creating a very healthy middle market in the music business -- more midsize bands, clubs, theaters, amphitheaters, festivals, etc. Some of these acts will percolate up and become the arena acts of tomorrow; Arcade Fire, Radiohead, The Black Keys and Muse are good examples."
In search of free-spending music fans, the industry also is expanding into foreign markets. In December, Rapino announced the opening of Live Nation's Moscow office. "Russia and nearby markets have become an important part of our global tours in recent years," he says, "and by establishing a local presence, we can rapidly scale our concerts for over 200 million fans." South America also has become a prominent destination. Lollapalooza Chile and Lollapalooza Brazil debuted during the past two years, while McCartney, U2, Madonna, Lady Gaga and Waters toured through the region.
The Internet has mapped out the new territory, says Jay Marciano, president and CEO of AEG Europe. "Digital exposure has made it easier for new artists to build global fan bases, and it is my belief that mature markets will benefit from new artists who originate from outside the U.S. and Europe. Niche artists actually create more opportunities for promoters."
These niche artists won't headline arenas, like legacy acts do. So there will likely be an increased emphasis on the early mainstays of the touring industry: theaters and large concert halls. As if to underscore this point, Live Nation has built and rebranded clubs named after Graham's Fillmores in Charlotte, Detroit, Denver, Miami Beach and Silver Spring, Md.

In an effort to engage Gen Y music fans, promoters have placed a newfound emphasis on music festivals, which continue to energize the nation's younger concertgoers (with ticket prices upward of $200). Bonnaroo consistently sells out in advance, Coachella has expanded to two weekends, and the Electric Daisy Carnival drew 300,000 attendees over three days to the Las Vegas Motor Speedway last year. "Festivals have become the ultimate real-life community of fans with similar tastes and shared experiences," says Randy Phillips, president and CEO of AEG Live, which owns Coachella and other festivals. "They are also tastemaker filters, like radio used to be, for the discovery of new talent. They have become more profitable for our company and more hospitable for the fan."
The success of Electric Daisy Carnival -- which has evolved from a single-day SoCal rave into a three-day core event in Vegas, with 2013 satellite installments confirmed for Chicago, New York, Puerto Rico and Orlando -- demonstrates that a younger audience still is hungering for an offline, collective musical experience and has highlighted the power and appeal of electric dance music (EDM).
Is it a fad, as critics claim? Absolutely not, say industry experts like Rapino: "When rap, hip-hop, even rock were introduced, people were certain they were short-lived, but as the fan base grows and talent becomes even better, there becomes a lasting space." One who agrees with this assessment is former SFX owner Robert F.X. Sillerman, who announced in June that he would spend $1 billion to acquire the producers of EDM events.
Meanwhile, promoters are trying just about any new strategy to supplement revenues while they can, including taking a piece of the so-called secondary market. The proliferation of online ticket resale platforms such as StubHub and TicketsNow has demonstrated that the true market value of tickets often is higher than the initial face value. Some artists have directly reaped the spoils of resale by directing their own inventory to brokers and online platforms. The bar coding of tickets also allows the possibility for promoters and acts to receive a percentage of resales. Live Nation's Ticketmaster site has the ability to track sales through its secondary platform TicketsNow, and as of January, AEG Live's AXS Ticketing can do the same through an integration with StubHub.
Another increasingly utilized income source comes from selling credit card companies the right to presales. In the case of Justin Bieber's Jan. 18 show at Nashville's Bridgestone Arena, over 40 percent of the tickets were allocated to American Express cardholders. Indeed, so many seats to that performance had been directed to various revenue-building propositions that only 1,000 of a potential 14,000 seats were available for the general public. In response, AEG Live's Phillips acknowledges, "I am not sure why we even have public onsales anymore, since most tickets are now sold in credit card, fan club, venue, sponsor and radio presales."
Not to be outdone, legacy acts offer special "experiential packages," which carry a hefty price tag, pairing choice seats with backstage tours, soundchecks and/or meet-and-greets. Live Nation owns SLO VIP Services, which it purchased from Shelley Lazar, who founded the concept in the '80s as an outgrowth of her years coordinating backstage credentials and comp tickets for Graham and Ron Delsener. Lazar's flagship clients included McCartney, Bob Dylan, Barbra Streisand, The Eagles and The Who. A $750 VIP package for an Allman Brothers Band show during their upcoming Beacon Theatre run includes a front-row-center ticket, preshow reception, merchandise and a collectible laminate.

So will all this work? Perhaps a more pointed question is: Can the live music industry survive the coming generational shift? Will young people show the same passion for live music as their elders -- and do they have the income to support their habit? Tentative signs point to yes, based on festival attendance as well as the rising popularity of such performers as Mumford & Sons, Zac Brown Band, Bassnectar, Grace Potter & the Nocturnals and Vampire Weekend. At its core, the live entertainment industry is built on a certain ineffable, unquantifiable connection between fan and band, which is also why those legacy acts might not be leaving the stage anytime soon.
"In my 43 years of attending concerts and 37 working in it, I find the excitement of live music to be a wonderful constant," explains Michael Marion, general manager of Little Rock's Verizon Arena. "The bubble of the baby boomers continues to roll through our population, and they still want to see the artists of their youth. During their younger years, they came to value the live experience. It was quite often the only time to actually see an artist. There was no MTV, YouTube, TMZ or any other media by which to experience an artist. That sentiment lives on and will continue to play a part in the concert business. Also, we see the younger generation becoming fans of these so-called legacy acts. Artists like Journey, Tom Petty and many others have made a connection with the young people of today. Trust me on this, I have a 16-year-old."


Source
ch33rylips 10th-Feb-2013 01:53 am (UTC)
ch33rylips 10th-Feb-2013 05:12 am (UTC)
Yes a gif totally proving your point I have no choice but to accept it, cause it's not like I went to the tour and saw her live for myself or anything...
cathaea 10th-Feb-2013 02:28 am (UTC)
I'm not a Britard but I don't get why everyone says that FF's sales were terrible. They were better than Onyx and although not as good as Circus, that tour was meant to be her come-back, all-or-nothing tour. The FF Tour didn't have a huge budget behind it, no major sponsors and wasn't meant to break any box office records. So, yeah, it wasn't her most successful tour but it hardly flopped.
eightball 10th-Feb-2013 02:36 am (UTC)
also Circus got 2 US legs. The ff tour did pretty well and got on best of lists in gross, idk where people are getting that it didnt do well.
x_noisekisses 10th-Feb-2013 08:12 am (UTC)
mte
felixdharma 10th-Feb-2013 05:48 pm (UTC)
Exactly and it was her first tour to come to south america which was a blessing for me
This page was loaded Dec 20th 2014, 10:26 pm GMT.