“It’s the economy stupid,” and despite it all we still carry on with our business albeit on shaky ground. Fortunately, the bulk of the summer touring season ended just before the disastrous reports from Wall Street became headline news — thus leading us to wild speculation regarding what the future might hold in store for the upcoming winter and spring season.
By the time this piece is published the country will have hopefully chosen a new president, and quite possibly, the effects of the “bail-out” will be reporting a positive outcome in all areas of the economy. Despite an optimistic scenario where Wall Street and the world market does rebound quickly, we will still have to rely upon a trickle-down effect from the “bail-out,” and it may be a few months or more before we see results from the government’s intervention.
Effects on Touring Seasons
Nonetheless, last year’s economy has been nothing less than taxing on all of us (pun intended, damn it) even though some tour returns have looked decent enough. In the July issue of Rolling Stone magazine it was reported that Bonnaroo and Coachella, two major summer festivals, failed to sell out for the first time in years. The Stevie Wonder, Janet Jackson, Maroon 5 and George Michael tours struggled through the summer, and even Springsteen tickets were moving slower than usual. Madonna’s tour posted strong sales as did Radiohead, Bon Jovi, the Dave Matthews Band and Jimmy Buffett to name a few, but the high price of gasoline, though not overly detrimental to the upper echelon of the touring business, did have a far more reaching effect on the smaller touring bands.
Not to downplay the consequence of inflation in regard to the larger acts, but the up-and-coming and mid-level touring bands that were unable to charge $100 or more for a ticket to their shows certainly felt the pinch of the high gas prices in a more direct manner. Regional audio companies all fell prey to the budget crunch, and the busier ones I spoke with grumbled about less work, while the smaller companies complained that there was none at all.
Marketing Tours
In the past — though having a shallow concept in regard to the bands — marketing tours have always had seemingly deep pockets, but this year they too felt the walls of the economy closing in on them. These marketing tours, with the backing of record labels and major corporate sponsorship, introduce their wares while at the same time presenting young and rising stars to perform in malls from coast to coast. The past few years has seen a boom in this kind of marketing, and the company I work for is often hired to provide audio for the marketing firm in charge of presenting artists such as Ashlee Simpson and The Plain White T’s to their adoring public.
This year, the negotiations broke down between the marketing firm and myself while we were engaged in the process of trying to plan a 12-week summer mall tour with Coca Cola and Kate Voegele. Although my prices had only been modestly adjusted to account for higher gas and travel costs, the marketing company balked at the final price. After a bit of haggling, we finally settled upon a flat fee for the equipment rental with the marketing firm agreeing to provide travel, accommodations and salary for my technicians, as well as the cartage of the equipment from mall to shining mall. I’m positive that the marketing company will never again agree to that type of arrangement, but for three months this past summer two of my techs were working and my audio department had an income from the tour without having to manage all the extraneous cost.
Trickle-Down Effect
Other than that solo three-month tour, this past summer turned out to be a bit slower than usual, although business did pick up a bit in September just before Lehman Brothers, AIG and the rest of Wall Street went belly up. Although many people may feel that the Wall Street investors have finally received their come-uppance, the negative trickle-down effect has already started to take place as companies and people worried about the state of the economy cut back on their events and shows.
I don’t mean to imply that the shows have gone away altogether, but on my end I have begun to see more of a negotiation process in regard to putting together audio and other aspects of any given production. Hopefully, the government bailout, in association with our newly elected president, will restore confidence and faith in the economy. This positive influx of cash will only trickle down to us on the heels of the negative trickle down, however, leaving us all in a worrisome predicament for more time than we would like.
Settling for Less
Business loans have dried up and the banks that are still viable are overly cautious in regard to extending credit. This is especially worrisome to the smaller and mid-size sound companies that are already in debt up to their ears and need to make payments or even update their equipment. In an atmosphere like this, the buyer that manages to still produce an event is now shopping for a better-than-usual deal to offset their cost of doing business. Unfortunately, the audio company that wants to do business may have to settle for less, and this does not bode well for any of us since this type of business environment causes a negative ripple effect that spreads like rings on a pond.
I apologize for being so downbeat — maybe all of this will be straightened out by the time this article is read, but I am furious about the flagrant abuses of finance and policy that has taken place over the past few years and brought us to this point of chaos. Of course, it would be irresponsible for me to place all the blame on the lenders since it is the borrowers that keep the lenders in business. Regulating the financial industry is an obvious panacea, but more importantly a real change of perception is required much akin to the dieter who benefits more from a change in lifestyle than just a change of diet. Anyway, that said, I must confess that I will miss providing audio for the Lehman Brothers Christmas party… it was always quite the blow out.
