The live concert/touring biz pulled a rabbit out of the hat in 2005. Mid-year, Pollstar's data indicated that concert attendance had declined in North America by nearly 12% despite the fact that the cost of tickets had experienced their first drop in a decade. Fewer warm bodies in cheaper seats produced a drop of more than 17% in overall revenue. However, by year's end, a tour schedule back-loaded with big names such as the Rolling Stones and U2 pushed the year's total take to $3.1 billion, up 11% over 2004. That's good news, but don't start popping any corks yet. The music business– which, last I looked, was still the part of the entertainment universe responsible for finding and developing the acts that people will ultimately want to see live–tanked for a fifth straight year. The IFPI, the global counterpart of the infamously litigious RIAA, announced in January that global music revenues fell 2% in 2005. The U.S. alone has experienced more than a 20% drop in five years. Digital downloads increased threefold in 2005 over the previous year, to $1.1 billion, with Apple's iTunes accounting for 70% of that. But it's not enough to prop up an industry staggering under a combination of the massive piracy that's collateral to the digital paradigm shift, and its own massive stupidity. (Sometime this year, Apple's deal with the major record labels will have to be renegotiated. With predictable idiocy, the labels are already grumbling that the 99-cent download, which has given them what little ray of light there has been in that business lately, isn't good enough and that consumers should pay more and Apple take less.) Not surprisingly, the IFPI stated further it doesn't expect to see any change in the downward trend in 2006.
So the question is, what's going to drive the concert touring industry in the future? It's not going to be the past, as it has been for the last 10 years. How long can the Stones and McCartney and Springsteen and the Eagles continue to be the big breadwinners for live shows? How many times can anyone see the Stones? (Don't answer that.) Seriously, it would seem that a decaying prerecorded music business is not going to provide the next generation of superstars that concertgoers will be willing to pay high ticket prices to see.
I asked Gary Bongiovanni, editor at Pollstar, what he thought. He expressed a similar concern. "There used to be more correlation between selling records and selling tickets, but we're increasingly a separate industry," he says, adding that the schism is evident in the charts: Music sales are dominated by urban rap and hip-hop artists, while the concert top 10 is mainly white rock acts. "Mariah Carey had high record sales, but she didn't even tour," he says.
Concern about the future is legitimate, Bongiovanni concurs. "The business is being fueled by artists from the '60s and '70s," he says. "They're posting huge numbers, but that can't continue. Age will take its toll. Are we developing the acts that will have long-term careers? Will John Mayer be the next James Taylor? Will Green Day be the next Who?"
There are a few twists that might provide some clues. Broadway–which is now more musical than since the days of Damon Runyon–is booming: Ticket sales were $825 million in 2005, up from $749 million the year before. Broadway is generating three-quarters the amount of revenue that the entire legit download sector is doing –and it's doing it from one city, not the World Wide Web.
It's also worth noting that the second-highest grossing concert series in 2005 also never left the building: Celine Dion's Las Vegas show, which took in nearly $44 million at an average ticket price of $136.70. Elton John is also settled in at a Vegas casino, as is Barry Manilow, who joined Dion among the top-20 grossers for extended-stay performances. It's not a stretch to speculate that Bruce Springsteen could set up shop on the Jersey shore and Pink Floyd could take over a theatre a few nights a week in London's West End and let their audiences come to them.
What this seems to prove is that the live performance continues to impart a value to music that recordings no longer can. But because the old paradigm of making an album and touring to support it is rapidly fading, the live concert business is going to have to look past the crumbling record business to find new crops of artists people want to come out and pay to see.
Local promoters once played a large role in helping baby acts get started by putting them on as opening acts for larger artists. The ability to have that kind of latitude faded in the last decade as Clear Channel came to dominate the concert business. Now, with its touring asset spun off into Live Nation (which Bongiovanni rightly points out will have to concentrate on profitability instead of market share), regional promoters may be able to once again have more leverage that can translate into helping build new careers. Clubs are also going to be more important or the same reason, a topic covered in this space a few months ago.
Live sound professionals need to understand that the landscape is shifting beneath them on a daily basis. This is just another crevasse to cross. Make it an opportunity instead of an obstacle.
