Cost of Touring Undermines Free-Music Theory

Free-music subsidized via tour income - widely utilized as an excuse in the justification of music piracy - has always been a long shot, unchallenged concept; but the rising cost of gasoline has recently shed light on just how difficult it is to make a living by touring - even in the best of times. Adding insult to injury, artist's creativity is now further taxed with deriving new ways to hit the road without going bankrupt in the process.

From Luciana Lopez, The Oregonian

Tune up the bikes and scrape up the french-fry grease: It's summer touring season for bands. As gas prices climb ever upward, musicians have had to get creative at something more than their music. Portland band Blind Pilot, for example, is traveling under pedal power, and nationally touring psych-rockers Apollo Sunshine are converting their van to run on vegetable oil. There's an easier way to save gas money, though: Portland rocker Michael Dean Damron is just flat-out canceling dates.

Different solutions, but all applied to the same problem: how to balance the need to tour set in motion by declining CD sales against the skyrocketing cost of gas, which makes touring more expensive and less profitable.

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Bon Jovi Joins Van Halen in Scalping Game

From Alfred Branch, Jr., Ticketnews:

It appears that you can add Bon Jovi to the list of artists scalping tickets to their own shows for hundreds, even thousands, of dollars above face value.

Bon Jovi joins Van Halen and other artists in the ticket scalping game as a way of maximizing revenues on their current tour. Band, promoters and venues are now routinely withholding blocks of premium tickets from fans, which they later resell at significantly higher prices through various means, such as StubHub!, fan sites, Ticketmaster or auction sites.

They typically get away with it because the identity of the reseller is not always obvious, but they also face a potential firestorm, as in case of the wildly popular Hannah Montana/Miley Cyrus tour, if fans believe they are being duped.

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Live Nation Launches Global Ticketing Business

From Yahoo Finance:

Live Nation (NYSE: LYV - News) announced today that it has entered into a long-term agreement with CTS Eventim which will enable Live Nation to launch its own ticketing business utilizing the most technologically advanced ticketing platform in the world. Live Nation will exclusively license the Eventim platform in North America, and Eventim will provide back office ticketing services in the UK and ticketing services across Europe. The new agreement will allow Live Nation to begin selling tickets on January 1st, 2009.

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Robert Plant to Tour With Alison Krauss

Cayocosta

BBC News reported that Robert Plant will tour, but not with Led Zeppelin - instead, with country artist Alison Krauss beginning in the UK in May with US dates expected for the summer. Tickets for UK dates are already on sale.

Promoters Offer Whole Lotta Loot to Lure Led Zeppelin Back on Stage

From Times Online:

Led Zeppelin could earn well over £100 million if the hard-rock band went on tour next year in the wake of Monday’s triumphant reunion gig. The band are being pursued with offers from both Live Nation and AEG, the rival concert promoters, with each structuring bids in the form of a large upfront payment to lure the band to their venues.

One source said that “AEG put a bid in on the night” - although that could not be confirmed independently – but intense demand, as already seen for Monday’s gig, would probably make a Zeppelin reunion the most sought-after ticket in 2008. It is likely that the four-piece band would be able at least to match the estimated $212 million grossed by The Police for their reunion this year, according to figures compiled by Billboard, the industry magazine.

Typically, promoters and venue owners pay a high proportion of the box office gross to the artist. Industry insiders say that in the UK the proportion can be as high as 95 per cent. In America, the figure can reach as much 110 per cent – the proportion is higher than the box office gross because the venue owner will make money out of food and drink and at least some of the merchandising.

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2007 Concert Dollars, Attendance Down 10.2%, 19.2% Respectively

Unless you're a major headliner, the make up your lost record sales revenue with touring argument appears to have just lost its credibility.

From Ray Waddell, Billboard:

Overall, North American concert dollars and attendance are down double digits this year, after a record year in 2006 with the Rolling Stones, Madonna, U2, Barbra Streisand and other big ticket tours on the road. North American gross concert dollars for 2007 are down 10.2% to $2.6 billion, and concert attendance is down 19.2% to 51 million.

"Yes, a 19.2% decrease in attendance is very disturbing, since it reflects that the consumers are not really supporting breaking and mid-level talent," AEG Live president/ CEO Randy Phillips says. "If this trend continues, who will be the headliners of tomorrow?"

Related: Live Nation struggles with stock price

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Piracy Effect? Artists Want Piece of Resold Concert Ticket Action

Lost proceeds once derived from recorded music sales prompt artists to seek additional income from ancillary sources.

From Owen Gibson and Sam Jones, Guardian:

Radiohead, Robbie Williams and Arctic Monkeys joined calls yesterday for a levy to be added to tickets resold on the web to allow musicians to claw back some of the profits made by touts and fans.

The acts' managers, together with about 400 other artists, including KT Tunstall and the Verve, said the move was vital to bring some regulation and rigour to a market they described as "the wild west".

They proposed the creation of a Resale Rights Society, which would collect a fee from each ticket sold on eBay and other websites such as Seatwave, Viagogo and GetMeIn.com that have sprung up to satisfy the demand to trade concert tickets.

They said the levy would help to ensure that money raised from the boom in live music flowed back into the industry rather than the pockets of venture capitalists.

With the increased demand for tickets, resale values have soared, fuelling a sizeable secondary market. According to the information service Tixdaq, the market is already worth around £200m a year in the UK. In October, £2m was spent on tickets for the Spice Girls alone.

Marc Marot, chairman-elect of the RRS and the former chief executive of Island Records, said the levy proposal was a "grown-up solution" to a "completely unregulated area".

"The secondary ticketing market offers benefits to music fans and the live music industry alike. It does not make sense to try and criminalise it," he said. "On the other hand there are real issues of consumer protection here. It is unacceptable that not a penny of the £200m in transactions generated by the resale of concert tickets in the UK is returned to investors in the live music industry."

Marot said the move was not intended to boost the bank balances of big names such as Mick Jagger and Sting but to help new artists who increasingly make less money from recorded music sales and rely on income from gigs to make a living.

As record sales have plummeted, the live scene has boomed in recent years with new artists and reformed supergroups playing to wider demographics in better quality venues. A Mintel report in July said the market was worth £743m a year.

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Live Nation Moving Into 360 Territory

From Ethan Smith, Wall Street Journal:

The world's largest concert promoter, Live Nation Inc., has come to a sobering conclusion: Staging live music events isn't enough to drive the growth it needs to thrive in the convulsing music business.

So Chief Executive Michael Rapino has mounted what he calls a "transformation" aimed at finding new ways -- big and small -- to use its platform as a giant in the concert business as a base for expansion.

Part of that transformation means moving into areas traditionally controlled by other players in the music industry, such as record labels. Mr. Rapino has already made waves this year with a $120 million deal with singer Madonna, which, in a first for the company, includes recording as well as touring. He says he is on the hunt for several more such deals. He also made a controversial decision to part ways with Ticketmaster when the company's contract expires at the end of 2008, and run much of the ticketing operation itself.

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For All the Rock in China

From Ben Sisario, New York Times:

As she would anywhere in the world, Karen O of the arty New York rock band the Yeah Yeah Yeahs strode onto a festival stage here last month in costume, looking like a wild, futuristic harlequin in her cape of silver wings and blue-and-green striped tights. Shouting to 10,000 mud-soaked fans who shouted her lyrics right back at her, she thanked them in gasps of Mandarin: “Xie xie ni!”

A couple of days earlier the Brooklyn rapper Talib Kweli was at a gleaming new club across town. And last Sunday, Linkin Park, a group of rap-rock titans with worldwide sales of 45 million, played in Shanghai to a sold-out stadium crowd of 25,000.

They are among the latest in a growing tide of Western acts hoping to crack the vast new entertainment market of China. Once largely closed to foreign music, the country has gradually loosened restrictions and — at a time when record sales in the West continue to plunge, and new sources of revenue have become essential — emerged as a crucial territory on pop’s global map.

“China is on the tip of everybody’s tongue,” said Peter Grosslight, worldwide head of music for the William Morris Agency. “There’s 1.3 billion people there. It’s becoming a much wealthier place. How can we ignore that?”

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Chesney Gloms Beaches

Cayocosta

Kenny Chesney's been very busy lately trademarking literally everything that can be merchandised having to do with sunshine and the ocean; so what better sponsor for his 2008 'Poets and Pirates' tour than Corona Extra - the beer marketed via commercials filmed at beach locations.

By the way, I live on an island and can report first-hand that I feel no compulsion to drink Corona or listen to Kenny Chesney.