Music concert touring hit a speed bump in 2010 and production equipment and service vendors can expect a knot on the head as a result. According to Pollstar's end-of-year report, concert touring ticket revenues for the 50 biggest grossing tours globally fell 12 percent, to $2.93 billion, from $3.34 billion in 2009. In the U.S., the world's single biggest music market, the drop-off was even steeper, with concerts here reporting a 15 percent decline to $1.69 billion. And those same top 50 acts played eight-percent fewer shows in 2010, says Pollstar. In short, the music touring market – the sector that the music industry has been looking at to pull itself out of the deepening hole created by cratering CD sales – is contracting.
Aging Rockers
The reasons are varied. Ticket prices rose worldwide by 3.9 percent to $76.69, up from $73.83 in 2009, according to Pollstar's research. Ironically, ticket prices in North America actually fell last year – the average price declined $1.55, or two percent. That, however, mostly reflects Live Nation Entertainment's widespread last-minute discounting on certain shows, to $10 or even $20 a ticket, and the cancellation of others. There is also saturation by the one strong part of the music touring market – vintage artists. Of Pollstar's tally of top 10 touring artists of last year, only two – Lady Gaga and Michel Bublé – are under 50 years old. The others, including classic rockers Bon Jovi, AC/DC, U2, Metallica, Paul McCartney, Roger Waters and the Eagles – are headed to an inevitable senescence where they'll have to hang up their guns, with vendors hanging fewer lights and screens.
Lighting companies say the Pollstar numbers were not unexpected, but came as a bit of shock nonetheless. "Our sales meeting last week was all about exactly that," says David Milly, president of Theatrical Lighting Systems (TLS) in Huntsville, AL, which last year had Women of Faith and Rodney Atkins on the road. It capped two years of watching a trend that he says points to a future of more acts touring but spending collectively less on lighting, video and other production aspects. "We've been standardizing our equipment packages and building smaller, more uniform packages, because that's what the market seems to be asking for right now," he says. "They want a down-sized product offering to accommodate their lower touring budgets."
"Keep it Cheap"
Milly says that accountancy dictates lighting designs in an era when touring budgets have to reflect lower ticket revenue projections. Live Nation, the country's largest promoter, has already reduced its fiscal projections for 2011 and has also announced its intention to pay the artists it promotes less money as part of its overall cost-cutting strategy. "It used to be that someone would say, ‘I've got to have the MAC 700, and if you can't get it for me, I'll find someone who will.' Now, it's, ‘If it's 70 watts, I'm good. Just keep it cheap,'" he says. In fact, Milly adds, the real competition is less between vendors now than it is between the vendors and the budgets they're confronted with, as well as how effects budgets are allocated between lighting and video projection. But at least having a budget, smaller as it might be, is better than having what Milly calls, "A sketched drawing that I have to bid against. Then everyone will be faced with the same amount of money and the question becomes, how much equipment can you send out for that amount?"
Chris Lisle, an LD for tours for Robert Plant, Babyface and Miranda Lambert, says the Pollstar numbers might actually lag behind the effect that the economy at large has had on touring economics. "I started to see the downward pressure on costs two years ago. 2009 was the year we really felt it," he recalls, with rental prices for fixtures dropping by as much as 50 percent due to a combination of lower future revenue projections and tours trying to do more with less.
Lisle says he doesn't expect prices to have to drop much more, if at all. If anything, he's seen some upward movement in rental costs for lighting and projection, because the effects of any downturn in touring revenues have already been priced into budgets for tours going out this year. "Depending upon the scale of the act, they're going to carry less equipment this year, but the bottom line is that, with CD sales continuing to fall, touring is still the way most of these artists are going to bring in most of their revenues," he says. "The revenues may be less than they were three years ago, but they're still going out and touring."
A Broader Base
But like virtually every other industry, those businesses that support touring as a core part of their revenue basis will adapt. The wider use of LED technology offers LDs and other creatives more options to innovatively converge lighting and projection, and lighting systems developers and manufacturers are learning that as the high end of the business gets shaved down, the bottom end of the user pyramid expands, with more opportunity to sell more lower-priced products to more users. The bigger challenge for the future might lie in how artists ranging from Phish to the New York Philharmonic are experimenting with live concerts broadcast to cinemas. But that's another story, and another column.
