Thursday, February 3
Changing the Touring Business Model
Moderator: Charlie Brusco, Alliance Artists
Doc McGhee, McGhee Entertainment
Elliot Roberts, Lookout Management
Peter Katsis, The Firm
Peter Asher, Sanctuary Artist Management

Let’s get one thing out of the way. These high ticket prices? They’re not because of high guarantees set by managers. Right out of the gate, the panel of managers made sure that was clear.
“We all know it’s because of us going to everybody and putting a gun to their head and saying, ‘If you don’t pay us this amount, we’re gonna kill ya,’” Charlie Brusco joked.

The answers lie in the new era of the big promoter.

“Ticket prices are going up because of the conglomerate promoters like Clear Channel who took over the venues where we have to play our acts,” Elliot Roberts said. He talked of the late-’90s business model of CCE (or SFX Entertainment) overpaying for acts, which turned into a model of the promotion company owning the venue, getting the facility fees, parking fees and other ancillary income on top of the box office.

“If you go with the younger, independent promoters, ticket prices are much lower,” Roberts said.
“It’s simple. The culture changed five years ago,” Doc McGhee said. “Before then, for 27 years, I never had a guarantee with a promoter. Even eight years ago, we could negotiate terms with the buildings as far as T-shirts were concerned, parking, everything. We could pound them and walk out with a lot of money without the guarantee.”

That took the panel on a walk down memory lane, back to the days when the 25 major promoters in the U.S. “were our partners in the artist because they had an investment from the start,” an esprit de corps that shared the vision for the young artist. There were Mo Ostins at the record companies whom you could take a record to, and they’d listen to it and work on the strategy with you.
“Now, if KROQ doesn’t take the track, it’s over,” Roberts said.

His folk-tinged Tegan & Sara will take years longer to break because of the lack of airplay (outside of Los Angeles’ KCRW, he noted).

Promoters like Bill Graham, Larry Magid and Ron Delsener could take an artist from the club to the 3,000-seater to the sheds. And, as Peter Asher noted, there’s few artists that break at a proper speed these days, with Modest Mouse and its decade-long climb to its current level being an exception.

“Now you don’t have a promoter,” McGhee said. “You’ve got a marketing guy that markets out of somewhere – I don’t know – but there are no good promoters anymore. “The biggest problem is not that the artist doesn’t want to put on the show they want to put on, it’s because they won’t let us. They throw money at you, and you say, ‘Cool.’ And then you end up doing shit you shouldn’t be doing.”

If all this sounds negative, negative, negative, Roberts was quick to shift to the positive.
“I was listening to the other panels talk about the sorry state of the business,” he said. “To me, it’s never been better. There’s more quality young acts now than in 15, 20 years (who have long-term potential).”

In contrast, the ’90s didn’t produce too many long-term acts, with the exception of Red Hot Chili Peppers and Pearl Jam, he said.

McGhee got applause for explaining how greed has destroyed too many young bands. “They have a radio hit and they’re doing the 16,000 seats and the girl can’t sing or the guy can’t sing and people only know three songs ... and they’re charging them out the ass, and all of a sudden, nobody wants to go see them again. Just over the greed factor, we kill new artists.”

McGhee, known for his wit, continued with the zingers. “I didn’t ask for 900 grand; the phone rang,” he said, talking about how, hypothetically, his artist might get a high guarantee. “Would you take that? I say, ‘why not?’ “Then the ticket prices fall into that, and then you lose the settlement. Nowadays, you have to go into the settlement with a lava lamp and a masseuse because the accountant’s sitting in there sobbing. And they go, ‘Doc, is there anything you can do for us?’ And I go, ‘How ‘bout a hug?’”

Speaking of the usual complaint about radio shows and how tough it is to get artists to play free shows, McGhee waxed nostalgic. “It was so much better in the old days when you could buy an 8-ball and give it to the guys, or buy hookers for them.”

As far as guarantees go, the consensus was, if you offer a manager an ungodly amount, they’ll take it. After all, if they don’t take the offer, the artist will probably fire them. And, as Roberts pointed out, the artist might be going through a divorce or financial crisis. They might actually need that money.
“We need to go back to the egg, go back to personal responsibility,” McGhee said.

Artists need to be taught that. For instance, they need to return to the promoters who worked their butts off the first time around. And the artists need to be taught how to be nice to people. Some are so bad as to treat their fans poorly and refuse to put on a good show.

“They’ll ask, ‘Why are there only 3,500 people out there?’” McGhee said. “(And I’d answer) ‘I don’t know; let me take a look at the ticket. Nope, it’s got your name on it. I thought maybe they put my name on it because I could probably draw 3,500.’”