Artists’ business managers say that after the pandemic touring became a lot more expensive.
For Paul McCartney’s recent performance at Hamilton’s TD Coliseum, it wasn’t unusual seeing tickets go for $5000.
By Nick Krewen
Special to the Star
It’s no secret that concert ticket prices have reached unprecedented heights, bolstered in part by the secondary resale market, dynamic pricing and ticketing fees that rise accordingly with each transaction.
In fact, for Paul McCartney‘s recent performance at Hamilton’s TD Coliseum, it wasn’t unusual to see tickets on TicketMaster going for $5000 a piece.
And while it’s convenient to point an angry finger at a promoter like Live Nation or their in-house ticket agency, there’s another source that’s feeling the pinch and forcing fans to pay more.
The artist.
“Concerts and tours are expensive for the artist,” said Patricia Terrence, a partner of Toronto-based Sprackman Terrence, an accounting firm that specializes in business management services for entertainers and boasts an international clientele of Grammy-winning touring acts.
Terrence told the Star those higher costs were caused by the COVID-driven concert shutdown between March 2020 and fall 2022.
And it isn’t the only factor.
“Inflation has risen the cost of everything,” said Ed Gold, founder and CEO of New York-based Gold Business Management, who represents Canadian singer-songwriter Steven Page, soul star Teddy Swims, boygenius’s Julien Baker and heavy metal band Gojira, among others.
Business managers like Terrence and Gold are responsible for dealing with all aspects their clients’ fiscal health, whether it’s paying bills, monitoring investments, dealing with taxes or planning tours.
“Our role of working on the budgets is helpful in that it tells the artist, ‘What can I expect for the work I’m doing? I’m doing five shows a week for 25 weeks. What am I grossing and what am I keeping? And how many shows do I need to perform to make what I need?’” Gold said.
They’re also there to provide a reality check: although it’s up to the artist to either take or reject their advice, business managers present options.
“They may say to me, ‘We’ve done a lot of touring in the van — we’d like to rent a bus this time,’” Gold said. “And I would tell them, ‘OK, here’s a budget with and without a bus. You’re going to be more comfortable and it’s going to be better in so many ways, but this is how much less money you’ll be getting.
“It’s not unusual to do 10 to 15 different versions of the budget leading up to the tour.”
Budget busters
While the type of tour and budget depends on the artist’s stature — club treks will require fewer crew members, while stadium jaunts for the likes of Taylor Swift, The Weeknd and Metallica might employ upward of 200 professionals to transport and assemble stage sets — the blueprint remains the same: all those costs are borne by the artist.
And that list of expenses is a long one: it includes musicians, crews, visas, travel, accommodations, freight, fuel, sound, lighting, insurance, props, wardrobe, special effects and team commissions all taking a larger chunk of the bottom line, thanks to the pandemic.
Patricia Terrence said that the work stoppage in 2020 led to labour and service shortages when live music resumed a few years later. Thousands of support workers left the touring industry, and those that did return demanded higher wages, jumping from pre-pandemic costs of $650 (U.S.) a day to current highs of $800 (U.S.) per show for the more experienced crew.
“There was a good 20 per cent increase in everybody’s fees across the board,” Terrence said. “And it’s very hard to lock (experienced crew) in.”
These crews also secured improved travel arrangements, preferring hotels to sleeping aboard 12-bunk luxury buses, as was common practice.
“People are not willing to rough it out,” Terrence said. “People are just not willing to tour on a leg that’s greater than five hours travel time from one location to the next, so they’re all demanding premium economy. Airfare and hotel costs have gone up and that’s something that the artist actually bears.
“Bussing is now expensive because of the driver and the fuel. If you’re looking at a North American tour spanning over six to seven months — a big chunk of the year — you’re looking at bussing costs over $1.2 million (U.S.) just to lock in two buses for a tour.”
Gold can relate. “Ten years ago, I could remember planning a tour budget where you’d rent a bus — and it wasn’t a luxury bus — at $1,250 to $1,300 (U.S.) a day. That covered renting the bus, paying for the driver, the hotel room for the driver and tolls and gas throughout the tour.
“When we returned post-pandemic — and again, not for luxury buses — we were out $2,000 to $2,100 (U.S.) a day. If you’re doing a five-week tour, that’s a lot of money.”
Stage technicians also had a change of heart, according to Gold.
“After being at home for a year,” he said, “they realized that they didn’t want to be on the road anymore. At that point you had a shortage of qualified techs, so weekly rates for your road crew went up as well. All of those things played into these increased costs, which caused bands, their booking agents and their managers to say, ‘It’s costing more for us to go on tour — so we might need a higher advance, which means a higher guarantee, which could lead to a higher ticket price.”
For younger artists, Terrence says putting an emphasis on their mental health is unintentionally impacting their touring income.
“Artists in the past used to grind in a different way: they didn’t necessarily prioritize their mental health,” she said. “Artists these days are taking longer breaks between legs of touring. They’re touring a lot less, and what that means is that these upfront large costs simply can’t be amortized over a larger number of show dates … It’s inherently creating higher costs across the board for the artist and lower profits, because obviously they have fewer guarantees coming in and less income from their tours because they’re performing less.”
For international artists, costs of visas to enter the U.S. have doubled, assuming they’re able to procure one in time for a tour — thanks to the Trump administration’s downsizing of government services.
“You used to be able to get away with a $5,000 (U.S.) visa,” said Terrence. “Nowadays, it’s a minimum $8,000 to $10,000 (U.S.).”
Then there’s insurance.
“Cancellation insurance has become significantly expensive,” said Terrence, citing costs that could run as high as $200,000 to $400,000 (U.S.) per tour.
“If artists do choose to proceed with cancellation insurance, that’s eating a significant part of their profits. But many artists will actually pass on that because it’s such a significant cost. You can pick and choose what you want with cancellation insurance, whether it be for terrorist acts, health reasons or natural disasters, but if you want to choose them all, they come with a cost.”
Even if circumstances warrant a cancellation, Terrence said insurers are reluctant to honour their policies in a timely manner.
“What we have seen change significantly over the last few years, from an insurance company perspective, is if there’s ever a claim, it’s very hard for the artist to get that claim paid by the insurers,” she said.
“It’s just a long, drawn-out process and these artists — even after paying these significant costs — are out of pocket for a very long time until the claims are settled. Insurance companies just don’t want to pay. So they’re making the artists’ lives very difficult. It again becomes a cash-flow issue that could span over two or three years.”
Easing the pain
While merchandising income and sponsorship deals can, in some cases, turn red ink into black once all the numbers are tallied, there are a few steps that can be taken to decrease the price of tickets.
Maria del Pilar Lopez, of New York professional services firm Citrin Cooperman, would like to see promoters offer artists higher guarantees — a percentage of the profit, which usually ranges from 85 to 95 per cent of a show’s gross income — just to keep up with the times.
“I don’t think that promoters have incorporated the increased costs of everything in the guarantee that they pay the artist,” Lopez said.
Patricia Terrence would like other changes.
“It’s highway robbery for what these artists are paying for freighting of their equipment and for the building of their stages,” Terrence said. “These companies — you have to purchase their stages, which you don’t own — and then you have to lease it from them after paying the costs to build them. There needs to be some oversight so these artists can perform and tour with less of an overhead burden.
“The other thing charged back to the artist is simple necessities (in the venue): a table or chair or sofa in any of the change rooms or offices. They charge you a rental fee to have those brought into the space and the costs of those things are astronomical. I don’t think that’s a fair cost for the artist to bear.”
Lopez is also concerned about the impact higher ticket prices have on developing artists in smaller markets.
“Pre-pandemic, independent and developing artists had so much cash flow and had the backup of so many income sources that when they were able to tour, they were able to profit,” Lopez said. “It was not huge, but they were able to do it.
“Nowadays, it’s difficult for the small tours to be able to survive because the pandemic raised the costs of everything. Now it’s almost prohibitive.”
Ed Gold contends that there needs to be a happy medium established between promoters and entertainers in order to keep ticket prices stable.
“The equation from the promoter standpoint is they still need have a path to make money, and if the artists need more money to cover their expenses, then the ticket prices will need to go up,” he said.
But he also maintains that the appeal of the concert experience will continue to generate demand, no matter the cost.
“Seeing live music is the one thing that’s still rewarding and a communal experience you don’t usually get. I still see this as a very pure place to be in the music industry.”