The Comeback: How The Concert Business Is Going About It

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“There’s two different mindsets with venue owners, agents or managers,” says Peter Gross of Coalition Entertainment, a talent buyer for venues and festivals in 10 states including Nebraska, Florida and Georgia. “There’s one: this is crazy and no one knows what’s going to happen and we’re going to sit back and wait for things to clear and go from there … But I’ve always been a proactive, go get ‘em type.”

Since early March, first with Miami’s Ultra Music Festival and then Austin’s South By Southwest being called off and then Coachella rescheduled for October – along with sports seasons, school years and even Hollywood blockbusters being put on hold – it quickly became apparent that no concerts of any kind would be taking place in the immediate future, with some proclaiming that could be the case for all of 2020, or even longer. The coronavirus pandemic suddenly became a tangible and dire obstacle for the North American concert industry rather than an abstract, distant possibility in a foreign country.

The titanic economic and social consequences of all “non-essential businesses” (an oxymoron to any business owner or entrepreneur), remaining closed for longer than a month led to local government leaders, politicians and business leaders clamoring to reopen. President Trump then gave some guidance as to what that could look like and leaders of some states announced measures to reopen some nonessential businesses as early as this week.
This has shifted the conversation to the seemingly real possibility of venues, at least to some extent, reopening. The big question is still “when?” Almost nothing else matters when it comes down to it in the live business. The answer, however, may depend on where you live, its population density and the political stripes of your state representatives.

Rich Fury / Getty Images / Coachella – Coachella
Coachella, largely seen as a bellwether for the industry and first of the official festival season, was also the first major event to reschedule to fall.

“Things are in constant flux as we all know,” says Madison Entertainment’s Roger LeBlanc, a veteran talent buyer for festivals and clubs, based in Nashville. “One day there is hope that we might get a bit of relief and be able to open up in some partial capacity or other, and the next we are talking about being shut down through 2021. I think the uncertainty is the deadliest of all, sadly.”

But that’s Nashville, and other less dense locales have a different perspective.

“We are currently forecasting a September timeline for reopening, but that could be revised earlier or later depending on the political environment and the success of phase one restarting of the economy,” says Logjam Presents owner Nick Checota, who is based in Montana and operates venues, a restaurant and books shows of multiple size in the small market towns of Missoula (pop. 74.4K) and Bozeman (pop. 48.5K), including The Wilma Theatre and KettleHouse Amphitheatre.

Though his are tertiary markets, Checota’s response is like that of most: things are changing rapidly, including best practices and guidelines. Last week, for example, Missoula’s City-County Health Department implemented plans more stringent than Governor Steve Bullock’s phase one guidelines. Under the governor’s plan, bars, restaurants and casinos can reopen on May 4 with a plan that includes 50% reduced capacity and limited hours.

On the arena and stadium side of the venue business, the buildings await guidance from their respective sports leagues. The President, in his April 16 briefing introducing his “Opening Up America Again” plan, said he “spoke to the [sports] commissioners yesterday,” and that “many of them are going to be starting without the fans” with events “made for television.” He also noted “fans will start coming in – maybe they’ll be separated by two seats. And then ultimately we want to have packed arenas.” Under these directives, it will likely be nightclub venues in secondary and tertiary markets where live music performances open back up first.

Aaron J. Thornton / Getty Images – Fillmore Detroit
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Whether that is a good idea depends on who you ask. “Our strategy with each client has been, let’s talk about it and figure out a climate when you’re comfortable,” Coalition Entertainment’s Gross says. “Our side has been to sit down with each client and say OK, you’re comfortable with September, so we’ve been booking September forward, and if that can’t happen, we’ll reschedule. We’re happy to do the work.”

That brings up the problem of rescheduling concerts to a specific time, where existing tours and other events were planned, leading to a best-case scenario glut of shows.

“It took me three days to undo what took us six to nine months to plan, it’s that quick,” Artist Group International’s Peter Pappalardo said of moving a whole spring arena tour for Five Finger Death Punch. Early decisions led to the dates being moved to fall early in the game. However, “It’s a much deeper problem [than just moving dates]. It’ll take years to sort out what happened and how bad it really was.”

This kind of saturation is usually not a huge concern in the rock/pop world, where there are usually plenty of fans to go around and, maybe more importantly, a whole calendar.

“There’s going to be an oversaturation of festivals being rescheduled on top of festivals already existing, on top of tours being rescheduled and oversaturated with existing tours,” says Prime Social Group co-founder Zach Ruben, whose Columbus-based company puts on large outdoor festivals in multiple markets including Nashville, Charlotte, Columbus, and Grand Rapids. Bonnaroo moving into fall will likely impact PSG’s Breakaway Music Festivals in the region, which typically take place in early fall.

Moving festivals like Bonnaroo and Coachella, with hundreds of artists and potentially hundreds of thousands of fans, could be an example of a situation the concert business hasn’t seen before, a supply-side issue.

“We’re used to demand-side problems and can combat that a little through discounting, aggressive marketing, value-adds, etc., but the industry has never faced a supply-side problem before and no one really knows what to do,” says Mike Mauer, co-founder of Valmont, which provides event sponsorship, marketing and ticketing strategy for venues and festivals.

Concert giant Live Nation, the vertically integrated behemoth of the business and rightly seen as a barometer of the greater global concert industry, announced pay cuts for execs including President and CEO Michael Rapino, who will not be collecting a salary this year, and noted that 15 million tickets had been impacted by the coronavirus pandemic – presumably of just shows it promoted rather than all ticketed events. Live Nation President Joe Berchtold told CNBC’s “Squawk Alley” that the company can survive even without a full year of events. That’s not to say it’s been easy, as the company’s market capitalization has plunged as its stock recovers from a pounding in March, and has announced updated, fan-friendly refund policies for canceled as well as rescheduled shows.

For smaller businesses, relief efforts are having an impact, although maybe seeming like a drop in the bucket at times.

“We did receive PPP [Paycheck Protection Program] funds, which will help our staff and overhead in the short term, but fully appreciate this will be inadequate to address the longer-term issues that face venues and the entertainment industry,” Logjam’s Checota says. “We are also currently developing plans to hibernate Logjam operations and venues for an extended period to enable us to weather what could be an extended shutter period.”

In response to the difficult economic climate, the now-1,000-venue-strong National Independent Venue Alliance has organized quickly to lobby Congress and plead its case as a vital business and driver of $10 billion to local economies annually. Grassroots efforts have had an impact as well, such as one co-organized by HEARD Presents’ Stephen Sternschein who owns Empire Control Room & Garage in Austin, a NIVA member, who says, “There’s a need for an independent voice right now,” adding that many venues are bedrocks of their respective local economies. “Most of the talk has been aligned with the big guys, but there are some issues specific to us.” He’s helped organize the Red River Cultural District’s “Banding Together” relief efforts in Austin after the cancellation of South By Southwest, which has now distributed $40,000 in H-E-B supermarket gift cards to 500 local bartenders, production staff, servers and others currently out of work.

Ethan Miller / Getty Images – Vegas strong
Show Me The Money: The casino realm may be one of the first to reopen, including Las Vegas, where elected officials have expressed an eagerness to resume business as usual, and regional casinos on tribal land.

Any partial reopening will require quick thinking and adaptation from venues, agents and promoters. To cope with reduced capacities at general admission shows, LeBlanc says he’s discussed having two shows a night.

“Most venue owners fight for every extra person per square footage, so as a result, to slice that in half or worse, that math doesn’t work. So you start looking at do you do two shows in one night? That’s one possibility.”

“There’s a real cost related to operating at a lower capacity,” adds Dave Poe, who with Patchwork Presents books and operates clubs and theatres in multiple states, including the 3,500-capacity Criterion Theatre in Oklahoma City. For example, “For full security staff for a sold-out show, how many extra staff do we need to stay a safe distance apart for bathroom lines, merch lines and that sort of thing?”

One sector of the business that could provide clues to what a reopening looks like, and how successful it could be, is the casino realm, where social distancing is presumably possible and where sovereign tribal governing bodies can operate somewhat independently.

Fantasy Springs Casino in Indio, Calif., has rescheduled shows not for fall but July 4 (Chaka Khan), including Pitbull July 11. The dates are a far cry from what was being considered a best-case scenario just weeks ago, although representatives tell local media there are contingency plans if those dates are unable to take place.

Although hopeful of any kind of reopening, nearly everyone in the business has acknowledged the responsibility of keeping fans, artists and staff safe and the possibility of a hasty reopening doing more harm than good.

“Any city or state that opens up too early or certain businesses open too early, any rise in infections is going to push us back and potentially start things over,” Poe says. “For now, we just have to wait and listen to the government and scientists.”

While festivals would appear last in line to be opened back up, much will depend on the specifics of size, site and date, as not every festival these days is a 100,000-person mega-event taking up two weekends in major metropolitan areas like Chicago.

“We have a small boutique festival of only 2,000 people, on a piece of land that can hold up to 50,000, so for that kind of festival to do social distancing is viable,” Gross says of one event taking place in Georgia. Whether that particular show will go ahead if allowed, Gross says, “It’s still too early right now. I’m still holding out some hope but keeping a realistic attitude.”

The question of if shows can physically happen doesn’t mean they would be a winning financial proposition, either. Danny Wimmer Presents’ “Louisville Trifesta,” a trio of major outdoor festivals scheduled in September, was called off for 2020. Despite possibly being able to take place at that time, considering the uncertainty of what fall will look like, and two of the festivals not having announced lineups yet, the decision is understandable, and has been commended by many.

One event seemingly confident of taking place is Electric Daisy Carnival in Las Vegas, which is advertised as sold out and now set for October. Likewise, Miami hip-hop juggernaut Rolling Loud kept its full lineup intact and moved to February.

It may be foolhardy to get too ahead of ourselves, as things are changing so rapidly, including even California Gov. Gavin Newsom on Tuesday talking about plans to reopen some businesses in a matter of weeks, and even schools by early July, which had been thought of as highly unlikely just days ago.

“It’ll pass like anything else; it’s just a matter of time,” Gross says. ”Hopefully things come back quickly but we do it smartly. It’s kind of up to us.”