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THE LEFSETZ LETTER: Soft Ticket Sales


This weekend you can go see "Shrek" for twenty bucks.


Or maybe not.


In the process of trying to maintain revenue, the movie industry is trying to squeeze every last buck out of its customers for special events. By time they're done, will there even be a movie business? Or will it look more like the Broadway business, a tiny blip in a small location that charges premium prices for tourists?


The music industry was there first. Seeing the decline in recorded music revenues, ticket prices soared. We can blame Live Nation, but let's first and foremost blame the acts. Who not only priced tickets exorbitantly, but scalped their own tickets. They were greedy.


What's the end result?


Bob Lefsetz, Santa Monica-based industry legend, is the author of the e-mail newsletter, "The Lefsetz Letter". Famous for being beholden to no one, and speaking the truth, Lefsetz addresses the issues that are at the core of the music business: downloading, copy protection, pricing and the music itself.

His intense brilliance captivates readers from Steven Tyler to Rick Nielsen to Bryan Adams to Quincy Jones to music business honchos like Michael Rapino, Randy Phillips, Don Ienner, Cliff Burnstein, Irving Azoff and Tom Freston.

Never boring, always entertaining, Mr. Lefsetz's insights are fueled by his stint as an entertainment business attorney, majordomo of Sanctuary Music's American division and consultancies to major labels.

Bob has been a weekly contributor to CelebrityAccess and Encore since 2001, and we plan many more years of partnership with him. While we here at CelebrityAccess and Encore do not necessarily agree with all of Bob's opinions, we are proud to help share them with you.


The club business has been devastated. Live music is about the special event, one doesn't go regularly. It's about paying top buck for a name brand. Take a chance? At these prices!

And now we've got Sarah McLachlan admitting that Lilith Fair tickets are "pretty soft" (the story is everywhere, but it originated on "Billboard": http://news.yahoo.com/s/nm/20100518/music_nm/us_mclachlan)


What Sarah says seems reasonable, that only 300 seats or so out of 16,000 are $250, and that there are 9,000 that are $25, until you click through and try to buy some.


At the local L.A. date at the Verizon Wireless Amphitheatre/Irvine Meadows, the first Ticketmaster choice is:


'Lilith Universe' – Diamond Package


The price? $750 a ticket.


Then we've got:


'Lilith Spirit' – Gold Spirit


The price is: $450 a ticket.



Then there's 'Lilith Spirit' – Silver Package. Prices there are $300 a ticket.

And then, fourth choice down, we come to "NEW FULL PRICE TICKET". Where the options are: $252, $101, $71.50, $41.50 and $31.50.

But it gets even worse. After that, there's a line for "Citi Cardmember Preferred Tickets". And then, at the very bottom, we've got "Lawn 4 Pack Offer". Those are only $14.25 apiece, but after service charges, aren't you just better off buying the ultimate DVD, which you can watch again and again in the privacy of your own home. up close and personal?


In other words, first and foremost, we've got a perception problem. No matter how many super-expensive seats there are, perception is you just can't get a good one unless you pay up, demoralizing potential attendees.

Furthermore, no one on the bill is "hot". There's no GaGa that makes people NEED to go.

And there you've got the modern concert business. People either NEED to go, or they pass. And no matter how cheap you make the tickets, most people won't go if it's not a hot show. Kind of like Broadway, people will pony up for a few shows, and the rest close. In other words, "Shrek" may do decent business, but the non-Shreks will do even worse, because now movies are no longer entertainment on a whim, but expensive planned events, you don't want to get ripped off and you're no longer in the habit of going.

Wow, we need to start over.

Obviously, the best way is to build new stars. But that's so difficult in a world where radio and TV mean ever less and no one's willing to put in the time to build. It's so tough to build, no one wants to see you in the clubs!

And then we've got to rethink the whole ticket-buying culture.

In other words, it's not about beating the scalpers, reaping the margin for the acts, so much as it is about getting the best tickets in the hands of fans for the cheapest price.


Huh? Isn't this the OPPOSITE of what everybody's saying?

Yup.

In other words, if we continue to follow the movie industry's lead, we end up with a smaller business, that excludes most people. Hell, Michael Rapino says the average Live Nation ticket buyer only goes to a show once or twice a year. Don't you remember going once a month?

And GaGa may sell out, but Eagles stadium dates are soft. And you can even get tickets for U2. It seems that other than GaGa, everybody's affected.

Except maybe for Taylor Swift. Who insists that every ticket be cheap. Putting forth an image of democracy, of we're all in it together. Wasn't that how it used to be? The acts and the audience bonded and were one? Before there was a barricade built between the two, with the acts rich on one side, flying in private jets and riding in limousines as their customers feel fleeced?

It's great if you're rich, but most people are not.


Then again, they'll pay for something they want. Like the iPad or iPhone. They garner premium prices, they're hot. But most music products are not.

How do we make the events hotter? How do we make people want to go? How do we maintain the perception the average person can get a good ticket at a fair price?