Where's the Tour Money

As the structure of the music industry has changed and record sales no longer generate the majority of income, artists have had to turn to other directions to earn a living. Many artists, belonging to major or independent record labels, have returned to the live performance component of the music business. Live performances are one of the very few ways for artists to interact with their fan bases. As many listeners are subscribing to streaming services such as Spotify, the already struggling record industry is experiencing continued challenges. Touring and live performances have successfully sustained many entertainment careers in this struggling industry.

Just as an industry is reinventing itself, Billboard releases a report that many opening acts for your favorite artists are losing money with every show played. As touring is proving lucrative for superstars, once again smaller artists are suffering. The practice of setting ticket prices is a delicate art and could be one of the sole determinants of a well-attended show. As venue sizes increase, this fragile ticketing formula is continually put to the test to benefit the headlining artist.

 As tour and business managers have the interests of the headlining artist as a priority, opening artists are feeling more and more of the pinch. An opening artist with a $15,000 performance fee spends about $10,000 per week on production costs and an additional $7500 per week on crew costs including tour management. As an opening artist, you are often relying on your label for as much financial support as possible given your inability to cover basic touring costs. As an opening artist signed to a major label, it is likely you will not see much income from touring.

As an artist or act becomes larger, the costs of touring also grow larger just as the guaranteed percentage of the tour’s gross income. As the live show requires greater resources, the potential for income also grows as the demand for additional items such as tour merchandise grows. Tour merchandise allows an act to cover additional expenses that have accumulated while touring such as production, transportation and crew costs while being respective to ticket prices and consumers.

With the increased costs of touring, many headling artists may eliminate opening acts and many openers may decline major tours. Artists such as Beyoncé, Elton John and Stevie Wonder perform without opening acts, will the trend continue?

Resources

Waddell, R. (2014, Oct. 3).  In Why are Opening Acts for Superstars Losing Money?. Retrieved Oct. 5, 2014, from http://www.billboard.com/biz/articles/news/touring/6274026/why-are-opening-acts-for-superstars-losing-money