Monday, December 9, 2019

Aspen Live 2019 | Lefsetz Letter

Actually, for twenty attendees, the conference is still going on, they couldn’t get out of town because the airport closed.

That’s Aspen.

And speaking of Aspen, yesterday Rich Burkley, Senior Vice President, Strategy and Business Development for the Aspen Skiing Company, sat down for an interview.

He said Aspen was a destination. And eighty percent of visitors are returnees. So it was about treating them right, saying yes if they complained, even if they were wrong, the key is to maintain the bond.

But the real issue is the IKON Pass.

You see there’s been consolidation in the ski business. There are now two rival companies selling cheap passes, IKON and EPIC. And as a result, more people are skiing and they’re going to dream destinations and the locals are PISSED! They want the mountains for themselves.

But Aspen is limited by its twelve thousand beds.

And the difficulty in getting there.

So why go to a conference that’s a glorified ski vacation?

Because it’s not about the panels so much as who you meet that makes conferences worthwhile. And when you ski with them…my whole social life revolves around people I’ve met in Aspen at Jim Lewi’s conference. Which used to be called the “Aspen Artist Development Conference,” but that was back in the nineties, when labels still had money to spare. So, over time it’s shifted to the live side, where all the action truly is.

That’s what I learned. There are two businesses. The label one that gets all the ink, and the live one.

Bob Roux, President of Live Nation, said his company does seven thousand shows in the U.S. a year. Sounds like a lot, and it is a lot, but there are thirty thousand shows in the country a year. Do you think they’re all from the Spotify Top 50?

No, as a matter of fact, these chartbusters are a disproportionately smaller part of the live business.

So who can sell a ticket? And who controls the ticket? Those are the two big music business questions today.

The promoters pay the artists, far more than the labels, it’s the promoters who build acts, especially those not Spotify Top 50/radio-friendly. Anybody can look at the chart and tell you what’s hot. But what is developing, what has buzz under the radar, that’s a completely different discussion.

So let’s get to the ticketing. Dave Marcus of Ticketmaster warned us about the BOSS act. Never forget that the government can’t understand ticketing, hell, even the fans can’t understand ticketing! So the brokers got in Congress’s ear and want to protect their advantage. They’re like the anti-abortion crew, they never sleep and are always pushing their cause, and if you’re not battling them each and every day, you’re gonna lose. So Marcus is trying to round up people to protect the industry’s interests, contact him, this is important.

But the dirty little secret is while the industry kicks and screams, hates the brokers, they also love them. Yup, sell them some inventory and you’ll protect yourself against loss. Cut a deal for some free inventory and offload the tickets on the brokers. It’s kinda like paperless, it turned out when the whole venue went paperless, the show didn’t sell out. So there’s a mania surrounding ticket prices, and despite all the data, a lot of guesswork is still involved.

So Ant Taylor, CEO of Lyte, is trying to beat the scalpers at their own game.

But I’m wary of outsiders gaining traction in the business. The industry does not want them to. The dirty little secret is the only profit for the promoter is in the ticketing. So…

The acts want a huge guarantee and ninety eight/two. In other words, the promoter gives the act almost all of the face value and makes it up on the ticket fees, and the ancillaries. And the fees are a way to keep money out of the artist fee, you see the artists are greedy, they want a piece of everything, which is why I’m skeptical of Lyte.

So here’s the story with Lyte… You sell your ticket to them at face value, and they have a waiting list of guaranteed buyers. The buyers cough up their credit cards for a guaranteed price, and if tickets are available, they get them.

So, Lyte monitors the brokers. For the first two weeks, prices are inflated, these are the ones you read about in the media. So Lyte waits two weeks and says it then undercuts the brokers. Yup, Lyte says its tech is better than the brokers’, but no one’s beaten the brokers’ tech yet. Try selling a ticket on StubHub, the brokers’ software will immediately underprice it. If you’re buying tickets to resell…DON’T!

But what is the incentive for the fan to cough up their ticket for face value, especially when the show is hot. Maybe a small percentage will go to charity, but…in a world of greed, where everybody’s trying to get rich, there’s no money for nothing, there are no chicks for free.

But let’s say it all works out. The uplift goes to…THE PROMOTERS! Do you think those representing A-level acts are gonna go for this? The promoters say to trust them, that the revenue will show up in the settlement, you’ll get your share… HUH? When did an act ever trust the promoter?

So Lyte had a deal with Goldenvoice for Coachella. I applaud where Lyte’s coming from, but we don’t live in a kumbaya world, and really, since the only money is in the tickets, the promoters, and Ticketmaster, do not want to give up control.

So Michael Belkin interviewed Greg Harris, CEO of the Rock Hall, and he was very impressive, he made you want to get on a plane to Cleveland.

However, we all know the nomination/election process is screwed up. I think they should have closed the doors years ago. We all know the limited number of acts that truly belong in there, just not crowd favorites. As for allowing in hip-hop, I hate the rationalization. Sure, R&B was a huge part of rock, that should not be denied, but now, as rock has essentially died, we have a new starting line and… Shouldn’t there just be a Hip-Hop Hall of Fame? Look at it this way, classical art, pre-nineteenth century, does not go into the Museum of Modern Art, it’s in the Metropolitan Museum of Art. It’s the ROCK Hall of Fame, not the MUSIC Hall of Fame…not only keep out hip-hop, and the undeserving rockers, but the popsters too!

Then again, being an inductee has lost all credibility. Kinda like music in general, as opposed to those classic acts I referenced above.

Now this woman Becky Gardenhire, one of the heads of WME Nashville, was extremely impressive. She was interviewed by Jamie Loeb and suddenly, males felt like they were looking in as opposed to the reverse. Women talk to each other differently than they speak to men. A lot of issues were covered, Becky is making a difference.

As for Marc Ruxin, of Mixhalo…a slam dunk. You get clear sound no matter where you sit. This is happening now, at Staples, at the Park in Vegas with Aerosmith. Come on, unless you’re up close the sound in most venues is…awful. To be able to have a stream sent to your phone, the one the musicians hear? GENIUS!

As for the skiing…

It was a weak year, up until two weeks ago. But Aspen is almost completely open. On Thursday, despite the fog, we banged the powder bumps on the Back of Bell, up by Bonnie’s on Red’s.


Stop railing about exclusion from radio, from streaming services, if you’ve truly got the goods, if you can build an audience, promoters are hungry for you. Not everybody can play, but those left out make all the noise, just like those who believe they should be able to pay ten bucks to sit in the front row for Post Malone.

We’re trying to make sense in this world. Especially in an era where those invested are proffering untruths in order to protect their territory.

But they do call it the music BUSINESS!


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