Looking past boxscore downturn, live industry is bullish on state of the business
In any year, gauging the health of the touring business is no easy task, but we'll go out on a limb here: Business is good.
Historically, when relying on anecdotal indicators, the relative health of this business often depends on whom you're talking to. Similarly, although Billboard Boxscore numbers are effective in quantifying the success of certain tours, as a broad indicator of business those statistics can be skewed dramatically by one or two tours.
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Boxscore charts depend on the consistency and accuracy of reports from promoters, venues and managers. Unfortunately, those reports are received in such an erratic way, they aren't the most reliable metric in gauging the overall performance of the business.
Still, if we analyze the numbers and balance them with what the industry tells us, we can still truly get a fix on how things are going out there. So, when comparing what we hear and what Boxscore numbers show, this year we are relying more on what those in the industry tell us: The touring industry is healthy. That healthy diagnosis comes from the seller side.
"Business is very strong," William Morris Endeavor (WME) head of music Marc Geiger says. "It's strong in a multitude of areas that are going through high growth: pop, country, electronic, indie, festivals, international. We're bullish." And that diagnosis also comes from the buyer side.
"Across the board, by every metric that we use, the business was better than the year before," says Charlie Walker, partner in Austin-based promoter C3 Presents. Key executives at the nation's largest promoter agree. "Live Nation had a great 2012 selling tickets in North America and around the world, and we see tremendous opportunity to expand our business," Live Nation Global Touring chairman Arthur Fogel says.
Mark Campana, co-president of Live Nation North America Concerts, adds: "We feel the industry is healthy, and the shows seem to have a bright future for us going into next year as well. We are categorizing 2012 as a strong year." Input from other industry stakeholders echoes these sentiments. In fact, despite what Boxscore reports tell us (we'll get to that in a minute), we believe business is near the record levels of 2009, the year prior to "the great slump" of 2010, a year marked by cancellations, postponements and industry finger-pointing.
The down year of 2010 also lead to a large-scale cessation in Boxscore reporting that has, for the most part, not resumed to any great degree. But evaluations of a healthy, growing live business by those in the trenches does contrast with what Boxscore tells us, specifically that 2012 global Boxscore reports for gross (totaling $3.8 billion) and attendance (more than 53 million) are both down approximately 10%. For North America, the numbers are less disconcerting, with gross up 1.7% and attendance down 6%.
But, when considering the dynamic behind the Boxscore reports, rather than actual business trends, two factors account for the poor numbers. First, the two primary growth areas of the industry today are festivals and international business, both of which are among the most difficult numbers for Boxscore to obtain. Second, following the record year of 2009 -- when global Boxscore grosses hit $4.4 billion and worldwide attendance reached 73 million -- and after both the business and Boxscore reporting took a hit in 2010, one of the most important metrics that boosted the reliability of Boxscore data also dropped a notch.
That key metric? The overall number of shows reported. Nowhere is that more evident than at Live Nation, the world's largest promoter. Live Nation reported more than 9,085 shows to Boxscore in 2009. But midway through 2010, the promoter stopped reporting all shows as a matter of course -- although it still does frequently report certain top-end tours upon request and all shows from its global touring division. (Venues and managers also report tours promoted by Live Nation, but not consistently.)
Last year, Live Nation reported 1,693 shows to Boxscore, and this year, 1,661. Not to single out Live Nation, but when there's that kind of drop-off in data collection, the numbers are skewed mightily. Then there's the inherent cyclical nature of who's touring in a given year, what sort of business is reported to Boxscore and, more importantly, what's less likely to be reported to Boxscore.
The sectors of the live business that are less likely to yield Boxscore reports include casinos (extremely active buyers of talent), a large number of fairs and festivals (the latter particularly strong), international dates (a growing sector), small-venue shows (which are enjoying huge volume these days) and stiffs. Conversely, a rising tide not only lifts all boats, but also lifts Boxscore, and the highest tide ever for touring rolled in last year with U2's record-shattering 360° tour.
"There are a handful of huge superstar acts like U2, Bon Jovi, the Rolling Stones, and when they tour, it disproportionately skews the whole year," says Randy Phillips, CEO of AEG Live, the nation's second-largest promoter. "When you look at stats on touring and you're trying to get a handle on it, you really have to discount the fact that there are these occasional mega-tours that dominate a year, but that doesn't make it a healthy year." Touring's top end last year -- U2 -- was alone responsible for nearly $300 million in box office, whereas this year's top tour -- Madonna -- comes in at more than $70 million less for the year, a testament to what an anomaly U2's numbers were.
Other than U2, the business generated by touring's elite artists is nearly identical for 2011 and 2012, with the top 25 tours for both this year and last generating about $1.8 billion in box office. Seven tours grossed in the $100 million-plus range this year, up from five in 2011, and seven tours topped 1 million in attendance both this year and last.
Everyone likes to work with superstars, but the industry depends on a wide range of artists, venues and events to make for a robust touring economy, and that mix seems to be healthy right now. "I thought  was a really solid year, on a host of levels. Across every discipline, we continue to grow," Creative Artists Agency (CAA) managing partner/head of music Rob Light says. "The live experience has never been more important. People want to congregate, to experience memorable lifestyle events. What I most appreciate about ... what's happening right now, is people aren't locked into saying, 'This is what I like and only what I like.' There's a real mix of people enjoying everything, and that's great for the overall health of what we do." WME's Geiger adds, "You're seeing a lot of touring growth from artists that are succeeding in ways that are hard to measure." We understand.