The sobering financials of broadways latest season.

[DAME]

Interesting. Things aren’t so rosy.

https://www.forbes.com/sites/leeseymour/2019/07/11/investors-set-to-lose-100-million-as-broadway-undergoes-huge-market-correction/

[HogansHero]

Things are fine. That's just not an attention grabbing headline. 
 

Most shows lose money, and the more they risk the more they lose. And the big losers won't miss a dime of it.

The article as usual includes the usual embarrassing level of naiveté mixed with some aphorisms that don hold up that well under analysis. But oh well.

[DoTheDood]

The article also mentions that 16 shows closed between Tonys and Labor Day and poses it as if that's abnormal, but from what I can tell that seems pretty on track with Broadway. Isn't that a super common time to close a show?

[haterobics]

If 16 open runs closed, that would be more startling. But a lot of the shows on that list were closing before Labor Day no matter what...

[Mr. Wormwood]

If there's a show that flops on Broadway but eventually becomes a huge hit on the regional/community/school circuit (such as Addams Family, Seussical, Little Mermaid, etc) - does that money go to investors or to the creative team or both?

[bear88]

I know just enough about Broadway box office stuff to make a fool of myself here, but doesn't this happen every single year? Isn't it actually better for plays?

Most plays that open in the spring close by Labor Day or much sooner, either because they don't make money or because the stars in them have other commitments. The lone long-running hit play this season is To Kill a Mockingbird, but this seems like a decent season for investors in plays. The Ferryman recouped and probably closed too soon. Network recouped. What the Constitution Means to Me will come close. Burn This might come close if the article is correct.

That's pretty good, isn't it? In recent years, many people have bemoaned the impossibility of moneymaking, worthwhile plays on Broadway. Frankie and Johnny had other issues, but one of its problems was that it was a two-person play opening in the middle of Tony season with a bunch of praised and popular plays (including one that basically beat it to the punch and had bigger stars). 

As for the musicals, there appear to be only two shows that will likely make a profit, Hadestown and Ain't Too Proud. That's not a high percentage of hits, but compared to what season? In the vaunted season of Hamilton, there was one other musical, Waitress, that really thrived. School of Rock turned a profit, as I recall. That's three new musicals.

In 2017, there were two hits, Dear Evan Hansen and Come From Away, and they're still playing. Everything else lost money.

Last year wasn't a bonanza. The Band's Visit recouped but didn't last. Mean Girls and Frozen are plugging away but are regarded as underperforming shows given the popularity of the source material.

What's so different about this year?

[SmoothLover]

I think they have discovered over the last few years that limited runs of straight plays with big stars are recouping nicely unless they have been a critical disappointment. They can also up the ticket prices. It seems like a lot of plays and musicals closed this year but it is very similar to another season not too long ago.

[OlBlueEyes]

One quick thought for what it may be worth: Broadway produces products of great value, crafted by many of the best in the land of writers, composers, musicians, costume designers, performers of all kinds, and others that I left out.

As evidence of the value we have the people who fly 2000 miles to New York for a rushed visit to five or six theaters on a weekend. Also the relative success of touring companies.

There are still let’s say conservatively hundreds of thousands whose demand for the Broadway product is not being met. Find a way to get the product to those people in one way or another.

[dramamama611]

The article says it all near its end: "And you know what? That's okay. The industry is in fine health even if it isn't constantly breaking records. Hits like Hadestown and Mockingbird prove demand remains high for live theater. The summer turnover is simply a vivid reminder that quality matters, too."


So its all huffing and puffing without real substance.

Yes, end of summer is a big time for shows to close (as is after the first of the year), but this year seems a bit more extreme- maybe because this seaon had a lot of mediocrity.

[massofmen]

operating costs going up every year...capitalization costs going up every year...same amount of seats in the theaters. 

tipping point coming soon...

[g.d.e.l.g.i.]

Mr. Wormwood said: "If there's a show that flops on Broadway but eventually becomes a huge hit on the regional/community/school circuit (such as Addams Family, Seussical, Little Mermaid, etc) - does that money go to investors or to the creative team or both?"

Actually an excellent question, not asked often enough. The answer is that it depends on the terms of the deal, but they often retain an interest in the amateur rights until such time as their investment is recouped from royalties.

(That, incidentally, is part of why Frank Wildhorn could still find investors up through Bonnie & Clyde -- it was a long-range investment, knowing they might not make the money back on Broadway, but there would be lucrative runs in Europe and at the amateur level from which to reap their returns. I say "up through Bonnie & Clyde" because it was the one time they decided to take a more serious risk with a new show of his; it's a fairly exclusively American story that wouldn't play well elsewhere and it might have some amateur legs but so far I've heard of exactly one regional production, but it was so good that they thought he just might buck the trend. It didn't, the J&H revival flopped shortly thereafter, and after two losses in a row, that's why you hear about him working pretty much exclusively overseas.)

[Huss417]

I was looking on Ticketmaster for seats for Tootsie for this weekend. Both shows Saturday and the Sunday matinee must have  70-80% of available seats open. I wonder what if any advance they have.

[OlBlueEyes]

I’m not sure that I can agree that Broadway is in fine shape when four of five shows lose money. “Investors” are really donors, receiving in return a lottery ticket that they might hit a Hamilton or a Book of Mormon.

Remember that we are far into a long period of economic growth and prosperity. When recessions hit donations dry up.

But you could be right that conditions are pretty much the same as usual historically. There’s a tendency to be an alarmist. And Forbes publishes a lot of alarmist articles.

[Jarethan]

To me there seems to be a difference between this season and previous seasons (excluding last year).  For the last 10 - 15 years, business was great right up until Labor Day. I assume a lot of the producers of shows that are closing in early August realized that that is no longer the case.  Kids are going back to college in mid-August and, increasingly, grade schools are starting before Labor Day.  So, there is no point to wait to Labor Day...might as well close before the losses pile up.  I suspect we are seeing a new pattern...instead of Labor Day, the new normal for closing will be mid-August, losing about three weeks in the process.

I agree with posters who say that this has always been the case, the majority of shows each season have always lost money in their Broadway runs.  How do they attract investors if that is the case?  I assume that some investors love the theatre, some love the possibility of Tony awards, some believe in portfolio theory, i.e., 10 flops can be offset by one Hamilton, some are gamblers, some like the excitement, some get some fun and write-offs to offset other income, etc.  With musicals at least, some are hoping for the next Wicked or Lion King or Phantom or Aladdin or Hamilton or DEH or BOM or Chicago.

With rare exception, we have reached the point where most plays open for limited engagements, with stars in lead roles...that is a template that frequently results in returns on investments, though not always, as we know from this season.  That is a change from 50 years ago, where almost everything was open-ended, even if that translated into closing on opening night.  

It would be interesting to know if, over X period of time, the huge profits generated from the hits offset the losses from all the failures over time.  I assume that must be the case, but have no idea in fact.  

[Wick3]

@jarethan, I see your point. I recall Carousel and Spongebob both closed in mid-September last year. It is interesting how a lot of the shows closing this season is doing so before Labor Day. 

I'm not a Broadway investor but I'd imagine that a good number of Broadway investors are simply re-investing the profits they made from other shows (i.e. Phantom/Wicked/Chicago/Hamilton investors).

Also, casting matters. It's really hard to flop if you have an A-list Hollywood/TV celebrity headlining the show. Yes, they're expensive too but at least the show has a higher likelihood of recouping the investment. 

[DAME]

Wick3 said: "
Also, casting matters. It's really hard to flop if you have an A-list Hollywood/TV celebrity headlining the show. Yes, they're expensive too but at least the show has a higher likelihood of recouping the investment."

Because Frankie and Johnnie did so well. 

[chrishuyen]

I wouldn't call either Audra or Michael Shannon an A-list Hollywood or TV star, and it's also been noted how the timing of Frankie and Johnny effected the shows run.

I actually think Ken Davenport has a pretty insightful post on his blog (https://www.theproducersperspective.com/my_weblog/2019/07/is-this-a-sign-of-a-market-correction-on-broadway-coming.html) and I agree with jarethan that maybe August is going to be the new norm. Though I wonder why ALL the shows closing this year so far have chosen a date before labor day. There has to be at least some uptick in attendance then doesn't it?

I think also some shows could cut down on excess spending, like the Moulin Rouge budget just seemed ridiculous to me (though I haven't seen it so I can't say whether it was well spent), and I get the need for spectacle but lately it sometimes feels like every show is trying to outdo the next one.

[Mike Barrett]

Michael Shannon And Audra are nowhere near A list, sorry. No disrespect to them but that’s not A list haha. Sad to hear this for sure but doesn’t seem too surprising. I wouldn’t be surprised if in 10 years a broadway theatre or two close down, and more small off broadway opens.

[alovingfan]

Mike Barrett said: "Michael Shannon And Audra are nowhere near A list, sorry. No disrespect to them but that’s not A list haha. Sad to hear this for sure but doesn’t seem too surprising. I wouldn’t be surprised if in 10 years a broadway theatre or two close down, and more small off broadway opens."

No.  Sorry.  You are wrong.  Michael Shannon is most certainly a A List actor.  As is Glenda Jackson.  Maybe your just out of touch. 

[Wick3]

DAME said: "Wick3 said: "
Also, casting matters. It's really hard to flop if you have an A-list Hollywood/TV celebrity headlining the show. Yes, they're expensive too but at least the show has a higher likelihood of recouping the investment."

Because Frankie and Johnnie did so well."

@DAME, as much as I love Audra on Broadway I do not consider her (or Shannon) A-list hollywood/TV celebrities.

[DAME]

Wick3 said: "DAME said: "Wick3 said: "
Also, casting matters. It's really hard to flop if you have an A-list Hollywood/TV celebrity headlining the show. Yes, they're expensive too but at least the show has a higher likelihood of recouping the investment."

Because Frankie and Johnnie did so well."

@DAME, as much as I love Audra on Broadway I do not consider her (or Shannon) A-list hollywood/TV celebrities."

I have been agent for 26 years.  Michael Shannon is most certainly a A-list actor these days.  Audra is certainly a A lister in the broadway world and her name has some cache out of it.  And Glenda Jackson is in the legend status.  

[Mike Barrett]

Never said a word about Ms Jackson, thank you. If we’re talkiny Hollywood a list, that’s not Audra. I think if anytbing Frankie and Johnny certainly proves Michael Shannon is not an a list name to sell tickets. He’s a phenomenal actor, so I’m not out of touch, look at the sales.

[haterobics]

Huss417 said: "I was looking on Ticketmaster for seats for Tootsie for this weekend. Both shows Saturday and the Sunday matinee must have 70-80% of available seats open. I wonder what if any advance they have."

20-30%

[rg7759]

Good point about the slaughter taking place mid September the past 2 years, and this year a month earlier

[DAME]

Mike Barrett said: "Never said a word about Ms Jackson, thank you. If we’re talkiny Hollywood a list, that’s not Audra. I think if anytbing Frankie and Johnny certainly proves Michael Shannon is not an a list name to sell tickets. He’s a phenomenal actor, so I’m not out of touch, look at the sales."

Honey;  don't take things so personally.  This is just chit chat.  Michael Shannon not selling tickets has more to do with the poor interest in this production,  it's dates, and a very poor marketing campaign.  Michael Shannon is in huge demand. "Alovingfan "made reference to Ms Jackson.  That is why I mentioned her.  Have nice weekend.