How Much Does It Cost To Rent Madison Square Garden

Pop Concerts, Once Cheap, Now Rival Broadway in Price

May 22, 1990

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May 22, 1990

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Pop music concerts, which used to be an inexpensive alternative to Broadway shows and other performing arts events in the New York metropolitan area, have been steadily going up in price.

This year, the top ticket prices for selected concerts at Radio City Music Hall have reached $50. That was the top price for Frank Sinatra's engagement last week at the Music Hall, which he postponed until mid-June after one performance. The ticket is only $10 below the $60 top price of the best seats for the most expensive Broadway musical, ''Jerome Robbins's Broadway,'' and only $5 less than a top ticket to any other major Broadway musical.

Mr. Sinatra's five sold-out shows at the 5,800-seat Music Hall are expected to gross more than $1.3 million. By comparison, the highest grossing Broadway show, ''Phantom of the Opera,'' is always sold out and brings in more than $550,000 for a week of eight performances at the 1,600-seat Majestic Theater.

McCartney Hits $32.50

Similarly, the ticket prices for arena concerts by pop superstars have climbed to $30. Though the $30 barrier was cracked earlier by Michael Jackson, the Rolling Stones and a couple of other big acts, it is only now becoming commonplace.

Now all 55,000 tickets for Billy Joel's sold-out concert on June 22 at Yankee Stadium are also $30, and so are all tickets for the eight performances of Madonna's ''Blond Ambition'' tour in mid-June at the Brendan Byrne Arena in East Rutherford, N.J., and the Nassau Coliseum in Uniondale, L.I. Tickets for Paul McCartney's two sold-out concerts at Giants Stadium on July 9 and 11 are $32.50. When the Beatles first performed at Shea Stadium in 1966, the tickets were $5.75.

With some exceptions, the tickets for shows that today cost $30 would have cost $20 to $25 five years ago. During that time top prices have risen from $35 to $50.

The performers stand to make astronomical profits from these shows. Mr. McCartney and Madonna will probably walk away from their New York area concerts with more than $2 million each. And even after they pay their staffs and road crews, they will earn well over a million dollars, The 3 Main Promoters ''There's been a giant jump in prices in the last 12 months and especially in the last three months,'' said John Scher, the president of the Metropolitan Entertainment Company. Mr. Scher, who is based in Montclair, N.J., is one of the New York area's three leading promoters of pop concerts. His two principal competitors are Ron Delsener, who runs Ron Delsener Enterprises, in Manhattan, and Radio City Music Hall Productions.

The rise in ticket prices for pop concerts is part of a national trend that promoters attribute in large part to bidding wars by representatives of competing arenas vying to book concerts by the most popular acts.

''Thirty dollars is going to be the going price now on a lot of shows,'' said Mr. Delsener, who is promoting the Joel, McCartney and Madonna concerts. Mr. Delsener compared the bidding for the top talent to an art auction. He said one consequence may be that concertgoers have less money for other concerts with lesser-known acts.

Mr. Delsener, Mr. Scher and Scott Sanders of Radio City Music Hall Productions said the downturn in the economy in the Northeast has not affected ticket sales at the concerts they are promoting.

How Price Is Determined

They said the ticket prices for their concerts are determined by several factors. The most important, they said, is the cost of producing a show, which includes signing the performers, renting the facility and advertising. In negotiating with a promoter, the agents for a top pop act ask for an average of 85 percent of the net receipts of a concert after expenses have been paid.

Costs vary from facility to facility and depend a lot on rental and labor costs. Mr. Scher said the total cost of an average arena concert, including the performers, runs to about $200,000 at Madison Square Garden, $110,000 at the Nassau Coliseum and $120,000 at the Byrne Arena. For shows that do not immediately sell out, advertising costs are $25,000 to $30,000. Rents for the three facilities range from $20,000 to around $30,000 a concert, plus a share of the profits.

Perhaps the biggest variable affecting ticket prices is the guarantee a promoter pays to an act. Some popular acts demand as little as $25,000, but the guarantees can go as high as $100,000 to $200,000. If a show is successful, the promoter earns 10 to 20 percent of the net receipts. Infrequently, a promoter can lose $200,000 to $300,000 from a poorly attended stadium event. Mr. Scher said that 80 to 85 percent of the his company's arena shows were profitable.

Other Costs Are Stable

Even while the price of talent has risen, he said, the other costs of promoting concerts in the New York area over the last year have remained steady, rising less than 5 percent at Giants Stadium and the Byrne Arena and decreasing slightly at the Nassau Coliseum.

Like almost everything else in Manhattan, the costs of producing concerts are considerably higher than they are in New Jersey or on Long Island. This summer, the top prices for Shirley Bassey's Carnegie Hall concerts on July 12 to 14 are $50, which is $10 more than her concerts cost last year. Mr. Delsener, who is promoting them, said the rise was a result of living-cost increases for Carnegie's unions.

At Radio City Music Hall, the first solo act to crack the $50 barrier was Ella Fitzgerald last year. For her one-night return engagement last month, the top price was again $50. Both concerts sold out, each grossing more than $250,000.

At the Low End

This is the second year that Radio City Music Hall will also promote the Reebok Riverstage series of pop concerts at Pier 84, starting on June 13. At the request of New York City, which leases the site to Radio City, the ticket prices will be markedly lower than at other concert venues. With few exceptions they will be $17 for advance tickets and $19.50 for those bought on the day of the show. The series opens with Rickie Lee Jones and Lyle Lovett. Some of the other performers scheduled to appear include Alice Cooper, Ziggy Marley, Tears for Fears, Bad Company, B. B. King and the Moody Blues.

Other variables also affect the pricing of pop concerts. Performers whose shows involve the aggressive merchandizing of T-shirts and other memorabilia tend to take into account the possibility that a high ticket price might cut into its merchandising revenue. Some artists can gross almost as much in T-shirt sales as in ticket sales. Acts like Def Leppard, Bon Jovi and New Kids on the Block, which have young, loyal audiences, sell as much as $10 in merchandise for each person attending.

The Age of the Audience

While the generational divisions in musical taste of the late 1960's and early 70's have blurred in the last two decades, they can be sensed in the ways that audiences of different ages approach pop music entertainment. Thus ticket pricing is strongly influenced by the age of the audience and the type of music being offered.

The standard method by which young rock bands build up audiences is through constant touring, going from clubs to middle-size halls to large arenas. Because those audiences are mostly teen-agers with limited income, new performers use lower-than-average ticket prices to cultivate and then hold a loyal audience. Mr. Scher cited Bruce Springsteen, the Who, the Grateful Dead, U2, Robert Plant and Def Leppard as top acts that have followed this course.

When the Who played Giants Stadium last year, for example, the tickets were only $23.50. Tickets for Depeche Mode, which has sold out its June 16 Giants Stadium engagement, are $22.50. New Kids on the Block's Giants Stadium shows on July 20 and 21 are $25. Depeche Mode and the New Kids both have young, ardent followings.

Successful and durable performers like Mr. Sinatra and Miss Bassey, who bills herself as ''the world's greatest female entertainer,'' cultivate a flashy, ''high rolling'' aura that attracts a ''big spender'' type of audience. By paying a lot for tickets and dressing up to see their shows, audiences partake in the glamour of the event.

Veteran rock acts like the Grateful Dead, however, build their reputations on a populist working class mystique. The Grateful Dead, it is believed, haven't played to an empty seat in a decade. This summer the Dead are embarking on an extended national stadium tour. Depending on the city, the ticket price will range from $22.50 to $25.

The Elegant Cabarets

Roughly the same measurements that apply to concerts also apply to clubs. Elegant cabarets like Rainbow and Stars and the Cafe Carlyle have a $35 cover charge for an affluent over-40 crowd that is expected to order lots of food and drink.

Jazz clubs that book big names have a long tradition of being pricey. Depending on the act, the Blue Note, New York's biggest jazz club, in the West Village, charges anywhere from $15 to $35 and a $5 minimum per person at tables.

In rock clubs, which have younger audiences, the prices are a little lower. The Ritz, on the site of the old Studio 54, charges around $20 a show with no minimums. But that also can mean no seating. In New York right now, the club that has held the line on ticket prices is the Bottom Line, a rock showcase club started in the 70's. The average ticket price at the Bottom Line is $13.50 on weeknights and $15 on weekends.

So far, the rise in concert prices has not encountered strong public resistance. But how far can it go?

''There is not a bottomless pit of discretionary income out there,'' Mr. Scher said. ''The public will pay anything to see the superstars. But at what cost to the economic health of the rest of the entertaiment industry?''