Cover Design

We just got the cover design for our next book, Theater Careers: A Realistic Guide, to be published by USC Press this summer. We've reviewed the copy edited text of it.  Next we'll see the page proofs.

And in other good news--for us, at least--we submitted the manuscript for our new theater history textbook for undergraduates, A Concise Theatre History, to be published January 2013 by Pearson/Allyn & Bacon.

Yes, I know I spelled "theater" two ways: the two presses have differing style sheets on how the word should be spelled.

Apology

Do to other book assignments, I have been unable to update this blog.  But it is not totally dead.  I continue to update the links on the right: links to current news articles about the business of the theatre.

Federal Arts Funding is a Rounding Error

An excellent essay on arts funding from the federal government is "Federal arts funding: a trace ingredient in the sausage factory of government spending," by Aaron Andersen, posted on Createquity.com.  Read it.  Andersen points out that federal art funding is 0.066% of the federal budget or 66/1000s of one percent.  The percent of the federal income which is not collected because of the income tax deduction for mortgage interest is 200 times the amount spent on the arts, or about 13 percent.

Looking for a comparison, I considered my computer monitor, which has 1,600 by 900 pixels or a total of 1.71 million pixels.  If my monitor was all federal expenditures, the federal funding for the arts would count for less than one horizontal line of pixels on this monitor, 1,129 pixels.  If that number of pixels on the edge of the screen went black, I'm not sure I'd notice.  The mortgage deduction moneys would be 222,300 pixels, about 138 horizontal lines or 1/7 of the screen real estate. That much, I'd notice.

So much political heat about arts funding over so little money.

Review in Latest American Theatre

A review of Stage Money appears in the May-June 2011 issue of American Theatre, the magazine published by Theatre Communications Group. 

Written by Richard Stein, executive director of Arts Orange County, the review is totally positive.  It begins, "For anyone who has ever tried to explain the difference between Broadway and the rest of the American theatre, Stage Money offers a thoughtful, succinct and well-organized overview on how things work."

We couldn't be more pleased because Stein's description of Stage Money is exactly what we set out to write.

NFP Theater Supply Down by At Least One: Intiman of Seattle

The news came out yesterday that the Intiman Theatre of Seattle was canceling the rest of this season and laying off all staff.  The board hopes to restart the theatre with a 2011-2012 season.  We hope they can but it's hard to plan and implement without staff.  

This news made us think about the hubbub started when the chairman of the National Endowment for the Arts, Rocco Landesman, said that theater supply was in excess of demand a few months ago.  Since demand was not increasing, he continued, supply would have to shrink.  We've been seeing the shrinking for several years and some good and vital theaters with national reputations have gone away.  Think of the Theatre de la Jeune Lune of Minneapolis, one of the first to exit even before we knew the world had entered a major recession.  

We weren't surprised.  The "Afterword" of our book, Stage Money, lays out the problem using statistics similar to those Landesman used.  

[An] NEA study, limited to theatres with a budget of at least $75,000, found that the number of not-for-profit theatres had doubled between 1990 and 2005.  Although the financial state of these theatres looked sound at the time of the survey, the NEA findings about the changing size of the theatre audience were troubling.  The study found that audience size in this period, measured by a respected national survey of public participation in the arts, did not grow and in some cases declined.  The audience for musical theatre remained roughly flat as a percentage of the US population, but population growth increased the audience size for musical theatre from 32 million in 1992 to 37 million in 2008.   The absolute size of the audience for straight plays declined, from 25 million people to 21 million.  The question that remains is obvious and stark: how can the number of theatres double if the audience for all theatre has only increased by 1.7 percent? 

In business terms, this would be called a glut, where there is an overabundance of a product causing prices to fall, in a perfect market.  When a farm product is in a glut, some farmers decide to raise something else in the next year.  When a manufactured good is in a glut, companies go into bankruptcy, are acquired or merge with other companies, or change what they manufacture.  Once supply and demand are in better balance, the remaining firms can make a profit again. Recessions often trigger this consolidation.  When the economy is hot, companies on the brink can last a little longer but a recession reveals weaknesses.

The NFP theater is not like a manufacturing company so the effects of a glut on theater are different in some ways.  A community has a sense of ownership of a successful NFP theater and will not readily let one die.

NFPs have two sources of funds: box office and donations and grants.  Many grant making groups have discouraged NFP arts groups from having surpluses; this policy has put some groups at risk.  Grants organizations have been more interested in funding some new initiative, a new building, than in funding operating costs.  Grantsmakers in the Arts, an organization in support of arts grantsmakers, published the results of its "National Capitalization Project" in September 2010, urging its members to reconsider these policies that have put arts organizations at risk in this recession, and not only theaters, but dance companies, opera companies, orchestras, and museums.

For the NFP theater, box office counts, too.  In addition to supplying 40 to 60 percent of budget in the NFP theater, a thriving box office convinces donors that the organization is healthy, filling an aesthetic need in the community.  There is some level of audience so low that unearned moneys will start diminishing, too.

(In passing, note that Broadway never has a glut problem because it has only 40 theaters to fill.)

One doesn't get to choose directly which companies will survive. We don't get to choose directly which theaters will survive this recession.  The issue is not only artistic.  In the case of Intiman, the board says, a history of running in the red and carrying excess debt has lead to their shuttering now.

Some have argued on theater blogs that this conflict between supply and demand doesn't apply to the NFP theater because the people involved are making art.   Nice idea, but even artists have mortgages and health costs and student loans, etc.  Yes, artists will tighten their belts to hang on.  But as we looked at average wages for theater artists for our next book in process, Theater Career Facts: What Students and Parents Should Know, we found that for many theater artists, there is little room left for economizing already.

New Manuscript Submitted So We're Back to Posting

It's been a while since posting here because we were finishing the review draft of our second book.  Titled Theater Career Facts: What Students and Parents Should Know, it resembles Stage Money in being a fact-based, money-oriented discussion.  Theater Career Facts covers the paths available to high school grads and new BAs, the costs involved, and the likelihood of financial success working in the theater.  In addition to having a minimum of advice and opinion, it is unusual for books of its ilk in being about almost all careers in theater, not only acting.  The manuscript is at the publisher and will probably be published in Spring 2012.

Americans for the Arts Bringing More Bad News

The Americans for the Arts, an arts advocacy group, just published its National Arts Index and the data aren't encouraging.  The Index attempts to be for the arts what the Dow Jones Industrial Index is for the stock market.  To that end, the National Arts Index combines data from many different aspects of the nation's arts endeavors, some denominated in money, some in degrees, some in world premieres, some in percentages.  How one can justify combining these varied numbers into one number is difficult to imagine.  (The Dow Jones is statistically manipulated but at least starts with things that are all the same denomination: stock prices.)  But even if the Arts Index is unrealistic, the report is not because it details from where the figures come.  The data the Americans for the Arts published are dismal, if not surprising, to anyone interested in the arts.

Over the period from 1999 to 2007, not-for-profit arts revenues grew 21 percent but the number of nfp arts groups, fighting for a share of those revenues, went up 60 percent.  Attendance at live theater dropped from 50 million in 2003 to 39.6 million in 2009.  This is based on market surveys by  Scarborough Research. According to figures coming from the Theatre Communications Group, attendance at nfp theaters went from a high of 34.3 million in 2003 to 30 million in 2009.  Giving to nfp arts groups is down from most sources.The number of world premieres performed by American theaters is down from a high of 348 in 2003 to 247 in 2009.   

As the report notes as the first of its findings in the introduction: "The arts follow the nation's business cycle."

Don't Start a Theater Company!

Backstage this week has a brief essay titled, "Need an Acting Job?  Start a Theater Company."  Please don't, at least, don't start one to get a job. 

"Why open a theater company? Simple: So you can work," author Reginald Nelson writes.  Were it that simple.  A theater company is a small business and as such has all the requirements of a small business plus the demands of artistry.

Add to that two facts--the not-for-profit theater in the US is overbuilt, meaning there are too many theaters chasing too little audience, and the US is just coming out of a recession--and the conclusion is clear.  Without some sort of "angel" providing regular money inputs to a new theater, it's unlikely to be successful.

Of course, our book Stage Money has background on the not-for-profit theater that would be useful for anyone considering founding one.  This blog has a number of relevant essays and facts about the current environment for the not-for-profit theater, including: 

• If You Read Nothing Else about the NFP Theater, Read "Theatre Facts 2009"

• This Recession for One Theater

• The Urge to Merge

• NFP Theatres Saw Trouble Even Before the Recession

• Surveys that Prove the Obvious; NFPs Are Financially Stressed

• Why a Good Theatre Died

 

 

 

The First Review

Our first review is in Southern Theatre, the journal of the Southeastern Theatre Conference (SETC).  The reviewer is--full disclosure--a long-time friend of Jim Patterson but also a theater professional: Phillip Hill, professor emeritus of drama at Furman University in Greenville, SC. Any one who knows Phil knows he is a plain-speaking, upright individual.

The take-away from the review is "Stage Money has something important to offer to everyone with a serious interest in the American theatre."

Complete review follows:

Full disclosure: I first read this book in manuscript and offered suggestions, some of which its authors apparently have adopted. On reading the published version, I still find it intensely interesting and very valuable.

Its authors describe Stage Money: The Business of Professional Theater as a “cynical book,” focusing on how play productions are financed in the U.S. in the early 21st Century. It is “not a how-to book on theater producing,” but a book on “how theater is paid for.” To that end, the authors marshal a compelling array of statistics and production details with extraordinary completeness, at least in respect to the Broadway theatre. Also included are statistics from the nation’s not-for-profit theatres, as well as some other commercial theatre activities. Although “Broadway” theatre can be definitively identified, there is no generally agreed upon definition of “professional” theatre outside of Broadway; the authors admit this limitation and use sampling techniques to document the rest of their universe as fully as they can.

One of the co-authors, Donahue, holds an MBA, and his expertise in legal structures, financial statistics and economic theory shapes the book. Donahue’s co-author is an emeritus theatre professor, a director and a writer on theatre, and the fact that the art is the reason for the money is never overlooked. Many theatre people eschew mathematics, money and legalisms as somehow foreign to their art, but this book demonstrates how central to theatre art these seemingly dreary matters are, and it does so in eminently readable, even entertaining, form. In short, the eschewers are the very people who most need to read the book.

I had thought for decades that I understood as much about Broadway producing as anyone without the actualexperience, but I learned much that I didn’t know before. I have been aware for decades of the increasing importance of the not-for-profit professional theatre (NFP), but this book explores the symbiotic relationshipsamong NFPs and Broadway and the Road in truly enlightening ways. I thought I understood why ticket prices have inflated horrendously during my lifetime, while actors struggled to survive, but I didn’t know the half of it. In short, I think Stage Money has something important to offer to everyone with a serious interest in the American theatre.

One warning: The facts and figures come, for the most part, from the first decade of this century, and are supplemented right up to the publication date. But the data will date quickly, as the authors demonstrate by discussing the effects of the current recession and speculating about what recovery from that recession may entail. They offer their website (www.stagemoney.net) as a source of more up-to-date statistics, but the book will almost certainly suffer as new facts cause the old ones to appear dated.

Read it now.

End quotation.

The Urge to Merge

In the Afterword to Stage Money: The Business of the Professional Theater the impact of the recession on the theater, particularly the not-for-profit theater, is examined. We write that statistics show that the NFP theater was ready for consolidation before the recession.  And a recession always speeds the pace of consolidations.

"Consolidation" is a business term for what happens when some line of business is overbuilt, when there are more suppliers than there are buyers to support.  In response, firms go under, become smaller often via bankruptcy, change their line of business, or merge with other businesses hoping size will save them.  With fewer suppliers, the supply and demand become balanced. We've seen lots of NFP theaters going under and a few going through bankruptcy to reorganize their debt.  Many NFP theaters are staging safer, more middle-of-the-road material than before, a kind of changing of their line of business.  Now we're seeing mergers.

Colonial Theatre and Berkshire Theatre Festival are merging, according to an article by Larry Murray writing for Berkshire On Stage.  The two theaters are about 25 miles from each other, in Pittsfield and Stockbridge, Massachusetts, and differ in size and ambition.  Reconciling the differences should be an interesting challenge to all involved.

Berkshire Theatre's 2009

Einstein Show.

The Berkshire Theatre describes its mission as "to sustain, promote, and produce theatre for its community through performance and educational activities. . . .dedicated to producing theatre that recognizes its venerable past, while providing a home for the next generation of the American theatre's creative artists."  It has two performances spaces, seating 400 and 120.  It produces revivals and new plays with a yearly budget of $2.7 million as of its 2008 IRS filing.

The Colonial Theatre mission is "[t]o enrich life in Pittsfield and the Berkshires by presenting, producing, and hosting a wide variety of quality performing arts events, accessible to all, while fostering artistic collaboration and performing arts education in a restored national historic landmark building.  Its one theater seats 700 and largely books touring acts and shcws. Colonial's yearly expenses as of its 2008 IRS filing were just a little more than $2 million.

Not coincidentally, Arts Insights, the monthly newsletter of the Arts Consulting Group, posted a good piece in November 2010 titled "To Merge or Not to Merge? The Right Process Reveals the Answer," written by Karhryn R. Martin.

Why is the NFP theater ripe for consolidation?  Because of two facts.  Between 1990 and 2005 the number of NFP theaters with budgets of $75,000 or more doubled.  But between 1992 and 2008 the audience for theater increased by only 1.7 percent.  Clearly, there are more NFP theaters--many started during a time of relative economic plenty--than there are audiences to support them.  For the source of these statistics, see page 153 of Stage Money.

Added January 20, 2011

It's not theater, per se, but yesterday the Kennedy Center announced that it is taking over operations of the Washington National Opera, which without this merger, "appeared doomed," according to the Washington Post.  "In what amounts to a rescue operation, the Kennedy Center announced Thursday that it is taking over the Washington National Opera, a company that has been floundering artistically and financially for years." The consolidation in the performing arts goes on. 

Without Flops, There Would Be No Hits

In the Boston Globe, Nathan Rabin has an essay "The case for total failure" arguing for the importance of movie flops.  He writes that flops have destoyed careers and bankrupted studios but when flops don't have such extreme effects, they can be valuable.  Flops can provoke a film artist to rethink his or her strategy towards creation.  A flop can introduce new technology for other filmmakers to perfect.

Rabin doesn't invoke my personal salve for when I see a terrible theater production: without flops there wouldn't be hits.  I'm a statistical elitist.  Believing that all human endeavor when measured and graphed would produce a bell curve, with most people in the middle and only a few folks at the worst and best ends of the curve, helps me accept that failures are not necessarily weaknesses for those involved.  No one plans to produce a flop--except in the plot of The Producers.  Everyone wants a hit and works for one.


In our book, Stage Money, we note that Babe Ruth, who had an extraordinary batting average, still got an out almost two-thirds of his times at bat.

As much as producers, playwrights, directors, designers, and actors learn through their careers,--whether hits, flops, or middling successes--each new show is a new business selling a new product.  And new businesses are highly risky.  For elaboration on this comparison, see Chapter Three, "Risk and Return in the Commercial Theater," in our book Stage Money.

This Recession for One Theater

For a interesting and personal story of the impact of the recession on at least one theater and one theater-maker, read an op-ed piece in today's New York Times: "Recession Theater" by Ann Hood. The piece is a quick bio of Ed Shea, founder of the Providence, RI, Second Story Theater.  His own story is an inspiration about the motivating power of theater stories.  But now, in this recession, his formerly successful theater is in crisis. 

Hood's essay begins, "'That dark summer,' said Ed Shea, of the economic collapse. 'I thought for the first time, "Maybe this won’t last."' Ed’s Second Story Theater company had gone from selling out shows before the recession to struggling to fill seats.'