Archive for August, 2009

Charging cover for live music events is back on the radar again. Maybe it never really went away, but Mankind Tracer’s new cover charge system seems to be bringing this back into discussion again. I have friends in the live music community who are performers, venue owners, and consumers, and I think everyone has been in a bit of a no-win situation for a while now. I’m not sure that a cover charge system is the solution, though, and I think it may hurt the musicians.

The problem in a nutshell: The venue pays a musician to play. The musician plays, and the musician’s fans attend. The venue is frustrated to see the tips go to the musician and not the venue tip jar. The venue owner pays their tier and other expenses out of pocket because tips don’t cover them.

Even before the bottom dropped out of the economy and tightened up everyone’s entertainment budgets, it seemed that there was a lot of resistance to the idea of cover charges. A thread in the official SL forums, titled “Would you pay to attend a live performance?” has some insight into how the rank-and-file viewed this back in June 2008. The general response answer to the question was an unsurprising “No.”

Argos Hawks had a really good point in the thread: “With all the free stuff out there, charging a cover will be hard to pull off effectively. It could even lower your revenues. In RL, whenever a tip is added to the bill for me, I end up tipping less than I would have. I don’t like people telling me how much I liked the service. In SL, paying for a live performance upfront would feel the same way.”

I think that if you charge a cover, you’d better be sure that the cover charge is all you expect to bring in for the event, because a lot of consumers are going to feel like they did their part up front. There will likely be no additional tipping of the musician, the venue, or the staff.

A year or so ago, according to Ticious Trotter, “Now, roughly 75% of the audience is tipping the musician (average fees are now 3k-8k) and nearly 10% are tipping the venue.” I would guess that musicians count on this tip money. I know some of them do. Would cover charges be high enough and the split be generous enough to pay a musician’s usual performance fee plus what they would usually earn in tips? If not, you’re just taken away a lot of incentive for your best talent to play at your venue.

It’s a tough balancing act. I don’t really envy venues trying to go through it. I think that the most sustainable venues are either those whose owners are resigned to coming out-of-pocket for them, or those who have managed to get sponsorship. Oh, those in the middle of hideously gaudy malls seem to do OK, too, possibly because they’re riding the coat-tails of another business model entirely.

I do firmly believe that if every venue went to a cover charge model today, we would see a huge contraction of live music inworld. A small fraction of the total user population of SL will spend money at all. Attempting to force those who do to spend money won’t work. So that means there are less attendees to go around. Are smaller, paying audiences better than larger, partially nonpaying ones? I think that’s going to be the question we see answered when or if venues begin to implement this new cover charge system.


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