Clichés Abound in WSJ’s Analysis of the Met Opera

And I have officially had it.

Yesterday Terry Teachout published a story in the Wall Street Journal that casts a long glance at the problems the Metropolitan Opera is currently facing.  And I’m fairly confident my scream of frustration could be heard all the way in Manhattan.

I don’t want to bash Mr. Teachout, whom I’ve never met.  I don’t wish to disparage his writing, his obvious experience, or even knowledge of the arts.  I should also point out that we’re in full agreement that Mr. Gelb has run out of ideas about how to run the Met, either artistically or organizationally.

But I must take issue with this article.  Unfortunately, it tosses around every wrong-headed cliché about the arts and arts management that I’ve been trying to put to rest since my blog’s inception, including Baumol’s cost disease, an outdated report from the NEA, and the use of paid capacity to measure financial success.

How is it that demonstratably false ideas can take such a powerful hold on our collective consciousness?

While I can’t take up this larger question, I can certainly rebuff the points of this specific article.

* * *

“To keep its doors open, the Met must fill those extra seats, and it’s no longer doing so.”

Why?

Is its business plan that it must sell 100% of its seats? Is it a specific metric in the strategic financial plan that the Met must sell 50% more seats than the Vienna State Opera? Is there a contract provision that it must fill those remaining seats or the Met loses its lease?  Is the importance to simply fill a seat at whatever price point, or to bring in the necessary ticket revenue?

A better question: is it not possible to do a projection of ticket revenue, based on a projection of attendance, and base the budget on that figure?  That is a clear, specific goal with measurable metrics… unlike “fill the house!”

 

“Two decades ago, the company earned 90% of its potential box-office revenue. That figure has been declining steadily in recent years and dropped to 66% last season, an all-time low that’s been the talk of the opera world ever since it was disclosed in May.”

This hits at an issue I’ve warned against before—the danger of measuring success on the idea of paid capacity.  To explain, there are three separate criteria for measuring ticketing success. They are:

  • Ticket revenue. The total amount of money that is brought in by selling tickets, over the entire year. This number is directly tied to an organization’s budget. It assumes over the course of the year some shows will do better than others, but sets a final benchmark for where the organization hopes to land at the end of the year. If the company doesn’t hit its ticket revenue goal, there are serious, direct budgetary consequences.
  • Number of tickets sold. This simply reflects the number of tickets an organization sells over the course of the year. This number is usually tied to marketing goals, but it doesn’t have to tie directly to the organizational budget. In part this is because different tickets cost different amounts. And, it doesn’t necessarily indicate who actually attends the performance—there is always a number of people who buy tickets but ultimately don’t use them, as a result of inclement weather, last minute emergencies, or such. Or, a local business could buy a block of tickets to give to its employees, only to find the employees aren’t interested or available. Again, this is a useful metric, but hard to tie directly back to the budget.
  • Percent capacity sold. Percent capacity refers to how many people are actually in the theater as a percentage of the total seating capacity. This is the number that really makes a difference to the performers, who love to perform to a full house. But just because the house is full, or at near-capacity, that doesn’t mean the show is doing well. If a show is struggling, administrators may choose to “paper the house” or give away tickets to improve the optics of the situation. Or, it could offer a wave of last minute discounts to lure people in for a fraction of the listed ticket price. There are other issues that can eat into inventory, such as stage extensions or closed-off sections that actually reduce the number of seats available. This can be a useful metric, but as a result of the qualifications I mentioned it is usually the least important metric, and has the least impact on a company’s budget.

The key to remember is that all of these things are different and don’t directly relate to each other… or necessarily to the overall budget. As a result, your final analysis of how successful you are will look very different based on which criteria you choose.

But Mr. Teachout’s argument seems to focus on paid capacity sold—a particularly problematic choice. Again, capacity in and of itself doesn’t tell the whole story. Were those seats occupied because the opera company papered the house? Or were the ticket prices relatively cheaper 10 or 20 years ago, leading to more tickets being sold but far less overall revenue? What were the total number of seats sold, and what was the average price per ticket? Was the price per ticket appropriate for the performance, leading to acceptable amounts of revenue? After all, it is possible, particularly when an expensive superstar performer is headlining a production, that a company could sell every ticket in the house and still lose money.

 

“As a result, Peter Gelb, the Met’s general manager, has been forced to raise ticket prices to an average of $158.50 per head. On Broadway, the average price is $103.86.”

I think this is pushing the cause-and-effect nature of what’s going on.  Mr. Gelb didn’t have to do this, he chose to do this as a specific strategy to hit financial targets—to wring more ticket revenue from fewer attendees.  It’s somewhat controversial; during the recent round of contentious labor negotiations, the Met musicians pointed out that overall ticket revenue increased as ticket prices fell.  More people were willing to buy cheaper tickets.  The struggle to find the perfect price point that can maximize both attendance and revenue simultaneously is one all performing arts groups face.

 

“Mr. Gelb argued in 2014 that ‘the question is not whether I think I’m doing a good job or not in trying to keep the [Metropolitan Opera] alive. It’s whether I’m doing a good job or not in the face of a cultural and social rejection of opera as an art form.’ He has a point: The National Endowment for the Arts reports that the percentage of U.S. adults who attend at least one operatic performance each year declined to 2.1% in 2012 from 3.2% in 2002.”

I propose that that NEA study be put to rest permanently.

First of all, I point out that the study in question ended in 2012… four years ago.  Is there any other sector of the economy that would base its current outlook or future projections on four-year-old data? Or on market trends from four years ago?

But more to the point. As I’ve mentioned earlier, I can agree that the NEA report does indeed show a decline in attendance between 2002 and 2012 (here’s the key section of the report: NEA Report Chapter 1 – Visual and Performing Arts Attendance). But a deeper dive into the data suggests that the story is more complicated.

For one, this chosen time period ends up distorting the data—the decade between 2002 and 2012 is tailor-made to show a devastating decline in arts attendance.  In 2003, the country entered into a huge economic decline brought on by the dot-com bust.  I was working in the Development department of the Minnesota Orchestra at that time, and remember it vividly.  What followed was several years of reduced individual contributions, a sharp decline in corporate partnerships… and a big dip in ticket sales.  The Minnesota Orchestra was fortunate that Osmo Vänskä took over as Music Director in 2003, and curious ticket buyers helped boost sales, but the overall industry trend was fairly weak. There was a gradual recovery thereafter, but things came crashing down with the Great Recession in 2008.  The economic recovery was underway by 2012, which in fact helped President Obama win reelection, but it only really took hold after that, and many people are still feeling shell-shocked even today.

Between these two economic shocks, it’s absolutely no surprise that ticket sales are lower between 2002 and 2012. I made essentially the same point responding to an article by Greg Sandow, who based his analysis on numbers from this same time period.

But I also think there are some caveats in the NEA report that further muddle the idea of a general decline.

Right on page 2, as part of the key findings, the report states: “Older adults are the only demographic subgroup to show an increase in performing arts attendance over a decade ago. Their rates of attendance at classical music, opera, musicals, and non-musicals were significantly higher in 2012 than in 2002.”

So clearly, although the report notes an overall decline in participation, a key demographic group—essentially the Baby Boomers—are turning in greater numbers.  This is huge.  Boomers, after all, are the natural audience for the Met, with levels of disposable income that Millennials and Gen Xers do not yet match.  Yes of course arts organizations need to attract younger people to expand the pipeline of donors and ticket buyers; and indeed, many opera companies are working hard to bring them on board (this story from Opera Philadelphia is particularly interesting in this regard). But in the meantime, the Boomers are at the peak of their economic capacity, and their high rate of attendance is welcome, stabilizing news.

There is also the important point of clarification about participation rates that go beyond just the raw number of audience members attending classical music performances.  Andrew Doe made a powerful point on the blog “Proper Discord” about this:

In the UK, the percentage of adults attending concerts has increased over the last decade. In the US, the percentage has dropped because of population growth, but the actual audience size has held steady for at least 30 years.

Exactly.  This is reinforced by the NEA report, particularly in Figure 1-8: in 2002, 11.6% of U.S. adults attended classical music, versus 8.8% in 2012. Opera has seen more of a decline, from 3.2% down to 2.1%. This looks alarming at first glance, but population matters. In 2002, the United States’ population was approximately 282 million, and in 2012 it was 315 million.   This means in real terms, the “decline” in audience members attending an opera production is from 6,880,000 to 6,615,000 … which isn’t too bad, considering the two major recessions the country went through.

But there are even more interesting nuggets to uncover.  As Figure 1-9 points out, total attendance figures declined from 13.3 million to 10.0 million between 2002 and 2012 (most opera goers attend more than one production per year).  Yes, that’s a drop-off, but it’s hardly catastrophic.  Moreover, it doesn’t account for the Met’s much sharper decline over the same time period.

This would suggest that there’s something deeper going on at the Met than a general, nation-wide decline in ticket sales.

 

“He made no serious attempt to cut the company’s labor costs until the 10-alarm budget crisis of 2014 forced him to face the fiscal music and confront the unions, which he did with only limited success.”

This is problematic, as labor costs weren’t the root of of the Met’s fiscal problems.  As I covered extensively over the course of the recent contract negotiations, the labor costs were so high because of Mr. Gelb’s managerial decisions, which among other things racked up large overtime costs by scheduling long, chorus-heavy productions back-to-back and requiring labor-intensive sets/costumes for the HD broadcasts.

Mr. Gelb’s bloated managerial budget was a far greater problem. This became evident last fall when the Met released its numbers for FY2015.  As a bit of context, a story in the New York Times, the terms of the final settlement are listed as follows:

“…the Met’s management agreed not only to match the value of the [7%] labor cuts on the administrative side, but also to cut $11.25 million worth of other expenses – which may include cutting costs, scheduling more carefully, or reducing rehearsals – in each of the four years of the contract.”

So this is the equation for FY15: $11.25M (management expenses) + ?(admin. staff cuts) + ?(7% labor cuts) = $18M in savings.

Yes, the workers played a part, but the labor cuts are less than $6.75M… meaning that the majority of cost savings (62.5%) came from the management’s side.  This is not surprising, in that many of us pointed out that most of the Met’s financial problems were caused by wasteful spending on the part of the management rather than the union workers.

 

“For if you know anything at all about economics, you’ve probably already got a pretty good idea of what’s happening there. It sounds like a raging case of cost disease—one that could be fatal.”

Oh my God… I have no patience for this.  Mr. Teachout is referring the famous economic principle referred to as “Baumol’s curse” or “Baumol’s cost disease.” The name comes from economist William Baumol who first postulated it several decades ago… and it been used as a cudgel against performing arts groups ever since to show how they are fundamentally “unsustainable.”

I don’t buy it—and lots and lots of people have pointed out the myriad problems with this argument.

For one, the whole notion is that since it’s impossible to introduce efficiencies (such as reducing the size of the workforce or otherwise streamlining production), operas and classical music ensembles become pricier and pricier over time, to the point that they are no longer economically sustainable.  But there is a well-established counter-example:  the New York Yankees. The number of baseball players has also remained fixed for more than a century, and the players’ pay has likewise steadily increased over time… does that mean that baseball teams are inherently unprofitable? Of course not.  Costs and revenues are far more complex than that—rising personnel costs have been balanced out by a number of additional revenue streams.

It’s not just me saying this; William Baumol himself points out that while there haven’t been productivity gains in the size of an orchestra’s personnel, there have been gains elsewhere… in all the various activities that surround the performance. In his 2012 book, The Cost Disease: Why Computers Get Cheaper and Health Care Doesn’t, he writes:

The rise in productivity that makes it possible to create commodities with less and less labor, thereby lowering what consumers pay, has occurred in almost every industry. Even services that seem most impervious to productivity growth have participated indirectly in this process. I frequent use the example of a Mozart string quartet written for a half-hour performance as an example of a service that resists reduction of its labor content. But even an activity like live musical performance has benefited from considerable savings in time expended. In 1790, when Mozart traveled from Vienna to give a performance in Frankfort am Main, the trip required six days of extreme discomfort. (At the time, however, that was considered swift – Mozart wrote that he was surprised at the speed of the journey.) Today, the same trip takes only six hours: 1.5 hours for the airplane flight and 4.5 hours for transit to and from the airport and other preliminaries. Surely this is a marked reduction in the time required for such a musical performance…..

I could add to that the notion that there have been efficiencies gained in the number of rehearsal hours required for pieces, the marketing needed to attract audiences, and a host of other areas.  And let us not forget that many operas are technically revivals, so that the initial investments into the creation of sets, lighting designs, costumes and such have already been made.

But more important, this model ignores the fact that opera companies are nearly always 501 (c) (3) not-for-profits, as categorized by the IRS. This means that they are allowed to fundraise to support operations… and performances. This means they follow a completely different economic model than the one used to manufacture iPhones or flat screen TVs.

Can we please stop unthinkingly toss out Baumol’s cost disease as “proof” that classical music is financially unsustainable?

 

“Moreover—and this is the heart of the matter—the Metropolitan Opera House is so gargantuan that the company has no choice but to “build” the biggest possible “model” of opera. For in addition to having 3,800 seats, the Met also has an 80-foot-deep stage with a proscenium opening that measures 54 feet on each side. This makes it all but impossible to successfully mount smaller-scale low-to-medium-budget shows there: It’s elephants or nothing.”

I guess I have a higher regard for human ingenuity.  There are ways to be creative, and to creatively problem-solve that keep the artistry intact.  They are an extreme example, but the minimalist “New Bayreuth” productions of the 1950s were critical and commercial successes… and they didn’t require the construction of overpriced moving monoliths to make their musical points.

* * *

Well, this has already droned on far too long.  But let me recap: the arts world has to let go of these popular, though incorrect clichés.  First, paid capacity is a terrible way to gauge success—it does not provide real numbers that are actually tied to the budget.  That four-year old study from the NEA needs to be put to rest, and we need a more updated, nuanced study of arts attendance in this country.  And “Baumol’s cost disease” is an idea that has been vastly overplayed when talking about the arts… to the degree that Baumol himself is pushing back on how it’s being used.

Yes, the arts face many challenges.  Yes, the Met faces many challenges.  But to find real and lasting solutions, we need to have a deeper dive into what these issues.

.

Xochipilli

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49 thoughts on “Clichés Abound in WSJ’s Analysis of the Met Opera

  1. I’ve always enjoyed Teachout’s writing on art and artists, music and musicians. But this piece of his reads like a regurgitated handout from Gelb himself. I think it’d be a good idea going forward, that if Mr. Teachout decides to write about the financial end of performance art, he at least ought to run the articles by you first, Scott. Thanks so much for this!

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    • And, as corollary, you can never pay musicians enough. They are such special snowflakes that they deserve infinite compensation.

      There, I’ve saved you the trouble of reading everything Scott Chamberlain has ever written.

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      • Well, not exactly… then you’ll miss all my writings about paying stagehands, lighting designers, costumers, carpenters, choristers, ushers, and everyone else that makes a performance possible relative to their time and talents. It’s not just musicians!

        And I think it only takes a few seconds to realize my points are that musicians, stagehands, lighting designers, et al should be paid relative to their time and talent, in keeping with the organization’s fiscal resources and the job market as a whole.

        And curious. So… above I gave a detailed analysis of why I think Baumol’s cost disease should be retired. You respond with… this. Do you have anything substantive to add to the discussion? Or any strong rebuttal to why we should stop using the 2012 NEA report when discussing audience development?

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      • Like, dude….. I had considered challenging you to game of wits, but I see you are unarmed.
        The “special snowflakes” comment is just stupidly ignorant and shows your inability to grasp the nuances involved in collective bargaining, which is where the essence of running an (orchestral) non-profit takes place.
        As a 35+ year professional orchestra musician, with experience in the way many orchestras do business, allow me to make the following observation: Historically, orchestra boards only raise as much money as they are “forced” to by the collective bargaining process. I mean really, it’s human nature; would you willingly grant musician requests for a raise, even cost of living adjustments, if you didn’t have to? If it meant the admittedly hard work of raising even more money? The reality has been that musicians must go to extraordinary measures to force every nickel out of boards. I guess boards/mgmt. have always found it easier to demonize “labor” for their endless greediness than acknowledge That they are skilled professionals who are the product after all.

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    • Well, not entirely, but I freely admit I find his tenure has been a disaster. If memory and Internet searches serve, I believe that you have criticized him yourself… sometimes for the very same things I do. I recall a WQXR interview where you called him a “polarizing figure,” and acknowledged that one of your colleagues from Parterre called him out for “rookie mistakes” for some of the same reasons I’m criticizing him—such as racking up large overtime costs by scheduling long, chorus-heavy productions back-to-back. Do rebut posts to Parterre, too? Or just bloggers in Minneapolis?

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      • Now you equate specific criticism with declaring disaster. Too bad the Aztecs didn’t teach logic.

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  2. “the minimalist “New Bayreuth” productions of the 1950s were critical and commercial successes… and they didn’t require the construction of overpriced moving monoliths to make their musical points.”

    No, they only required ten months of painstaking experimental lighting rehearsals in an empty theater, using a mostly nonunion crew. Let Peter Gelb try that and see how extravagantly you start screaming.

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    • Not to mention that you’re trying to compare a repertory theater in the USA in 2016 to a festival theater in Germany in 1950. Why bother even to stay on the same planet when you’re spinning your fever dreams?

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      • You seem to think this is the first time in human history that there’s been a tension between art and finances. And seem to be unclear about the concept of an analogy. And about the value of money… do you really think there is a no difference between the costs involved in these productions, even accounting for inflation? Are you suggesting that the production costs of lighting scheme of the New Bayreuth productions somehow equal those of the recent Ring cycle at the Met? I mean, the Met’s production included its own lighting scheme, and multi-million dollar monoliths, too, right?

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      • Don’t tell me what I “seem to think.” You posited Wieland’s Bayreuth solution as a model for the Met, blithely ignoring the minor details that Wieland was working in a different era, in a different sort of theater, in a different sort of program scheme (festival vs. repertory), for a different audience, and under vastly different economic conditions. (For that matter, he wasn’t even presenting precisely the same works as anyone else in the world at that time, because Bayreuth was one of the few theaters that customarily performed Wagner uncut; the Met was still making big cuts in the major works as late as the 1970s.)

        Yes, Wieland came up with a successful solution in the long run, though you are delusional if you think he enjoyed unanimously positive reviews for his work. But that was a solution geared to a particular problem that has almost nothing to do with the Met’s dynamics, e.g., being locked into paying orchestra and chorus for 52 weeks a year when they only work 36 of those weeks.

        But I bow to the wisdom of a Great Lakes area choral singer and part-time astrologer.

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      • Good God, years later are we still fighting about Wieland Wagner’s productions? Let me be clear. No, I don’t think Wieland’s solutions are the end-all, be-all that will solve every problem for every opera company or music ensemble. I fully agree that they were solutions grounded in a specific time and place. That’s the point. Every solution should be grounded in the time and place it inhabits. In a time of economic ruin and finite resources, Wieland came up with a specific solution. Of course it didn’t necessarily earn universal approval. But it worked, and remained true to the art form. And that’s my point: let’s be inspired by that ingenuity and find a solution for our time, and the problems we face. San Diego seemed to use that approach, and the results look promising. And broadly, I’m not sure what your point is… Gelb is great and we should just trust his judgement?

        Great Lakes choral singer? I suppose, although the nearest Great Lake is 150 miles away. I’m not sure where you get part-time astrologer. I mean, yes, as part of my doctoral work on Aztec religion I can do your chart as the Aztecs would have done. That said, I only do that on request, and as I am not a follower of the Aztec religion, it’s mostly as a curiosity—or as I mentioned in my “about” section, as a glorified party trick. But hey, if you want me to do that for you, you’ll need to give me your exact birth date.

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      • I believe “Great Lakes choral singer and part time astrologer” is technically known as an argument “ad hominem,” an technique employed when one’s pet principal argument, “it’s all those pesky oboe players and their damned pensions!!” fails to impress.

        Such a lot of vitriol, such overabundance of sarcasm, meanness and snide-ness! Very impressive.

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  3. It seems like there are smart ways to cut back the production costs of a season while still keeping the audiences happy and without slashing wages. I know at Lyric Opera of Chicago during one of the seasons during the recent crash, they had announced Les Troyens, but they changed it to La Damnation de Faust. I love both works, but Damnation is less than half the length and has a much smaller cast. The change must have saved them a huge amount in overtime and personnel costs costs. Susan Graham was absolutely luminous and I thoroughly enjoyed it. One friend commented it was the production he had seen at Lyric.

    I don’t know if it is just that I’m spoiled by having two exceptionally well run local opera companies (Lyric Opera and Chicago Opera Theater), but I never understand all the panicking in the press about how opera is a dying art form.

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    • So the solution is doing shorter operas with smaller casts? Sort of eliminates all that nice Wagner and Verdi, but, hey, the important thing is that the oboe players have fixed-benefit pensions, after all.

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      • Mr. Jorden…you sexy, slanderous beast!
        Putting all that on the slender shoulders of professional orchestral oboes. *fanning myself*

        Neither Mr. Moran in his comment nor Mr. Chamberlain in his post said anything about what THE “solution” is.
        Calm down, sweetheart. Is there some kind of…tension…in your life?

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    • Les Troyens is on the calendar for Nov/Dec so they obviously feel they are on firmer financial ground. Maybe I can catch the stagecoach to Chicago to see it.

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  4. So, Mr. Jorden. In response to my proposal that we need to stop using a series of tired clichés about the arts world, you attack my blog as a drunken circle jerk where we throw money at musicians in some sort of a fever-dream Aztec ritual.

    Goodness. I need to change my “about” section….

    Again, I spelled out my idea and the thinking that underpins it. You obviously have the smarts, the experience, and the writing chops to come up with a real response if you want to… but thus far you haven’t. Instead we get a stream of unconvincing snark—which is so unconvincing, and so snarky that I have to believe it’s just for show.

    So what’s really going on?

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  5. I was impressed with your article, as it provided information of which I was not aware, and, because it provided ammunition for rebutting local boards of several arts organizations which insist that cutting costs will solve all the problems of their institutions.

    They want to run 501 3 (C) arts organizations as if they were competitive businesses, instead of what they are as cultural entities. It cuts to the heart of the problem with culture in America: lack of education in the arts in schools, especially since the Reagan era, which began the erosion of the progress of public participation in attendance, viewing, funding, which had been made in the 1970’s.

    As a result, we have bland, repetitive programing of traditional ballets: Swan Lake and Sleeping Beauty (ad nauseum), music, art blockbusters, such as any exhibition featuring Impressionism, Picasso, or Van Gogh. Depth and unfamiliarity is anathema to corporate types who only understand “popular” desire for the familiar. “Give ’em what they want” attitude. Very much like the thinking that led to the disasters of the car manufacturers and the giant gas guzzlers of the 90’s and 2000’s.

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  6. Pingback: diacritical | Five Highlights From Last Week’s AJ: Ethics, Success, And Documentation Edition

  7. I am only privy to the Met by reading newspaper reports or ranting weblogs about it – or watch the occasional HD production a couple of months later in my local cinema. However, I am not standing on the sidelines of Performing Arts Management – even if my experience is a fraction in comparison to that of the Met.

    Although it is wonderful that people have ideas and their opinions about matters, it is so sad that not everyone with access to a laptop deserves to be considered a expert either.

    Problems within the Performing Arts Management cannot be one or only a few identified reasons only. It is a plethora of factors that are interrelated to each other like a spider’s web.

    Anyone that has ever produced shows over more than a decade; knows firsthand that the foundational principle of the cost-disease is real. Whether it is old or not trendy or needs to be re-interpreted – is beside the point. It is a reality of taking decisions within the arts organisation. Deal with it. We have a wonderful proverb in my mother tongue that could roughly translate to “When the donkey brays, he publicly declares his ignorance.”

    Most health problems within arts organisations are fundamentally started by appointing the wrong people on boards and especially the wrong people in managerial positions.

    Secondly, audience development is not about marketing, it is a long-range planning that should be considered at all artistic level decision-making processes. The latter has at its heart the understanding of the audience member. Here Mr Gelb seems to be in good company with some other managers of major (and minor) opera houses and orchestras in the world: They do not know their audiences and therefore all artistic decisions are cancerous at the DNA level already.

    Please take advice from Mr. Michael Kaiser. He has proven himself that he understands the problems properly and that he can do something positive about it.

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    • Thank you for posting.

      I fully agree that not everyone with access to a laptop deserves to be considered an expert. For what it’s worth, I too am not “standing on the sidelines of Performing Arts Management.” I have been working in arts management for many years, having started work for the Minnesota Orchestra back in 1992; I’ve worked in such areas as audience experience, development, marketing and public relations with a variety of arts groups over the years. I’ve worked with symphony orchestras, chamber ensembles, and performing arts venues. In addition to my time as an arts administrator, I am currently the Board President of the Minnesota Chorale as well as an active performer. While I don’t pretend to have all the answers, I think my time as performing artist, arts administrator, and board member indicate that I, too, have earned a place in the discussions of running an arts organization.

      I gather others share this view, as this very post has been widely distributed, including being promoted by such entities as ArtsJournal and Musical America; previous articles have been cross posted in Nonprofit Quarterly.

      To your points.

      So, to my explanation of why Baumol’s Cost Disease is an ineffective analytical tool or frame of reference—an idea that even William Baumol himself is pushing back against—you respond by saying essentially… it is, too! And telling me to “deal with it.”

      With respect, “deal with it” is an unconvincing argument.

      Being “old” or “trendy” has nothing to do with anything—Baumol’s cost disease doesn’t work here. It is an interesting concept in regards to manufacturing, but far less so for a nonprofit arts organization… particularly a nonprofit that under 501 (c) (3) tax code is allowed to use contributed income as a revenue stream. I listed a few of my specific issues with it above… if you have evidence that it does work, or specific data to bolster this claim beyond “everyone knows it’s true,” please provide it.

      I agree that putting the “wrong people on boards and especially the wrong people in managerial positions” is a problem. But there are many kinds of “wrong people,” including those who dogmatically cling to outmoded business models or rely on conventional wisdom. This was certainly a problem with, say, the Minnesota Orchestra and San Diego Opera, but new leadership and new administrators have taken over those organizations and completely turned them around.

      Thank you for the summary of audience development. I’ve written about it extensively on my blog, covering it in such posts as this one (you can jump to bullet point 3 if you don’t want to read the whole thing).

      Also, thank you for the recommendation for reading Michael Kaiser’s works. You’ll be pleased to know I’ve referenced him frequently on my blog and elsewhere through social media. I agree that Baumol’s cost disease does factor into his most recent work, but I also know there has been push back—plenty of other people are fed up with this tired concept, too.

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  8. It is the law of supply and demand. The technological revolution has given us an unprecedented amount of options to opera which is, in truth, becoming increasingly obsolete. I have seen too many articles like this one which dance blithely and willfully around the obvious. Opera will always be with us but its market share is clearly and inexorably shrinking. While your comments contain some grains of truth, they also look like rationalizations in denial of the obvious. I grew up on the black and white television entertainment of the fifties which is, of course, now only quaint and passé. Similarly, on the larger historical scale, it is the same with opera is now seen primarily as humorously eccentric.

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    • Hello and thank you for your comment. You’ll forgive me if I don’t agree. In my experience, I’ve seen too many articles dance “blithely and willfully” around the fact that opera is doing quite well.

      I’m curious as to what data behind your statement that opera is “in truth, becoming increasingly obsolete.” As I’ve stated on my blog, I’ve found the reverse to be true.

      Take the case of the San Diego Opera. There, the board and management attempted to close the company down, arguing as you do that the art form was dead. The entire community rose up in rebellion, overthrew the board and installed a new administration that rebuilt the organization.

      And the country is filled with similar examples of hope and resilience. Since 2000, over 260 new opera companies have sprung up around the country.

      As I mentioned above, Opera Philadelphia is not just doing well—almost half its audience is under 35.

      Here in town, the Minnesota Opera’s premiere of The Shining was an event—and every ticket in the entire run was sold out weeks before the opening.

      The Met Opera ended its fiscal year with a $1 M surplus.

      International Conference of Symphony and Opera Musicians (ICSO) Chair Bruce Ridge has recently provided a run down for last year:

      The Atlanta Symphony announced that it ended the season with a surplus, and raised $13 million
      The Arizona Opera exceeded its fundraising goals
      The Buffalo Philharmonic saw record season ticket sales and subscription revenues for the third consecutive year
      The Charlotte Symphony received a $2 million gift
      The Cincinnati Symphony raised over $26 million and signed a new contract that adds 15 new musicians over the next five years
      The Dallas Symphony achieved a balanced budget and received a $5 million gift
      The Detroit Symphony raised $1.4 million in one evening
      The Houston Grand Opera exceeded its fundraising goal, raising almost $173 million
      The Houston Symphony received a $5 million donation, the largest gift in nearly a decade
      The Indianapolis Symphony saw ticket sales increase 15%, and subscriptions rose 24%.
      The Memphis Symphony received a $1 million gift for education programs
      The Minnesota Orchestra received $6 million in special gifts and embarked on a historic tour to Cuba
      The Nashville Symphony set fundraising and ticket sales records
      The Omaha Symphony saw record attendance
      The Oregon Symphony set records for ticket sales and contributions, and its gala raised a record $700,000
      The Pacific Symphony’s gala raised a record $1.6 million
      The Richmond Symphony received a $1 million gift for outdoor concerts
      The Rochester Philharmonic reported a 19% increase in single ticket sales
      The St. Louis Symphony received a $10 million gift
      The St. Paul Chamber Orchestra saw its highest attendance in 20 years

      So in your own words: “While your comments contain some grains of truth, they look like rationalizations in denial of the obvious.”

      And I’m astonished at your metaphor about no one watching black and white TV anymore. Well, yes… but to state the obvious, they are still watching TV. Television programming is still a vital medium that reaches millions, even if they don’t watch the specific shows you used to watch on the specific technological device you used to watch.

      Yes, I know arts organizations—and opera companies in particular—face challenges. I am, after all, the Board President of an arts organization. But the cries of “opera is dying” are overblown.

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  9. The Arts Journal itself has presented, over time, article after article describing the increasing problems opera has had, and is having, of shrinking and aging audiences. I am not going to research this to find supporting data but if you don’t realize that opera is plagued with growing attendance problems then you are reading even the Arts Journal too selectively. I don’t know exactly what you mean by “overblown”, but opera’s market share is on a long, if gradual, downward spiral, not dramatically perhaps, but steadily. This in Europe too. That I generally don’t care for opera does not mean that I take any joy in its relative decline, but I believe it is the cries that opera is fully alive and well ” which are overblown”. When I was a child, most American households had at least a Reader’s Digest collection of classical music in the form of an LP album or two. Where is its counterpart today? The truth be known, classical music is shrinking in (relative) popularity. The dominance of traditional Euro-Centric music and literature is giving way inevitably to technological and cultural globalization. There is nothing about opera that makes it immune, like the other genres, to ceding to the new and/or keeping relevant. Other genres, I hasten to add, see fit to change or alter their art form over the course of time to keep things fresh.

    It has been said that the fans of the two music genres who personally define themselves the most by their music culture, are those of Rap/Hip-Hop and Classical/Opera. We have the air of superiority on the one hand, and the air of special coolness on the other. Outsiders just wont get it (us). It is Interesting to me that these two cultures share this sense of exclusivity and specialness in common. In their bearing and attitude toward outsiders, they have often been simply off-putting. I have seen where classical is trying to rectify this behavior, this image of hubris but, no doubt about it, there is a history. The effort to effect this change undoubtedly has less to do with new found humility than it does with keen pecuniary instincts.

    I will stick to my story. Opera is archaic. It has its place, even if that place is getting relatively smaller.

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    • Hello again, Don.

      First… yes, I know ArtsJournal has posted articles about opera’s tough times in the past, but it has also just cross posted my article, too. And looking at my blogs stats, many readers are finding their way to this story from their link. Here’s a link if you missed it.

      But in general, I suspect we’re going to keep talking past each other. Your argument seems to based on a generalized appeal to conventional wisdom. My point has been, however, that “conventional wisdom” is based on inaccurate and incomplete data, and has calcified past the point of usefulness. Therefore, uncritical acceptance of conventional wisdom is wrong.

      I didn’t come up with this idea randomly. In my original article up above, I laid out my reasoning, showing that the overall “decline” of opera goers listed in that NEA report (the same one that everyone seems to link to as “proof” of declining audiences) shows a minor decline in attendance from 6.8 million to 6.6 million… or about 250,000, which took place over the course of two major recessions. I showed how several opera companies (and classical music ensembles generally) had record years in terms of fundraising and ticket sales. How San Diego refused to accept the death of its opera company and literally brought it back after its leaders tried to close it down as “unsustainable.” Of how new opera companies continue to emerge all over the country, or how new operas have captured attention.

      So that is what I mean by “overblown.” That yes there are ongoing challenges, but that the nation is awash in good news, too—a host of specific stories from every corner of the country that show opera remains a vital art form with community support.

      To these you simply say, “I’m not going to find supporting data” and tell me that I’m wrong. That’s not compelling.

      Plus, the analogy you use about Readers Digest albums, like your previous analogy about black and white TV, is too limited, and misses the point. You seem to see the decline in those prestige albums as proof that opera and classical music (you seem to switch back and forth between these genres) is “dead.” But there are other ways to measure consumption of classical music, based on current technologies most people use. Classical CD sales are down because… CD sales are down. Far more people are getting music via radio, online streaming services, or even YouTube. Many of these trends are documented here. This is true for opera, too; we’ve become an “on demand” society. Many listeners don’t see the need to purchase a full album to hear a particular piece.

      This is a key way to show whether opera and classical music are truly vibrant—overall listening habits. So is an analysis of musical participation—either as instrumentalists or singers, as professionals or amateurs. So is an analysis of analytics from industry leader Giving USA, which shows that arts-related philanthropy is growing exponentially, faster than other areas of philanthropy.

      These are real analyses, backed by real data. And if you want to convince me that classical music or opera are dying, you’ll need to provide similar analyses and real data as proof.

      “Lack of Reader’s Digest albums” isn’t scientific.

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  10. Pingback: Something’s Wrong at the Met… or is there? | KHFM-FM

  11. Since you felt free to use the term “calcified” with reference to common knowledge, let me suggest that, from another perspective, the same term characterizes the current state of opera as a comparatively static and increasingly struggling (not dying) art form.

    Much of what informs our opinions comes from specific learning experiences over the course of time. On one hand there is the conventional wisdom which once told us the world was flat and that Mars had canals, until improved methods of observation eventually rectified that understandable and inevitable misperception. Until that point, however, what was then scientific knowledge was now conventional wisdom. We could not function as human beings but for the knowledge we accumulate over time in the form of trustworthy, relevant learning experiences. We are certainly justified in our various opinions on all manner of subjects despite our lack of recorded or recallable sources with which to support them. What would life be like if we did not have the ability to draw conclusions from the duly considered information we had assimilated, even though the sources had long been forgotten. Even the grand theories of physics can be seen as a form of conventional wisdom in the sense that even its latest theories are provisional; physicists accept the inevitability that their latest theories will be overturned by even later grand theories that will come, one after the other, ostensibly forever.

    Again, I did not say that opera is “dying”, only that its relevance in an immense and complex context is diminishing. You can’t attack a straw man and assume it will be seen as a relevant or clever rejoinder.

    I did not say that “I am not going to find supporting data” out of laziness. I have long since carefully considered my supporting data but, did not commit the sources for it to memory or record them. My careful evaluation of them at the time was no less scientific than your use here of statistics. If you can cast doubt on the integrity of my sources, I can similarly cast doubt on your selective use of facts and sources.

    You scorn my reliance on what you call common knowledge. Knowledge is scientific only until it is shown to have been erroneous. The world was seen as flat and mars was once seen to have canals through the scientific means of the times; only now do we refer to these misimpressions as ones of common knowledge, which, after all is a parent of the scientific kind. There is no more reason to mistrust the legitimacy of my knowledge and its sources than there is to mistrust your selective use reliance of “statistics”.

    You misinterpreted my Readers Digest analogy. In the fifties, Classical and Opera had a larger place in our collective consciousness. I lived it. I am living it now. There were simply lot fewer options to Opera then.

    You say my lack of supporting data is not compelling. I say your selective use of sources is “not compelling”. You wouldn’t be the only human being with an iron in the fire, a vested interest.
    I have come to trust in the unrecorded forgotten sources of my ‘assimilated’ knowledge. My faith in them and that which they support is the proof of their validity. Most of the things we do and believe come out of our assimilated knowledge. My sources are no less trustworthy for their lack of documentation or my ability to recall, certainly not to me who has come to trust them. This trust has been justified.

    Insofar as I can determine, in your comments about the exponential growth of both opera audiences and philanthropy, you didn’t factor in population growth. I was commenting, unambiguously, about market share, not pure numbers. This could be seen as a convenient way to make a relative loss appear to be a gain. One might even do this unconsciously. I’m just sayin’.

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  12. The links below give witness to the existential problems of opera and of classical music in general. I am loathe to argue on the basis of statistics as they can so easily be used to support whatever one wants them to. I copied these links in just a few minutes. Of course, they do not agree with my position in every detail but they do tell a troubling story about the deteriorating situation of classical music in the United States. Opera is now being shown in ways which would have been virtually unthinkable for the purist of just a few years ago. It is a case of adapt or die for the genre and every adaption it makes, artistically or technologically (digital, etc..), means a compromise of its original form. These represent at least a partial death of traditional opera, even of its artistic integrity. Please recall that I never suggested unqualified demise, but death comes in many forms and time-frames. I still maintain that nearly intolerable hubris and in your face airs of artistic and cultural superiority have played a significant role in the genre’s struggle to gain new fans. I have been on the receiving end of this kind of this behavior from strangers, and even from a brother-in-law! This is complicated, and like most issues, there is an element of truth on both sides. I suggest we are each looking at a different side of a single coin. Black and white, and either/or positions are usually cop-outs, denials of complexity if you will. Sorry for not transferring the below links so you can just click on them. I am hopeless with a computer.

    http://www.slate.com/articles/arts/culturebox/2014/01/classical_music_sales_decline_is_classical_on_death_s_door.html
    http://www.breitbart.com/big-government/2015/10/25/real-reason-death-classical-music/
    http://musicschoolcentral.com/classical-music-dying-just-one-problem/
    http://www.gramophone.co.uk/forum/general-discussion/is-classical-music-over
    http://www.nytimes.com/2012/11/25/opinion/sunday/sunday-dialogue-is-classical-music-dying.html?_r=0
    http://www.nytimes.com/2012/11/25/opinion/sunday/sunday-dialogue-is-classical-music-dying.html?_r=0
    http://www.wqxr.org/#!/story/classical-musics-demise-slate-column-stirs-anger-internet/
    http://slippedisc.com/2015/08/an-account-of-the-decline-and-fall-of-classical-records/
    http://www.gregsandow.com/BookBlog/Ch2RiffShort.pdf
    http://www.denverpost.com/2015/12/24/american-art-essay-classical-music-is-shrinking-and-that-is-good-for-classical-music/
    http://www.blouinartinfo.com/news/story/1039353/is-opera-dying
    https://www.quora.com/Is-there-evidence-that-opera-is-in-decline-in-terms-of-popularity-with-new-audiences-and-attendance
    https://www.operapulse.com/explore-opera/features/the-incredible-shrinking-opera-audience/
    http://www.commdiginews.com/politics-2/mcdonalds-opera-and-the-decline-of-western-culture-15114/
    http://www.lemodesittjr.com/2016/01/19/the-decline-and-fall-of-opera/
    http://nypost.com/2014/07/21/profits-decline-for-metropolitan-opera-broadcasts/
    http://www.huffingtonpost.com/adria-firestone/is-opera-dead_b_5016799.html
    http://www.huffingtonpost.com/adria-firestone/is-opera-dead_b_5016799.html
    http://www.brooklynrail.org/2006/06/music/until-the-fat-lady-sings
    https://www.operapulse.com/explore-opera/features/the-incredible-shrinking-opera-audience/
    https://nonprofitquarterly.org/2015/01/19/decreasing-arts-attendance-what-you-may-not-know/

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  13. Pingback: Yet Another Feeble WSJ Article on the Met Opera | Mask of the Flower Prince

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