Author: Mark Nagel
FM Issue: Tech and Trends 2015
“The chief business of the American people is business” – Calvin Coolidge, 30th U.S. President
Though often misquoted, these famous words of one of the most reticent U.S. presidents symbolized a significant portion of Calvin Coolidge’s six years in office. Believing that free individuals operating under a simple code of law would make wise decisions regarding their spending and other behaviors, the usually forgotten Coolidge presided over one of the most economically successful eras of U.S. history when the middle class grew exponentially and formerly luxury items like automobiles, vacuum cleaners, and refrigerators became common household items.
The public assembly facility industry would appear to be a fine example of Coolidge’s ideal where buyers and sellers can make choices free from external pressures. Since the industry largely revolves around discretionary spending, there should be little concern for how participants in booking, ticketing, and concessions transactions behave. However, continuing escalating ticket prices for many of the top performers has caused some individuals to become uneasy with the state of the industry. Acts often tell their managers to make as much money as possible, but then also try to limit ticket prices, or at least explain that high prices are due to other factors (ticket company fees, service charges, etc.) besides the act’s desire to generate income. Though no one “forces” patrons to buy tickets, acts often feel that they need to implement public relations campaigns to avoid public scrutiny for providing a service customers gladly purchase. An independent observer might ask why such activities need to occur when the most popular acts clearly provide benefits to fans that continually pay high prices to enjoy their performances.
Recently, Jack White’s experience in Norman, Oklahoma, reinforced the fear that many acts have regarding their compensation. Though he played a sold-out concert at the University of Oklahoma on February 2, White’s concert was marred by “controversy” because his contract indicated he was guaranteed to make US$80,000. The Oklahoma Daily, the university’s campus newspaper, obtained copies of the contract through a Freedom of Information Act Request and then wrote stories regarding the “inappropriate” compensation. In addition, it reviewed White’s request for specific foods, including the mandated recipe for guacamole as well as a requirement that no bananas be in the facility.
Leaving aside the intricacies of the guacamole recipe, which might have been included to ensure the contract was read and followed much like Van Halen used to insist on removing brown M&Ms from its dressing room to make sure all the stage pyrotechnics were safely set up, one who believes in free people engaging in business transactions has to wonder why Jack White should have to defend his compensation, especially when he was able to sell out approximately 5,000 seats. Presumably, those fans had no issues with spending their disposable income to experience the iconic White on stage. The McCasland Field House at the University of Oklahoma is in competition with other venues to attract prominent acts. Though mistakes can certainly be made in over or underestimating an acts’ following and its resulting compensation, such occurrences are part of the free market system. If Jack White sold few tickets—which help drive ancillary revenues such as parking, concessions, and licensed merchandise for the University of Oklahoma—his next concert contract would likely have guaranteed far less than $80,000 in compensation, which actually is dwarfed when compared to some of the more popular touring acts who often command well over $500,000.
The campus newspaper indicated that student fees were utilized to subsidize activities on campus, and that is certainly true, though in this case, with such strong ticket sales, it was unlikely that a large, direct subsidy went to fulfill White’s guarantee. Given the established subsidy definition, just about anything that occurs in The McCasland Field House or in other venues on campus would be considered student subsidized. The campus newspaper could and SHOULD engage in activities that cause their readership to think and potentially take action. I certainly do not know if The Oklahoma Daily critiques every event on campus and questions the compensation of other acts, guest speakers, or visiting professors, but my guess is that there is a large amount of student fees going to subsidize events the general public would NOT desire to pay to attend and that the newspaper remains largely silent. Anytime one of these “financial losing” events occurs, the campus newspaper should question why it was booked if it wishes to maintain its position as protecting the financial interests of the student body.
Though White, who behaved petulantly in response to the initial article, certainly could have handled the criticism in a more professional manner, the greater concern for the live entertainment industry, as well as other aspects of U.S. business, is more people are expected to feel bad, and are asked to potentially apologize, for providing a legal service to a willing customer base. In the short term, highly successful artists will have to hide their financial compensation as they have done in the recent past. But in the long term, a greater concern for the sport and entertainment industry—as well as the rest of society—is the public’s growing distain for successful people, even when those people achieve their wealth by providing products and services that make their customers happy. This is a trend that would not make Calvin Coolidge happy. FM
