Broadway Economics

Broadway EconomicsBy Keith WeissHistoryIn 1896, the Theatrical Syndicate was an organization that controlled the booking of productions.Syndicate monopolized the booking of first-class theatrical attractions nationally because of the poor way business with productions was done by independent theater companies that competed with the Syndicate.Shubert Brothers, bought out the Syndicate around 1920, but became just as controlling as the Syndicate was. Before the Great Depression, Broadway was t its peak with nearly 270 productions on Broadway.Broadway Vs. HollywoodBetween 1910 to 1925, 1,000 independent theater companies in NYC went bankrupt. Audiences were being drawn away from theater by the movie industry.Musicals kept their fan bases because they were more entertaining than regular dramas. Producers demanded higher guarantees or larger percentages of the gross. Managers began investing in movies and vaudeville. Prices for one theater ticket in 1929 ranged from $3.85 to $6.60 Prices for one movie ticket were on average $0.60.Movies attracted low-income audiences. Ticket buyers could sit in gallery seats when watching a movie, which was cheaper. Many movie theater companies eliminated their theatrical competition by buying theaters located on Broadway. Inflated production costs quadrupled in price in 1928, so production standards increased, which increased the likelihood of flops, or failed productions, so this led to the development of theatrical unions.

UnionsThese unions included workers that ranged from performers to stage crew. Unions made sure workers got the pay they deserved. Performers started getting paid for their rehearsal time. The leading actor of a Broadway show was paid $1,000 per week. Inspired by the Industrial Revolution, unions demanded greater pay for its members, and went on strike if their compromises were not satisfactory enough.Throughout history, multiple Broadway unions have gone on strike for better pay, dramatically affecting the economy of New York City.

Rock Musicals=Risk MusicalsAs the history of Broadway progresses, many producers have to take risks in the interests of the audience.Ex:HairCaligulaRent

TourismTourism draws in $4.5 billion of the New York economy, including hotels and restaurant services.Producers try to find family shows to attract tourists. Ex:Disney ShowsSpider-Man9/11 Effect on SalesAfter 9/11, the decrease in tourism decreased attendance for Broadway shows. After September 11, 2001, there was an initial drop in ticket sales of 75%. Within nine months, the drop in ticket sales was only 12%. Kids Night on BroadwayIn 2005, the Broadway Theater League began Kids Night on Broadway, which is a year-round national audience development program in which kids ages 6-18 get to see a participating Broadway show for free, with the price of a regular adult ticket. It nurtures a new audience of young people, who will hopefully develop the lifelong habit of going to theater when they get older.

Book of Mormon EffectThe Book of Mormon remains an extremely successful show that has been sold out since its opening night in February 2011. Mormon has made a combined total, including royalties, of $170,871,548. Trey Parker and Matt Stone, the creators of The Book of Mormon decided to create a new kind of musical. This musical appealed to South Park viewers. The producers of the show chose to remain in a theater with a small seating capacity and their cheapest tickets at incredibly high prices.Theater-goers demonstrated that the demand elasticity for tickets to The Book of Mormon is elastic.