Stage Money: The Business of the Professional Theater

By Tim Donahue; Jim Patterson | Go to book overview

4
The Road and Las Vegas

The touring of professional theater, colloquially referred to as the road, is big business. More revenue from ticket sales is collected on the road than on Broadway in a given year. Some of this money is easy to track because the trade association, the Broadway League, collects financial information from its members’ tours. But the league is not the sole producer of the more than a hundred traveling shows that crisscross the United States every year. There are also educational and children’s theater tours and nonunion professional tours that recycle the Broadway canon, especially musicals. All Broadway League tours must be union tours, but nonleague tours are both union and nonunion.

The road, whether union or nonunion, is dominated by an entity that must be described to understand fully the structure and financial value of touring. It’s now called Key Brand Entertainment: a tour producer, a tour presenter, and an owner or operator of touring venues. For completeness, consider as well Las Vegas, which has ups and downs as an important adjunct or substitute for theater touring. Together these varied strands make up the road.


The Financial Players for a Tour

As described earlier, the producer of a successful first-class production obtains an option from the copyright holder that includes a number of rights, including the right to organize one or more national tours and international productions of the play or musical. In many cases a successful Broadway run will result in the same producer organizing at least one national tour. The producer may capitalize that tour using earnings from the Broadway production or may create a new producing partnership/company to produce the tour. Unless the legal agreements with the Broadway investors stipulate how tours are to be capitalized, it’s the producer’s choice. Tours typically take nine months to a year to organize.

Even shows that are not successful on Broadway may spawn tours anyway. Sometimes such a tour will result in payback and profit for the original investors.

-60-

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