Bloomberg Audio Studios, podcasts, radio news. On Sunday, Broadway's top build players will gather at Radio City Music Hall in New York for the Tony Awards, one night a year
where everyone can experience the magic of Broadway. For nearly eight decades, the Tonys have celebrated the biggest shows of the season, and this year the biggest shows are bigger than ever, at least when it comes to ticket sales, with audiences paying top dollar to see star studded shows like Othellow, good Night, and good Luck and The Picture
of Dorian Gray. An industry trade group called the Broadway League reported that this season has brought in nearly one point nine billion dollars, making it the highest grossing in Broadway recorded history.
The top end of the ticket prices going like higher and hire and hire. I don't know if that's going to stop. They have to make money.
That's Chris Rouser. He's the editor of Bloomberg Pursuits, which covers the arts, culture and luxury, and Chris says the theater is becoming more of a luxury because now more than ever, it costs an arm and a leg to break a leg on Broadway. In such a high risk, high reward industry, producers have been rethinking what it takes to make a hit show, and that business model shift is affecting everything from ticket prices to the kind of work audiences from all over the world see on stage.
You have to be not afraid to take a risk. I think this business is very risky, and you know, when talking to young producers as well as talking to investors, I'm very honest about the risks involved.
Kind of the conventional wisdom on Broadway in particular and commercial theater at large is it's very challenging to make a living, but you can make a killing.
I'm Sarah Holder today on the show The Big Take Goes to Broadway. I sit down with Bloomberg's Chris Rouser and speak with two Tony Award winning producers, Darryl Roth and Lucas Catler, about the economic realities changing the theater biz, what it means for tourism, for our and for what you pay at the box office. The economics of Broadway
have always been tricky. It's basically the whole plot of the Producers, where Matthew brodericks Leo bloom helps cook up an unconventional plan to make it in the theater business.
One of the right circumstances, a producer could make more money with a flop than he could with a hit.
It's expensive and it's maddening, and it takes a lot.
Of luck, just like in the producer exactly.
But I wanted to ask you why is it so hard to mount a financially successful Broadway show today?
The problem today is that costs are extraordinarily high. They're higher than they have ever been before. So the carrying costs from week to week are really just very hard to get over. Union labor. Almost everyone that works on a show is union, and they have a lot of protections, especially after the pandemic, so those costs are high. The theater rent for the limited number of Broadway theaters there are is a single digit percentage of ticket sales, so
that's a big chunk. You've got sets, you've got marketing, you've got all that stuff, So that actually adds up to an almost prohibitive base level that you have to clear in order to recoup your investment, which means it gets back to net zero.
Labor costs rent for a theater, materials to build sets and hang lights, promos and advertisements.
It adds up now to produce a play on Broadway. You know, the budgets can be anywhere between. I would say six and ten million dollars. On the high side, a musical is now twenty twenty five million.
Daryl Roth has produced more than one hundred and thirty shows on and off Broadway since the eighties, including Tony Award winning plays like august Osah County Warhorse and Paula Vogels.
In decent thirty years ago, you could produce a play for under four million dollars and have all the soups and nuts and desserts that you need to make it work.
Daryl is one of the producers behind one of this season's buzziest tickets, The Picture of Dorian Gray. It's a play based on the Oscar Wild novel and stars Sarah Snook, who you might know from Succession on HBO. How much did The Picture of Dorian Gray cost to mount.
It was a round eight million.
The goal for a producer is to recoup that investment, something that's easier said than done. Lucas Catler, who's produced Broadway musicals like Merrily We Roll Along and Hear Lies Love says that's what makes bringing a show to Broadway such a financial high wire act. When we spoke with him, he was inside a theater in London in the middle of rehearsals for a new musical. He's producing.
Even the best shows, the ones that win Best Musical and like really break through and find an audience, a lot of times those shows don't even make money, and so like a strange loop is actually a great example of a show that I didn't work on them Badway. I worked on off Broadway. But it's by all accounts extreme critical success and a really well regarded piece of art. But they haven't recouped on Broadway, for example, I mean they closed early.
When you got your start in the industry, what was the conventional wisdom that other producers shared with you about the path to success on Broadway?
I would say, writ large that it's very challenging. One in five shows will make their money back on Broadway, meaning a lot of producers will hopefully produce shows on Broadway that will Like you know, limited run plays will in the best case of success, return ten twenty percent to investors. Whereas musicals, you really want to get a long running musical that will then be a big hit and be able to sustain your ability to create other
work as well. So it's a high risk, high reward business and that's been the mo for Feeder since its inception in America, but also really really specifically on Broadway today, particularly because the margins are really tight between how much a cost to run a show and how much money you can make in the box office. I'm still a young career producer, but like still developing musicals with the
hope to ultimately make a killing one day. But for now, it's like there's no real avenue to make a steady income without having a show that's long running.
People are always swinging for those big runaway hits, those Hamilton's, those wickeds, which make the eighty percent of shows that don't recoup kind of worth the gamble.
But Chris says it is a gamble. The New York Times reported that four of the fourteen new musicals that open the season have already closed or set closing dates.
It's gotten harder to find investors because you know, statistically most things don't recoup.
And Daryl Ross says that's led to a big shift on Broadway.
I think the trend now which we didn't see as much when I began my career is the star vehicle.
The star vehicle like Dorian Gray starring Sarah Snook or Othello featuring Denzel Washington and Jake Jillenhall, or good Night and good Luck, directed by George Clooney, who also plays the lead. These plays tend to run for a limited amount of time based on the actors availability, and Darryl says it's a model that can help bring in early funding.
Both investors and producers can feel that there's less risk based on the appeal of the star we're talking about, and so it's easier to get investors to come along on the journey.
It can also be easier to get audiences into theaters. Othello gross three point five million dollars last week. Glengarry Glenn Ross featuring Kieran Culkin, Bob Odenkirk and Bill Burr made around two million dollars, around the same amount as The Lion King, which has been running for more than twenty five years. Dorian Gray brought in nearly one and a half million.
Goodnight in good Luck, which is on Broadway right now starring George Clooney has a big cast and is an expensive show, but it broke four million a week in ticket sales, which is a record, and that's a crazy amount of money.
Part of the reason it's making that much money is because a seat at good Night and good Luck can run you between about two hundred dollars and nine hundred dollars. How the new economics of Broadway are landing with audiences. That's after the break. It's harder than ever to succeed on Broadway without really trying or even trying a lot. Bloomberg's Chris Rouser says that's pushed Broadway producers towards a few different categories of material, the kinds of shows that
are considered an easier sell for audiences and investors. We talked about the limited engagement run starring a celebrity. Then there's the jukebox music.
Musicals are the hardest thing to produce and make succeed, and so if you can build a musical based on an artist's catalog like Share or Bobby Darren is one right now.
Tony Award winner Jonathan Groff is Bobby Darren in justin Time.
That has a built in audience. So that's sort of viewed as safe. And then there's like existing ip so like The Notebook, Back to the Future, Harry Potter, It's the Wizarding World on the Great White Way. These things that also have big audiences built in and feel less risky to audiences and producers. Those are kind of the three things that we feel like all the news shows are like that, and honestly, that can be tiring.
Whiches aren't getting picked up in this formula, Like which kind of productions does this shut out?
I mean it shuts out a lot of original musicals. It's very expensive to put on an original musical or any musical, and it's very risky. You know, it's can be twice as expensive as a play. So there's only a couple new like sort of really new musicals that are on Broadway this season. And then people are very familiar with Shakespeare Tennessee Williams. You see a lot of that sort of like Western canon stuff come back and
back and back. Lately, it doesn't feel like you see a ton of new artists or artists of color, or artists from a different background international, So yeah, I can feel like that stuff is being squeezed out it's.
Also driving ticket prices up.
So you'll generally see a show we'll start with some rush tickets or lottery tickets can be quite cheap, and then they'll start at fifty nine to seventy nine ninety nine dollars and go up into the three hundreds, maybe four hundred for premium seats right in the front, and that's very expensive. Some of the shows this spring ticket costs were eight hundred and nine hundred dollars, and that's a result of dynamic ticket pricing, which is the same as what airlines use and hotels use to book rooms.
So it's not a person deciding that this show is worth eight hundred dollars, it is ai deciding that people will pay eight hundred dollars to see a show. So we are breaking records in terms of what some shows are making.
What does it mean for the economy of a city like New York, which is built around tourists coming to see shows if the average tourists can no longer afford a ticket to an average show. I don't know if we're there yet, but.
Yeah, so New York views Broadway is an important part of its tourism infrastructure, and when we were coming out of the pandemic. The city took a lot of steps to try to help Broadway get back on its feet, because it's not just people going to Times Square, it's not just people who want to come to your show. Broadway is part of the appeal of New York and when things that get too too expensive and you can't come, that makes New York feel expensive, That makes you feel
like that city is not for me. But nobody wants Broadway to be inaccessible for everybody.
H bristle at the fact that some of the ticket prices for premium seats, when you know eight nine hundred dollars a ticket, I mean that cannot be the trend.
Producer Darryl Roth again.
But interestingly, the average ticket price this year was about one hundred and thirty dollars.
That means those eyebrow raising outliers are actually being and out by tickets to shows that have stayed more affordable. But whatever the price, audiences keep coming. So far this Broadway season, over fourteen point six million people have seen a show. It's the first year that's gotten close to the industry's pre pandemic attendance levels.
We've had ninety one percent capacity on Broadway, which is really wonderful. So things are looking up, and certainly everybody feels excited post pandemic to see Broadway coming back. You know, it's it means so much to the city economically, let alone those of us that just love the art form.
It's part of the reason why Daryl says taking all those risks we've been talking about can be worth it, including supporting shows that don't fit the money making molds producers have been leaning on more and more.
It's hard to say what's commercial and what's not commercial before it happens. You know, we've often been really surprised by things that we think aren't going to be commercial and they are and vice gers. So I say it to people, just do what you love and be driven by what you respond to in the hope that other people will respond to that same story.
The big example this season is Maybe Happy Ending. Did you see it?
Yes?
Yeah, Julia Press, our producer, and I actually saw it together. Oh loved it.
Yes, wonderful show. It's very original but actually debuted in Korea and then came here and it's a little magical show about two robots and a robot retirement home, and that alone sort of doesn't necessarily feel like the great raw material for a music hall Shakespeare Shakespeare. And it's also it's just two people on a stage. It's kind of actually, at the root of it, a small story. But the music is wonderful, and the set is incredible, and the story is lovely, and it just feels so
fresh and original. I remember, actually I'm getting goosebumps talking about it. When I saw it in previews, the set broke three times, and even so everybody's sitting there was like, we're seeing something. This theater is half full. We don't know if anyone's going to come see this show. And then had such incredible word of mouth that it just built and built and built and built, and now it's selling incredibly well you can't get tickets.
Yeah, yeah, there's such a magic to that. Yes, we'll see whether the Tony voters agree. Daryl, of course, is rooting for Dorian Gray.
Certainly, I believe Sarah Snook should win the Best Actress in a Play. I have obviously a personal belief in that, but I do believe she deserves that honor.
Meanwhile, the producer Lucas Catler is pulling for Oh Mary.
I'm seethingly jealous of everyone involved in this show because it's like it's doing everything that I love, is such a joy and a romp while still showcasing the highest level of artistry that theater makers have to offer.
But whatever happens on Sunday, Darryl says, next Broadway season is sure to bring its own surprises. What's next for the industry.
I think that this year has shown producers and audiences that you can take a chance on something that might be a little unique and out of the norm that I hope continues. I'm sure the star vehicles will continue, There's no question about that. I think we'll see more smaller musicals being mounted, what I like to call chamber musicals. And I also think we'll see a trend to plays
that appeal to a younger audience. Now that this year has shown that there is excitement and enthusiasm from you know, the younger theater going audience, I think we'll all be happy to offer more good fare and keep that audience growing. I mean we must, otherwise you know, we'll be out of business.
This is the big take from Bloomberg News. I'm Sarah Holder. The show is hosted by Me, David gera Wanja and Seleia Mosen. The show is made by Aaron Edwards, David Fox, Eleanor Harrison Dungate, Patty Hirsch, Ridgel, Lewis Chrisky, Naomi Julia Us, Tracy Samuelson, Naomi Shaven, Alex Dugia, Julia Weaver, Yang Yong take Yasazua and Julian Weller. To get more from the Big Take and unlimited access to all of bloomberg dot com, subscribe today at Bloomberg dot com Slash Podcast offer. Thanks
for listening. We'll be back on Monday.