Performance fees and venue revenues

Anyone who has the slightest amount of experience or involvement in the Second Life music community knows and understands that the current model does not work in favor of the venues or venue owners. I have personally been a sole venue owner and still currently pay for shows that are performed on my land. I have many people come to me with ideas and solutions and have heard others opinions as well. I’m writing this to express my ideas and opinions and while some people may agree with me and others will not these are my thoughts on the matter and not on behalf of anyone other then myself.

So before we begin to find a solution we need to first look at some hard facts and some of the things many people avoid talking about for fear of being looked down upon. I personally do what I do because I love doing it. This is something I hear repeated and see reflected over and over again in the music community. But just like real life we all try to find something to do that we enjoy doing that provides a benefit to us at the same time. I hear comments like ” it’s all about the music.” and ” I do it because I love the music”. Everyone understands this and all of us agree with it, but at the end of the day there is a business side to what we do and people avoid facing it because they’re afraid others will think they aren’t about the music. So lets just all agree that we all want the same thing and that is for the music to continue and grow and get that out of the way and look at what needs to be done to make the changes to our current culture to make it more fair and equitable for everyone. Before we can start to talk about solutions or ideas we need to look at how things are now and why they are that way.

Why do the performers have a fee and how are they determined?

When you hire a performer to perform at your event or venue you are paying them to provide a service. You’re paying for their time and talent and skills that they are able to provide that others can not. If anyone one could do it their would be no reason for the service.  Any experienced performer that does shows for a fee understands that there are certain things expected beyond the talent and quality of the performance they provide, mainly promoting their shows and bring as many people as they can to the venue they are performing at. Everything they do focuses on these two things and they work together hand in hand. Improving their show and increasing the amount of people at their shows.

A good performer spends a major part of their free time either learning new songs or in some cases creating their own. they practice and rehearse, if they play an instrument they learn to play new stuff. Anyone who sings on a regular basis quickly learns that the voice is a muscle, like any muscle it has to be trained and exercised in order to grow and improve. They also spend time before during and after shows talking with the people who hire them and come to listen to them in order to build relationships and increase the attendance at their shows, As a cost of doing business most of them will hire a manager or another form of assistant to do other tasks for them so they have more time to focus on improving their shows.

Technical requirements. Performing in Second Life or any virtual manner requires more then just a computer and headset if you want to provide any kind of decent show at all. At minimum a performer needs a mixer and a decent microphone. If they play an instrument they have to maintain the instrument. sometimes better computers, sound cards or software is needed to do what they do. The better quality any of these items are the better the sound quality is and the better the show quality is, most performers start with the basics and then as their shows grow and improve they upgrade their equipment. Even if they aren’t trying to upgrade, over time all of this stuff has wear and tear and eventually breaks and needs to be replaced and becomes a cost of doing business.

There is no standard or guideline for determining how much a performer should charge. There’s no rule book that says if a performer does x,y and z, they get paid this amount. An experienced performer or venue owner knows there are certain factors that need to be considered when determining what fee to charge or they are willing to pay. There are three primary or major factors; the first being the level of skills and talent the performer is able to provide, the second is the quality of the show, and third is a direct result of the first two combined with promotion of the shows, the popularity of the show or how many people the performer can bring with them to a show. this third one is often looked at the most by the venue owners as they currently rely solely on venue tips for revenue from the show. A secondary factor for the performers themselves is the frequency of which they wish to perform. The rate they charge affects directly how many shows they perform. Higher fees equal less shows.

WSL does not require the performers to charge any specific fees, the only requirement we have is they charge the same for every show they do. We do this in order to be fair to both them and the venues, it is not fair to charge one venue more or less for providing the same service to both. We do discuss there fees with them and look at the factors I described above and we may suggest a higher or lower fee but ultimately the performer is the one who determines what fee they will charge for a show. The talent and skill provided along with the quality of the show are not consistent factors, so most often the primary determining factor is the one that is most important to the venues. Popularity or attendance at shows.

Fees just like anything else in a free market are subject to supply and demand and may affect them slightly but we have found there is a fairly standard range that venues are willing to pay for and this is what we suggest or recommend based on attendance. These are averages and may vary slightly. This applies only with the performers we work with directly.

average attendance of 15 to 20 people $2500

average attendance of 20 to 25 people $3000

average attendance of 30 to 40 people $3500 – $4000

average attendance of 40 or more $5000 – $6000

 

Why own a venue?

When a new person comes to me and wants to book a show, one of the first questions I ask them is why? Why do you want to have a live performer on your land? Invariably I get one of two answers.

The first being that they have something else on the land they want to promote and want people to visit the land. whether this is rental properties, stores etc. These people are often hoping to generate enough income off the other sources to compensate for the cost of the shows and often become frustrated with the expense. Most of them still have a love for the music and the shows and the community itself, they are just trying to compensate the expense. But this method has been proven to fail repeatedly for years and rarely results in a venue even breaking even on the costs of operation.

The second answer I get always has something to do with being involved with the music and the shows and the community. It may be a specific performer or just the music in general but they want to be involved and participate and provide somewhere for the performers to perform. The experienced people in this group have accepted before they even start that the current model does not work and they will only spend money that they won’t get back. The less experienced ones quickly find out how expensive it is and usually close their doors shortly after opening them.

Either of these result in one thing. Either an individual or a small group of individuals paying directly for all the expenses associated with providing the shows and then hoping that the majority of the people who attend and benefit from the show will make a random voluntary donation to help pay for it.

Lets look at some of the expenses that are involved and associated with owning a live venue. Again this varies greatly according to the size of the venue and the frequency and quality of shows performed, so I’m going to try and reflect an average venue. One of the biggest expenses up front is the virtual land itself. Most of the average or bigger venues own or rent anywhere from a half to full sim of land. this equates to $150 to $300 usd a month. Next is landscaping and decorating the land and the venue. Some people are able to build and do this themselves, others purchase items to decorate with and some will even pay someone to do the decorating for them. The venues re decorate according to seasons and holidays and special events. So whether it is personal time and investment or your paying out of pocket it equates to roughly another $100 to $150 usd a month in decorating and sim expenses. So at a bare minimum before you even start you’re looking $250 to $450 USD not lindens a month. Some venues try to do it all themselves or have staff that are willing to work for tips only while others will pay for staff. so being conservative we’ll add in another $50 to $75 USD a month for this expense. Now we add to this the cost of the performers fees. Again this varies greatly according to the frequency and quality of the shows so we will look at an average. Currently the median range of performer fees is about $3500 lindens for an hour show. Most venues will do an average of 7 to 10 shows a week. So still being conservative we figure 7 shows a week at $3500 per show, this works out to $24,500 lindens a week or $106,000 lindens a month. As i am typing this if you purchase a $106,000 lindens from the exchange that equals $431.90 USD . So if we total all this up it means the average venue spends between $750 to $1000 USD, not lindens a month and this expense falls directly on an individual or a small group of individuals.

Before we proceed there are a couple things I would like to mention. The first is that no one requires anyone to own a venue. I occasionally meet venue owners who seem to feel as if they are required or someone is forcing them to pay for something they don’t have to pay for. If you choose to own a venue then yes there are expenses involved, but it is ultimately your choice to own one or not. If this is how you feel perhaps owning a venue isn’t really meant for you. Another attitude I have been approached with is that in some cases the venue owner feels that instead they are the ones providing a service to the performers by providing them with somewhere to sing. I hear comments like ” I spend all this time and money on land, and getting people here to hear them sing. They should sing for me for free.” If this is your approach to owning a venue you are destined to fail. As a venue the services you provide are for the crowd or people who attend the shows, the performers are people you hire to help provide these services. The crowd is your customer, not the performer.

So what does all this mean and how do we fix it?

Some people reading this may be perfectly happy with the way things are and are happy to just continue doing things the same way they have always been done. Some of what I am about to suggest may not be popular and may cause some dissension. For WSL and myself personally, whether changes happen or not we will adjust and continue to provide the same quality and professional services we always have. I am not trying to encourage anyone in any particular direction, I am only simply addressing the concerns and providing my suggestions for possible solutions.  The SL music community is a small community and culture of it’s own within SL and a culture can not change over night or immediately but IF, I repeat IF, people want to see things change they have to start somewhere.

The biggest issue with all of the thing we have discussed is that the venues do not have any source of income or revenue for the shows other than the hope of a random donation from the people who attend the shows. Until this is addressed nothing will truly change and people can talk and wish and hope for as much as they want. If you as a venue offer people your services and give them the choice of free or paying for them regardless of the quality of the services you are providing, the majority of them will choose free every time.

In real life when people attend a live show there is either a ticket fee or a cover charge. The reason it’s called a cover charge, is because it is meant to cover the fee of the band or individual performing. The venue makes any of their money or profit off of the sale of concessions and souvenirs. This is not really an option in a virtual setting. But the majority of the venues that I hear from tell me they aren’t really looking to make a profit and would be happy with just making back most or all of what thy spend. As I mentioned above more then once, the expense for the shows falls on an individual or a small group of individuals. The majority of the people who receive the benefit of the services of both venue and the performer are allowed to do so at no charge and completely free to them. So unless the venues choose to charge the people who attend the shows this will never change and things will continue the way they are.

There is already a built in option in the land to charge a cover charge to be on the land and can even be set for time periods. The biggest issue or obstacle to this is getting everyone involved with the shows to agree to it. The fear or expected result is that if a venue charges a cover charge people just won’t attend and they will go somewhere else for free. I’ve heard from other individuals “it’s been tried before and it never works.”  And I agree if it’s just one individual venue trying to make a stand this is what would happen. But if even just the top 5 or 10 venues in SL agreed to work together this would start to change. Yes there would be widespread dissension and even some outrage from some people and I likely will receive some just for mentioning it.  No one wants to or is happy about paying for something they have been getting for free. But once things settled down and it stared to become the normal rather then the different, we would see a lot of change and the music and music community would grow to be even more then what it is today.

If a large enough group of venues came together and agreed to charge cover fees for their shows, they could then approach the performers and offer them an incentive of a slightly higher fee in exchange for agreeing that they would only sing at venues that charge a cover charge for their shows. Pretty much all performers understand the venue needs to make back their money somehow in order to survive and I personally think that many of them would be likely to agree to these terms if there was enough venues participating. Any other venue that doesn’t normally charge a cover charge could always have the option of booking the performer as long as they charged a cover for that performers show. Tips for both the venue and the performers would become what they are meant to be. A gratuity not a charge or a fee for the services provided by both the venue and the performers.

There would still be venues that don’t charge and performers that would be willing to sing there. Just like in real life the people and the free market economy would decide which venues and performers they like. I agree there would be both pros and cons to this method and in the beginning things would likely seem to get worse not better. The general public will be resistant to wanting to pay and attendance will drop. Fans will likely choose to attend a set of shows rather then a single show in order to pay less cover charges. But again it’s a community and a culture and change doesn’t happen over night. If it remains consistent it will become the normal rather then the adverse.

Again I am not saying any of this must happen or trying to start an uproar. This is just my thoughts and logical responses for the people who are expressing that they want to see change. I am leaving this page open for comments and I am always willing to discuss anything with anyone personally. If you managed to take the time to make it all the way through this I sincerely thank you and congratulate you and look forward to hearing from you with your own thoughts and ideas.

Jorrdan Jarman

 

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