Should the big corporations negotiate alongside you and me?

I’ve got my mind on the armada of corporations that are sailing towards our shores lately (see Wednesday’s post), and I started to think about how publicly traded companies, with market caps in the billions, might affect the cost of goods and services in our biz.

Let’s say in 10 years, there are 7-10 shows on Broadway produced by Giant Corps . . . you know, the ones with multiple revenue streams across multiple industries . . . where Broadway and its $15-20mm capitalizations is petty cash.  And let’s say those shows are also brand extensions, and could provide value to the company in other ways, regardless of the success of the Broadway production on its own.

The first question is . . . should those corps negotiate with our unions alongside an independent producer?  Are the playing fields the same?

The independent producer’s investors, who invest in one specific show, have just one revenue stream . . . that specific show.

The corporation’s shareholders have multiple revenue streams, not only across other industries, but most likely for that product itself.

Which one is less risky?

The second question, is what happens to non-collectively bargained rates and services?  This is an industry whose agents, lawyers and managers love to scream precedent and, my favorite, spout an individual’s “quote” (or the highest amount the artist, provider, etc. has been paid).

Should a “quote” or rate paid by a corp be applicable to a negotiation by an independent producer, whose investors live or die by that one show?  (Remind me to tell you about the time an agent asked for an amount for a client and then said, “Well Disney paid it, so . . . “)

One of the reasons that costs continue to go up in our business is that the vendors, artists and service providers all have to price for a “hit.”  They want to make sure if the show runs for twenty years, they were adequately compensated, which I totally get . . . and is a good negotiating strategy.

However, corporations, whose economical model allows them to pay more, because they are in fact getting more, may artificially push rates higher for you and me.

What this means is that the independent producer is going to have to be much more resolute in the negotiation process during the corporate invasion, making sure people know the difference in potential for the individual investor versus the corporate shareholder.

 

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Comments
  • Frank says:

    This sounds a lot like a few of my comments over the past couple months on here. It’s all true.

    You no longer negotiate a “fair” wage, you negotiate a “fair market” wage. Good luck, Ken.

  • Daniel Rich says:

    I hate to say it, but welcome to the way the rest of the world works. I worked for a smallish company in Silicon Valley for many years. In trying to hire systems or software engineers we would always hear “but I can make $xxx more at Google or Facebook.” We were to small (and admittedly cheap) to compete with them on that level. That didn’t mean that we didn’t fill the positions, it just meant that we had to search longer and find the people who really wanted to work for/with us.

    It’s a little different dealing with the unions, and honestly I can see a day when that model is going to have to change for the independent producer to survive. However, the same could be said of Hollywood and the small production houses have continued to succeed there.

    • Jerry K says:

      Maybe the engineers just wanted to work for someone who knew the correct usage of “to” vs. “too.”

  • Carvanpool says:

    Wow. Aren’t we all Whiney McWhineface.

    Boo hoo. A level playing field? This is America, dammit. You gettin all Bernie Sanders now.

    We don’t want no stinkin Socialism, do we?

  • Ken Wydro says:

    Quixotic question. The unions don’t care. To them, corporations means good wages. They don’t really give a shit about “independent” producers and the risks involved. They get paid first. If there is a long run, so much the better. This is the way of the Broadway world. Safe, soul-less, bell-and-whistle, gaudy lights and set production without a wisp of pain or genuine emotion. Broadway is gonna become more and more Disneyland, or an across-the -pond pit stop for the National Theater or RSC. A theatric kind of corporation.

  • RICK says:

    Money makes… the world go round…the world go round….$$$$$…Like…Jerry McGuire…YOU>>>Had me at Hello…Show me the $$$$…You Complete Me!…

  • Dan Radakovich says:

    Basically the clear advantage to a corporation with a property is to have it first shown as a Broadway play or musical as that way they can A) try it out first for B less than a full-press movie production. It also will generate essentially “free” publicity for a future film release/tv series/spinoffs etc. so it makes sense to do it over the liong haul. However, the fact is that going such a route while it maximizes total return in absolute dollars, the major entertainment concerns are FAR more interested in immediate returns/turnover. The model may be tried out but the advantage to them is to have as fast a profit as possible and to get it to produce more product, while the theater will always be one of the slowest returns possible[limited by single theater seating for each show even if a 2k seat venue, while a film in 1000 theaters even at 40 attendees per is 20 x that. The show mayrtun for years but the movie will mainly be over in a month, or a tv show in a season unless a mega hit. So the theatrical adaptation of a property will likely only be an afterthought for already successful franchises, which Disney will likely do well with but others I think will try it and not be successful enough to continue it for the most part.

  • Martha says:

    Are the Theater owners whores for Hollywood?

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