💸The Cost of Living vs. The Cost of Doing Business
Wayfinding: Conclusion > The Other Side of the Argument > The Cost of Living vs. The Cost of Doing Business
For many second wave digital theatre makers, the loss of income continues to shake the industry with little relief. The sudden pivot to digital and subsequent rapid ‘return to normal’ have not only eaten up all the funds large companies may have saved from the government’s generosity, : ‘Expenses, partly due to the general inflationary trends, have risen’. Simultaneously, audiences have not returned in the droves hoped for – that ‘showing up at in-person events fell 6%’ and ’82 percent watched or listened to arts activities through a digital platform’ between July 2021 and July 2022. ‘Confirming our population surveys, interviewees reported audiences as being “terrifyingly” slow to book’, Covid-era theatre survey reports. More audiences are waiting until the last minute so they know they can afford the theatre ticket.
Some groups speculated that more types of people might be interested in digital or hybrid theatre, especially if they did not previously go to in-person theatre; the hope was to bring in new fans and new money. However, s: ‘Although the frenzied shift to digital made some content cheaper and more accessible for existing audiences, it has so far failed to diversify the audience base. We ultimately witnessed more cultural engagement from roughly the same number and type of audiences’. : generally, they found that those who had previously attended arts organisations in-person, such as theatres, were more likely to also attend and support online, while after 2020, the number of audiences who were new to the organisation dropped. Even with the expense and effort of expanded access with digital and online offerings, this access does not make much difference to those who otherwise are not going to the theatre.
Inflation across the board continues to increase the cost of creative production, regardless of medium; producers are pushed to recoup costs faster, but audience members are holding back due to the squeeze of the cost of living. on the cost of both theatre and its new digital needs: ‘There is no standard contract, right now, for the pay breakdown when a theatrical production is filmed for streaming – that means every show that is filmed has to negotiate separately how much each person working on it is paid’. In contrast, Tran notes in this article, in the UK the government subsidises digitisation, unlike the US or Australia. Larger organisations like the National Theatre have many upfront costs, including film crew and performer contracts, paid for. While this model might be worth pushing for in other countries, though, it cannot guarantee theatre makers will find and generate more revenue.
Online work might bring more attention but won’t necessarily bring more income, as even major streaming companies typically lose money, as Grant Dodwell from Australian Theatre Live told me: ‘The business model has changed, and even cinema’s business model has changed to a great degree. But with your Netflix and your streamers now, which are all losing money, and all the subscription platforms are losing money – we’re niche’.
likely stemmed from early free or donation-based works in 2020: ‘At the beginning of the shutdown, digital platforms were a critical tool for audience engagement. … In the initial panic of moving their artistic offerings online, companies have undervalued their own product’. Andrew Hungerford said Know Theatre experienced similar issues with ticket sales, leaving the experience unpredictable at best, and a financial loss at worst; he knew specifically which shows had made any money off livestreaming or recordings: ‘we were able to get the multicam edit of the show Alabaster by Audrey Cefaly online, and we actually sold enough tickets to that video-on-demand version that we met our box office goal for that production. Which was incredible’. Morgan Green of Wilma Theater told me that they were able to make good revenue off livestreams and other streams of their shows – Wilma announced they would stream every show in their 2024/25 season and offered a season ticket package for just their digital option – but their success seems a rare exception. Andrew Hungerford generated a report that he posted on Twitter/X in 2022, breaking down Know’s losses on streaming ticket revenue; he described the struggle to me:
… we are living in this tension of commitment to paying an artist a living wage, and also for accessible ticket prices. … also, accessibility. And my feeling is, the outcomes for any grant to an arts organization should be, Did artists get paid? And was art made? And if art wasn't made, with something learned? And to me that feels like that should be the outcome. ... our best-selling digital work sold like kind of middling performing in-person show and our lower selling sold like not very well selling in-person show … … in our first year of that ’21, ’22, about 14% of our total audience engaged with the work digitally. … And this season, it's been more like 10%. So, from what I hear from other sources, 10% is sort of the sweet spot for theatres that are still successfully producing digital work – 10% is a is a consistent number for theatres that are successful with it. And to me that has a lot of value, because that's still 10%.
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