Event promoters didn’t have it any easier. While they hustled and shook to put feet on the floor and butts in the seats of the venues they represented, the venues themselves and the recording studios where the music supposedly originated walked away with dollars that had little to nothing to do with the live show.

“People don’t realize the value of event promoters, and it’s been that since I got into the business,” says promoter Ike Bradley of True Head Promotions. “The only way to get eyes on the stage is to get out and promote, all day, every day. There are extreme jobs that are easier than this.”

The Wall Comes Down This power structure has changed over the years, opening the door to more opportunity for artists of all varieties. Atlantic Records has been pushed aside in favor of the revenue sharing provided by YouTube and iTunes. Artists even have the capability to build their own platforms and sell their own music, as demonstrated by Fifty Cent’s bypassing of the record companies as well as the rise of Eminem under the tutelage of Dr. Dre. The countless artists who have been able to breakthrough the once rigid powers that be indicate that the walls of artistic restriction have officially crumbled.

Then again…

The More Things Change, the More they Stay the Same Artists and event promoters have made progress, no doubt, through the rise of digital outlets. Social media promotion has put event masters on the map more easily than ever before. Artists have exploited the democracization of the internet through blogs and other similar content platforms.

Then again, the original revenue model that put food in these artists’ mouths is still the same: become popular, sell music, sell out concerts, bank your money, and keep churning out hits. And while a lot of that probably isn’t going away, it’s also not exactly innovative.

The good news is that being a musician isn’t the same as being an athlete. Old athletes lose their core ability to make money and are forced to find new ways to build revenue, as is evidenced by the painfully high number of athletes that lose their bankroll in retirement. Artists, on the other hand, can generally perform their routine into their golden years and beyond. Madonna, Tom Petty and the Red Hot Chili Peppers all played at the Super Bowl years after their best-selling albums were released. Then again, not everyone is as famous or successful as those groups, leaving plenty of musicians in the precarious position of securing alternative revenue streams of capitalizing on the height of their career. Even MC Hammer eventually went broke, and even if financial mismanagement had something to do with it, there’s more to be learned from his tale than the importance of smart financial planning.

The Artistic Ceiling isn’t About Losing Inspiration It’s about maxing out revenues.

When artists pack the house, they have the opportunity to sell everyone in the venue an album, T-shirt and other merchandise… and that’s it. If the venue holds 1000 people and tickets are $25 each, revenue for the night caps at $25,000. Between the employees of the venue, the venue’s cut, operational costs associated with electricity and equipment wear and tear, the event promoter and the artist, that money gets divided rather quickly, transforming even the most successful nights into barely enough money to cover the surface of the table. Even if the artist manages to convert 20% of the audience into merchandise sales at $20 each, the result is an extra $4,000. It’s not a bad cut, but it won’t make or break the artist, especially after you factor in a manager’s cut, travel expenses and every other cost that comes with being a professional musician.

Artists are still seeking the next way forward: either they determine effective new revenue streams, or risk going broke in their post-career “glory days.”

The Answer: Live Streaming Live streaming is the answer to artists’ and event promoters’ woes. While the venue may sell out, fans can still attend the show in spirit and experience it in sight by watching the event via live stream broadcasts. These same broadcasts can also be sold later, creating multiple streams.

The advantages don’t end there. The venue is in only one city, but live streaming allows fans from all over the world to enjoy the show by getting in on the action. It also engages fans that may not be looking to pay the live ticket price or go through what some may consider to be the nuisance of a live show.

Consider the scenario mentioned in the last section. The complete haul for the artist was $4,000 + a cut of the $25,000 from the gate – the cost of doing business (travel, etc.). The event promoter simply walks away with whatever cut is negotiated with the club or venue.

But what if five times the number of fans inside the venue ordered an available live stream pay per view for a mere 1/5 the cost of ticket prices? Revenue for the event would nearly double in a snap. And while the live stream partner facilitating the stream would receive the bulk for operations, the artist and event promoter would still walk away with a much better haul. Assuming the artist takes 20% of the live stream revenue in our scenario, it makes for an extra $5,000, dwarfing merchandise sales. Better yet, that same revenue stream becomes available every show, bringing the artist more than $100,000 over a twenty city tour.

$100,000 at 5-8% compounding interest is an artist’s retirement plan waiting to happen, and it requires no additional cost or headaches on their part. The same can be said for promoters.

“Extra money all around without having to pack the arena beyond fire code?” says Bradley. “Sounds like a winner to me.”

The fans win. The artist wins. The promoter wins.

Everyone wins.

Originally posted at That Video Magazine.  Used with permission.