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As coronavirus concerns bloom, performing arts world fears major hit
NEW YORK, March 11, 2020 (BSS/AFP) – Coronavirus angst has the world
washing its hands with newfound vigor — but the performing arts world
wringing them, as directives to scrap mass events threaten the entertainment
world with economic chaos.
The past week has seen major events including Miami’s Ultra electronic
dance music fest and Austin’s famed South By Southwest culture and tech 10-
day event cancelled, and the spring’s premier Coachella festival postponed
until October.
Pearl Jam, Madonna and Santana are among the A-list artists who’ve dropped
or postponed concert dates at home and abroad over virus fears, with fine
arts venues like the Boston Symphony Orchestra and New York’s American Ballet
Theater also cancelling tours in Asia and the Middle East.
Elvan Sahin, a 32-year-old Manhattan resident, decided against attending a
classical music concert this week at New York’s Lincoln Center over the
coronavirus, saying: “I think I’m going to be more comfortable sitting this
out.”
“I’m used to tuning out the hype and exaggeration around hurricanes and
snowstorms, but this whole contagious virus thing is new to me,” she told
AFP.
“I know I sound crazy — but I’m not handling it very calmly.”
– ‘Already on fire’ –
Kevin Lyman, founder of the Warped Tour — a traveling rock tour that ran
from 1995-2019 — said the last time he witnessed such entertainment industry
chaos was post-September 11.
Amid that shock, he recalls the first reaction was “to keep the show
going.”
“And of course it didn’t,” he told AFP. “The music business shut down for
awhile.”
But Lyman called the current coronavirus panic “unprecedented.”
Adam Siegel, the entertainment manager at American Agents & Brokers — an
insurance company whose clients include Ultra — said that massive events
like Coachella might have four to five different insurance policies.
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Terrorism insurance has been commonplace since 9/11, and many American
events now buy active shooter insurance, he said — but the average contract
doesn’t have a clause for communicable disease threats.
Now it’s too late: “You can’t get insurance on a building when it’s
already on fire.”
“If they have a policy that’s going to respond, in most cases we need a
government entity of some sort to pull the plug,” Siegel said.
That requirement is likely why California’s Coachella festival — which
has been sold out for months, and expects 125,000 fans daily over the two
April weekends — waited until Riverside County declared a public health
emergency, and ordered the rescheduling.
– ‘Uncharted territory’ –
A mandate from Riverside County — the municipal authority where the
desert music festival takes place — to cancel or move the show would trigger
any protective insurance policy promoters have, Siegel said.
It could also allow events to exercise a “force majeure” clause in
performance contracts, which waive financial liability between promoters and
artists in the case of extreme, unpredictable emergencies.
Coachella nets between $75 million and $100 million in profits each year,
according to the LA Times.
For now, it’s just postponed, but in the event of cancellation an
insurance payout due to force majeure could hover between $150 and 200
million.
Depending on individual contracts, artists would likely keep whatever
payouts they’ve already received — but might be out money already spent on
set production.
In the end, “it always is going to come back to what the actual cause of
loss was and if that was a covered peril in your policy,” Siegel said. “It’s
not black and white. It’s open to interpretation.”
“It’s really uncharted territory.”
– ‘Devastating’ –
The economic consequences of pushing back or cancelling major festivals
and events reach far beyond promoters and artists, Siegel said.
“There’s a lot at stake,” he said. “There’s a lot more people that are in
this food chain that are going to be affected — vendors, crew, local
businesses.”
“In a gig economy, many people who have been booked to work Coachella, for
example, could be out a lot of money.”
Just under 400,000 people live in the Coachella Valley, with a population
that skews older — the very people coronavirus could hit hardest.
But it’s also a zone where tourism reigns: the Palm Springs-area visitors
bureau says the $7 billion-industry supports one in four jobs.
Fear in the festival circuit extends to concert venues worldwide, Lyman
said.
Large entertainment companies like AEG — the parent company of
GoldenVoice, which puts on Coachella — or Live Nation will “take a hit,” he
said, but it’s the independent club owners facing serious financial threats.
“Those small people that depend on the weekly business that don’t have big
reserve funds — it could be devastating,” he said.
“Every day that goes longer, it’ll hit them to a greater degree.”
But as the world reels from cancellations, it appears venues can count on
at least one artist to stick it out.
Bob Dylan, 78, on Monday announced a summer North American tour — on top
of April’s schedule that has him playing 14 dates in Japan.
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