No. 1 with a Bullet: Venues versus alcohol
If music doesn’t have an age restriction, then why do some music venues? Occasionally, shows will be limited to those 21 and over, or if they are all ages, they require you to pay a fee if you are under 21. Age doesn’t have anything to do with music, but age restricts drinking, and drinking has everything to do with music.
When people are at shows, they sometimes like to relax and have a couple drinks. For smaller venues, this luxury becomes a huge part of their business model.
When bands play at venues, the venue is the one paying them to play, so they need to create revenue in order to maintain the cost of bands, operations, salaries, etc. I don’t know the exact breakdown of where your money goes when you pay for a ticket at a smaller local venue, but some, if not all, of that money usually goes to the bands. So what else do you have the option of selling? Alcohol.
Small venues literally need people to buy alcohol at shows in order to stay afloat, which is why anyone under 21 pays a fee to make up for the alcohol that they wouldn’t be selling otherwise.
But if you think small venues have it bad, check out how much worse arenas have it.
There was an article in New Jersey’s Sunday Star-Ledger about the economics of the concert business. Britney Spears performed at New Jersey’s Izod Center last August and made $1.75 million in ticket sales (which all went to Britney). But the venue was only left with a $170,215 profit for the night.
The only way arenas like Izod make money is from charges such as parking, concessions and rent, and that revenue depends on who’s performing. Think about it: the crowd at a Britney Spears show is going to drink a lot less beer than one at a Bruce Springsteen show ($45,599 and $209,138 in concessions, respectively), and there will be a lot more carpooling in minivans at the Britney show than Springsteen ($66,089 and $209,652 in parking, respectively).
But who’s going to park and buy food at your venue if you don’t have a big act to see?
By the time Izod pays Live Nation, production, security and employees, their parking and concession revenue doesn’t really mean much.
You may need to be 21 to buy alcohol, but you’re never too young to learn about the effects of its consumption.