High Entry Cost and “Retainability” of Musical Organizations

Kid Rock performs with the Detroit Symphony Orchestra. The Sold-Out show raised over a million dollars for the DSO. Or maybe some of those funds are going to relocate the Kid Rock Badass Beer?

In my previous post I outlined some aspects of various performance based industries (Classical Music, Sports, Pop Music) and how audiences numbers can matter little to the largest organizations within them (Orchestras, Sports Teams, Pop Superstars).  I highlighted what i was referring to as an “infrastructure” which contributes to the lion’s share of revenue (and resources) that are as much, if not more, important to the profitability (and sustainability) of such industries.

Ironically, given his position within the field of cultural economics and the “Cost Disease” named after him, William J. Baumol discusses how industries can become “too big to fail” in almost the opposite way that so-called labor-intensive industries (such as the Performing Arts) are “too big to succeed” due to the Performance Income Gap.

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