Copenhagen Phil in danger – online petition

The current Danish Minister for Culture, Mette Bock, recently wrote a feature article in the Jyllands-Posten (Jutland Post) which suggested that Copenhagen Phil- Zealand region’s symphony orchestra be closed down. At the same time, politician Alex Ahrendtsen from the Danish People’s Party also proposed plans to close down the orchestra.

Copenhagen Phil needs your support!

The Danish Culture Minister aims to strengthen the Danish orchestra landscape.. however closing Copenhagen Phil seems to be the least constructive way to achieve this. According to Politiken newspaper, “..of the 5 Danish regional orchestras, Copenhagen Phil has been the most proactive in re-thinking the idea of what a symphony orchestra can contribute with new concert partnerships, pop-up concerts in the metro, and a strong working relationship with private businesses. Copenhagen Phil is an innovative center for the presentation of music for a growing and diverse audience in the whole region”.

Copenhagen Phil is the island of Zealand’s symphony orchestra and it plays for just as many audiences in Copenhagen as in the rest of Zealand. The orchestra is Zealand region’s local sympony orchestra, which regularly meets residents from all over Zealand and in the concert hall in Copenhagen. If the orchestra is closed, one entire region in Denmark will not have a symphony orchestra- a region with 2.6 million inhabitants and with the largest land area. How is it possible that Zealand may no longer have it’s own regional orchestra?

Help the orchestras  fight to save an innovative and modern symphony orchestra, which works in and for all of Zealand, including Copenhagen.

Sign the petition here!

Please note that you have to confirm your signature in the confirmation e-mail.
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US Orchestras loose subscribers and audiences

The League of American Orchestras has released Orchestra Facts: 2006-2014, the organization’s first comprehensive longitudinal study of American orchestra finances and operations.

Survey says: US orchestras loose subscribers and audienees

Survey says: US orchestras loose subscribers and audienees

Using an extensive variety of organizational and external data sources, the study depicts the enormous breadth and scope of the American orchestra field, along with the complexities and resiliencies inherent in the art form’s business model. With its focus on the nine-year period from 2006 to 2014, including topline trends, five-year trends, and one-year snapshots, Orchestra Facts examines the effects of the recent recession, as well as broader trends around audience attendance, orchestra finances, and accessibility.

Orchestra Facts: 2006-2014 reveals a remarkable breadth of activity and commitment of resources on the part of orchestras in service to their communities,” said League of American Orchestras President and CEO Jesse Rosen. “Our first-ever longitudinal study provides an authoritative fact base for analyzing orchestras’ finances and operations, as well as new metrics for understanding orchestras’ education and community engagement activity.” The report finds that the scope and scale of the orchestra field in the United States is vast: in 2014, 1,224 orchestras contributed $1.8 billion to the U.S. economy and attracted a total audience of nearly 25 million. Two out of every three orchestras operated with annual expenses budgets of under $300,000. Cost barriers traditionally associated with attending orchestra performances are coming down: the number of free concerts has increased, while the cost of purchasing paid-for tickets fell.

 

An 18% growth in the number of households subscribing shows that demand for subscriptions is still growing, even if spend per subscriber is down. Overall, audiences declined by 10.5% between 2010 and 2014, broadly in line with other performing arts sectors. However, audiences for classical series concerts declined by 5.5% (corresponding roughly to a 3% decline in the number of classical series performances offered). The report also finds that orchestras’ work continues outside the concert hall through a wide array of education and community engagement activities for diverse audiences.

Generally, the report confirms recession recovery for the field as a whole, but individual orchestras may have different experiences. The study also illustrates the complexity of the orchestra business model as orchestras balance multiple forms of earned, contributed, and investment revenue. Looking at Change in Unrestricted Net Assets (CUNA), defined as the difference between unrestricted income and total expenses, the proportion of orchestras reporting deficits dropped from 40% in 2010 to 18% in 2014.

 Report Highlights*:

See report’s Key Findings (pp 4-5) and Conclusions (p 20) sections for more details.

Download the Full Report Here

 

For the first time, this report publicly reveals a detailed picture of the scope and scale of the orchestra field in the United States:

  • In 2014, the orchestra field contributed $1.8 billion to the U.S. economy and attracted a total audience of nearly 25 million.
  • That same year, there were 1,224 U.S. orchestras, distributed widely across all 50 states, and two out of every three orchestras operated with annual expenses budgets of under $300,000.

Orchestras perform, but also teach, lead, facilitate, and train.

  • Their work drives a vast array of education and community engagement (EdCE) activities.
  • A segment of the report analyzes survey responses from 98 orchestras EdCE activities: these 98 orchestras alone reported 19,000 EdCE performances, musical activities, and events, with 2.1 million people participating in these EdCE events.
  • Two thirds participated without charge.
  • Thirty-eight percent of the EdCE participants were African American, Hispanic/Latino, Asian American/Pacific Islander, or American Indian/Alaskan Native. Sixty-two percent were white.

Cost barriers traditionally associated with attending orchestra performances are coming down:

  • Between 2010 and 2014, the number of free concerts increased, while the cost of purchasing paid-for tickets fell.

Orchestras find themselves at a moment of transition:

  • 2013 saw a significant shift in the traditional orchestra business model as – for the first time – income produced by single ticket and group sales was higher than that earned from subscription revenues.
  • The subscription model remains important: an 18% growth in the number of households subscribing shows that demand for subscriptions is still growing, even if spend per subscriber is down.
  • Overall, audiences declined by 10.5% between 2010 and 2014, broadly in line with other performing arts sectors.
  • However, audiences for classical series concerts declined by 5.5%, corresponding roughly to a 3% decline in the number of classical series performances offered.
  • The stability of contributed income through the recession years and the large number of small gifts made to orchestras (around 75% of the gifts made by non-trustee individuals were under $250) indicate a broad base of continuing community support for – and appreciation of – orchestras’ work.

The orchestra business model is complex but resilient:

  • Orchestras depend upon a complex portfolio of revenue sources that includes multiple forms of earned, contributed, and investment income.
  • Orchestras successfully maintained contributed income levels through the recession while containing growth in expenses.
  • Many orchestras rely on investment income, though this makes them more vulnerable during leaner times.
  • Between 2006 and 2014, total asset value increased by 4% while liabilities decreased by 7.5%, having peaked at the recession’s height. Consequently, net assets grew at a rate exceeding inflation by 6.6%.
  • In general terms, these measures indicate improved organizational stability over time, despite the impact of recession on the field.
  • Looking at Change in Unrestricted Net Assets (CUNA), defined as the difference between unrestricted income and total expenses, the proportion of orchestras reporting deficits dropped from 40% in 2010 to 18% in 2014.
  • It’s important to note that the report confirms recession recovery for the whole field; individual orchestras may have different experiences.

Orchestra Field-wide 2014 Snapshot: 1,224 orchestras in the NCAR and OSR data sets for financial year 2013-14

Orchestra Field 2006-14, 9-year Trends: The 547 orchestras with annual expenses of $50,000 or more that submitted data each of the five financial years from 2005-06 to 2013-14

The OSR data set was also exclusively analyzed in the following two ways: OSR2014 Snapshot: The 107 League member orchestras participating in the Orchestra Statistical Report for financial year 2013-14;  OSR 2010-14, 5-year Trends: The 65 League member orchestras participating in the Orchestra Statistical Report for each of the five financial years from 2009-10 to 2013-14

Figures in the report are adjusted for inflation.

Orchestras surveyed include both professional and semi-professional orchestras, but do not include school, college, or military orchestras.

Youth orchestras are partially represented in the data sets, and are identified by footnotes throughout the report.

Read the full press release here.

Breaking: Topic National and International Orchestra Events

Orchestra managers world is moving forward rather fast in these days.

This weekend Chinese orchestras held their national 2015 summit in in Xiuning village of Anhui province, organized by the Chinese Symphony Orchestra Development Foundation (CSDF).

 

From April 24 to 26, the Orchestra Association of Finland (Suomen Sinfoniaorkesterit ry – SUOSIO) will celebrate its 50th anniversary and national conference in Lahti. You may find the program here. I will give a presentation on Germany’s orchestra landscape in the 25th year of peaceful reunification.

SUOSIO_Logo

Parallel to this national event the International Artists Managers Association IAMA will held its 25th International Conference in Helsinki from April 23 to 25. Participants will join the SUSIO celebration on April 24 in Lahti.

 

German orchestras will meet for their triannual national orchestra conference (Deutsche Orchesterkonferenz) on May 5, 2015 in Mainz, next to Francfort (organized by DOV – German Orchestra Union). Discussions and keynotes will tackle the topic situation of arts funding from the central state, the federal states and the municipalities. Another issue will be the funding of public radio stations and radio ensembles by the public household fee (established in January 2013). Registration is open.

Detroit Symphony – Blueprint of recovery, secrets of success

If an orchestra has been in dire straits, board, management and musicians look out for a new path. How can we manage change? Where are our strengths and our weaknesses? What are our USPs?

DSO-Logo

It’s amazing to follow the latest development of the Detroit Symphony. After a severe downturn and a long musicians strike recovery is on the way. An interview with DSO Executive Vice President Paul Hogle shows some secrets of success. May be a blueprint of recovery for every orchestra.

Detroit Symphony surpasses fundraising goal – one third over 2011

Really amazing news form the U.S. orchestra sector:  Just 16 months since returning to the stage at historic Orchestra Hall, the Detroit Symphony Orchestra (DSO) has triumphed not only in meeting its highly ambitious fundraising goal of $12.32 million, but also in surpassing pre-strike annual fund contributions ($11.5 million raised in fiscal year 2010). This is an outstanding success and showcases how a straight and wise management can redevelop the orchestra organization from the scratch.

Home of DSO downtown Detroit

From the DSO press release:

“It is highly unusual for an orchestra’s philanthropic support to rebound so quickly,” said DSO Executive Vice President Paul Hogle. “Our fundraising success this year is a testament to metro Detroit citizens and how strongly they believe in the DSO’s bright future. Now more than ever, we are so very proud to call ourselves a community-supported orchestra.”

Number of donors doubled since 2010 pre-strike level

These extraordinary results represent remarkable increases in giving, as well as a dramatic expansion of the DSO donor base. The current number of donors stands at 9,287, which is 15 percent higher than the abbreviated 2010-11 season and a 100 percent increase over the 2009-10 campaign. Among these new donors are 130 new Governing Members, (voting members of the organization who give $2,500 or more) bringing the roster of this new group to 271 in only its second year.

Board giving accounts for $2.1 million of the total amount raised with the average board gift at about $25,000. Corporate fundraising levels have returned to that of the 2009-10 season with a $390,000 increase over last season, representing 25 percent growth. The net contribution from projects of the Volunteer Council earned $93,678, which is nearly $30,000 over goal.

The goal for donations related to special events was crushed by a whopping 122 percent, grossing $1.3 million thanks to such wildly successful fundraisers as the annual Classical Roots gala and concert, this year honoring Dr. Arthur Johnson; the season-end Heroes Gala, dedicated to board member Lloyd Reuss; and a very special sold-out, one-night-only performance with Kid Rock.

The DSO 2013 annual fund campaign, with a goal of $12.865 million, is now under way.

Meanwhile other US orchestras are in dire straits: Atlanta Symphony, Minnesota Orchestra, Saint Paul Chamber Orchestra, Indianapolis Symphony, San Antonio Symphony etc.

Berlin Philharmonic – a most successful business model

As a public foundation, the Berlin Philharmonic is not only financed by grants from the City of Berlin (15 Mio. Euro per year). Ticket sales, hall rentals, merchandizing, recordings and concert tours secure the prestigious orchestra also own revenue on a constant high level. The total budget is about 34 Mio Euro per year. The commitment of major sponsors such as the Deutsche Bank guarantees the continued existence of the award-winning education program Zukunft@BPhil and the DIGITAL CONCERT HALL (DCH).

Mission of the most successful orchestra

High revenues

What could medium and small orchestra learn the business model of the Berlin Philharmonic?  The Berlin Philharmonic since 2002 is a public foundation, which is supported by the City of Berlin. The Foundation generates additional revenue about 67 percent of the whole budget to the city’s own contribution. This is outstanding. Within the Berlin Philharmonic Foundation, there are three main pillars of self-generated revenue: 1. proceeds from the ticket sales of a magnitude that is nearing the height of the city’s grant. 2. In addition, revenues come from the rental of rooms, the two concert halls and concert tours of the orchestra. 3. Deutsche Bank and further sponsors support the orchestra.

Sponsors and Friends
The sponsorship money is managed by the Berlin Philharmonie GmbH (Ltd.), a wholly owned subsidiary of the Foundation. The main sponsor is the Deutsche Bank, which finances the education program Zukunft@BPhil, the communication and marketing departments and the DCH with about 6 Mio. Euro per year. The second major sponsor is the Volkswagen Group, which makes the annual European Concert. The Friends of the Berlin Philharmonic support the orchestra especially in obtaining high-quality instruments. These are usually purchased by the Friends of the Foundation and forwarded to the Foundation or directly to the musicians as permanent loans.

Ticket sales
The ticket sales developed quite well during the last few years. The orchestra was able already before the creation of the foundation to set the ticket prices itself. Over the past few years the foundation had to raise ticket prices because of stagnant public funding and had to absorb all cost increases itself. Meanwhile, the organization has arrived at a magnitude of about 10 Mio. Euro from ticket sales per year. This high amount refers to the stable attendance of audiences to the two concert halls. The revenue accounted for a total capacity of around 95 percent of the paid seats. The free ticket contingent is lower by about two percent less than that of many other cultural institutions in the city.

In Berlin, the price can vary for concert tickets known to be at a lower level than in cities such as Hamburg or Munich. However, the cultural offers in Berlin are very big. The Berlin Philharmonic takes a pool position with a variety of concerts at the present market. Per season, the orchestra performs 90 – 95 symphony concerts and some 40 chamber concerts. In such a situation prices cannot be calculated as high as at a festival, where an orchestra only occurs two or three times. The ticket prices are in comparison to the ticket prices in the pop music industry very reasonable.

The chamber music hall has been opened for more experimental programs. This created a larger audience. In the great hall the orchestra can reach at symphony concerts, of course, a higher utilization. However, considering that the chamber music hall with more than 1100 seats rather large, some 70 percent of tickets sold are a thoroughly enjoyable record. Various campaigns, media partnerships and support from other institutions have helped the management to increase the capacity of this smaller hall continuously.

The large hall with 2440 seats is particularly popular as it offers the possibility to generate high revenues. Due to the large number of the own events and rehearsals of the orchestra, the large hall is not often available. On stage of the Chamber Music Hall only small concerts can take place due to space and security reasons. Otherwise, there are still areas such as the “Green Room” or the south foyer for receptions on rent. But in the overall balance these items are rather small.

Touring income
The income from concert tours is very important for the balance sheet. For the orchestra alone it is important from an artistic point of view to be present in other major music centers of the world. For the foundation as an institution, it is also crucial that touring generates stable income. One must pay close attention to financial balance. Not at any place equally high yields can be achieved. The touring business is still an important economic factor, despite the global financial crisis.

Media deals
At the time Herbert von Karajan already a compaby of musicians was formed, which perceived the media rights of the orchestra. Since 2002, a Limited of trustees, a wholly owned subsidiary of the Foundation’s manages the income from sales of recorded music and film rights. But times have changed. Unlike to other orchestras the BPhil musicians do not get a media package, but the orchestra members can decide on the exploitation of their rights themselves. Purely legal, it is income to the individual orchestra members directly and are therefore not reflected in the foundation budget. While there are agreements under which the foundation of the proceeds of certain audio and video recordings is involved in the Philharmonic budget. This however makes up only a small portion of the foundations revenue.

Marketing
Even marketing and communications have changed since the founding of the Foundation. As the organization completed the sponsorship deal with Deutsche Bank, it was settled that the presence should be expanded in the medial department. Since then the orchestra had the opportunity to make its publications more expensive. Even in marketing, one can operate differently than before. It depends not so much on the new legal form than with the higher financial resources given by the sponsor. The internet is for marketing of great importance, because potential customers can be addressed directly in this way.

The management is working on electronic tickets, which you can print out on your computer yourself as such as airline or train tickets. There must be, however, a maximum protection against forgery, to prevent in most popular concerts some hundreds of illegal e-tickets in circulation. The advantages of electronic tickets are obvious: The customer would save much time, and the orchestra could reduce administrative costs. At pre-booking-weekends already 60 to 65 percent of the tickets are purchased through the internet. Other distribution channels such as the cash register, the telephone and the written order, however are continued to be kept open to all interested parties to offer a real chance at a concert visit.

The future of the Berlin Philharmonic looks bright: The management has safety in planning for the next time, both in terms of state funds as well as the sponsors. If nothing unexpected happens, the economic situation over the next four to five years will remain stable. Also the fact that the contract has been extended with chief conductor Sir Simon Rattle in 2018, has a positive impact on the overall situation.

Conclusion

The design of the BPhil foundation model is of course specifically connected with the Berlin Philharmonic. The five-year grant contract with the City of Berlin allows the management to plan to work with guest conductors and soloists and concert tours with the necessary time heats. The model of a public foundation that provides both legal and economic independence is more generally also suitable for other orchestras.

Asean Orchestras discuss topic problems

Some 60 participants from orchestras and associations in Asia, Europe and North America have been discussing topic problems of orchestras at the 8th AAPRO Summit in Moscow.

Moscow: AAPRO Summit discussions

Get some ideas from the so called „Russian“ day:   Especially interesting to investigate more about the situation of Russian orchestras. Nobody knows the exact orchestra count and the numbers of musicians. It differs from 70 to 90 all over Russia and from 15 to 20 in Moscow. Funding comes for most of the orchestras (90 percent) from the state, the regions and the cities. But there have been private foundings as well, for example the Russian National Orchestra (RNO) with Mikhael Pletnev which started as a private enterprise in the early 1990s. The payment of the Moscow and St. Petersburg Orchestra musicians has been risen a little bit, but  in other regions it is still on a level of some 150 Euros a month.

Today the RNO gets 50 percent of the budget from the state. The other half of the cake is a) foreign sponsorship (esp. from the Russian Arts Foundation in the US), b) domestic sponsorship from Russian and Russian based foreign enterprises and c) commercial orchestra activities (ticket sales, subscription etc.).  During the last few years the RNO created its own production structures, esp. an own arts production company.

Some Russian participants complained about the lack of clear regulations, for example collective bargaining agreeements and other rules for the orchestra management. Very often management people work on a trial-and-error-basis. A little bit surprising was the message that Russia is not only an export country for more or less cheaper orchestras but even more a developing market for foreign artists, orchestras and ensembles. Indeed, during the AAPRO summit German Brass performed in Moscow and the International House of Music (with a great 3.000 seat hall) invited the Stuttgarter Bachakademie and Leipziger Bachorchester for a Bach Festival.

During the discussions and presentations some other important points were made:

– A Moscow based firm (360 Project Company) has developed a 360 grade display system for illustrated concerts not only on one screen behind the orchestra but using the whole hall. The „Russian Philharmonic“ (Moscow City Symphony) with its new chief conductor Dmitri Jurowski has used this new system for several concert projects already.

Pro 360 presentation

– The Russian Symphony and Chamber Orchestra Managers‘ Association (ASKOR) reported on festival activites to collect money for better orchestra instruments and higher musician salaries by running festival concerts and special masterclasses and training events. However, the ASKOR is not a real manager tool in comparison to other managers associations. It only organizes festivals but there is no real interaction between orchestras, agencies or managers.

– Moscow City Symphony „Russian Philharmonic“ (hosting the summit) and the Moscow Chamber Orchestra (Spivakov) are the only city funded Moscow orchestras. All others in the Moscow region depend on the state funding. The state funded orchestras are almost in the „old shape“ reigned by a conductor. The Russian Philharmonic seems to be the only one with a real professional orchestra management. There is no common spirit, no solidarity between Russian orchestras yet, participants reported.

Russian Philharmonic on stage

– The German and Singapore based MSM Productions informed about media strategies for orchestras and classical music. Internet downloads have been going up, but more for pop and rock music. Classical music is still purchased on CD, DVD and Blue Ray. Orchestras should keep this in mind.

– The final session of the first day dealed with lobbying tools for orchestras and orchestra associations. Examples and thoughts from Germany and Finland gave some fresh inputs how to enhance orchestra activities in the society.

Some more issues of the summit delt with concert programming, the administrative and creative ratio of orchestra management, labour disputes and conflicts and the role of artist managers.

Speakers from Canada, Japan and Hungary pointed out that Asia and Russia are getting better connected to Europe and America: Asean born artists and composers have spread out all over the world. Today many of them are cultural bridge builders and gap fillers, „searching for sense in the sounds“. Orchestra programms and audiences have become much more diverse. In some forms visual elements, projections, puppet theatre etc. have been new applications for performing classiscal and new music.

Audiences have to been surveyd on a regular basis. Some orchestras started to invite destinguished audience members for dicussions on their programming. Beeing competitors with other entertainment branches orchestras have to be innovative as well as better connected with their stakeholders.

Japanese orchestra managers reported on the difficult situation since 3/11 earthquake and tsunami catastrophy. Some halls (Sendai, Kawasaki) have been badly damaged and will be refurbished. 2012 there will be budget cuts for all orchestras in Japan.  Public funding for orchestras in other Asean states is very different. In Hong Kong public support for the orchestras has been increased. In China many orchestras have been founded in the provinces during the last few years. However, many of these orchestra depend extremly on the goodwill of the local mayors and other politicians.  The lack of a classical music tradition is a big challenge for developing new audiences. But successes have been made.

Summit Venue: Moscow International House of Music

Labour disputes, severe funding problems and dramatic cuts were reported from the US (Philadelphia bankrupty, Detroit strikes etc.), Brazil (OSB case), Ecuador, UK, Netherlands, Italy and Germany. Some conflicts, but not all, could have been avoided by better management, some by better communication between management, musicians and the public. Cases of political ignorance with brutal funding cuts need more special and creative answers from the arts institutions.

The AAPRO summit showcased some vibrant development in the Asia Pacific region. Let’s see how the show goes on and look out for the date of the  2012 summit in Asia.