Select Committee on Culture, Media and Sport Minutes of Evidence


Examination of Witnesses (Questions 284-299)

AMBASSADOR THEATRE GROUP, CLEAR CHANNEL ENTERTAINMENT, REALLY USEFUL THEATRES, DELFONT MACKINTOSH THEATRES LTD

8 FEBRUARY 2005

  Q284 Chairman: Good morning. One of your associates has still to come, but no doubt we can interrogate him when he comes as well. Meanwhile, since you are here, it is very nice to have you here. I suppose that the first thing everybody will ask all of you is about the state of the Lottery Board, how far you have got, matching the funds, etc, etc?

  Mr Ptaszynski: As you will have heard from Richard Pulford last week, we are a long way down the line of getting agreement about how we can contribute quite a bit of the £250 million figure in self-help. We need consensus between theatre owners and theatre producers and I think we will be able to make public very soon now the texture of different ways in which we believe, over 15 years, we can provide our equal share of it. I think it is made easier by the fact that it is spread over 15 years and, of course, you will bear in mind that we spend already a considerable amount on the buildings ourselves.

  Q285 Chairman: Could I ask a double-sided question, does the West End need so many theatres?

  Mr Ptaszynski: It is a lovely question and you will not find complete agreement, I know, amongst the three of us, but I think that there is a crisis in terms of the straight play in the West End and it has been growing for some time. It is absolutely fabulous right now that you can go to see a brilliant new play like "Festen" on Shaftesbury Avenue and right next-door, directed by the person sitting in this chair an hour ago, a three-hour production of Schiller's "Don Carlos"; it is wonderful. That does not suggest to us that there is a crisis, but the source of "Oh, the West End is dying" clamour, which was particularly loud in the press last year, with no foundation, as you will know, because the attendance figures do not add up to that, but the source of it is the press's attention, drawn to the fact that over the summer months the playhouses, in particular, find it very hard to find product. Since 1950 the play-going audience in Britain probably has not increased, probably it is the same few hundred thousand people. Since 1950 something like 3,000 new seats have been built properly, beautiful, beautiful buildings, the National Theatre, of which I am on the Board, and the directors of most them you have had here. The Donmar Warehouse, the refurbished Royal Court, which of course did exist, Hampstead, the Almeida; there are about 3,000 new seats which have been created, to go to see plays in more contemporary, more comfortable surroundings. Audiences are very happy to migrate to those buildings. I am sure that every one of us would rather be sitting in the Cottesloe, I suspect, than sitting in the Apollo on Shaftesbury Avenue. We have a crisis where, even if the product keeps track with the number of theatres, we are always going to have too many theatres at a certain time of the year because the audience has migrated to other places. It is my suspicion that, in looking at what we all do about the fabric of the West End over the next 50 years, we may have to be brave enough to say that one or two buildings should be allowed to apply for change of use or be decommissioned, in the interests of the whole.

  Q286 Chairman: I am interested that you are talking about the crisis. When I first came to London you could go all around the West End and there would be new, commercial plays, contemporary plays of that time, written by writers, for example, like Enid Bagnold, etc, etc, but the fact was that the commercial theatre staged lots and lots of new plays, obviously, like any collection of plays, of varying quality but a lot of them extremely good. It is worse on Broadway certainly, but now there is practically nothing. Don Carlos, wherever it came from, is a very old play, and there were very favourable reviews today in the papers of the Rattigan Man and Boy, a very old play. We have revivals, new productions of old plays, we have lots of transfers from the subsidised theatre, like, for example, the wonderful Lieutenant of Inishmore which was on at the Garrick. What is it, what is the reason, if any of you with your expertise can pinpoint it, why there are hardly any new commercial plays staged in the West End theatre any more?

  Ms Squire: I think, what Andre alluded to, there is not agreement amongst us all here about the state of the play in the West End. I am Executive Director of Ambassador Theatre Group and we have musical houses but primarily we operate playhouses in the West End and I would dispute the fact that the play is in crisis. We produce new plays. At the moment, for example, Holly Hunter is in By the Bog of Cats, a new play. We are about to open the transfer of Losing Louis coming in from Hampstead Theatre, going to the Trafalgar Studios, which I think is a very fine example actually of ways that we need to address theatre buildings. The Whitehall Theatre, just up the road here, home of the Whitehall Farces, had become very much off the beaten track, it is not in the heart of the West End on Shaftesbury Avenue or St Martin's Lane, but last year, for a relatively inexpensive sum of money, with the support of Westminster and English Heritage, it is a listed building, we have been able to convert that into two studios, smaller, more intimate spaces, which are much better suited to a lot of contemporary work. For example, we have worked with the Young Vic on their production of a very fine musical, directed by Josette Bushell-Mingo, Simply Heavenly, which is playing there.

  Q287 Chairman: I saw Simply Heavenly when it first came out. It is very, very old, almost as old as I am. Then might I add Sweeney Todd, a wonderful production of Sweeney Todd but, with respect to Mr Sondheim, you can see Sweeney Todd at almost any time, anywhere?

  Ms Squire: It is not exclusive. I can think of, just off the top of my head, 16 plays last year that we were involved in; Guantanamo at the New Ambassadors, which indeed transferred in; Calico, the one about James Joyce; The Bog of Cats, which is on at the moment; Old Masters, Sweet Panic, a lot of interesting work. The two that I can think of just at the moment are Losing Louis and then Ying Tong, the play about the Goons, which is going to be on at the New Ambassadors. I think the work is there. I think it is very competitive and the quality of the work has to be extremely fine for it to work and survive.

  Mr Ptaszynski: I think actually the West End can and does encompass both of our viewpoints, and what Rosemary's company does is phenomenal, producing a lot of its own product for those buildings. Michael Codron, as I am sure most of you know, is the most successful commercial producer over the last 50 years plus, who has discovered and brought on more great writers than most of the subsidised sector combined. He pointed out to me three or four years ago that when he was going through a particular golden period during the seventies, if he had a success with a Simon Gray play on Shaftesbury Avenue and he got the kinds of reviews that Don Carlos got last week, he would be wondering in the back of his mind who he could put in the third cast at the end of the second year. His feeling now is that if he has those kinds of reviews for a play now, he wonders if it is going to get to the end of the six-month contract, the now reduced-length contract, of the first cast. That is a factor. The Ambassador has addressed that phenomenal turnover of product. We do not have very many new plays. Stones in His Pockets, Les Liaisons Dangereuses, they are rare, which sit down for three, four or five years any more, as they did in the fifties, sixties and seventies. I think, in the middle of that, you can sense why commercial producers are frightened of the risks more these days than perhaps they were 25 years ago.

  Q288 Chairman: Is it that not as many are being written as before? Is it that you cannot afford, because of the economics of the theatre, to have plays with large casts unless they are musicals, or what? Let me make it clear, I am not being critical, because, as I say, on Broadway it is much worse. To see a new play originating on Broadway, remembering the days of Tennessee Williams, etc, etc, etc, Arthur Miller, etc, it is a desert there. Is there some problem?

  Ms Squire: I think there are issues. I think it is to do with the economics. I think, on Broadway, the costs of producing are vastly more than they are of producing in this country. For example, we produced Noises Off, which as a project we took to the National Theatre. It was a revival of the Michael Frayn play. We took it to the National, we co-produced it with the National then toured it nationally, it came in for a very successful run in London, with several casts, it moved from one playhouse to a slightly smaller playhouse and then went to Broadway. The costs for producing the same piece of work on Broadway were approximately double, probably even three times what they were in the West End. There are a number of facts, I think, which, as an industry, we have to address. One is Sunday trading, but I think on Broadway they have got that right, in that now a Sunday matinee on Broadway is absolutely a part of the theatrical week. For performers and people in the industry it is better because you get Sunday evening off and, in the vast majority of theatres over there, you get Monday evening off as well, so you get off a day and a half, in fact. Whereas, here, playing the Sunday matinee is the exception rather than the rule, and I think that absolutely has to be a key priority for the industry. We are inching there. I think others probably will agree that we are almost there with BECTU. There are cost implications but I think it has to become the norm here. Just look at retail, the trading figures with retail, how important Sunday trading is; the same must apply to us as well. It is a leisure day now and the Sunday matinee must become the norm and not to play Monday night.

  Q289 Chairman: It is certainly a great institution. Whenever I am in New York it is very convenient to be able to spend a morning in the park, or something, and then go to a matinee. Looking at the question I put to Mr Ptaszynski right at the beginning of this session, what is being contemplated is £250 million of expenditure on renovating theatres. Taking into account what you are able to put into them, recycled old Hollywood musicals, and stuff like that, is that kind of investment, big capital investment, justified, in terms of the need of the real estate?

  Mr Ptaszynski: Would you forgive me if I alluded to that partly by adding something to your previous point, are the plays being written? I think there is often a temptation to look at the relationship between subsidised theatre and commercial theatre in a kind of a glass half empty way rather than a glass half full. The system that you referred to, commercial producers commissioning plays and bringing them straight into the West End, was a model that worked wonderfully for many, many decades. We have just a different model now. There is no shortage of young, commercial producers who are hungry for product, but the model now tends to be that, in the case of Losing Louis, for example, which Rosemary mentioned, my company put up some of the development funds for that, Michael Codron had the play, Michael took it to Hampstead, tested it out and then brought it in. You know this model. It is the more usual model these days, and it is a relationship which works very well for both of us. We do not expect to hang on to the historic model of having lots of commercial producers taking big risks coming straight into the West End, but if we had the right number of buildings, and maybe there are one or two more, that model does constantly provide a phenomenal amount of product. I would like to see us move to a position whereby, inside this big quarter of a billion pound figure, we have one or two other buildings, with a different relationship with BECTU and different operating costs, we can make the model work even more effectively. Cameron Mackintosh—Richard Johnston is not here—Cameron's new plans for the Sondheim Theatre, on top of the Queen's and the Gielgud, will make it a better transfer house for Donmar Warehouse shows. It would be wonderful if, the £250 million, one of us could work out a way of telling one of our bodies, Rosemary has done it to some degree, to find a studio, but there are glorious plays. The Pillowman is going straight to Broadway, a staggering piece of new writing which was seen by many people here, it could not quite get into the West End, too expensive, too risky. It was not that the new writing was not there but it just could not quite get into one of our buildings at our cost, and refurbishment, redesign and rebuilding may help us provide buildings which are better suited to that kind of product for shorter runs.

  Q290 Chris Bryant: Clearly, the theatre has changed. The days of Binky Beaumont, when they had an enormous monopoly on London theatres and on most of the receiving houses around the country, we talk about it seeming like there is a high concentration of theatres now but in those days it was considerably worse and they had a phenomenal stranglehold on the artistic sensibility in Britain. Do you think the concentration of ownership of theatres is a kind of financial necessity, or a weakness?

  Ms Squire: It is important, the relationship between the regions and London, and our company has had a deliberate policy and strategy to work both in the regions and in London. I think economy of scale means that it is more effective to run more buildings. We run 23 now, up and down the country, from Glasgow to Brighton, and with 12 in London. As an integrated business, I think our strategy has been to produce in London, to produce in the regions and to operate buildings in both of those areas. We are able to do that, and although we invest a huge amount back into our business, in terms of into our buildings, just to give you an idea, of the £50 million turnover we reinvest probably about £3 million every year back into maintaining and refurbishing our buildings as it is, but that kind of investment. Consequently, we are not massively profitable, because we are a young company, we still invest in development markets, we have just taken over new regional theatres which do take four or five years to establish themselves, so we perceive it as a longer-term business than that. I think that relationship between London and the regions is extremely healthy and I think we are absolutely way off any kind of monopoly. I think Catie's company and our company are very tiny percentages of all of them, I think we are about 3% and Catie's probably is about 5%.

  Ms Callender: I think the theatre universe is about a thousand in the UK and we are operating, between ourselves and our music division, about 28, and you 23, so I do not see it as a monopoly. I think, to build on Rosemary's comments, the other advantage, particularly in the regions, that we do bring from the economies of scale is helping some communities. Within our portfolio we are managing theatres on behalf of the council, and what we bring for them is the advantage of reduced costs year on year, but bringing the advantage of having a larger buying power and the expertise which means those communities can offer live theatre still, which is very important. There are advantages from that as well.

  Ms Squire: I think that is a very important collaboration actually. It is not the one between the public sector and the commercial sector that is most talked about. Andre, quite rightly, was talking about products and commercial producers taking shows to Hampstead or the National Theatre, or whatever, but what has been going on in the last five or six years which is very interesting in the regions is collaborations between companies like mine and Catie's company with local authorities, principally, in terms of operating large regional theatres. If you are one 1,300 or 1,500-seat theatre operating on your own, you are one in a market, you are out there in a very competitive situation, looking for product, you have to staff up a building with the right expertise, because, as you know, our industry is very people-intensive, so you need to have the right skills; it is very costly. Whereas a company which specialises and does nothing but operate and produce for theatre can give all of those resources centrally on a much more inexpensive basis. So a local authority, instead of running a theatre directly, can cap whatever proportion of their existing contribution they put into that building, can cap it, reduce it, know what they are going to have to put in, because in many cases it could have been an open cheque-book. It can give their audiences better quality, better choice, greater access and it is a win-win situation for the commercial operator and the local authority. I think that is a very healthy partnership between the public sector and the private sector.

  Q291 Chris Bryant: It sounds very third way. One of the things which the Binky Beaumonts could do, however, and did do, albeit sometimes perhaps in a somewhat restricted way, they were able to grow talent. They spent a considerable amount of time   and effort on building the Oliviers, the Richardsons, the Gielguds and the writing talent. That happened in a fully commercial theatre world at a time when cinema was making enormous inroads into audiences, and so on. Where does that happen in the commercial world now?

  Mr Ptaszynski: I think that responsibility has moved over towards the subsidised sector, except perhaps in the case of musicals, where the Really Useful Group and Cameron Mackintosh have driven the initiative to try to develop new musicals. I would have to say, in the mixed cultural economy we have now, that those jobs are done largely by the subsidised sector.

  Q292 Chris Bryant: Which is a strong argument for having a strong subsidised sector—I hate this word "product" that you are using—otherwise you have not got the talent coming through in all the different spheres. My own prejudice, to be honest, is that in Britain as a nation this is one of the things we have been phenomenally good at historically for centuries, and still are. You have used the word "crisis", other people have used the word "fragile" and if we are to maintain that for another 100 years so that people are still talking about great British plays from the 21st century in 100 years' time, we are going to have to work hard, are we not?

  Mr Ptaszynski: I do not think we are in an artistic crisis, by any means. I think the theatre is extraordinarily healthy, it is blooming. We are in or approaching, I believe, some sort of crisis about precisely how we use those buildings in the West End to their best over the next 100 years.

  Q293 Chris Bryant: Just about buying a ticket, maybe you have heard and others have raised the issue, it was raised last week as well, that the ticket on its face value might be £40 then on top of that you pay a booking fee, and it may be that somebody, it may be a company that you are buying it from, has bought 50 tickets three months ago and are selling them this week and you are paying for the extra convenience another £20 on top. There comes a point at which people start to feel a bit diddled by that?

  Mr Ptaszynski: My company also owns and runs See Tickets, which after Ticketmaster is the biggest ticket agent in Britain. This is such a contentious issue and most of us, as audience members, sympathise with the point and the irritation that you are feeling. Let us try, just for a second, to unpick this. Nick Starr gave a bit of a clue when he spoke to you last week, pointing out that there are no ticketing fees at the National because they control the box office, they control the product, the shows, as producers, and they control the building. He said to you that therefore "We are able to put the cost of running our ticketing operation down to what the commercial West End would call "inside commission", you do not see it, it is inside." You move across the river and those of us who control the buildings are not necessarily the same people who control the ticketing companies. Although our theatres sell tickets primarily through our company, 40% of tickets are sold through Ticketmaster, through Albemarle, or the many agents around London, so, first of all, you lose control by so many tickets going out to agents, and then the person producing the show is another third party, the producer. What I suggest to you we are not good at, we have not yet discovered as an industry, is the way not to wash that dirty linen in public. We have not worked out how to wrap all of that up to a £42.50 ticket which includes the booking fee. Take one show right now, "The Producers", at Drury Lane, a phenomenally successful show, there are no booking fees on anything through See Tickets. That is an agreement with the producer, because the producer wanted to make sure it was a "no booking-fee" show, so all of the cost of ticketing comes from inside the ticket price. In doing that, the producer has to accept that, because writers' and directors' royalties form a considerable part of the box office and the ticket price, the royalty pool of creators are also being paid royalties on the booking fee because it is inside the ticket price. Many producers prefer you to add on the £1.25 or £1.50 or £2, because it avoids them paying royalties on it because it is a legitimate charge for a ticketing process and not part of the box office income. That is one of the three or four little links that we have not covered properly to present a unified position. It always intrigues me that the ticketing fees on rock and roll events and festivals, and things, which we also sell a great deal of, are breathtaking. The concern you are addressing for the big ticket agencies, the sort of £2, £3 booking charge agencies, not the £8, £9, £10 ones of the tertiary market, the booking fees in the West End are tiny compared with going to see the Red Hot Chilli Peppers in Hyde Park and paying £15 on top of your £80 ticket as a booking fee.

  Chris Bryant: We will move on to that in the next inquiry that we do perhaps.

  Q294 Chairman: At least you have not gone down the road in New York whereby if you want to book by telephone you cannot do it directly with the theatre, there are two cartels which control booking to New York theatres, and they claim their fee, obviously. Welcome, Mr Johnston, we understand the problems you have had in getting here and we are very pleased to see you. One can understand why it is happening in New York, namely that you have got these two cartels and they control all the telephone booking and you cannot telephone a theatre. Here, you can telephone an individual theatre, but is there any greater cost to the theatre box offices of one telephoning to book than there is from one presenting oneself at the box office to book?

  Ms Squire: When I first started in 1980 in the West End, you could buy a theatre ticket from the theatre between 10 and eight when there was a show, and you could ring up the theatre. Credit card bookings on the telephone were just in their infancy, just starting, which is 25 years ago, it is not so long ago. Now, the service which is available, you can ring a central number and call pretty well any time of day or night, 24 hours, I think all of us can book 24 hours now. You can book on the Internet. The facility and the ease of being able to book tickets has changed dramatically. It is curious that when I first was working in a box office about a third of the tickets were sold in advance, mostly by people sending in cheques with stamped, addressed envelopes. Of course, that has all changed now, people do not do that, most people do not even carry their cheque-books with them. If you were to do that certainly to our box offices and send in a cheque you would pay only the face value of the ticket, as you would if you turned up at the box office to buy a ticket in person from the box office counter. If you opt to book on the telephone, to pay on the Internet, we do charge. I think the fees are relatively modest and they are not an issue that we have had huge numbers of complaints about at all.

  Q295 Chris Bryant: I have been to the theatre about 20 times in the last year and, I tell you, I fumed every time but I have never written you a letter to complain, so maybe I should have done. Maybe this is my letter of complaint.

  Ms Squire: If you go to rock and roll, which my kids do, you pay vast booking fees as well. Similarly, for cinemas you can pay fees for the facility of being able to do it.

  Q296 Chris Bryant: That is even less understandable.

  Ms Callender: The ticket price is less as well. The booking fee is about a third of the cost.

  Q297 Chris Bryant: You pay £10, £12, whatever, and then you pay £2 for the booking fee and, you think, that does not seem comprehensible?

  Mr Ptaszynski: I put it to you that it is the cosmetic that you object to, it is the fact that it is stuck on. You do not complain when you go to Marks & Spencer and buy underwear and that you are paying 15% of the price of that for the distribution of the product.

  Q298 Chris Bryant: It is also uncompetitive because you realise that different people might be charging a different fee but you do not ring two or three different organisations to get it, one assumes the basic price. To ask a different question, just about Sunday trading, because you raised the issue but you did not say where the problem lay, you suggested that it was something to do with BECTU?

  Ms Squire: One of the other problems which contribute to the economic difficulties of producing in London is the unions, we have three major unions that we all work with, the technical unions, BECTU, the Musicians' Union and Equity, which is the actors' union. Correct me if I am wrong but I think we are finally approaching with BECTU, I think has been the last one, there have been deals and there have been exceptions and that deals have been cut with the unions for certain theatres or certain productions. There is an extra cost involved, which I think is problematic. It is going to be more expensive to produce to open on a Sunday. I think the view is, and I do not know if my colleagues think this as well, that the economic benefit of trading on a Sunday is going to be far outweighed by the additional cost. Another fundamental problem linked to all of the issues, of seasonality, of trading, this summer, is actually going to be looking for much longer-term, more flexible arrangements with the unions to look at restructuring, having fewer permanent staff but having more staff. Things are becoming much more specialised, the technical skills that are required, then it makes greater sense to employ the specialist staff with a particular production who have the right skills for that particular production, rather than carrying an enormous overhead with a huge staff based at a theatre who do not have the right skills perhaps for a particular production coming in. I think that has got to be on the agenda for the future.

  Mr Ptaszynski: In 10 years' time, when those 40 dark buildings in the West End are alive and vibrant probably on Sunday afternoons, we will all be wondering how on earth we did without it, because it is the second biggest leisure day. We are nearly there, just to give you a tiny snatch of the kind of negotiating issue. On the current BECTU arrangement, a three-hour Sunday show can cost the producer up to 13 hours double time per BECTU member, and that just crushes the extra income, of course, that you get from doing a Sunday show. We are very close to a negotiation which is not a lot more than half of that, which is still great overtime, and makes it economically viable, and I hope by the end of this year you will see a different landscape on a Sunday.

  Ms Squire: I think it has to be the norm that we open for Sunday matinees; it is the only way forward.

  Mr Flook: Despite Chris Bryant's disparaging comments about the third way, in an earlier life I am well aware of what—

  Chris Bryant: I was in favour of it.

  Q299 Mr Flook: You were disparaging about it. In the way in which Paul Gregg built up Apollo Theatres, which SFX bought and which then Clear Channel bought, he did a lot of good in reviving theatres which otherwise probably would have been pulled down, by and large, and particularly the Liverpool Empire Theatre was renovated, mainly by his ability I think to see the commercialism from it. I think it is not just the third way, in fact, if it had been left to Liverpool Council it would not have happened at all. It is fair to say, as I am aware somewhat therefore of what Clear Channel have bought on the basis that caveat emptor exists, you knew when you were buying those London theatres that they were not everything that you would have liked them to be, and I presume there was a price struck therefore which reflected that. Now, two or three years later, and it is not just an issue for Clear Channel, it is an issue for all of you, we find you coming to ask for money, but it was implied in the price which you paid for the theatres, or not?

  Ms Callender: I am not sure it is as simple as that. The difficulty when you talk about the West End is there is quite an eclectic mix in that, so we are probably in one of the luckier positions in that we have the larger musical houses where the economic model is an easier model than for the drama houses, purely because of the size, the product typically runs longer, etc. Yes, there is a degree of that being in the model, but I think there is a lot that has changed around the theatre industry. We are not competing any more with just theatre. There was reference to the cinema being strong 30 or 40 years ago, but there is so much more competition for the leisure pound now, people are travelling four or five times more than they did, the music industry, DVDs, etc. That creates a much more demanding consumer that we would not have known four, five or 10 years ago. They are expecting a different standard and we have to keep up with that. I am not sure anybody could have predicted where that went, so there are many other things which have changed around that. The length of the run has been alluded to as far as drama houses are concerned, but it is shorter for musicals as well. We have the advantage of having "The Lion King" at the Lyceum, it is in its sixth year, but typically the musicals are not running for that length of time any more. I do not think anybody would have predicted that turnover of product five years ago, and it is linked to all those other changes in the leisure industry, so things are not the same. I am not sure it could have been predicted.

  Ms Squire: I think it is important to remember that what has been discussed by the Theatres Trust and through the Society of London Theatre is not actually works that are needed at the moment. All of our theatres are licensed, they are safe, they have got all the latest technology for fire alarms, and so on, everything that is required by law is there, they are perfect, functioning buildings. The things which the Act Now! report identified are actually about securing the future of what are almost exclusively listed buildings in 50 to 100 years' time. These are major, fundamental works. The buildings largely are 100 years old, built at the end of the 19th century, beginning of the 20th century, and expectations have changed from audiences. Audiences have changed physically as well. I know, in one of our theatres, you cannot get to the top two levels unless you go round to the back of the theatre, but they were built in a time when people who sat in the best stalls or the front circle would not ever remotely have considered rubbing shoulders with people who sat up in the gods.


 
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