By Erik Maza, The Baltimore Sun
11:47 AM EDT, September 23, 2011
In Silver Spring, they've been waiting for it for a decade: a brand-new music venue smack in the middle of the arts district — a rock counterpart to the dignified AFI Silver Theatre and the brainy Discovery complex.
When the Fillmore Silver Spring was finally unveiled this month, scores turned up to watch R&B star Mary J. Blige perform.
But the 2,000-capacity theater won't just be a new stage — it has the potential to rewrite the landscape for Baltimore and Washington booking agents as well as music lovers. That's because it pits the independent promoters who've long dominated the region against Live Nation, the country's most powerful live entertainment conglomerate.
With Live Nation in charge of the Fillmore, the indies and the behemoth will have to compete for marquee names, audiences and influence. As a result, the Fillmore could siphon concerts from Baltimore, and ticket prices may increase, promoters and experts said.
Seth Hurwitz, whose company I.M.P. runs the 9:30 Club and Merriweather Post Pavilion, sued to stop the Fillmore's construction last year.
"Even without the Live Nation element, there's already competition in trying to get acts," said Mark Mangold, marketing director for the Baltimore club Rams Head Live. "With them in the mix, when they're putting [in] an offer, the bands, in some cases, will take the higher offer, which hikes up ticket prices and then makes it a hard business for everybody else."
Live Nation plays down the protests, saying it intends to be a good neighbor.
"We're in addition to, not in competition," said Arich Berghammer, vice president of North American clubs and theaters. "The more music that's brought to the area, the more life it'll have."
Built on the former site of a J.C. Penney, the 23,000-square-foot Fillmore is still as spacious as a department store. Split into three floors, it's adorned with shiny chandeliers and burgundy curtains. There are five bars and a VIP lounge in the cellar — even two VIP suites. It cost $11.2 million, most of it coming from Montgomery County and the state.
Montgomery County has billed it as a glittering addition to Silver Spring's burgeoning arts district.
"It'll be one of the gems of our community," said Evan Glass, who sits on the Silver Spring Citizens' Advisory Board. Though Glass initially opposed the project, he was won over by Live Nation's plans for the venue.
Live Nation, which reported revenues in excess of $5 billion last year, has its hands in all segments of the industry, including ticketing, artist management and venue operations, where it's a dominant force with its string of amphitheaters.
But the Fillmore is its first stab at the club market in the region, Berghammer said. The company dabbled with promoting shows at a couple of Baltimore clubs — Rams Head Live and Sonar — in the late 2000s.
The Fillmore is part of a strategy that began in 2006 — with the $350 million purchase of the House of Blues chain — to pursue the midsize venue market, where Live Nation didn't have the kind of foothold it had with amphitheaters.
"Those 2,000-capacity venues are the wave of the future," said Dean Budnick, who has written a book, "Ticket Masters," about the company. "The comfort zone for many promoters is more in the smaller, midsize venues that only hold a couple of thousand, where the sightlines are good and people can have an intimate view of the artist."
Berghammer said consumers are looking for value, and the midsize venues are more approachable.
Promoters of midsize clubs in the region have typically operated without competition from Live Nation or AEG, the country's second-largest concert promoter. They fear that Live Nation will now use its leveraging power to try to lock artists into touring deals, preventing them from playing independent venues. And, with their modest resources, they expect they'll be out of their depth when making offers to talent.
"They pay way too much for certain artists to play certain markets," said Paul Manna, who books Artscape and the Maryland State Fair, among other concerts. "[The Fillmore] will affect Baltimore in some way," he said. "If an act is going to play the Fillmore, they're not going to Baltimore on that run, too."
Club promoters' concerns about the Fillmore are born out of general frustration with Live Nation's dominance in the music world. But they're also partly due to Hurwitz, who accused Live Nation in a 2009 federal lawsuit of "deliberately" and "unlawfully" coercing artists to pass over I.M.P.'s Merriweather in favor of the company's Jiffy Lube Live location. In a motion to dismiss filed in July 2009, Live Nation called Hurwitz's allegations "untrue" and "irrelevant."
Litigation in the federal suit is expected to last into 2012.
Hurwitz was concerned enough about the Fillmore that he sued the state in June last year to prevent it from releasing $4 million in funding for the venue. He was hardly the only one upset when Montgomery County gave Live Nation the lease in 2008. Citizens' groups protested loudly over what they called the lack of transparency in the selection, the expense of the project and the use of taxpayer dollars to fund a theater leased by a billion-dollar corporation.
Budnick said regional promoters' concerns are justified. Live Nation's offers are so lucrative that "tour agents and managers are hard-pressed to say no," Budnick said.
One saving grace for midsize venues has been that while Live Nation can conceivably route a full tour through its amphitheaters, it couldn't do the same with its clubs because it didn't have enough of them.
Caught in the crossfire will be consumers, who may see their ticket prices go up in a sector — clubs — that had been largely immune from skyrocketing prices at bigger venues.
"Historically, competition between promoters leads to higher ticket prices for consumers," Budnick said. Promoters will try to top each other with offers for touring acts, and "a higher advance comes with a higher ticket price."
In the world of amphitheaters, which Live Nation has come to dominate, "there's no question tickets have gone up," Budnick said. "It remains to be seen if the same will happen in the club setting."
Hurwitz said it's possible ticket prices may go up on some shows at the 9:30 Club because of the competition for bands.
Since the theater opened, rival promoters have noted some initial missteps, like above-average pricing and overly safe bookings — a Bruce Springsteen tribute band was booked for the venue's first week. General admission tickets at Fillmore for September range from $10 to $70; tickets for the Canadian DJ Deadmau5 cost $50; his concert at Rams Head Live cost $25 per ticket two years ago. Berghammer said the goal is for prices to hover around $20.
Hurwitz, whose 9:30 Club in Washington stands to lose the most because of its proximity to the Fillmore, said his strategy is to be more selective with bookings and letting fans pick between his club and the Fillmore. For fans, he said, it will be like choosing between "a city's Little Italy or an Olive Garden."
"Let them be who they are, and I'll be who I am," he said. "Hopefully, it won't be a gray area for bands. It'll be black-and-white."
Berghammer said the Fillmore isn't meant to compete directly with the 9:30 Club or other venues. Its goal is to expand entertainment options for an already arts-rich area.
"If you look at Fillmore in the first couple of months, it's big and bold," he said. "But over the long haul, you'll find our programming strategy is diverse, from country to rock en Espanol to Ethiopian music. It's a venue where you do a bar mitzvah and you can do spoken word. That's the ethos of the Fillmore."
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