Reprinted from

BLOOMBERG.COM

Off-Broadway Begins Charging Premium Prices (Even for Flops)

By Philip Boroff

February 9, 2007

Feb. 9 (Bloomberg) -- Even as it goes begging for customers and attention, off-Broadway is taking a page from Broadway's play book by raising prices for its best seats.

About a dozen off-Broadway shows have introduced so-called premium seating at the front of its theaters.  The "Voysey "Inheritance,'' an Edwardian drama adapted by David Mamet about the legacy of corrupt money managers, began offering $95 seats last month, up from $60.   "Altar Boyz,"  a long-running musical comedy about a Christian boy band at New World Stages, sells a few tickets for each performance for $126, $46 above the regular top price of $79.99.

"There is always someone who wants to fly first class,'' said Ken Davenport, a 34-year-old producer and co-conceiver of 'Altar Boyz.'"  "It's the law of supply and demand. We don't follow this enough in our industry.''

Broadway producers have been accused of gouging theatergoers with $250 orchestra seats (they're actually $300 at Wicked'). So-called premium seats, introduced by "The Producers" in 2001, helped boost overall Broadway revenue by 12 percent last season, when attendance rose just 4 percent.

Off-Broadway's in a different boat. Many theaters are subsidized, and most still offer scores of inexpensive, often discounted tickets for prime seats. To fill theaters, productions even resort to services such as Audience Extras, which gives away tickets to its subscribers, save for a $3 reservation charge. (Struggling Broadway shows also frequently "paper'' their houses.)

Terrible Odds

While only one show in five breaks even on Broadway, perhaps one in 20 recoups its investment off-Broadway.

After opening on Dec. 6, Voysey has become the Atlantic Theater Company's longest running off-Broadway show since Mamet co-founded the group with actor William H. Macy in 1985. Managing director Andrew Hamingson, 44, said the company introduced the premium seats when it extended the run the first time, in January. It sells as many as 10 of the 165 available tickets per performance for $95. The extra $2,800 per week helps underwrite a production with 12 actors that would otherwise almost certainly close in the red.

"It's such a gamble when we're running a show this size,'' he said. "Any way we can make a few extra dollars, we will take an advantage to maximize revenue and minimize expenses.''

Unlike Broadway, off-Broadway often offers bonuses for those who pay a premium. The Atlantic gives away a free glass of Cycles Gladiator cabernet sauvignon wine.

Free T-Shirt

At the two-year-old "Altar Boyz,'' premium ticket holders receive an "Altar Boyz'' T-shirt, CD, button and the chance to meet the cast after the show, without having to compete for their attention outside the stage door.

Others with premium tickets include: "Jacques Brel Is Alive and Well and Living in Paris''; the 11-year-old revue "I Love You, You're Perfect, Now Change''; and Steve Solomon's two- month-old solo show "My Mother's Italian, My Father's Jewish and I'm in Therapy.'' (It's planning a tour later this year, in addition to the open-ended run in the Little Shubert Theater, which will be recast with another performer.)

Even flops are selling premium seats. "Evil Dead: The Musical,'' scheduled to close Feb. 17, sells its best seats for $101; regular top price is $66.

Producers will continue pricing shows like airline seats. Next month, to coincide with spring break, Davenport plans an experiment. He'll boost the top, non-premium price of "Altar Boyz'' tickets by $20, to $99.99 for a few Saturday nights, the prime theatergoing night.

He figures those who balk at full price will accept $50 tickets at the Theater Development Fund's TKTS half-price booth in Times Square.

"We're using the basic principles of yield management,'' he said.

(Philip Boroff is a reporter for Bloomberg News. The opinions expressed are his own.)