Sphere
Sphere didn’t announce any new acts during its earnings call on Tuesday (Nov. 12), but the Las Vegas venue has enough interest from artists that the venue is “struggling with how to squeeze everybody in through the fall,” said CEO James Dolan.
Having a long line of artists waiting to perform is a good problem to have. Residencies by U2, Phish, Dead & Co. and The Eagles have changed how artists perform live and turned the state-of-the-art Sphere into a must-see for music fans. But running a one-of-a-kind venue presents unique challenges and requires on-the-fly learning.
To keep the venue busy and generate more revenue, last quarter Sphere increased the number of “side by sides,” the company’s term for running multiple events in a single day—a showing of “Postcards from Earth” before a music concert, for example. “A lot of this has to do with logistics, about about setting up the arena for one and taking it down and then setting it up for the other,” said Dolan.
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Still, a full year of operational experience didn’t lead to more business last quarter. Total Sphere revenue was $127.1 million in the quarter ended Sept. 30, down from $151.2 million and $170.4 million in the prior two quarters, respectively. Revenue from events such as concerts was $40.9 million, down from $58.4 million in the previous quarter. The Eagles began a residency in September, and the same month Sphere hosted its first live sports event, UFC 306, which become Sphere’s highest grossing single event to date.
The Sphere Experience, which covers showings of Postcard from Earth and V-U2: An Immersive Concert Film, generated $71.5 million, down from $74.5 million and $100.5 million in the previous two quarters.
Exosphere advertising and suite license fees totaled $8.5 million, down from $15.9 million in the previous quarter. Dolan said Sphere was experiencing “structural” issues in securing advertising on the venue’s 580,000 square-foot exterior. “I wish the day we lit it up that we knew exactly how to run it, and exactly how to sell it, and exactly how to program it, etc.,” he admitted. “But that’s just not the case.”
The company is also learning how to program its original content such as “V-U2,” which captures U2’s residency at the venue. “How we market it, how we just, you know, how we we schedule it, etc, that I’m not sure of,” said Dolan. “But I do think that the product is valuable. And I also think that it’s going to be evergreen. You’re not going to be able to see Bono 20 years from now.”
Sphere’s operating loss of $125.1 million improved to $16.1 million after adjustments to remove nearly $80 million of depreciation, $13.2 million of share-based compensation and other non-operational items such as amortization, restructuring charges and merger-related costs. The venue’s selling, general and administrative expenses totaled $105 million while direct operating expenses were $62.5 million.
Sphere shares were down 8.7% to $40.22 in morning trading.
MSG Networks, Sphere Entertainment Co.’s other division, had revenue of $100.8 million, down 9% from the prior-year quarter. MSG Networks owns regional sports networks and the streaming platform MSG+. The impact of a 13% drop in subscribers was partially offset by an increase in affiliation rates.
In October, Sphere Entertainment announced plans to build the next Sphere venue in Abu Dhabi, the capitol city of the United Arab Emirates. Unlike the $2.3-billion Las Vegas venue, which was entirely funded by Sphere Entertainment Co., the Abu Dhabi venue will be entirely funded by the government’s Department of Culture and Tourism and operate under a franchise model. Dolan said Sphere Entertainment will receive a franchise initiation fee that grants Abu Dhabi the right to use the company’s intellectual property.
Sphere Entertainment Co. has reached an agreement with the Abu Dhabi Department of Culture and Tourism to create a second Sphere in the United Arab Emirates (UAE) capital city.
“The vision for Sphere has always included a global network of venues, and today’s announcement is a significant milestone toward that goal,” said James L. Dolan, executive chairman/CEO of Sphere Entertainment who oversaw the construction of the Las Vegas Sphere in late 2023. Sphere Entertainment is a spinoff of Madison Square Garden Entertainment and is headquartered in L.A., where a small staff develops the audio and visual components for Sphere’s massive internal video screen.
The long-term success of Sphere has always been contingent on Dolan’s ability to scale the business model and build additional Sphere facilities to amortize the costs of producing content for the uniquely shaped arena. According to sources, video produced to accompany the 10-bout Noche UFC match in Las Vegas cost last month cost upwards of $20 million.
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A second Sphere location would provide Dolan and crew a chance to recoup some of their production costs from a new audience via projects like Postcard from Earth, a multi-sensory film directed by Darren Aronofsky that helped generate more than $1 million in average daily ticket sales on the days it ran during the company’s most recent fiscal quarter, according to a shareholders report.
There’s also an opportunity to save on production costs by staging concerts at both the Vegas and Abu Dhabi venues, although it’s unclear how much demand there would be in the Middle East for Western concerts. Since the end of the pandemic, only a handful of concerts from American artists performing in the UAE have been reported to Billboard Boxscore.
“We are excited to bring Sphere to Abu Dhabi in partnership with Sphere Entertainment, providing our residents and visitors with an extraordinary new form of entertainment,” said H.E. Mohamed Khalifa Al Mubarak, chairman of DCT Abu Dhabi, in a statement. “Sphere Abu Dhabi will seamlessly integrate advanced technology with captivating storytelling, creating unforgettable memories for everyone who visits. This partnership aligns with our Tourism Strategy 2030, further establishing Abu Dhabi as a vibrant hub for culture and innovation. By embracing cutting-edge entertainment like Sphere, we’re not only elevating our global profile but also setting new standards in immersive experiences and cultural offerings.”
Under the terms of the partnership, which is subject to the finalization of definitive agreements, DCT Abu Dhabi will pay Sphere Entertainment a franchise initiation fee for the right to build the venue, utilizing Sphere Entertainment’s proprietary designs, technology and intellectual property. Construction will be funded by DCT Abu Dhabi, with Sphere Entertainment’s team of experts providing services related to development, construction and pre-opening of the venue.
Following the venue’s opening, Sphere Entertainment plans to maintain ongoing arrangements with DCT Abu Dhabi that are expected to include annual fees for creative and artistic content licensed by Sphere Entertainment, such as Sphere Experiences; use of Sphere’s brand, patents, proprietary technology and intellectual property; and operational services related to venue operations and technology, as well as commercial and strategic advisory support.
Time to drop the needle on the latest Executive Turntable, Billboard’s comprehensive(ish) compendium of promotions, hirings, exits and firings — and all things in between — across music.
Read on for mostly good news and also check out Billboard‘s annual list of music’s highest compensated executives, plus our weekly interview series spotlighting a single executive, our helpful calendar of notable events, and have you ever wanted to look at tchotchkes inside the office of an executive while reading their in-depth answers to the most important questions facing the biz? From the Desk Of is probably your jam.
Sphere Entertainment announced the departure of David Byrnes, the company’s executive vice president, chief financial officer and treasurer. Byrnes will remain in his role during a transition period while the company searches for a new CFO. The NYC-based media executive has been Sphere’s finance lead since January of this year and held that same position at MSG Entertainment before that. During his tenure at Sphere and MSG, he has played a key role in major transactions including the spin-off of MSG Entertainment, the sale of a majority interest in Tao Group Hospitality, and two stock offerings. Byrnes joined MSG following a nearly 14-year run in senior roles at CBS (and later ViacomCBS), rising to executive vp of corporate finance and then exiting prior to the company’s name change to Paramount Global in early 2022. Byrnes has not announced his next move.
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Sphere Entertainment, which opened its spectacle-invoking Las Vegas venue in September 2023 with U2’s residency, has since hosted live-wired artists including Phish, Dead & Company and current residents Eagles (they play tonight and tomorrow), and multimedia shows like Darren Aronofsky’s Postcard from Earth. During its fiscal year ending June 30, Sphere reported $273.4 million in revenue and full-year revenue of $1.03 billion, nearly double the prior year’s $573.8 million.
Meanwhile…
BMG appointed Melanie McAllister as its global chief human resources officer (CHRO), effective Nov. 1. Reporting to CEO Thomas Coesfeld, she will join the executive board and oversee key HR functions across 20 offices, including hiring, performance, development, DE&I and aligning HR strategies with overarching business goals. McAllister brings extensive experience from her previous roles as Chief People Officer at EasyPark Group and Megaport, and nearly a decade as Chief HR Officer at Arvato. She has also held senior HR positions at Oracle and other global tech firms and holds a Master’s in Strategic HR from Liverpool JM University and serves on the board of ENABLE Trust. Coesfeld expressed enthusiasm for McAllister’s role in shaping BMG’s future, adding “Her expertise, vision, and proven track record of combining innovative thinking with people excellence will have a transformative impact on our company.”
Johnny Pinchard was promoted to head of A&R at Believe UK, advancing from his role as senior A&R Manager. Reporting to Malena Wolfer and Panos Polymatidis, he’ll continue working from the London office. Since joining Believe from RCA Records in 2021, Pinchard has signed notable artists like Sea Girls, who reached No. 4 on the UK Albums Chart, and rapper Blanco, who has earned over 140 million streams in less than a year. He also signed Grammy-nominated electronic artist HAYLA, who won Vocalist of the Year at the 2024 EDMA’s. Pinchard is committed to developing new talent, including Sainte, Leon Vynehall, Grace Davies, and Sevdaliza. Believe UK Managing Director Alex Kennedy praised Pinchard as being “absolutely vital in identifying, signing and developing a wide range of artists that have formed the cornerstone of our success and that fit the Believe ethos perfectly.”
Jessica Vaughn
Raedio appointed Jessica Vaughn as vp of creative synch sales, a new role at the audio company. Vaughn will lead efforts to expand Raedio’s music library and sync services, aiming to deliver “Audio Everywhere.” Her responsibilities also include developing growth strategies for Raedio’s one-stop music library and collaborating with industry partners to secure music placements across film, television, advertising and gaming. Outside of her day job, Vaughn is a veteran singer-songwriter who gained attention in the late aughts as Charlotte Sometimes, releasing her debut album on Geffen and appearing on the sophomore season of The Voice. She now performs and records under the name LACES. In 2023, Vaughn penned a guest column for Billboard advocating for more creatives joining executive ranks across the industry.
Canvas Music onboarded former Spotify UK & Ireland managing director Tom Connaughton as partner and senior advisor of the independent boutique distributor. Connaughton joins to support Canvas Music’s mission of offering artist-centered, indie label-like distribution services. Canvas was launched in 2020 by Richard Lyne, who said the company’s goal is to “provide a great service with a great product but with more focus and less volume.” Connaughton expressed excitement about joining and highlighted the potential of Canvas to bride the gap between artists, tech and audiences in a “fair, artist-centered way.” Connaughton hit the exits at Spotify in late 2023 after five years in leadership roles at the streaming giant. Prior to Spotify, he served in various roles at Vevo.
Ineffable Records appointed Sage Ressler as head of synch, effective immediately. Ressler previously worked at Spirit Music Group, where she negotiated licensing deals and secured placements across a plethora of media formats. At Ineffable, she will work with marquee artists across the reggae, indie and Caribbean music spaces, including Sean Paul, Sublime, Govana, Protoje and Bob Marley: One Love star Hector “Roots” Lewis. Ressler will lead the label’s first formal synchronization department, which will focus on securing high-profile placements for the label’s catalog across film, TV, advertising, gaming and more. “The opportunity to help shape and lead the synch department feels like a natural next step for both myself and the company,” said Ressler. “Synch has become a uniquely powerful tool for storytelling, and it’s opening doors for artists in ways we’ve never seen before.” –Kyle Denis
NASHVILLE NOTES: Opry Entertainment Group promoted Jordan Pettit to vp of artist relations and Jenn Tressler to director of artist and industry relations. Pettit, who joined OEG in 2018 and has been instrumental in initiatives like Opry NextStage, will now lead OEG’s artist relations team, developing programs to strengthen artist and fan connections. Tressler has built strong industry relationships since joining OEG in 2020 and will continue to focus on creative artist engagement strategies, especially for the Grand Ole Opry … Rachel Derosia has been promoted to senior vp of comedy at Outback Presents. She’ll work with co-CEO Brian Dorfman and co-svp Joel Bachkoff to expand the division. The Rochester, NY native started her professional career in music, working at Sony Music before shifting to comedy at Zanies Comedy Club, later joining Outback Presents as a coordinator. She has managed and produced numerous tours, helping comedians transition from club to theater-level performances … Chandler Thurston joined Position Music’s A&R team as the first hire for their new Nashville office. Previously, he was senior creative director at Anthem Entertainment, managing talents like Jamie Paulin and Meghan Patrick, and overseeing hits such as Florida Georgia Line’s “Talk You Out of It.” Before Anthem, Thurston worked at Major Bob Music, where he helped sign and develop writers like Alysa Vanderheym. He’ll be based at Position Music’s Nashville office, set to open in Q3 of 2025.
Jaime Kelsall joined Paladin Artists, effective immediately, reuniting with former colleagues from APA and The Agency Group. Based in Los Angeles, Kelsall brings over 20 years of experience, having represented clients like Dionne Warwick, Fitz and the Tantrums, ZZ Ward, and Michelle Branch. She began her career as an intern at the House of Blues in New Orleans, later working at Absolute Artists Agency in San Francisco, where she met Paladin partner Bruce Solar. Kelsall then joined The Agency Group in Los Angeles before spending over 20 years at APA. “We are all thrilled have the talented Jaime Kelsall join our team at Paladin,” said Solar. “We are excited to have her continue her journey with us that started so long ago and bringing her expertise and professionalism to our company.”
ALL IN THE FAMILY: Fairchild Media Group, a division of Billboard parent Penske Media Corporation, promoted Jim Fallon to chief content officer for WWD and FMG. Fallon, with 45 years of industry experience, will oversee editorial and content creation for FMG’s brands, including WWD, Beauty Inc, Sourcing Journal, and Footwear News. Reporting to CEO Amanda Smith, Fallon will focus on enhancing brand positioning, expanding audiences, fostering collaboration, and developing new editorial products. Fallon previously served as editorial director of Fairchild Fashion Media and held leadership roles at Fairchild Publications, including editor of WWD.
ICYMI:
Eric Wong
Warner Music said Eric Wong will shift from chief marketing officer to the role of global head of A&R, recorded music. He’ll also assume the presidency of East West Records. As part of that transition, WMG’s evp of global marketing Jessica Keeley-Carter has been promoted to chief marketing officer, recorded music … Chris Moncada is promoted to COO at MNRK Music Group … and former C3 Presents promoter Sophie Lobl was named vp of Rolling Stone Live. [KEEP READING]
Last Week’s Turntable: Sweet Relief Makes It Official With Executive Director
Chinese music streaming companies had another big week after authorities unveiled an economic stimulus plan that will encourage the purchase of Chinese equities, with Cloud Music gaining 10.7% to 134.50 HKD ($17.32) and Tencent Music Entertainment rising 9.9% to $13.48. Last week, Cloud Music and Tencent Music gained 31.5% and 24.6%, respectively.
The Billboard Global Music Index (BGMI) increased 0.4% to 1,964.44, a fourth-consecutive weekly gain and the third straight week the index set a new record high. With winners and losers evenly split amongst the index’s 20 stocks, the BMGI improved its year-to-date gain to 28.1%.
Outside of China, where the Shanghai Composite Index rose 8.1% to 3,336.50, stocks were generally muted this week as investors were uncertain about how the widening war in the Middle East would affect the global economy. Oil prices increased 10% this week in part due to President Joe Biden’s comment that the U.S. was discussing possible strikes by Israel on Iranian oil production sites. Prices remained well below levels reached following Russia’s invasion of Ukraine in February 2022, however.
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In the U.S., the Nasdaq composite rose 0.1% and the S&P 500 gained 0.2%. In the U.K., the FTSE 100 fell 0.5% to 8,280.63. South Korea’s KOSPI composite index dropped 3.0% to 2,569.71.
iHeartMedia was the BGMI’s biggest gainer of the week, rising 15.2% to $1.97; the radio company’s shares have fallen 3.9% year to date but have risen 142% since hitting a 52-week low of $0.813 on May 28. Elsewhere, the index’s most valuable companies had either modest gains or losses. Live Nation gained 2.0% to $110.87. Spotify rose 0.6% to $371.45. HYBE increased 0.3% to 173,500 KRW ($128.82). Universal Music Group fell 2.0% to 23.37 euros ($25.66).
Sphere Entertainment Co. shares rose 4.4% to $45.26 as Wolfe Research upgraded the company on Wednesday (Oct. 2) to “outperform.” The company’s flagship venue, Sphere in Las Vegas, has added more shows to existing residencies. The Eagles will perform four additional shows in February, bringing its residency to 24 dates. In addition, Anyma added dates on Jan. 10 and 11 — the seventh and eighth shows at the venue for the Italian producer, who will break a string of legacy rock bands to become the first EDM artist to perform at Sphere.
Guggenheim reiterated its “buy” rating on Warner Music Group (WMG) and slightly lowered its estimate for ad-supported streaming revenue ahead of the company’s fiscal fourth-quarter earnings. BofA Securities downgraded WMG to “underperform” from “neutral” on Friday and lowered its price target to $30 from $33. WMG shares finished the week at $31.14, down 0.2%.
LiveOne shares fell 35.8% after the company lowered its fiscal 2025 guidance following a revised partnership with Tesla in which the auto manufacturer will no longer subsidize some customers’ in-auto streaming platform powered by LiveOne’s Slacker Radio. The Los Angeles-based company’s stock has fallen 51.4% year to date.
K-pop stocks, which have fallen sharply in 2024, were muted this week. HYBE, YG Entertainment, SM Entertainment and JYP Entertainment fell by an average of 0.1%, which nudged their average year-to-date loss down to 32.0%.
Billboard
Billboard
Billboard
On nights when there are no live acts playing Sphere Las Vegas, the venue’s Exosphere (its one-of-a-kind outer LED screen) reads, “U2 are not here.” However, five nights a week inside the immersive venue, U2 can be seen performing the best of their U2:UV residency that ran from September 2023 to March 2024 through concert film V-U2. Captured via the Sphere’s proprietary Big Sky camera system, the concert film is just as good as, if not better than, the Irish band’s actual show.
Directed by U2’s The Edge and his wife Morleigh Steinberg, V-U2 brings a slew of firsts to the almost one-year-old venue and its content creation capabilities. The film – captured over three nights of the band’s sold-out residency at Sphere – is part of a growing slate of programming for Sphere Experiences, which run when there is no live residency or special event at the Las Vegas venue. Sphere Experiences also include the Darren Aronofsky film Postcard from Earth.
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“V-U2 was born out of a conversation with the band, ‘How do we memorialize this moment’” of U2’s historic Sphere residency, says Sphere Studios’ senior vp of capture Andrew Shulkind, who served as the film’s director of photography. “For 100 years of movie making, we’ve been telling stories through a rectangular lens. This is a different kind of storytelling. There’s no way to tell this story in a traditional way. You could cut it up, have wide-angle lenses, or have a choppy concert film, but nothing could recreate the Sphere experience.”
Nothing except maybe the technology that makes the live sphere experience possible.
“Coincidentally, we’ve been building cameras to capture other content [outside] the venue,” Shulkind says. “If we can tell the story of what it’s like to be in a sulfur volcano for Postcard or flying over Mont Blanc, why not tell the story of being inside Sphere [during a concert] with our very own technology?”
When Shulkind was first commissioned to work at the Sphere in 2018, the company faced a dilemma of creating images sharp enough for their screens when off-the-shelf-cameras would not suffice. After pursuing different avenues, the Sphere team created the Big Sky camera in 2021. “The camera, lens and all its components are entirely internal technology on which we have 10 patents,” says Shulkind. “Nobody else needs that crazy level of resolution. Coincidentally, the game-changing technology has pushed the business forward.”
The Big Sky technology debuted in Aronofsky’s Postcard from Earth, capturing the images and video required for the Sphere’s 16K x 16K immersive display plane from edge to edge. It also features the largest single sensor in commercial use—a 316-megapixel, 3” x 3” HDR image sensor capable of a 40X resolution increase over 4K cameras. Big Sky can capture content up to 120 frames per second in the 18K square format and higher speed frame rates at lower resolutions.
V-U2: An Immersive Concert Film
Rich Fury/Sphere Entertainment
Using the same technology, producer Alan Maloney, U2, Sphere Studios and the venue, the teams collaborated to shoot over three nights of the 40-date residency (two in February and one in March) to create V-U2, the first film shot entirely on Big Sky cameras.
Working for more than two months on the edit of V-U2 at the Sphere Studios Big Dome in Burbank, Calif. – with a quarter-sized version of the screen and haptic seats and sound featured in the venue – Steinberg (who is an accomplished director and choreographer that choreographed many of Bono’s moves for the Zoo TV Tour in the 1990s) and The Edge wanted to make sure the final product wasn’t just a concert film or a documentary, but a faithful recreation of the live with the most precise view of U2 possible, down to the details on their shoelaces.
“Seeing the band like that—whether you’re high up or in the lower seats. That’s amazing for fans,” Steinberg says.
However, from the director’s perspective, the medium posed significant challenges. “You can’t easily see your edits. You’re either looking through an Oculus [headset] or at a very low-resolution image on a monitor. You quickly learn what you might not be seeing and make compensations for that,” Steinberg says.
One of the most complex production pieces was transforming the 100-minute U2:UV into the 82-minute V-U2. This called for interweaving the setlist of U2:UV with some of the classic covers performed throughout the residency, such as Elvis Presley‘s “Love Me Tender,” Lou Reed’s “Walk on the Wild Side” and Frank Sinatra’s “My Way.”
The directors wanted to reflect the arc of the live show into the concert film and “also considered that this will be viewed by a broader audience, not just U2 fans,” Steinberg says. “People are coming to see what the Sphere can do. The first three songs of the film are a perfect example of that. However, we do ask the audience to sit through two songs where there are no [background] visuals [just a shot of the band]. Even if you aren’t a U2 fan, there’s much to enjoy and experience.”
Steinberg says the film captures the best moments of the residency in new depth and sharpness, with a fresh perspective. The rendition of “‘The Fly’ is a brilliant piece in the film … the space morphs and gives the illusion of the room becoming square. It is a true use of the word ‘awesome,’” she says. “There are shots from the stage, looking out at the audience, which is a new perspective you don’t normally have.”
The track “One” features a camera angle on Bono that Shulkind characterizes as the biggest close-up ever filmed. “The ability to show Bono in this very intimate moment during this intimate song that everybody knows was so powerful,” he says. “It blew everyone away.”
V-U2: An Immersive Concert Film
Rich Fury/Sphere Entertainment
“We had to shrink it down a little bit. It was even bigger,” Steinberg says of the stunning image that showcases Bono in grand detail. “The camera then slowly pulls back, revealing the band. The moment extends into an infinite view of the room, with everyone in the audience holding up their lights.”
The sound of the audience from the original live events also played a critical role in developing the concert film. Captured on crowd mics placed through the venue during the live shows in February and March, the audience can be heard during the film – between and over songs – responding to the band’s performance. “So much of that rawness and bits of unexpected magic parallel the imaging side,” says Shulkind. “You hear the show’s little imperfections and human aspects.”
V-U2 is set to play regularly as Sphere Experiences continue to be created. While it is not yet determined whether every band in residency at Sphere will get their own film, the content has been collected at Phish and Dead & Company shows and will be captured during the Eagles’ current run.
“We will continue to capture every band that comes through,” says MSG Entertainment’s executive vp of live Josephine Vaccarello. “Everyone who comes into our venue is learning how to play with the tools we have in the toolbox differently. We’re continually trying to figure out how we innovate and how we continue to grow, and this was one of the ways.”
“Every Sphere show is a unique moment in time,” Shulkind says. “We’re still figuring out what that looks like for other shows. It’s an endless journey of discovery because we’re learning how this new medium works.”
09/21/2024
You’ve heard about that “dark desert highway” for decades. But have you ever seen it?
09/21/2024
On Saturday (Sept. 14), UFC CEO Dana White will pull off an impressive first in Las Vegas that he never really wanted to do — and has already vowed never to do again.
That day, White will host Noche UFC, a 10-bout celebration tailor-made for Mexican Independence Day (which is coming two days later, on Sept. 16) as the first sporting event inside the Sphere in Las Vegas, the $2 billion arena built by James Dolan that has so far hosted rock residencies by U2, Dead & Company and Phish.
While White has not been shy about plugging Noche UFC as one of the most visually stunning and technologically advanced events ever in combat sports, he’s repeatedly sworn in the media that it’s “a one-and-done,” recently telling MMA reporter John Morgan, “We’re not ever doing an event at the Sphere again.”
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That’s because, as White explains, the cost of doing an event at Sphere is so astronomically expensive — especially building video content for Sphere’s one-of-a-kind interactive video system — that it’s virtually impossible to make one’s money back through ticket sales alone, especially for one-time events.
“Think about U2,” who served as the Sphere’s first 40-show concert residency beginning in September 2023, White said on SNY Sports on Tuesday (Sept. 10). “Whatever that cost them, they had 40 nights to amortize those costs. We just have one.”
The budget for Noche UFC, originally forecast at $8 million, has exploded to more than $20 million due to production costs, sources tell Billboard. Making matters worse, ticket sales for Noche UFC appear to be in a death spiral, with fans balking at the event’s original $3,500 per ticket asking price and scalpers offering nearly as many tickets for resale as are still available on the primary market, often at steep discounts.
That $3,500 ticket price is also considerably more than the average $120 per ticket that the company charged for Noche UFC’s 2023 edition at Vegas’ T-Mobile Arena, an upcharge associated with Sphere’s huge production costs. Noche UFC is taking place at Sphere because executives with MGM Grand, one of the largest gaming companies in Las Vegas, reached a deal with boxing promoter Al Hayman for the date that UFC was supposed to have under a 2017 anchor tenant agreement at T-Mobile Arena which, White has said, “totally f–ed us.”
Until now, Sphere has hosted U2’s 40-date run; a four-night string of concerts by Phish; and Dead & Company’s 30-show residency that wrapped in July. For each, the bands created custom lighting and video productions designed specifically for Sphere’s groundbreaking display that would be effectively unusable at any other venue, meaning that the possibilities of Sphere being a stop on any artist’s regular tour routing would be essentially untenable.
UFC is also leaning into Sphere’s capabilities. Between bouts, the company will screen 90-second video vignettes, produced by outside partners like Valerie Bush and the production company Antigravity Academy. The videos, sources tell Billboard, are custom-built for Sphere’s massive high-definition screens and require expensive post-production work and computer rendering that only Sphere Company officials can handle.
Even the rehearsal hours for Noche UFC are difficult: White recently announced at a press conference that because Sphere airs a nightly film, he can’t get his team into the building to rehearse the show until 1 a.m.
All of which poses additional issues that make Sphere difficult, if not impossible, to accommodate most one-off events, particularly if production costs come with a $20 million price tag. UFC can recoup some of its financial outlay through pay-per-view sales, but it’s heavily relying on average ticket prices of $3,500 that fans aren’t buying, and a pay-per-view model, whether live-streamed or on television, is not straightforward for the music business.
Dolan, however, never marketed the facility as a one-time event host and it’s likely that some of the production costs associated with the Sphere will drop over time as the market for cloud computing recedes. Besides, Dolan hasn’t been shy about how his future ambitions will make Sphere more approachable.
The best way to reduce the costs of producing events for the Sphere, company officials said on a recent earnings call, is to build more Spheres. After losing out on a bid to a Sphere in London, Dolan reportedly has a half-dozen new locations in mind.
The year-old Sphere venue quickly became a must-see attraction in Las Vegas, but some analysts don’t believe the eye-grabbing, multi-purpose venue has a viable business model. Benchmark downgraded Sphere Entertainment Co. to a “sell” rating on Tuesday (Sept. 3) with a $40 price target, sending the stock down 4.4% to $44.55. Benchmark downgraded the stock […]
Surely many Deadheads took in multiple performances of Dead & Company’s 30-date residency at Las Vegas’ Sphere this past spring and summer. It’s unlikely, however, that many of them saw more than Bernie Cahill.
Cahill — who, as a partner at Activist Artists Management, co-manages Dead & Company with Irving Azoff and Steve Moir — caught 20 Dead Forever shows at the fantastical, $2.3 billion venue, with his box suite perch offering impeccable views of the band as it seemed to lift off from the Grateful Dead’s former house in San Francisco’s Haight Ashbury district and hurtle into deep space.
“This definitely was a work in progress,” Cahill tells Billboard. “We were adding new content as late as the final weekend. We feel like we had made a commitment to the fans that we would continue to evolve the show and deliver, and we did.“
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The run made Dead & Company the third group to play Sphere after U2 opened the venue last September and Phish put on a three-night run of shows this past April. Dead Forever grossed $121.5 million and sold 429,000 tickets over 27 shows from May 16-Aug. 3, according to numbers reported to Billboard Boxscore.
Here, Cahill talks about helping break in the cutting-edge venue, bringing Deadheads to Vegas and why, if asked, they’d likely do it all over again.
Was there a sense of learning as the residency went on, and if so, what were those lessons?
Getting in that room and dealing with the audio and some of the basics of not having amplified sound on stage, you learn a lot. Obviously, Irving had just gone through it with U2, so we definitely had a leg up and were lucky that U2 shared so much institutional knowledge with us.
But still, until you get in that room, you just don’t know what you’re in for, so it was a constant evolution. Every single night we were learning things about the room, the audio, the content. Sometimes we would see new content that we would have, and it would just pop and be remarkable, and other times it didn’t always work exactly as it was envisioned. That’s just part of the process of this new medium and new canvas.
I imagine by the end, you have this performance that feels really fully formed, because you’ve developed it over the course of all these shows.
I feel like the guys were inspired as well. They found a new gear at the Sphere. Maybe part of it is the residency, part of it is the challenge of doing something new. I think that was huge for them. You’ve been doing this for particularly as long as Bob [Weir] and Mickey [Hart] have, and I think they were really fired up about the challenge of it. They leaned into all parts of it without ever losing sight of the songs. They were just knocking it out of the park. After the final tour, I didn’t think the band could get much tighter and better, and they pulled it off.
Do you feel they were leveling up because they had to compete with this fantastical thing they were in?
Yes, there’s some of that. But also, they were looking for ways to make this a complimentary integration of their visual storytelling and their music. With this immersive experience happening around you when you’re on that stage, I think they probably felt — and it shows — that they needed to deliver it at another level musically, and they did. I think the room invites that.
Were there unforeseen challenges that came up over the course of the residency?
Lots. [Laughs] I think some of the bigger ones were just things Derek Featherstone, our tour director and front-of-house engineer, had to manage, which was we had less rehearsal than we probably would have liked. When we’re loading in after they show the [Darren] Aronofsky movie [during the daytime], for instance, and we can’t do a full tech run-through of new content, that can be scary and flying without a net a bit. But I think what we see in our granular understanding of the show and then the fan experience, I don’t think they felt any of that stress or worry.
Were you finding that fans were going again and again, or was it more of a one-off experience for people?
Definitely repeat. There were so many repeats, and I think people were really gratified that they were doing more than just a show or more than just one weekend. We had people that saw shows every weekend. Most people saw at least two or three shows. That’s kind of the magic of this band and this community. They know that at a minimum, Bob and John [Mayer] are going tell a story over the weekend and they’re not going to repeat any songs. That story would unfold Thursday, Friday, Saturday, almost like a three-act play. That really appealed to our community.
Having done this, what advice would you give to a manager whose group is about to play the Sphere?
Well, for one thing, learn as much as you can from folks like U2 and Dead & Co. and Phish that have done it. We’re an open book, we’ll share whatever we can. We made mistakes, and we learned a lot, and we’re happy to share that with other artists that are coming after us.
Being a band that has always had visuals as a prominent part of the storytelling helped us a lot. It was very natural for us to explore that and go much deeper at the Sphere. I think bands that come after us who have those visual elements as a part their story and their brand will have an easier time creating their show. I would just advise to get started as soon as you can and don’t stop pushing the margin, either. Keep going with it and keep exploring and experimenting throughout your run.
The venue also really makes sense for a band with such a long a rich history, because the show so effectively leaned into that visually. Obviously, that’s not something a newer act can really do.
True. We have this very rich palette to draw from, and it really clicked in this venue. Yes, there were the crazy moments when it felt very 3D and hurtling through space. Then there were the analog moments and, I think, important emotional moments where the band was just connecting, whether it was Bob playing while standing on the moon and the ballads that just brought everybody to a whisper. I guess the other advice would be to strike that balance of those emotional, analog-feeling moments and then playing with the technology and how big you can go.
It was touching, thinking about the life of Bob Weir and where he and Mickey are coming from and now, they’re effectively playing in a spaceship.
Yeah, exactly. But by the way, it’s very Bob Weir if you know him. He loves technology. They’re all really technophiles. They love it. I think they love anything that allows them to go deeper with their storytelling and their exploration of this music. That is a gift to these artists, and I think is a big part of why the Sphere worked so well and was such a success.
Would they try it again?
When asked in interviews they’ve done since, I think they’ve all said they would definitely entertain an invite and would love to come back and do some things. Bob wants to really lean into this idea of being able to affect the visuals in real time and synching them more with the music itself.
But there were already some interesting things happening in that room that I don’t know if people even realized. [One night] there was a full moon outside, and we beamed the actual live full moon into the Sphere. That wasn’t video. That was a Weir idea.
If you were to do another residency, is there anything you would change?
Jim Dolan, you have to give him so much credit. He nailed it with this venue, which is impeccable in almost every way, from the backstage where we all spent most of our time, to front of house. Maybe [it would be] having a bit more time to rehearse, more tech rehearsal, just getting comfortable in the Sphere, because it’s one of one. It’s the only one in the world.
After hosting residencies by Dead & Company and Phish, Sphere Entertainment Co. closed out its fiscal year ended June 30 with revenue of $273.4 million and a net loss of $46.6 million in the fourth quarter.
For full-year revenue, the company posted a $201-million net loss on revenue of $1.03 billion. That’s nearly double the $573.8 million revenue number in the prior year, when the Sphere venue in Las Vegas had revenue of just $2.6 million after launching late in 2023.
Following the earnings release, shares of Sphere Entertainment jumped 9.3% to $44.55 on Wednesday (Aug. 14).
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The MSG Networks division had quarterly revenue of $122.2 million, down 6.2% from the prior-year period, and annual revenue of $529.7 million, a 7% decline. MSG Networks operates two TV sports networks, MSG Network and MSG Sportsnet, and the MSG+ streaming platform.
The eye-grabbing $2.3-billion Sphere venue in Las Vegas reported revenue of $151.2 million in the latest quarter. Events such as concerts and corporate events accounted for revenue of $58.4 million. The Sphere Experience, an interactive experience combined with a showing of the film Postcard from Earth, had revenue of $74.5 million from 208 performances.
Sphere generated revenue of $489.4 million in its first three full quarters of operation. Though U2 opened its 40-date run at the end of the first fiscal quarter, the bulk of the concerts occurred in the second and third quarters. Four dates by Phish in April were followed by Dead & Co.’s 30-date residency that concluded Aug. 10.
With state-of-the-art visuals and audio, as well as the capacity to host multiple types of events, Sphere “has the potential to change the entertainment landscape for artists, guests and partners,” CEO James Dolan said during Wednesday’s earnings call. “Fully realizing that vision will take time, but we are learning every day how to optimize Sphere’s operating model.”
While its concerts have generated worldwide media attention and exposure on social media, Sphere’s financial potential depends on maximizing its utilization beyond that of a traditional venue. To that end, Dolan said the company is “making progress” toward its goal of hosting multiple events in a single day. The Sphere Experience, which includes the 50-minute film Postcard from Earth, ran on the same days as Dead & Company’s shows in July and August.
Sphere is also branching out into different types of events that take advantage of its Las Vegas location and an ability to offer dazzling visual displays on its 160,000-square-foot video screen. In June, the venue hosted its first corporate keynote event with Hewlett Packard Enterprise as well as the NHL Draft.
The content category, which includes Postcard from Earth, is another aspect of maximizing Sphere’s usage. Content generated more than $1 million in average daily ticket sales in the latest quarter, according to Dolan, and has earned more than $300 million in “high margin” revenue since debuting in October 2023.
“We are actively developing new cinematic experiences and expect to launch our next attraction in the coming weeks,” said Dolan. “We believe this expanding content library will benefit our Las Vegas business and strengthen our value proposition to new markets.”
The Eagles begin a 20-date residency at Sphere in September while Anyma will give the venue its first EDM shows in late December. Also in September, Sphere will host its first live sports event, UFC 306.