By Todd Brabec, ASCAP Executive VP of Membership and Jeff Brabec
With eye-catching headlines like "Broadway Rockets to All-Time High," "Cats Sweet $1.2 Million," "Phantom with $16.5 Million Advance," and "The Lion King earns $1,000,000 in a Week," the Broadway theater has always held a certain glamour and fascination for both writers and those willing to invest their money.
The production of a Broadway musical is an extremely expensive undertaking, usually requiring from $5 million to $20 million to open in New York. In this world of multimillion-dollar investments, enormous profits, and equally enormous losses, the bookwriter, composer, and lyricist of a Broadway musical can earn unbelievably large amounts of money during the New York run, as well as for many years after the final curtain goes down on Broadway.
Many composers and lyricists in this field are governed by the minimum compensation standards and guidelines for the participation of income of the Dramatists Guild contract.
The Broadway Opening: After the out-of-town pre-Broadway run, the musical normally enters New York for previews. Once the musical opens, the writers are guaranteed a minimum royalty of 4.5% of the weekly gross box office receipts until the show's costs have been recouped, and 6% of such receipts thereafter. For example, a hit musical on Broadway will usually take in from $600,000 to $1,000,000 per week in ticket sales. If the writers were sharing the guild's postrecoupment minimum of 6% (2% each to the composer, lyricist, and bookwriter), the weekly writer royalties for each would range from $12,000 to $20,000 each. And by multiplying this figure by 52 weeks, each writer would receive from $624,000 to $1,040,000 in annual royalties from the Broadway run of the show alone, not to mention the substantial amount of money being generated by touring productions of the musical throughout the world.
© 2007 Todd Brabec, Jeff Brabec
For more information, check out the book Music, Money and Success: The Insider's Guide To Making Money In The Music Business (Schirmer Trade Books/Music Sales/502 pages) available for sale at Amazon.com, Barnes & Noble, Borders, Music Sales Group and www.musicandmoney.com.