Two Items Of Note

First up, on 4/3/2011 the New Jersey Star-Ledger published an extensive article written by Mark Mueller about the unfolding legal troubles which have contributed to violin dealer Dietmar Machold’s fall from grace. Among other items, the report recounts Machold’s involvement with the New Jersey Symphony Orchestra’s (NJSO) Golden (Pyrate?) Age instrument deal that soured mere weeks after being plucked from the vine. Mueller calls it a “recurring bad dream for the NJSO” and rightly so…

The NJSO’s deal contributed in large part to the organization’s financial troubles that have resulted in a series of extensive budget cuts that continue to hobble the orchestra. If that weren’t enough, the deal attracted a tidal wave of questions focused on the orchestra’s governance and oversight.

The 2003 [Golden Age instrument] deal was the most audacious ever undertaken by an orchestra, and it nearly bankrupted the NJSO. It also drew the scrutiny of the FBI and the Internal Revenue Service, which were looking into a pattern of massive tax write-offs by Axelrod. (full article)

If nothing else, the NJSO deal should be warning enough to the entire field about moving too quickly into new business models: don’t skim on the due diligence and do your research.

Cleveland in Miami: boon to local arts scene or big budget carpetbaggers?

Speaking of new business models, the second item of note comes from another piece of retrospection, this one appearing in the 4/6/2011 edition of South Florida Classical Review where David Fleshler takes a long, hard look at the five year old Cleveland Orchestra (CO) residency in Miami.

Fleshler dives head first into the good, the bad, and the in-between surrounding the residency’s impact on the Miami area. On one hand, no one seems to be complaining about the orchestra’s artistic levels (yep, they sound good), but on the other hand it is clear that the CO’s claims of being a boon to local philanthropic development ring hollow in the ears of some South Florida arts executives.

A top administrator at a leading South Florida music organization, who preferred not to be identified, firmly believes that Cleveland’s Miami residency has had a major negative effect on local institutions.

“There is no way that you can raise millions of dollars every year for the Cleveland Orchestra without impacting fundraising for the other arts organizations,” he said. “Miami is still a limited-size pie. And they’re getting a huge share.

“I wish I could say that the pie just got bigger. It didn’t. The banks and foundations who made the choice to give to them at the same time made the choice not to give to others.”

More damaging still, he believes, is that the Cleveland Orchestra’s presence prevents any burgeoning initiative for a new symphony orchestra to replace the Florida Philharmonic. “Having them here will not allow any spark for a professional, full-time orchestra to ever catch fire.”

You can’t get much clearer than that.

About Drew McManus

"I hear that every time you show up to work with an orchestra, people get fired." Those were the first words out of an executive's mouth after her board chair introduced us. That executive is now a dear colleague and friend but the day that consulting contract began with her orchestra, she was convinced I was a hatchet-man brought in by the board to clean house.

I understand where the trepidation comes from as a great deal of my consulting and technology provider work for arts organizations involves due diligence, separating fact from fiction, interpreting spin, as well as performance review and oversight. So yes, sometimes that work results in one or two individuals "aggressively embracing career change" but far more often than not, it reinforces and clarifies exactly what works and why.

In short, it doesn't matter if you know where all the bodies are buried if you can't keep your own clients out of the ground, and I'm fortunate enough to say that for more than 15 years, I've done exactly that for groups of all budget size from Qatar to Kathmandu.

For fun, I write a daily blog about the orchestra business, provide a platform for arts insiders to speak their mind, keep track of what people in this business get paid, help write a satirical cartoon about orchestra life, hack the arts, and love a good coffee drink.

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0 thoughts on “Two Items Of Note

  1. The Florida Philharmonic closed its doors in 2003, as I recall, and Cleveland began its residency program in 2007.
    If there was financial support for a local professional orchestra available, where was that support directed in the intervening four years?

    Cleveland stepped into a vacuum and has made a success of its residency programs which go far beyond the concert series. Furthermore without this residency and the financial support it pulls in, the Cleveland Orchestra would cease to exist in its current state. Folks in Cleveland, sadly, can no longer sustain an Orchestra at this level (and cost) on their own.

    I am not completely buying the notion that the presence of the Cleveland Orchestra and its draw on local financial resources precludes development of a local professional orchestra in Miami. But I do think it will not happen until someone can persuasively make the case for it.

    Michael Tilson Thomas seems to have done just that in Miami Beach with the New World Symphony.

  2. I am glad that this discussion about orchestras moving into other communities is taking place. Good idea at first for many reasons but then as this suggests, the locals generally tend to suffer. Indeed a quandry: nowhere these days does there seem to be enough money to go around. How on earth do we fix that unless prices for everything fall dramatically? But then, wages will also fall in tandem (and that will negatively affect purchasing and philanthropy) so we are not really fixing the problem, just perhaps changing the scale of it???

  3. Hmmm… the National Philharmonic is still surviving alongside the Baltimore Symphony at Strathmore Hall… at least last time I checked. How does that compare to the Miami market? Might make an interesting investigation.

  4. I don’t know if that would be a useful comparison in the sense of setting it aside Miami. For starters, the NSO didn’t go out of business. If anything the NSO/BSO scenario disproves much of what those who advocate a universal (and I would add stereotypical) structural deficit are trying to say.

  5. Re MTT and New World; ultimately, that group is an education institution, not a performing arts organization. Granted, it isn’t a traditional conservatory environment but it is equally not the same thing as a professional orchestra (especially when considering the massive difference in artistic expense structure).

    I guess the component that will always be the wrench in the works is the Dan Lewis variable. It is near impossible to determine if the Miami situation was influence by ulterior motives or not. Consequently, using it in any sort of case study scenario is problematic.

  6. Non-profit organizations, including orchestras, exist for the benefit of the public, not the other way around. Competition ultimately benefits the public even as it necessarily hurts certain individual enterprises. The Cleveland Orchestra residency has succeeded because it provides something to the public that so-called “local” organizations could not. Those aggrieved by this development should be trying to do a better job rather than sniping at the residency’s success.

  7. Granted New World is “sort-of” an educational institution (I think they do offer a stipend to the musicians); however it does give a full season of concerts, which should bring the public exposure/experience level close to, if not significantly better than, what many professional orchestras offer in this country to their communities.

    If we are looking for the impact of local artists living in the community, teaching and inspiring the next generation of musicians and audiences, does the fact of not being paid $80,000+ cheapen that contribution?

    I’m not saying here that the New World Symphony is a model (I am beginning to hate that word) to follow elsewhere. This sort of thing probably requires someone of the stature of Michael Tilson Thomas to make the case convincingly, both to the students and the funders.

    If Dudamel, Maazel, Rattle, Slatkin, Jarve, or some other similarly famous folk were to come to Miami and say they would like to start a professional orchestra there, does anyone think the money could not be found?

  8. Very interesting. How do you feel about the DSO’s public statements that the permanent reductions in compensation will have no impact on quality? the musicians there have argued that it will degrade quality and fail to attract the same quality of musicians that they have traditionally drawn. In the Cleveland Orchestra’s case, their musicians receive an even higher compensation package than Detroit (even before the salary cuts).

    Likewise, do you think the Florida Phil have gone out of business had they offered a higher compensation package to musicians and staffers?

  9. In general, I would caution against comparing a stipend to living wage.

    But more to the point, your final question is particularly interesting. I guess my only thoughts are along the lines of what kind of money are we talking about? Enough to fund a professional orchestra that pays a living wage or one that can sustain an educational institution?

    I’m with you 100% on developing a aversion to the word “model.” It’s about as useless as “paradigm” and a host of other trendy jargon.

  10. Drew, we seem to have run out of room in our previous stream as there was no nested “Reply” prompt in your last comment.

    A living wage solely from orchestral playing is certainly a glorious goal for musicians who have invested in the low six-figures for their education. However this is only possible in the very few communities that can (and care to) support full time orchestras with weekly performances. I suspect the ratio of such orchestras to the whole orchestra scene in the USA is less than 2%, probably closer to 1%.

    A generation ago we used to speak of the “Big Five” orchestras of the highest quality, with other orchestras acknowledged as excellent, but not quite at that level. Then we began to see other orchestras begin to challenge the Five in quality (and frequency of performances). After this season of flowering, we have begun to see some correction and, in some locales, atrophy. This process is normal; the only dependable constant in life (beyond death and taxes)is change.

    I suspect that any new professional orchestra in Miami (or elsewhere) will not rise, phoenix-like, with a 52 week contracted season (with time off for good behavior). But starting with 12 weeks of really exciting programs in a City the size of Miami should be eminently doable, would complement Cleveland’s limited efforts, and would make the case for further growth.

  11. Correct, there is a limit to how many “replies you can use in the nested system but what I usually do is click one of the earlier “reply” links. Nonetheless, the business of determining firm definitions for subjective terms like “full time” or living wage” becomes very tricky; especially for this purpose.

    Nonetheless, if we look at professional orchestras that pay a minimum of $50k/yr base salary, out of the ICSOM/ROPA/IGSOBM/and even Naples thrown in for good measure (and since we’re talking about Florida anyway) that percentage jumps up closer to the one third mark as opposed to single digit percent.

    If we look at cities with similar or larger metropolitan demographics as Miami, that percentage jumps up even higher.

    As a result, I wholeheartedly agree that any professional orchestra which may (hopefully) spring up in Miami won’t be a 52 week orchestra but it isn’t unreasonable to think that it can enter the process at a point closer than not to the living wage threshold I outlined above.

    But the wrench in the works here is duplication. We’re not talking about a satellite orchestra vs. professional orchestra. In fact, we all know that those two types of organizations can and do easily coexist in numerous metropolitan areas. But the likelihood of two orchestral organizations that provide nearly identical service is practicably unheard of in the US over the past half century.

    When examined from that perspective the potential for the negative side of the double edged sword becomes clearer.

  12. A very good point, thanks for stepping in with that. At the same time, I would be surprised to learn if that distinction doesn’t exist more on paper than in reality. If I recall correctly, administrative positions in the Cleveland satellite office are still processed through the main admin offices. Likewise, if the funds raised via the satellite board are in any way used to fulfill collective bargaining agreement payments to musicians per terms of their agreement and are not completely and clearly mutually exclusive, then it becomes increasingly difficult to make a case that they are separate brands.

    All of that is a long way to say that if the funds raising in Miami via that 501(c)3 are directed toward the parent organization’s expenditure responsibilities, then the independence of that organization could be questionable.

  13. That’s a fascinating outlook; almost a borrowing from Peter to pay Paul scenario.

    I would point out that not every community is struggling. there are many that have and continue to do a fine job with managing current debt and in some cases, even growing and traditional historic patterns.

  14. We may be looking at different “data bases” here for our math. I think if one uses the ISCOM/ROPA membership only, the result does not actually reflect the breadth of professional orchestra activity around the country.

    For ICSOM the membership rate of qualified candidates is probably close to 100%. For ROPA much lower. I know of many fine professional orchestras that are not on that rather short list. Actually there are more off that list than are on. And of the ROPA membership players, how many are making $50,000+ from a single orchestra? Of the professional orchestras I know in New England, excluding the Boston Symphony, that percentage is zero. (The annual budget of a 75 player symphony orchestra paying a $50,000 minimum salary would probably fall in $6-7 million range).

    On the duplication front I am in agreement, but I don’t think the presence of one more professional orchestra residing in Miami supplementing the limited presence of Cleveland represents duplication at all. In the next three months at the Knight Concert Hall at the Arsht Center in Miami there is exactly one orchestral concert listed on the website. (Guess who? New World).

    I would argue that that this new orchestra should not be called something like the “Florida Philharmonic” however. There is no civic ownership or identity in that sort of title. A “Miami Symphony” could probably garner more financial and audience support, I think. And if it mixed in a healthy dose of the really terrific orchestral music written in Central and South America over the past 150 years that many audiences in the US don’t know at all (beyond Villa-Lobos)that identity would be enhanced.

  15. Not sure we’re talking about the same National? The National Philharmonic Orchestra or NPO is a per-service professional regional group in residence at Strathmore, sharing the same hall as the BSO in the Washington corridor. No, NPO is not full time, not close to BSO’s budget, but they are still respectable enough to play 8 to 10 classic sets a year in the same hall, and right in the same market as the full-time National Symphony Orchestra in DC (NSO).

    I believe Miami still has some regionals in existence, too – plus New World. I know you reference New World as an orchestra with an entirely different mission; but I argue that if it quacks like a duck… it’s just a uniquely cheaper duck. You get my point. I would like to add that to me, as a passionate classical music lover, New World and Cleveland in the same city at the same time (at least for a couple weeks) would be a fascinating listening opportunity at two ends of the “professional” musical spectrum. I could see the Miami area on my list of retirement cities if this CO thing works out for a while.

    The BSO plays much more often at Strathmore than Cleveland plays in Miami, only three weeks. The NSO, BSO, and NPO are all surviving within miles of each other. Whether the 2 bigger groups are engaged in donor tug of war, I’m certain that they are to a degree, but we may not know exactly how much. So far, so good.

    The Greater Miami MSA has failed to sustain a full-time orchestra since BEFORE the FPO opened and closed. The FPO wasn’t the first to fail. Even regional orchestras in that market have floundered, closed, or consolidated. What is it about the Miami market? I have read a few articles suggesting reasons for this, but that’s for another time.

    The Miami market is not incapable of supporting major arts institutions. How much did it cost for the NWO’s Frank Gehry hall? And didn’t Miami build the Carnival Center? Could Miami build and sustain a full-time orchestra again? Nothing is impossible with the right people on the bus and the will to build and sustain it.

    Even with the Dan Lewis connection, I think the FPO board could have fought harder to save the FPO. Has anyone thought of asking Cleveland to HELP Miami build an orchestra capable of playing at a similar level for the rest of the year? What about a CO franchise concept?

  16. The franchise concept is interesting. The Boston Symphony has it’s Esplanade Orchestra which takes over the Pops series at Symphony Hall after the BSO decamps to Tanglewood.

    Also interesting is that Cleveland has recently designated Giancarlo Guerrero (MD in Nashville) to take charge of the residency operation in Miami. Maybe there is already some thought for expansion?

  17. I’m glad you mentioned the Franchise orchestra idea Chris (and Lee), I actually wrote an article about that concept way back in 2003. But that notion focused on using an established brand (i.e. 501c3 performing arts organization) that hired new musicians in each market. In that sense, it is very different than what Cleveland is currently doing in Miami. At the same time, I don’t see any reason why they wouldn’t be able to change gears and hire new musicians who live or would relocate to Miami. After all, as you pointed out they hired a conductor (Guerrero) with a title, job description, and responsibilities geared exclusively toward Miami operations. So why not hire musicians as well?

  18. Lee: I think we were talking about two different “National” groups. Nonetheless, comparing the the satellite orchestra you’re referencing to the BSO is too much of an apples to oranges scenario. Satellite groups have always existed in and around the periphery of metropolitan centers and I doubt that will change anytime soon.

    I think you’re last paragraph is the big question. I recall making that point in an article about this years ago but I don’t recall exactly which one. But the gist was the same; if Cleveland is sincerely interested in using their presence to help re-establish a resident orchestra, then why is that not part of their stated mission?

    Wouldn’t it be fascinating to see someone like the Kennedy Center’s Michael Kaiser take an active interest and design one of the National Symphony Orchestra’s residency programs to help kick start those efforts.

  19. Wow just saw this post thread – some guy that lives in Cleveland has determined what is good for Miami is the Cleveland Orchestra – how about outsourcing the New World Symphony to Cleveland? – filling all those empty seats in Severance Hall (1/40th the cost!) – then Cleveland musicians would be referred to as ‘supplements’ to the NWS. I’ll bet money MTT/NWS would pack the place consistently. Guess what would be left of the great CO after 5 years…nada.

    Cleveland needs Miami way more than Miami needs or wants Cleveland – CO represents nothing but outsourcing on the most hypocritical level.
    “Musical Arts Association of Miami” – NOT.

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