San Diego Opera Crisis Underscores Need for Fresh Business Models

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When San Diego Opera recently announced its plans to fold after 49 years in business, a wide swath of the California arts community was stunned, including the musicians of the San Diego Symphony, which doubles as the opera company’s pit orchestra.

“It surprised everyone,” said James Chut, the music and art critic for U-T San Diego, the region’s major daily newspaper. “People were reading it online and there wasn’t even an announcement.”

On Monday, facing an outcry from employees, fans and politicians, the company’s board voted to delay the planned April 13 shutdown by two weeks while it considers its options. General artistic director and CEO Ian Campbell had previously said that it’s important to “go out with dignity, on a high note with heads held high,” rather than witness a prolonged downsizing and cutting back on quality. Ticket sales have declined 15 percent since 2010, ticket revenue has dropped about 8 percent, and big donors are harder to lure.

On Tuesday,  the American Guild of Musical Artists, the singer’s union, filed the second of two unfair labor practice charges against the company.

Chut tells Conducting Business that San Diego Opera has declined to consider alternative business models to stay afloat, relying instead on "a paradigm of grand opera that probably is from the ‘70s or ‘80s, in which regional companies represented a miniature version of the Metropolitan Opera, where you bring in big sets and big stars and have a big orchestra. If they’re going to do that business model or that artistic model, it’s probably not viable over the long run.”

Chut believes that the future of regional opera lies in nimbler alternatives, whether it’s using black-box theaters or collaborating with theater companies. He cites the Opera Theater of St. Louis and Fort Worth Opera, two regional companies that reinvented themselves as spring festivals after decades as main-season enterprises. Chut also questions the need to stay in the San Diego Civic Theater, a plush 1965 venue with seating for nearly 3,000 patrons.

“It seems like they’re tired,” Chut said of the board and administration. “The opera is in the black. They have cash reserves. They don’t have an accumulated deficit. But they are facing fundraising challenges of maybe having to raise $10 million next year."

The company has given no indications yet of next steps. But whether they can attract investors after raising doubts about the Opera's viability remains a significant question. "San Diego is the eighth largest city in the United States," said Chut. "What does it say about us if we can’t have an opera company?”

Listen to the full podcast above and please leave your comments below: What do you think is the right model for small opera companies in 2014?