Ticket revenue will allow Jazz Festival to draw 'name' acts
Silicon Valley/San Jose Business Journal - March 31, 2006by Andrew F. Hamm
Creating a bigger "buzz" -- and selling a few more hotel rooms -- is behind a plan to make fans pay to attend the 2006 Comcast San Jose Jazz Festival, organizers say.
A projected $5 admission charge for the Aug. 17-20 event will be used to add more well-known artists needed to grow the event and, by extension, the local economy, says festival director Bruce Labadie.
"We feel a responsibility to be an economic driver," Mr. Labadie says.
The 2006 headliner act, The Neville Brothers, is by far the biggest name ever scheduled to appear at San Jose's jazz festival, Mr. Labadie says.
"We are paying them twice as much as we've ever paid anyone," Mr. Labadie says. "In the long run, (charging a fee) is the best solution."
The Jazz Festival organizers have been getting pressure from the San Jose Convention & Visitors Bureau and the city of San Jose to make a bigger economic impact on the community.
"We need to find out what we can do to entice more people from farther away to attend these events," says Daniel Fenton, president and chief executive of the San Jose Convention & Visitors Bureau.
San Jose's 14 major hotels are still recovering from the dot-com bust in 2001. The hotels went over 70 percent average occupancy for the first time in five years in February, but hotel rates are still about half what they were during the height of the dot-com boom.
Although the jazz festival drew an estimated 160,000 people in 2005, most were day visitors who returned to their homes at night. Bigger acts are expected to bring in people from farther way who will stay at local hotels, eat at local restaurants and shop at local stores.
"The current model is not working anymore," says Geoff Roach, executive director of the San Jose Jazz Society, which hosts the annual jazz festival. Roach says the event has only been breaking even or losing money in recent years.
Organizers are predicting a 10 percent decline in attendance due to the $5 fee but expect crowds to grow in the following years as more well-known headliners make their way to San Jose.
"We don't have to get 'huge,'" Mr. Labadie says. "But we want to get bigger acts in order to ... create a 'buzz.' "
The 2005 San Jose Grand Prix, which drew 153,000 people to its three-day event, has led business and civic leaders to push existing San Jose events such as the Tapestry Arts Festival, the Pacific 10 Women's Basketball Tournament, Cinequest and the San Jose International Mariachi Gala Concert to grow. New events such as the Rock 'n' Roll Marathon, and the ZeroOne San Jose new media arts festival were developed with an eye toward bringing in tourists from outside the Bay Area. However, the Grand Prix acknowledged it lost several million dollars in 2005 and needed a $4 million subsidy from the city of San Jose to assure that a 2006 race would happen.
The San Jose City Council opened the door for the jazz festival to charge an admission fee when it repealed a long-standing city ordinance prohibiting organizers from charging for events held in a city park. That allowed the San Jose Grand Prix to charge admission for its three-day event last July.
"Their success opened some eyes," Mr. Labadie says.
The jazz festival tinkered with the idea of charging admission to a "VIP" area in front of its various stages while letting everybody else in for free but in the end decided that an all-venue ticket price would work better. The current plan calls for a free Friday concert, with separate $5 fees for Saturday and Sunday concerts.
The festival is offering free tickets to anybody staying at a local hotel as well as anybody taking the Altamont Commuter Express special weekend train to the event. In 2005, more than 1,200 people took the train to the weekend concert. ACE will also add a Sunday train to allow those East Bay residents to stay over Saturday night if they so desire.
The event, which has billed itself as the largest free jazz festival in the United States, has not made a final decision on whether to charge a fee. The festival's board of directors is scheduled to meet in April to make a final decision.
Besides drawing bigger name acts, the additional money will be used to create a barrier around Plaza de Cesar Chavez, set up a ticket-monitoring system and for Jazz Society programs.
The $1 million event has received about $250,000 in corporate sponsorships for the last few years. The rest of the money is made through concessions, mostly beer and wine sales.
Corporate sponsorship is expected to remain steady whether the festival charges or remains free, Mr. Labadie says.
While the festival lost Ford, Applied Materials and Chevron in 2004, the festival made that up with new sponsors, including Adobe Systems, as well as increased support from Southwest and Comcast Cable.
"We're not that far off from where we were last year," Mr. Labadie says.
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