Brian Lipton, Chief Theater Critic for

The announcement that long-running Phantom of the Opera would be closing on Broadway after 35 years was a reminder of the importance of the business aspect of “show business.”


There is a symbiotic relationship between the New York City economy and the health of Broadway. The last full theater season – 2018-2019 – saw ticket sales of $1.8 billion. That is more than the combined amount of the ten major league sporting teams in the New York City area


There are two different aspects of making money on Broadway. All shows first need to be capitalized for the upfront costs: rehearsals, scenery, renting a theater for the pre-opening time, paying actors during rehearsal For a large musical, capitalization costs can easily run $15-$25 million. A show needs to earn back those costs to make a profit. Post-opening, the weekly running costs include paying actors and behind-the-stage personnel.


Will another show run 35 years? Two possible contenders: The Lion King  and Chicago. Each has a different draw for audiences: The Lion King is family-friendly, and Chicago is written in such a way that it is able to put non-traditional theater performers, such as Pamela Anderson, in a prominent role. Rather than hope for another long-running show, producers will likely continue to rely on producing revivals or adaptations, with few shows based on original material.

POC: I’m Patricia O’Connell for This is Capitalism. Today I’m talking with Brian Lipton, who is the Chief Theater Critic for and the former editor-in-chief and currently a contributing editor to He is going to take us behind the scenes at Broadway and give us a little bit of a look about what’s going on with Broadway, the return to Broadway for both actors and theatergoers. Brian, thanks so much for joining us today on This is Capitalism.
BL: Thanks for having me, Patricia, I’m very excited.

POC: Well, Brian, I was not excited to see that Phantom of the Opera is closing. To me that was shocking, it was one of those things that you just thought would always be there. What does the closing of Phantom mean or signify for Broadway or is it just time for a 35-year-old production to close?
BL: I think it’s a little bit of both. I mean, like you, I think we all believed that it would be now and forever and ever and ever. And because it has made its money back so many times over we were aware that Cameron Mackintosh, its lead producer, could run it pretty much as long as he wanted to, regardless of whether it kept making money. In fact, with its closing notice, its grosses have soared to its highest in years.

But I think the reasoning behind it is, and this is the larger Broadway picture in general, is that this winter, January, February and probably to some extent March, which are always the toughest months for theater to survive –

POC: And just to clarify, Brian, when you’re talking about this winter, we’re talking about the upcoming winter season, January, February, March 2023?
BL: Yes. So because of the fact that I think New York seems…certainly there are fewer tourists than ever and winter is certainly not the tourist season because there are certainly fears that Covid could reoccur in larger numbers this winter, and because in general the local audiences, which are really supporting Broadway at the moment, are the least likely people to buy tickets in advance during the winter months.

POC: You said a really interesting thing about how he has made his money back many, many times. Can you talk a little bit about the economics of a Broadway show?
BL: There are two different aspects of making money on Broadway with a show. All shows are what they call capitalized, which is really the amount of money it takes to put the show on from start to finish. And that’s rehearsals, hiring of scenery, renting a theater at the beginning, paying actors, certainly, during the rehearsal, things that are up until day one. And of course with inflation, capitalization costs are higher than ever. So for a large musical now $15-$20-$25 million is not an unusual capitalization. And you have to make that money back during the run to get a profit.

On top of that, you have what are called the weekly running costs, which are paying the actors, paying the union, you know, all this. Not things like building the set, that’s already done, but you still have to pay rent, pay actors, pay union people, all that. So you have to do that every week and make that money back. And again, let’s talk about a musical like Phantom, that’s estimated to be in the $750,000 to $1 million dollar range because Phantom is a very elaborate show to make every week just to break even.

POC: Are the economics such that they have to run at 100 percent capacity for every show to break even every week?
BL: If you’re doing a limited run, which are more and more common…that’s often built in that you need to be running pure capacity.

Just this season we had Into the Woods, which is still at the St. James, but it was originally scheduled for only an eight week run and the only way that could’ve ever made money at eight weeks, and I’m still not sure it’s going to make money even though now it’s running a longer period, until January, is if those eight weeks it ran 100 percent. And it did come close to that. It’s no longer coming close to that.

The longer the run goes on, sometimes the less you have to make that 100 percent. But you can’t do badly, you have to still pack a fair amount of the house and a fair amount of the house at full-price tickets if you’re going to meet your running costs. And the minute you don’t do that, you run the risk of being in the red.

POC: How does the discounting of tickets factor into the profitability or the lack thereof for Broadway shows?
BL: It’s a major factor. You know, if you’re selling 1,000 seats at, shall we say, $60 or $70, so you’re making $700,000 a week instead of at these current prices making $2 million a week..

A show like The Music Man is a perfect example. It doesn’t really discount, it doesn’t need to, and so it is taking in over $3 million every single week. That will help it become profitable by the time it closes. But were they selling those tickets at 50 percent they wouldn’t even have a chance.

POC: Was Music Man expected to keep running?
BL: Obviously, they had the option of running after Hugh Jackman decided to leave. And he is actually staying, from what I gather, a few weeks past his actual contract. I think this has been done before when you have a star who is that powerful. I mean there is no other Hugh Jackman at the moment. So maybe the wisest business move, even if you could still theoretically make money – I mean it’s a very expensive show with a large cast – is basically to take the good money and just go.

POC: Well Hugh Jackman, to your point, I think is really an unusual if not unique case because he has a huge movie following from the Marvel movies.
BL: Yes, he is one of those rare people who is a true, true movie star and he is a true theater star even though he has only been on Broadway three or four times, most notably, of course, in The Boy from Oz, his big Broadway debut. But he has created a huge following. And so there are people who go back to see him four, five, six times. I mean he really engenders repeat visits. And I can probably count on one hand the number of stars who do that.

POC: It’s interesting because it seems that there are shows that have always done some what they call I guess stunt casting. You’ll see, for example, Pamela Anderson doing Chicago. No one thinks of Pamela Anderson as a Broadway star.
BL: First of all, I want to point out that I saw Pamela Anderson and she was actually really quite good, given her own limitations. But more to the point, she brought in business. She had the highest grosses for Chicago in many, many, many, many months if not years. And that was a perfect example of a right way, in a way, to do stunt casting. People were so curious, I think, to see what she could do that they actually showed up.

POC: Do you think that more shows will include stunt casting? If they’re going to write more shows or produce original shows, do you think that they will deliberately write stunt casting parts in there, you know, so you can get a big name to come for maybe six weeks?
BL: I don’t know about deliberately writing it but yes, what I do think is a lot of Broadway will be dominated, especially straight plays maybe more than musical, by what I call star casting, whether it’s stunt casting or not. I think in a lot of cases they’re going to look for that star power to motivate the box office.

Now conversely we have the new musical Some Like It Hot coming starring three people, Christian Borle, Adrianna Hicks, and J. Harrison Ghee, who their talents notwithstanding, all brilliant, could sell five dollars between the three of them. There they are banking on the property and they’re definitely promoting the careers of Scott Wittman and Marc Shaiman, who wrote the score. They have Tonys for Hairspray and they’re very well known. So they are almost the star attraction here. Whether this works remains to be seen.

I don’t think for the first part, to answer your question, sadly we’re going to see a whole lot of truly original work on Broadway for a while. I mean, I think everything we’re going to see is based on a movie, on a book, on some other thing. It’s a revival of a famous play. Really stuff that comes from scratch is few and far between.

POC: This ’22 to ’23 will be the first “normal” Broadway theater season that we’ve had in several years now. I mean the 2019 to 2020 season got cut short, of course, because of Covid. So what are we seeing now?
BL: What we’re seeing is a lot of flux, to be honest. In fact, this is a very unusual year in that we have a number, at least five, I believe, shows opening in December, including one, The Collaboration at Manhattan Theater Club. It’s an imagined conversation between Andy Warhol and Jean Paul Basquiat. It’s in London right now. It’s also being filmed simultaneously and it’s coming in for a limited run. So by the end of this year, Broadway will be surprisingly full.

That said, as a corollary, two things, but shows are closing. January will bring the closings of Beetlejuice, which tried to re-up again and closed after eight months. A Strange Loop, which won the Tony this year, in 2022, for Best Musical, is closing on January fifteenth, which will make it, depending on how you count things, either the shortest or the third-shortest running Best Musical ever. There are possibly more closings on the way. Obviously some of what’s playing now is also limited runs.

And then of course as you said, Phantom closes in February. But what I find most interesting is spring is usually the more prominent season than fall. Again, better weather, maybe more tourists, and closer to Tony time. Almost all of the really, really big musical houses, The Winter Garden, the Marquis, the St. James, I could go on, are vacant for the spring.

And I wonder, and this is really more speculation, if producers are to some extent hedging their bets. So Back to the Future, for example, is the kind of show that I would suspect would probably have to take a million to a million and a half every week to just be in break-even territory eventually.


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About Patricia O’Connell: Patricia O’Connell serves as Editor in Chief of “This Is Capitalism,” a content site sponsored by Stephens Inc., and is host of the site’s podcast series, “CEO Stories.” Patricia, a former editor at BusinessWeek and a New York Times best-selling author, brings her experience as a journalist and her passion for storytelling to “This Is Capitalism.”