F1-ed OVER: Grand Prix to Wreck Las Vegas Show Revenue Again

Posted on: November 21, 2024, 04:41h. 

Last updated on: November 21, 2024, 08:54h.

It’s not only restaurants and casinos that are taking a huge business hit from this week’s F1 Las Vegas Grand Prix, though they’re the only ones that have sued so far. The operators of Las Vegas’ many production shows are feeling a sting in their balance sheets for a second time.

The issue is that, unlike other big events that come to town — such as the Super Bowl and National Finals Rodeo — F1 hijacks Las Vegas’ main thoroughfare to use as its performance space. This seriously hampers efforts by tourists and even employees to get and enter any resort on the Las Vegas Strip in a timely fashion.

Either because show-seeking tourists avoided Las Vegas during the inaugural F1 Grand Prix, were daunted by the maneuverability issues, or because they couldn’t physically get to one of the Strip’s Tix4Tonight kiosks to buy discounted day-of tickets, show tickets barely sold, resulting in huge operating losses.

So, this year, most producers gave up and went dark. Cirque du Soleil canceled all performance of “Mystere” at TI, “O” at the Bellagio, “KA” at the MGM Grand, “Michael Jackson ONE” at Mandalay Bay and “Mad Apple” at New York-New York until Sunday.

The same goes for Shin Lim’s magic show at the Palazzo, “Awakening” at the Wynn, Carrot Top’s comedy show and the “Fantasy” burlesque revue at the Luxor, and “Menopause The Musical” at Harrah’s.

All shows at the V Theater in the Miracle Mile Shops (“Zombie Burlesque,” “The Mentalist,” “V — The Ultimate Variety Show,” “Lioz — Master of Delusion,” “Big Black Comedy Show,” and “Purple Reign: The Prince Tribute Show”) were scotched.

And Spiegelworld canceled its “Atomic Saloon Show” at the Venetian and its new “DiscoShow” at the Linq for the entire week — though its most popular offering, “Absinthe,” is still running its Caesars Palace performances, just earlier than usual.

In fact, the only major acts performing this weekend will be David Copperfield, on Friday and Saturday at the MGM Grand, and Adele, who ends her “Weekends With Adele” residency on Saturday after 100 shows.

Race to the Bottom

Producers of the larger shows typically split the costs and profits of shows with the resorts that host them. But most Strip resorts will see higher-than-normal room rental revenues from F1 for the week, which will offset their diminished show profits.

The producers have no such luck.

While no Las Vegas producer likes exposing how much money they make or lose to the public, Spiegelworld is as unique in this regard as it is in dozens of others. Last year, its founder, Ross Mollison, admitted that F1 cost his company $500K in decimated sales. And that’s based on average audiences of 200-300 per show. In contrast, Cirque du Soleil can draw audiences of up to 9,000 to its shows.

So we’re mostly likely talking about tens of millions in entertainment revenue lost to F1 last year, and once again this year.

Though the idea of F1 subsidizing businesses for their lost revenue has been floated, it has yet to happen. Most likely, this is due to the overwhelming number of claims F1 would face if it opened that floodgate.

So far, only smaller casinos and restaurants, such as Ellis Island and Ferraro’s, have gone as far as suing F1 over their easily demonstrable revenue dips.

That’s not a route that any entertainment producers have decided to take … at least not yet.