Almost 300,000 will swing to Taylor Swift this week. Only a fifth of the 1.5 million who sought tickets were lucky. Over two billion more will watch it on streaming platforms.
The impact on Singapore’s tourism has exceeded expectations. Even three-star hotels in Geylang charge $400 a night. Some of these establishments charge by the hour.
Additionally, Michelin-starred restaurants at the Marina Bay Sands have endless waiting lists.
The revellers at the concert should never forget Colonel Tom Parker. He was an illegal Dutch immigrant to the US who was the mastermind behind mass concerts.
Parker is best known as Elvis Presley’s manager. His impact on entertainment was immense, but his origins were modest. He was born Andreas van Kujik in 1909 in a small town in Holland. His father was a delivery man — a predecessor of today’s Grab delivery men.
Parker went to America as a teenager after his father died. He jumped ship in New York. He found work as a carnival promoter. Like many immigrants, he adopted a new identity.
Tom Parker rolled off the tongue easier than his birth name. Though he had never become commissioned, he called himself Colonel. He went from town to town in the South with a travelling circus. He sometimes had to make do with just an income of US$1 a week.
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In 1955, his fortunes changed. He heard about a 19-year-old rock’ n’ roll singer in Tennessee named Elvis Presley. Like Taylor Swift, the youngster had a rare voice and risqué performance style. Parker viewed Presley as an entertainment machine. The shrewd promoter propelled Elvis’s career to unscaled heights.
Parker’s genius was negotiating juicy terms with record companies and Hollywood studios. By 1972, Elvis was the greatest entertainer in the world. He made the equivalent of US$1 million (or $1.3 million in today’s money) a week. The cigar-smoking and overweight Parker got half his earnings.
Elvis had accumulated an army of fans abroad. Parker had no passport because he had entered America illegally. Unlike Taylor Swift, Elvis had never performed abroad and his manager could not venture overseas.
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Entertainment economics
Parker found a new technology that could boost Elvis abroad without requiring him to go through immigration. Unlike Taylor Swift, Elvis never performed abroad. Satellite TV broadcasts had just taken off. In 1969, the landing on the moon was televised live worldwide.
Parker devised a mass concert in Honolulu, Hawaii. Hawaii is closer to Tokyo and Sydney than to New York. Its location and time zone made it ideal for the first concert beamed worldwide. The tropical city had ample hotel capacity, as does Singapore today.
The concert was called Aloha from Hawaii via Satellite. It was broadcast live to Asia and Oceania on Jan 14, 1973. The show was broadcast later in Europe. It overlapped with the Super Bowl in the US. NBC broadcast it a few weeks later.
The show earned outstanding ratings. Even the moon landing was eclipsed. No other event had reached as many people. Elvis and Parker made US$6 million (in today’s money from the event). The Hawaii economy made multiples of that amount.
Parker’s Hawaii event unleashed the concert economy worth US$526 billion. Meanwhile, Taylor Swift’s concert has cemented Singapore’s status as Asia’s entertainment capital. Singapore could make US$350 million to US$500 million from the concerts, this is much more than Taylor Swift’s largesse. Singapore may now host iconic events every quarter.
The hotels, taxis and restaurants are the beneficiaries of the avalanche of visitors. Tourist arrivals are still below 2019 levels and may be about to explode. Far East Hospitality Trust Q5T , which owns prime hotels like the Oasia and Rendezvous, trades at a 6% yield but is still 20% below its pre-Covid-19 level. Its operating income could rise to 25% higher in FY2024 than 2019 levels.
Taxis are hard to come by these days. This is not reflected in ComfortDelGro C52 ’s stock price. Its taxi revenue could rise by 30% y-o-y in FY2024. A 5% dividend yield may entice more people for the ride.
There are also F&B stocks like Jumbo Group 42R that have floundered since Covid-19. They may be worth a try as tourists swarm to Singapore. Tickets for the concert are as high as $2000. Investors may be better off watching the stocks jump like Elvis in 1972.
Nirgunan Tiruchelvam is head of consumer and internet at Aletheia Capital and author of Investing in the Covid Era. He owns ComfortDelGro shares
