MECHANICSVILLE, NY - Tom Zepperi of Taz Amusements has strong opinions about the music business, and he's not afraid to share them. "This industry is stuck in the mud, and it's not because manufacturers fail to give us the proper tools , it's because operators don't keep up with the times in terms of technology and pricing," charges the 36-year industry veteran. Zepperi operates 11 Rowe-Ecast "NetStars" and 80 Rowe CD boxes, and he is passionate in his defense of the downloading product.
"It's a sleek-looking, well-built machine that will last a long time" he says. "I was one of the first to use the Rowe-Ecast jukeboxes. I can't say enough good about it; the earnings are just phenomenal. They just do great business. Is 'NetStar' right for everyplace?" Zepperi asked rhetorically. "No, but it's definitely right for your best places. It's for the aggressive operator who installs top-quality speakers in top locations and insists on no competition from live entertainment, TV, or other recorded music. Under those conditions, it's a huge success."
Operators don't necessarily have to run huge routes to make a go of downloading music, Zepperi said. "We're a mom and pop operation that runs lots of equipment in a hands-on fashion," he observed. "Jukeboxes are our staple in tavern locations, one of the best ROI pieces on our route without a doubt." He admits the cost of investment can be high, but goes on to say that ROI is quite impressive. "By the time you install a 'NetStar' with top quality speakers, it may cost $10,000 but I've had $700 to $800 a week from a jukebox with an aggressive approach," he asserted. "One 'NetStar' made $25,000 in 14 months in a single location. That's a steady $500 a week, all the time."
Average-earning CD jukebox locations can sometimes be transformed into top-grossers with downloading music, Zepperi added. "I like to see 'NetStars' installed in places with marginal business, because it boosts business way high," he said. "Collections in these places on my route are now in high numbers thanks to 'NetStar' and they only vary 8% to 10% from week to week."
The ability to charge , and get , higher play pricing is a key factor in Zepperi's success with the Rowe-Ecast product. "I charge $1 for single song download and location customers don't mind paying and listening," he said. "Some industry people joke about the MasterCard and Visa swipe slot, but people use it. It's also a great alternative to use if the bill validator breaks down. We tell the bar owner to put his credit card in and buy some credits, then we repay them later."
Sharing some of the jukebox's income is a sacrifice that Zepperi is willing to make, because he says his bottom line is much better with downloading. "Many operators look at that 20% that goes to the manufacturer and that's all they see," he said. "I don't like paying it either, but the Internet gives us so much flexibility and it's well worth it for the greater earnings. Locations may frown at first but after they see the income, they stop frowning."
The cost of music updates via downloading also compares favorably to updating via CD purchases, in Zepperi's view. "Spending money on CDs to load a new jukebox is $1,500 before labor and setup and location requests, which can make the setup price $2,000," he said. "Setting up a downloading box costs nothing. Spending money for specialty CDs for St. Patrick's Day is a waste of money because customers often don't realize it's there. But the Rowe-Ecast touchscreen displays a shamrock to let them know. At Christmas the screen shows a holiday wreath. And yes, it does cause customers to play those specialty songs more."
Reliability and ease of music updating are important factors in Zepperi's favoring downloading music with the Rowe-Ecast machine. "Technical reliability of 'NetStar' is excellent, as is music selection," he said. "Every week they send us faxes to let us know what new music is available. I hook my 'NetStars' up to the Roadrunner cable service so downloading music is very reliable. Rowe does things for me above and beyond the call of duty, such as adding lighting to draw customer attention to the bill acceptor, which was originally hard to see. The Ecast guys are there all the time, talking you through any question you have."
Remote service and control capability can save an operator considerable time and money, Zepperi said. "At midnight recently I got a service call from a place 70 miles away," he related. "The jukebox wasn't taking money. My wife got on the computer and saw the problem: the bill stacker was full of currency! I called Ecast and they put the machine on free play until I could get there the next day. That saved me at least $50 in service costs, so what did I lose? The location kept his crowd happy and I didn't have to drive 140 mile round trip in the middle of the night."
When Zepperi advocates "aggressive" operating tactics, he means eliminating competing forms of entertainment and working with locations to actively promote jukebox play. "I am very selective about where I install any kind of jukebox; I allow no background music and no live entertainment, no radio, and no sound on TV except for special events," he said. "I write that into the contract. Background music makes people think, 'Oh, there's music playing so I won't put money in the jukebox.' Little things like that make a night-and-day difference to collections. I took a location that was doing $100 a month with a conventional CD jukebox; now it's doing $400 a week with 'NetStar' because we eliminated other forms of entertainment. The location owner is a happy man."
Enlisting bartenders and waitstaff to actively promote jukebox play is a key strategy as well. "We give them promotional money to put in the machine to get things going and create that atmosphere," Zepperi said.
Operators who complain that jukeboxes only make $150 a week, often are guilty of selling music too cheaply , and, worse yet, they are guilty of allowing other forms of entertainment to compete with the jukebox, Zepperi claims. "Since the jukebox is off when the TV or background music system is on, it's like trying to make money in a location that's closed," he pointed out. "It should be a big clue to operators when your pool and video games are earning consistently across your route, but music earnings are down in a particular spot."Zepperi does not hesitate to criticize his fellow operators for, in his view, failing to keep up with the evolving market. "There are major cities in my territory that don't even have a single downloading jukebox yet, or just got their first one a month ago," he said. "There are still guys around here operating 45-RPM vinyl boxes! Downloading is the wave of the future , no ifs, ands, or buts. If operators don't step up to the plate, they are missing the boat. It took me about six months to get the hang of it but now , as you can probably tell , I'm sold!"