Global Economics

Rolling Stones in China: the Outside Story


When a well-connected friend in Shanghai told me he could score some really excellent tickets for the Rolling Stones long-awaited debut concert in China on Apr. 8, I was in a state of rock 'n' roll nirvana. "These are really V-V.I.P. tickets," he assured me a week before the concert. It looked like I was the beneficiary of China's deeply ingrained business and personal networking phenomenon called guanxi.

Just about any foreign executive who hits the ground on the mainland these days has heard something about guanxi. Unless you invest a lot of time cementing relationships with suppliers, retailers, bankers, and above all, government officials, it is tough to work through the myriad official and unofficial barriers that govern commercial activity in China, or so the conventional wisdom goes. Even in the personal sphere, connections matter greatly, especially if you want coveted tickets to see Mick Jagger and the lads strut their stuff at a sold-out gig in Shanghai.

As it turns out, my position in the great guanxi pecking order wasn't as exalted as I thought. When I arrived at the Shanghai Airport a few hours before the show, I learned that my VVIP tickets had gone to a dreaded VVVIP. I was shattered.

WAITING ON A FRIEND. Undeterred, I started making calls to other nodes on my personal guanxi network. I tried a friend of a friend who worked for one of the show organizers, but she couldn't help. I'd called too late, and there wasn't much to do except hit the cash machine and brace myself for Shanghai's scalpers, a notoriously tough bunch. The only connection that matters with these guys is the size of your wallet.

The 8,000-seat, Grand Stage venue in Shanghai had sold out, and scalpers were selling tickets for as much as $480 a piece. That might not sound like much to diehard rock fans in the West, but it's more than most Shanghai denizens make in a month. Indeed for all the talk of the cultural significance of the Stones bringing their brand of bad-boy concert antics and renegade music to China, the concert crowd was dominated by Westerners.

(Chinese Stones fans unwilling to part with that kind of cash to see the band live will be able to watch a free broadcast of the concert to be aired by the Chinese state-owned broadcaster, CCTV, in mid-April.)

FAR AWAY EYES. I was running into foreigners from all over Asia who had flown in for the concert. There was an old American friend and his wife from Saigon, another guy in from Bali, and one inveterate fan in his 60s who arrived straight from Chicago, taking a limo straight to the Shanghai stadium. One Japanese businessman had flown for his 29th Stones concert.

No wonder Sir Mick had quipped to the international press that the show was being staged mainly for the benefit "of expat bankers and their girlfriends." That comment probably didn't go over terribly well with Deutsche Bank, the show's main sponsor.

One of those girlfriends was Zhong Feng Ying, a twenty-something native of Shanghai who arrived at the concert on the arm of a Western man many years her senior. Sporting high heels and a traditional high-collared silk Qi Pao dress with a daring slit, Zhong said, "The Rolling Stones are the best rock 'n' roll band in the world." Could she name any songs? Well, no actually. How about the second best band, I queried. "Ray Charles," she replied.

HEARTBREAKER. To be fair to Zhong, access to Western music of any kind is a very recent phenomenon made possible by the Internet and music downloads. International record companies have long been constrained in the number of CDs they can release into the Chinese market, and rampant counterfeiting has made it difficult for music labels such as EMI and BMG to penetrate the market.

As Zhong sashayed into the stadium clutching her VIP ticket, the scalper scene outside started heating up. If anyone still needed convincing of China's full embrace of the market economy, there's nothing like a rock concert to bring out those fabled capitalistic animal instincts. The first tout offered me a $375 ticket for $500. Five minutes later premiums gave way to discounts, with a $225 seat offered for $150. Prices were going up and down faster than the Shanghai stock exchange.

Suddenly the scalpers went into a huddle to form a cartel. When they emerged, prices went back up to a 30% premium. Soon the buyers -- virtually all of whom were foreigners -- were circulating the latest market prices among themselves. Word got around that a lot of the tickets were actually counterfeits, especially the VIP tickets with no price on them.

MISS YOU. Market chatter gave way to more convivial talk, and people were sipping beers bought from a Chinese man who showed up with a couple of cases to sell to the ticket-hunters. One fan, a Russian named Anastasia, who works in sales and marketing at Nasdaq-listed flat screen advertising seller Focus Media (FMCN), joked "this is a great place for networking."

When the Stones finally kicked off the show an hour late with "Start Me Up," the remaining tickets got snapped up by a quick-moving few, while the rest of us watched. I spotted a teary 17-year-old named Zhu Ye Xiao leaving with her mother. A scalper had offered her the very last ticket for $100, at a 33% premium and then yelled at her for not being able to pay as much as the foreigners could, a major loss of face for the woman.

Were the Stones really worth it to the teen? "I don't know the Rolling Stones very much," she replied. "I just like rock and roll."

SAD, SAD, SAD. Meanwhile, I tried to rationalize my own failure to get in to the Stones concert, which I later learned featured a cameo appearance of Chinese rock legend Cui Jian, who was invited on stage to sing "Wild Horses" with the band. I took some comfort knowing that the Chinese censors had nixed some of my favorite tunes, including "Brown Sugar," "Honky Tonk Women," "Beast of Burden," and "Let's Spend the Night Together."

But later that night, when I caught a clip of the show on CNN in my hotel room, I couldn't help feeling disappointed that I'd come so close to witnessing history. I felt even worse the next day when I called a friend to see how she'd enjoyed it. "What, you didn't go? I thought you had tickets." When I explained my travails, she said. "Why didn't you call me? My husband helped organize the show and we had backstage passes." The guanxi fates can be very cruel.


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