Nov. 28 (Bloomberg) -- La Scala’s opening night of the season, the Milanese social event that brims with VIPs, fur coats and diamonds, may be canceled for the first time in four decades as musicians protest labor contracts.

The premiere is a key source of funding for Italy’s most famous theater, which makes about 2 million euros ($2.6 million) from the evening gala that is always held on Dec. 7, Milan’s holiday celebrating its patron saint, Ambrogio.

The FIALS union, representing almost half of La Scala’s orchestra and choir members, is rejecting contracts accepted by about 90 percent of the company’s employees in October, and is seeking a bigger share of the opera house’s earnings from broadcasting. Management refuses to negotiate further.

“On July 23, we informed La Scala that we were going to strike during the first three shows of each ballet or opera,” Sandro Malatesta, local head of the FIALS union and a retired Scala trumpet player, said in an interview. “This also applies to the first night and we’re ready to go ahead.”

La Scala says its finances don’t allow it to give the artists more money. FIALS’s strikes already canceled three “La Dame aux Camelias” shows last month and three performances of “The Merry Widow” this month, costing the theater 600,000 euros. The season- opening new production of Verdi’s “Don Carlo” is now at risk.

La Scala is no stranger to labor protests. Then Musical Director Riccardo Muti was ousted in April 2005, two weeks after 90 percent of the opera house’s workers demanded that he step down following his dismissal of General Manager Carlo Fontana. Dancers protested the size of their changing rooms in 2005, while striking musicians caused some cancellations last autumn.

‘Optimistic’ Outlook

“I’m convinced that La Scala will face and overcome this situation,” Managing Director Stephane Lissner, who was confirmed this month in his post until at least 2013, told reporters on Nov. 25. “I’m as always an optimistic person.”

La Scala spokesman Carlo Maria Cella added that no more discussions are planned. Cella said he couldn’t confirm that Italian Prima Minister Silvio Berlusconi, Russian President Dmitry Medvedev and Argentine President Cristina Fernandez de Kirchner are planning to attend the gala opening, as reported on Nov. 25 in daily Corriere della Sera.

Three other unions representing La Scala staff accepted the new contract in October. The total benefits and wages package for 2008 to 2011 is worth 11.5 million euros, the opera house said. The theater may break even in 2008 for the fourth straight year unless strikes cause more disruptions, it said on Nov. 17.

Blockbuster Cancelled

La Scala, which was forced to cancel a potential blockbuster production of Giordano’s “Andrea Chenier” in the summer, is trying to battle the credit crunch by seeking new audiences. Plans include subsidized shows for young people, like the Dec. 4 preview of Don Carlo for those aged under 26, and big-screen performances.

Many of the world’s major opera houses are fighting accusations of elitism and criticism of high prices as they tap tax money to survive. La Scala is partly funded by taxpayers. The cost of a good opera seat -- from 180 euros to 224 euros -- makes it impossible for many people to attend. Stalls seats for the opening night cost 2,000 euros.

La Scala regularly draws top international singers, conductors and directors, despite the audience’s notorious tendency to boo anyone they don’t like.

Opening Night

The Dec. 7 gala opening has been a tradition for the past 42 years.

The theater, which was bombed by Allied forces in 1943, was refurbished and modernized between 2001 and 2004. It has about 1,000 staff, including part-time workers, and 713 of them ratified the July 30 contract. FIALS members comprise about 65 of 135 orchestra players and 30 of the 105 choral staff.

The new “Don Carlo,” the four-act version of Verdi’s 1867 grand opera, features Giuseppe Filianoti and Stuart Neill as the eponymous hero, and Fiorenza Cedolins and Micaela Carosi as Elisabeth de Valois.

The season’s other new productions are Handel’s “Alcina,” directed by Robert Carsen; Stravinsky’s “The Rake’s Progress”; Janacek’s “The Makropoulos Case” and Monteverdi’s “L’Orfeo.” Moscow’s Bolshoi company is also visiting with a new “Eugene Onegin.”

Barenboim’s ‘Aida’

Revivals include Wagner’s epic “Tristan und Isolde,” the dimly lit, gray production by Patrice Chereau and Richard Peduzzi that opened the season last year; Verdi’s perennial favorite “Aida,” which will be conducted by Daniel Barenboim; and the great Italian composer’s more rarely performed early work “I Due Foscari.” Rossini’s seldom seen “Il Viaggio a Reims” and Mozart’s classical “Idomeneo” are also being revived.

Ballets include “La Bayadere” over the holiday season, “Coppelia” and “Giselle.” Makhar Vaziev, former artistic director of the Kirov/Mariinsky Ballet, will start as director of La Scala’s ballet company in January.

“I hope good sense prevails, otherwise all the employees will be hurt,” Milan Mayor Letizia Moratti told reporters in November. “As mayor, as president of La Scala and as a citizen of Milan, I can’t help but be deeply concerned about what’s happening.”

To contact the reporters on this story review: James Amott in Milan at jamott@bloomberg.net Chiara Remondini in Milan at cremondini@bloomberg.net

Last Updated: November 27, 2008 20:26 EST