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Robert Kremer used to fancy himself as sort of the next Hilly Kristal.

“We get CBGB’s business!” he proudly informed The Observer last summer.

The longtime proprietor of the Pussycat Lounge on Greenwich Street, who is sometimes likened to the actor Bob Hoskins with a Russian accent, was referring, of course, to the famously run-down yet highly revered rock ’n’ roll venue on the Bowery, which was opened in 1973 by the unlikely godfather of the New York punk scene, the late Mr. Kristal, and closed in 2006 after a lengthy legal dispute over hefty rent hikes.

Picking up some of the sonic slack in CBGB’s wake, Mr. Kremer was hosting up to six bands a night, six nights a week—some nights even double-booking!—in his upstairs “Catbar” on a makeshift stage cobbled together with tables from the defunct restaurant he used to run in the same space.

At the time, he claimed to be profiting more from the bands than from even the topless dancers strutting the catwalk downstairs in his old-timey gentleman’s club.

“Our main business, believe it or not, is from the music,” Mr. Kremer insisted. “The musicians, more than anyone else, do drink.”

Six months later, he’s not singing the same old song: “The rock people, they don’t drink enough!”

Or, at least, not frequently enough, or in consistent enough numbers, as far as Mr. Kremer is concerned. The club began regularly bumping bands this past December in favor of a DJ and two-for-one cocktails.

A pair of electric guitars still hangs above the cash register, but no one seems to plug ’em in anymore, save for the occasional Saturday night.

“I figured people would love to see [live bands] compared to everything being canned and, you know, the iPod,” Mr. Kremer told The Observer this week. “We get some bands, every couple of weeks they’re here. One day, they draw a mob. The next day, not even their girlfriends show up!

“I’m not the only one that’s having problems with the live bands,” he added.

Indeed, many live music operators have experienced even bigger problems in recent years: In addition to the shuttered CBGB, Tonic, a respected stage for avant-garde musicians on the Lower East Side, closed last April, citing skyrocketing rents and a “debilitating” regulatory environment.

The Continental, another mainstay of the East Village punk scene, where such legendary performers as Iggy Pop and the Ramones once played, abandoned live music in September 2006 in an attempt to simply stay afloat. The venue now focuses on the basics of bar survival: cheap drinks, a pool table and sports on TV.

Trigger, the club’s owner, complained to The Village Voice about all the overhead involved with the bands: “sound people and booking people, advertising, maintaining and repairing the PA and other equipment. It’s expensive, and for every great night there are 10 or 15 slow ones, because the arts scene, especially when it comes to rock ’n’ roll, just isn’t what it once was.”

LIVE ENTERTAINMENT VENUES in Manhattan, in general, continue to fold in the face of increasing operation costs and intensifying real estate and regulatory pressures.

This past October, Mo Pitkin’s House of Satisfaction, a staple of the Lower East Side’s burgeoning burlesque scene, shuttered its doors after just two years in business. Its owners said steep mortgage payments were eating into the entertainment profits. The building is on the market for $4.9 million.

Closing rumors continue to dog nearby Rififi on East 11th Street, where owner Robert Goldsmith has put on a variety of live shows, ranging from comedy to burlesque, and has racked up 19 noise citations since 2006. His landlord is now actively seeking someone to buy out his lease.

It’s just a tough business, Mr. Goldsmith told The Observer: “This is not a way to get rich, I’ll tell you. When you go out to conquer the world, don’t open in New York City. There’s a lot of costs and competition and dealings with city government.”

“Almost every bar has one person who makes it their life’s mission to get the bar closed down,” he added.

Richard “Handsome Dick” Manitoba can relate. The former Dictators singer’s eponymously named Manitoba’s bar on Avenue B still hasn’t resumed its weekly live-music shows since pulling the plug last March after racking up $6,400 in fines for noise violations. Manitoba’s once hosted bands seven nights a week but later scaled back the number of live shows because, to put it simply, “it’s a different neighborhood,” Mr. Manitoba has said. Even limiting bands to one night per week didn’t prevent some cranks upstairs from calling in the city’s quality-of-life cops.

“The city cracks down on things, just to give bars fines—that’s what kills the new businesses,” said Joi Brozek, former co-owner of the Lucky Cat rock club in Williamsburg. “If you’re barely making rent and then you’re slapped with a $1,500 fine, you’re almost doomed to fail, especially when you’re dealing with music because then everyone comes out of the fucking cracks like cockroaches.”

Beyond city regulators, there are investigators from private industry, too, scouring clubs in search of cover bands and DJ’s who perform copyrighted music without the proper license.

Ms. Brozek saw her fair share of both forms of enforcement before selling her stake in the Lucky Cat in 2006.

“We soundproofed the whole fucking thing, we listened to the neighbors, we tried to do what we could do within our ability—it never was enough,” she said. “That’s the unfortunate thing with, you know, gentrification, and yuppies moving in and being able to afford to come to your place and spend money. It also means that they want it quiet by the time they want to go to sleep.”

She was relieved that the cranky-neighbor problem, at least, wouldn’t be an issue when she started booking bands at Mr. Kremer’s Pussycat Lounge in November 2006.

“The cool thing about Pussycat was that Robert lived upstairs,” she said of the club’s eccentric owner, “so we could have music going until, like, four in the morning, really loud. As long as there was business, he never really interfered.”

Yet, as the rock crowds ebbed and flowed, the frustrated proprietor began seeking a more consistent form of revenue. The resulting encroachment of happy-hour crowds on the bands’ pre-scheduled showtimes prompted Ms. Brozek to stop booking future shows there altogether. “I need something on a steady basis,” explained Mr. Kremer, who has spent the past two years battling his club’s possible closure through the court system. (He is contesting the building’s 2005 purchase by hotelier Sam Chang, who wants to kick him out and tear the club down.) He isn’t paying rent at the moment, but he still has to pay his lawyers.

“The real estate pressures are what make the owners pissed off if there’s an empty room,” said Ms. Brozek, who has since resumed booking live bands and burlesque shows at another venue, Lucky Cheng’s Fortune Cookie Cabaret in the East Village.

“The reality of it is, live music isn’t much of a moneymaker,” she said. “If it was up to me, and somebody said, ‘What would be your ideal business?’ I would say, a straight-up bar, and that’s it, because, really, live music is a ton of headaches.”