Are music festivals a bubble waiting to burst?

Marketplace Contributor May 7, 2015

Are music festivals a bubble waiting to burst?

Marketplace Contributor May 7, 2015

Forget sweltering clubs and concert halls. Summer tours for some bands are now a matter of hopping from one grassy lawn to another.

Take the indie rock band Modest Mouse. This summer they’re playing at least 10 festivals in the U.S., Canada and overseas.

The number of multi-day music festivals in North America has gone from a handful to hundreds.

“We do live in a culture right now which is heavily saturated with festivals,” says Jonathan Levine, who heads of the Paradigm Talent Agency’s Nashville office.“If someone has a plot of land and a checkbook, they can suddenly find themselves in the festival business.”

Levine’s roster includes the Black Eyed Peas and several members of The Grateful Dead – a band that played one of the most iconic music festivals. But a lot has changed since Woodstock.

Music festivals have gone mainstream, and they’re making hundreds of millions of dollars. Millennials, it seems, are willing to shell out for multi-day music experiences. And deep-pocketed corporate sponsors are willing to shell out to reach them.

And it’s all come none too soon for musicians.

The growth in the number of music festivals over the last decade and half has coincided with a big shift in how people buy recorded music — if they buy it. And now streaming services like Spotify, Pandora and, soon, Apple’s Beats are reinventing the model again.

“The whole industry, the whole — all of it — is changing so much, especially with the internet, downloads and MP3s and stuff. So, the festivals is really where it’s at,” Katelyn Shook says. Katelyn and her sister Laurie Shook are the front-women of the Shook Twins, a Portland-based indie folk pop group.

The stretch from May to September is the biggest time of year for the Shook Twins – biggest payouts, biggest crowds, biggest publicity. They plan their tours around festival dates.

“It’s so good for an up and coming band because when we go to a new territory, we don’t have to have the pressure of filling the club all by ourselves, we’re just part of this huge thing and they’re promoting it and they’re doing all the cool stuff for it,” Laurie Shook says.

The Shook Twins, Laurie and Katelyn Shook, in their van before a show in Spokane, Washington.

But is there a ceiling on all this growth?

“The problem that we’ve got is that everyone is competing for the same pool of talent. And it’s not just in North America. It’s worldwide,” says Gary Bongiovanni, editor of the concert business trade publication Pollstar.

For example, Bluesfest in Australia in early April snagged Ben Harper, Hozier, David Gray, Counting Crows and a lot of other in-demand acts, Bongiovanni says. And of course, if they’re in Australia, they couldn’t be in the U.S. for the ever-increasing number of festivals here. In Pollstar’s 2014 year-end business analysis, Bongiovanni forecast the competition for big names could lead to a “bloody market correction that weeds out weaker festivals.”

And he’s not the only one making gloomy predictions.

“There’s only so many artists that can play and anchor and headline the festivals,” Levine says. “So it’s going to be a little bit survival of the fittest. Some will thrive and others will not.”

There’s another force putting restrictions on the availability of big-name acts. It’s called a “radius” clause. For example, the Bonnaroo festival in Tennessee might tell a band it can’t play within 300 miles of the festival two months before or after. Larger festivals use the agreements to make sure they keep exclusive rights on the headliners – and the hype surrounding them.

Still, all of this isn’t bothering Drew Lorona too much. He’s one of the founders of the fledgling Treefort Music Festival in Boise, Idaho, which just wrapped up its fourth year. Like most new festivals, it’s struggled to turn a profit. But Lorona says the urban music festival has been careful to grow slowly and put its emphasis on discovering unknown bands.

“I think the festivals that will struggle are going to be the ones that don’t have that differentiation. … And that seems to be what’s popping up the most – is kind of branded as like a party in the desert type of thing,” says Lorona.

And speaking of popping up, he knows of at least two new music festivals starting in Idaho this summer.

Correction: Talent agent Jonathan Levine has represented several members of the Grateful Dead and their later bands, including The Dead, but not the Grateful Dead as was originally stated. The text has been corrected

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