Music News

Music Fests Like Coachella Drive Concert Sales to New Heights

It's as though the lamentable death of recorded music was accompanied by a kick-ass wake. Sure, label executives have had to sell their fancy homes and put their kids in public schools, but the rest of us have feasted on a musical smorgasbord.

Nothing better exemplifies this than this month's Coachella Valley Music and Arts Festival in Indio, California (3 1/2 hours west of Phoenix), the crown jewel among destination music festivals, a sort of spring break for music lovers. Three days of music, more than 150 bands, repeated over two weekends (the second week starts Friday, April 19), featuring a wonderful cross-section of the music world old and new — Red Hot Chili Peppers, Moby, Wu-Tang Clan, Social Distortion, Japandroids, Vampire Weekend, Spiritualized, Puscifer, 2 Chainz, Tame Impala, Passion Pit, and The Postal Service, to name a few.

Coachella is part of a rapid buildup in stationary music festivals, big and small, across the country and reflective of live music's explosion of growth since the millennium. Though it won't compensate for a 50 percent drop in U.S. sales of recorded music since 1999, concert ticket sales filled nearly 40 percent of that loss between 1999 and 2009.

During that time, North American revenue from live music tripled to $4.6 billion, up from $1.5 billion, before dipping during the recession. Last year, concert revenue was $4.3 billion versus $7 billion in music revenue (more than half of it digital, for the first time). Though downloading may have sapped music sales, it's only amplified people's desire to experience music up close and personal.

"You text. You don't call. You don't write notes. You don't pop up at your friends' house. You Skype. We're not touching each other," says rapper Murs, who founded the Paid Dues festival in Los Angeles. "Technology has separated us so much [that] it's natural for us to have this desire to come together, and [festivals] really cater to that communal nature."

It's a booming business, even for newcomers. Last year, Firefly Music Festival premièred at a racetrack in Dover, Delaware, drawing more than 30,000 patrons daily, making about $9 million in ticket sales alone. It's estimated to have injected upwards of $12 million into the Dover economy.

"There's an increased trend of multi-faceted social events, and people are more willing than ever to make sure they don't miss out on experiential, destination weekends with friends," writes Joe Reynolds, CEO of Red Frog Events, the festival's founder.

Sensing a score, the field's getting crowded. A hardly exhaustive list on Wikipedia logs 110 major festivals across the country. There are three new country fests (Flatlands in Kansas City, Taste of Country Music in the Catskills, and Faster Horses in Brooklyn), a pair each in Florida and Atlanta (Tampa's Funshine and Fort Lauderdale's Tortuga; Atlanta's Shaky Knees and Magnetic Music Fests), and a new one from the people who bring you Coachella (Grove Music Fest in Niagara-on-the-Lake, Canada).

The Phoenix area is home to more than a few: McDowell Mountain Music Festival, which featured The Shins, Les Claypool, and The Roots at the 2013 installment, and the still-mysterious Liquid Sol 13 in September at Canyon Moon Ranch. Early-bird $120 three-day tickets, but not a single band, have been announced. (Attempts to contact founder Harry Luge Jr. or others associated with the festival were unsuccessful.)

Live Nation alone put on 18 fests last year, including Jay-Z's new Made in America, Sasquatch in the Gorge in Washington, and Atlanta's Music Midtown, each of which sold out. Three of the country's biggest, most established festivals — Coachella ($47.3 million, 78,500 attendees daily for six days), Lollapalooza ($22.5 million, 100,000, three days), and Bonnaroo ($30 million, 80,000, four days) — regularly sell out early.

That's the power of an established brand. A 2010 Bloomberg story pegged Bonnaroo's profits at $12 million a year, which would explain the $5 million in charitable donations made during its first decade of existence. It's also why so many promoters are taking their shot.

When you consider the $254 million Coachella brought to the desert region around Indio (and $90 million to the city itself), you can see why a city would do whatever it can to help. Apparently, that only holds until a festival's established itself, at which point it grabs for more. (Indio proposed, then ultimately withdrew, a $4 million to $6 million ticket tax.)

"One of the obvious reasons music festivals have taken off is, a lot of people think they can make a lot of money with them, and it's not that easy," says Grayson Currin, who co-founded the Hopscotch Festival in Chapel Hill, North Carolina, now entering its fourth year. "The margins are pretty small."

Coachella founder Paul Tollet learned the way most festival promoters do — in bars and clubs. He began by booking his older brother's band The Targets. While attending Cal-Poly Pomona, Tollet hooked up with Goldenvoice founder Gary Tovar, who funded his promotion company with proceeds from pot dealing. Tovar eventually took a rap and went to jail, signing over control in the company to Tollet and his partner, Rick Van Santen, in 1991.

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Chris Parker
Contact: Chris Parker