Why are music festivals so expensive? | The Economist

I have never been to a music festival until today surprising I know because in the past 20 years they've become increasingly popular let's take California's Coachella it's been running since 1999 when it had 25 thousand attendees 2017 there were almost 250,000 of them and as festivals have grown so if ticket prices in 1979 a ticket for Glastonbury the UK's biggest festival cost five pounds in 2019 it was 248 pounds to put things in perspective if ticket prices rose with inflation it'd be five times more expensive today in reality they're 50 times more so why are festivals so expensive running a festival takes a huge amount of work this is Jenny Jordan she's a festival expert we never imagined the level of details going to lack Mitchell is a festival producer he runs boomtown one of the biggest independent music festivals in the UK it's like setting up a small town we've got hundreds of lines of budgets you've got to make sure that you've got water to make sure you've got Wi-Fi internal traffic management external drive management toilets for different security companies food stewarding drink artists internal transport their list is just bonkers at boomtown it also takes 12,000 crew 1596 tons of scaffolding 3 million litres of water in 2000 bins and all that costs but then there's one more thing that makes festivals much more expensive music and actually it all comes down to this it's much more difficult now to make money selling recorded music the rise of streaming has basically flipped the economics of the music industry always hey this is Tom Standage he's the head of all things digital at the Economist and a drummer in his spare time it used to be that you made your money from selling records selling CDs selling LPS and you promoted them by going on tour and now you make your money by going on tour and releasing an album is just really an excuse for another tour and as the importance of touring has increased so have artists fees at Woodstock in 1969 Jimi Hendrix got today's equivalent of $125,000 in 2019 at Coachella ariana grande was paid eight million dollars that's sixty four times more people out that really think that we're making millions we barely broke even last year even though the festival completely sold out because it's so expensive to put on artists are really really tricky because they will get offers from the big corporate festivals there are like five times what we can afford here's the deal over the past decade two companies Live Nation and AEG Live have become a dominant force in the festival market they've been pushing prices up and buying smaller festivals out now they own close to a third of the British market alone Live Nation's net worth in 2019 was estimated at fifteen point six billion dollars and they're scaling their business models turning the likes of the Lava Palooza festival into a franchise and exporting it to countries across the globe companies control the risk by running a number of different festivals that allows you to have mitigating factors if the weather is awful one weekend you've got another festival with income potentially a couple of weeks later it allows them to get some economies of scale and it allows them to get the top artists stores so that they can offer them more than one day over the summer period that's very effective and this means that the most popular acts headlined many of the big festivals well these economies of scale may be cost-effective for the big companies the risk is that festivals feel more samey and perhaps that's one of the reasons why overall festival attendance has declined since 2016 in Europe 18 percent of surveyed festivals reported a downturn in ticket sales as the market gets more challenging some independent festivals have turned economic necessity into an opportunity when we launched boomtown we had no chance competing on big acts as well so we had to kind of create this model in this experience it was unique and had its own sort of identity that says help out away from other festivals this is where it gets interesting a ten year British audience survey revealed that headline acts are a deciding factor for only 8% of festival goers but 53% said the overall experience is the reason they bought their ticket we asked these festival goers why they're here a lineup would drag me in but when I'm here sometimes I don't even see any music I'll be honest I don't know if any of the pretty music that's nothing doe the music its atmosphere and that's part of a much bigger picture in the past 20 years the Western world has shifted from buying things to buying these kinds of things in other words experiences my name is Joe pine and I'm gonna tell you all about the experience economy Joe has written a book called well the experience economy well what's happened as we've gone from an agrarian economy based off commodities through an industrial economy based off goods through a service economy and today we're in an experience economy what experiences really do is that they engage everyone inside of them it's this engagement that the likes of boomtown are banking on to pull in the punters new friends in 2019 boomtown hired 2,000 actors to draw festival goers into a variety of immersive experiences spread across 110 venues throughout the festival I have a question I would like to ask can you tell me who really was the man behind the basket and it's all designed to create this unique communal experience living in the digital age that we are now at there's more need than ever for people to connect that's what festivals do the best in the digital age also means we can document these experiences and of course show them off online we take selfies not because we think we're going to get the perfect picture but because we were there and it proves that we were there these are similar to that souvenir that you picked up on your seaside holiday that means absolutely nothing to anybody else but it's so important to you that is if you like the kind of evolution of what happened before if you went around to someone's house you could see what records they had what CDs they had and that was a kind of social media really posting stuff on Instagram is just a kind of updated version of that and in the spirit of keeping up to date pretty much every music festival is now selling the experience so what else will convince festival goers that their tickets offer value for money what's the future of this incredible city in other words what's more experiential than experience now is the experience that changes us in some way and that we call a transformation and the transformation is the fifth and final act and I'm offering this progression of economic value we're using experiences as the raw material to guide people to change to help them achieve their aspirations so expect to hear that a ticket to a festival in the future will be an investment in a truly transformative experience one that will offer an opportunity to help you discover your better self and when that might even be worth it thank you so much for watching this film click the link below to learn more about the role artists are playing in rising ticket prices also you can watch our film about how digital disruption is changing the music industry it's really interesting and of course if you like this film click that subscribe button subscribe to our Channel

Channel: undefined

Views: 699,935

Rating: 4.9399886 out of 5

Keywords: The Economist, Economist, Economist Films, Economist Videos, Politics, News, short-documentary, Festivals, music festival, Boomtown, Glastonbury, Coachella, Lollapalooza, music festivals, why are music festivals expensive, music festival 2019, festivals around the world

Id: PMfkO3Pv4VQ

Length: 8min 20sec (500 seconds)

Published: Sat Aug 03 2019

Reddit Comments

[u/i-got-leg-hair]

I don't think festivals are expensive. If you think about how much content you get and how many of your favorite artists you can see I think they're very fairly priced.

[u/SacaLaMierdita]

Small festivals aren’t that expensive

[u/Mtskiguy21]

I work production on the side, mainly in lighting. I dont think most people have the slightest clue how expensive it is to produce a festival stage. All said and done I think most festivals are a bargain. I believe most models plan on being in the red the first 2 years.

[u/trevorturtle]

Because shit costs money.

[u/FightinSweathog]

With the level of sound & production even at festivals on the more expensive end for sure still worth it, especially when you break it down by day.

I don’t wanna say overpriced, but when you compare costs n such of certain festivals some do start to seem unjustifiable from an attendee’s perspective.

Like bisco being 250 for 4 nights makes bonnaroo seem tough to spend on

[u/[deleted]]

If you’re coming from out of town to a non-camping festival, air travel and lodging often dwarf the cost of the festival itself.

[u/evanw96]

In the grand scheme of things they really aren’t that bad. Sure they’re a massive expense but you can same the same about any 3-4 day vacation curated by one big venue of any type.

They’re as expensive as you make them in my experience too. You can do a lot of them and buy 0 food or drinks and get out really inexpensively

[u/theblackmandarin]

I arrange a local festival for about 3000 attendance and the cost is around $40K, but the ROI is pretty solid lol

[u/yairina]

Expensive? Yes? Getting what you pay for? Also yes