Archive for June, 2010

Irish Music Industry – ‘Living On The Edge’

June 29, 2010

“The ‘sold out’ signs are gathering dust, the sponsorship gravy train is running dry, and before you can mutter the words ‘cancelled due to unforeseen circumstances’ we’ve got a crisis on our hands”

WITH NO light at the end of the economic tunnel, Ireland enters another festival season with the live-music industry in ragged shape. This is the same industry that has been picking up the slack for its failing, flailing first cousin – the recording industry – for a number of years now, steaming ahead with record-breaking sales figures and soaring ticket prices while its counterpart scratched its head, sulked in the corner and grumbled dissent about this pesky “digital age”.

However, decline can be a deceptive process. Even up to the middle of last year promoters were clinging to mantras such as “people will always want to go out to see live music” or “this has always been a quiet time of year” or “everything will be fine once the students get back”.

In an ideal world, yes, everyone wants to see live music. People would also like to click their heels three times and make their mortgages disappear, or for Brian Lenihan to incorporate a Radiohead-style Pay What You Want system for utility bills into the next budget. And any promoters waiting for returning students to save the day would be wise to have some pretty impressive foam parties and “slave auctions” lined up for September.

The “sold out” signs are gathering dust, the sponsorship gravy train is running dry, and before you can mutter the words “cancelled due to unforeseen circumstances” we’ve got a crisis on our hands. Across the boards attendances are down, in club venues, theatres, stadiums and fields, for the many independent promoters, boutique festivals and hundreds of hopeful local artists who make up this world. Every year speculation intensifies as to just how bad business can get, what will be the consequences of this, and who will be the casualties?

A GLOBAL PROBLEM?

Make no mistake: Ireland’s situation is symptomatic of a global problem.

US commentators are reporting Live Nation – “the largest live entertainment company in the world” – has this month cancelled some 200 concerts by CAA (Creative Artists Agency) alone. Blogger Jim DeRogatis wrote of Ticketmaster’s merger with Live Nation: “The recurring prediction about the recently merged concert-industry behemoth Ticketmaster-Live Nation has been that recent lay-offs, rivers of red ink on the profit statements, and the general unwieldlyness of the massive corporation that many of its own employees call the Death Star will inevitably cause it to crash and burn, much as many in the oil industry are predicting that the disaster in the Gulf will lead to the demise of BP.”

In Ireland, the term “bloodbath” is being bandied about in the live-music profession with alarming confidence. So what’s the problem? For starters, the heritage market is starting to run out of steam. This could be because these tours are largely list-ticking exercises, and once you’ve seen Leonard Cohen, Paul McCartney or The Rolling Stones you probably don’t need to fork out another €100 to see them again. And again. And again. Furthermore, audiences are slowly starting to get out of the habit of going to see live music, and that, somewhere down the line, could spell the end of a tradition. When funds are low, home entertainment can seem more attractive than taking a punt on a new band you could end up hating.

Record labels aren’t dishing out substantial tour support for new signings any more. The loss leader could well be something for future generations to look back and snigger at. Indie promoters are more and more reluctant to take hits on new bands. Why should they if the artist is only going to be gobbled up by Live Nation or whatever monster eventually replaces it?

AN IRISH MONOPOLY?

The live music industry in Ireland is often cited as a monopoly controlled by Denis Desmond’s MCD. Although that isn’t exactly true, MCD and (Desmond’s other company) Gaiety Investments make for an influential force. As co-owner of promoter Festival Republic, in partnership with Live Nation, Desmond not only has a massive presence in our small market, but also in the globally significant UK market, where their cache of festivals – directly or indirectly – includes T in the Park, Download, Glastonbury, Reading, Leeds, The Big Chill, Latitude, and various others.

Here in Ireland the landscape looks more like a three-way oligopoly where MCD compete with Peter Aiken’s Aiken promotions and John Reynolds’s Pod Concerts.

TWO LEADERS IN THE FIELD

And let’s remember, these guys run their shows with much bigger overheads, operational costs and hair-raising profit margins than your average indie promoter. The two big events that bookend the Irish summer are Oxegen and Electric Picnic, both now enormously successful, award-winning, established brands. Safe bets, you might think. Maybe not. In this business, the bigger the event, the more there is at stake.

On one hand you have MCD’s Oxegen, which starts on Friday, July 9th, a three-day music extravaganza at Punchestown Racecourse in Kildare aimed at a young audience out for a good time, a post-Leaving Cert rite of passage perfect for acts with big singalong tunes that sound great in the mud. The event caters for some 90,000 people a day, with up to 80,000 of those potentially camping on site. Oxegen splashes out on big stadium names, the sort of names your mum and dad have probably heard of: Jay-Z, Kings of Leon, Snow Patrol, The Who. Oxegen avoids too many left-field curveballs and doesn’t bother much with the festival trimmings – a signing tent, a big wheel, food, T-shirts, Heineken and some of the biggest acts in the world usually does the trick.

Electric Picnic, on the other hand, presents a smaller-budget line-up, and a broader festival experience. This year, from September 3rd-5th, hip heritage acts such as Public Image Limited and Roxy Music will rub shoulders with indie-rock favourites The National and LCD Soundsystem at Stradbally in Co Laois in September. Not all exactly household names, and that’s very much the point, because the Picnic attempts to bring to life a microcosmic cultural experience where music is just the tip of the iceberg.

The fare here includes comedy, literature, political debate, a silent disco, cinema, holistic therapy, alternative camping, ecological awareness, circus sideshows, posh fast food and designer wellies. The “boutique” (translation: slightly smaller than the other one) festival is promoted by Pod Concerts and Festival Republic, which bought out Aiken Promotions as well as a further majority shareholding in 2009 and, confusingly, brings Denis Desmond into its equation.

THE LITTLE GUYS

At the other end of the spectrum outsider festivals such as Patrick McCabe’s Flat Lake Literary Arts Festival, staged annually in a field in Co Monaghan since 2007, apply a business model best described as “on a wing and a prayer”. This eclectic, anarchic event has built up a loyal following and has attracted maverick figures such as Shane MacGowan and Alexei Sayle, as well as real coups like Seamus Heaney and Chris Morris. Throw in some bizarre sideshow attractions such as the X Tractor talent contest and the Post-Lounge Tent of Sentimentalism and you have the makings of an unforgettable weekend. After this year’s event, McCabe and his co-promoter, Kevin Allen, sent out a missive to patrons explaining that without Arts Council funding or significant sponsorship they had come up about €10,000 short of breaking even. To address the shortfall they will stage a fundraising Butty Barn gig on July 24th, consisting of some of the bands from this year’s festival line-up, with camping facilities provided in a field adjacent to McCabe’s home.

DOWNWARD TRAJECTORY

In stark contrast to 2008, when tickets sold out as early as June 17th, last year’s Picnic reportedly didn’t sell out, despite an estimated reduction in capacity from 35,000 to 30,000.

A similar downward trajectory can be seen in Oxegen’s ticket performance. In 2007, tickets reportedly sold out in under 70 minutes. Yet the following year it took two months to sell out, and last year the event appeared to still be on sale as the gates opened, despite a stellar line-up that included a reunited Blur, alongside current heavyweights Snow Patrol and Kings of Leon. A sell-out this year, despite an aggressive advertising campaign, appears highly unlikely at this point.

So what do these gloomy figures really mean? One would be forgiven for assuming that promoters are simply making less money than in previous years, but still “raking it in” on ticket sales, vending concessions, merchandising cuts, bar sales and, of course, the essential sponsorship funds. Don’t be so sure. Ticket sales are subject to a non-recoupable 13.5 per cent levy. After the ticket agencies take their cut, the rental on the land is paid, the whopping great talent budget is blown, the cost of production, tracking, fencing, tents, staffing, catering, marketing, those little golf cars promoters whiz around in, VIP hospitality, insurance, medical costs, and all the rest is paid for there may be something left over.

The general consensus among industry insiders is that most festivals require almost sold-out business to reach their profit margins. For example, if a festival is to make a modest but not-to-be-sniffed-at profit of €1,000,000 at an average of €200 net ticket price, that’s dependant on the last 5,000 tickets. Not for the faint-hearted.

Furthermore, most music promoters will admit that it’s almost impossible to draft an exact costing of a music festival – there are so many things that can go wrong.

A FINAL THOUGHT

Imagine being the promoter holding that modest wad of cash and thinking ‘was it really worth all that trouble?’ Then you feel something in the air, a light trickle, it’s raining. It’s pissing down. You look back down at the wad of cash and you think: “This is just enough money to pay for the ground repair.”

Words: Leagues O’Tool.

Taken from: The Irish Times.com 25/06/10

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