Live Music inteLLigence An ILMC Publication. July 2011, Issue 36
Ta l enT ’s G oT
Britain
IQ Marke t repor t
PeoPLe PoWer Social media and its meteoric impact on live reaching the Peaks Stuart Galbraith on 30 years in the business the next diMension? 3D and gigs: perfect match or passing fad? shifting gear Merchandise feels the heat Live Still the Driver: Chris Carey • the Winds of change: shuki Weiss • On the Beat: Derek Smith • survivaL: BoB Paterson
Issue 36, July 2011
Contents 16
News 6
In Brief The main headlines over the last two months
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In Depth Key stories from around the live music world
Features 16 People Power Social media and its gamechanging impact on live music 20 Reaching the Peaks Stuart Galbraith celebrates 30 years in the business 32 The Next Dimension? 3D and concerts: perfect match or passing fad?
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38 Talent’s Got Britain IQ’s first market report on Great Britain
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48 Shifting Gear Clive Rozario gets into the merchandise game
Comments and Columns 12 Live Still the Driver Chris Carey advises us to look beyond the numbers 13 The Winds of Change Shuki Weiss calls for understanding on Israel
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14 On the Beat Derek Smith says the police do like UK festivals, really 15 Survival... Bob Paterson on life for the smaller venue and agent 56 In Focus From conference whoring to rock festival-hopping 57 Insight Academy Music Group CEO John Northcote reflects the UK venue scene 58 Your Shout Who wants to be a record breaker?
Editorial
The Idea Factory
As the festival season kicks off, America is where all the action is, writes Greg Parmley…
THE ILMC JOURNAL Live Music Intelligence Issue 36, July 2011 IQ Magazine 2-4 Prowse Place, London, NW1 9PH, UK info@iq-mag.net www.iq-mag.net Tel: +44 (0)20 7284 5867 Fax: +44 (0)20 7284 1870
Publisher ILMC and M4 Media Editor Greg Parmley Associate Editor Allan McGowan Marketing & Advertising Manager Terry McNally Sub Editor Michael Muldoon Production Assistant Adam Milton Editorial Assistant Clive Rozario Contributors Lars Brandle, Chris Carey, Meredith Humphrey, Charlotte Mceleny, John Northcote, Bob Paterson: Clive Rozario Derek Smith, Manfred Tari, Shuki Weiss, Adam Woods. Editorial Contact Greg Parmley, greg@iq-mag.net Tel: +44 (0)20 7284 5867 Advertising Contact Terry McNally, terry@iq-mag.net Tel: +44 (0)20 7284 5867 Design & Production Oyster Studios enquiries@oysterstudios.com www.oysterstudios.com
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o the festival season is now fully upon us, and in the time it takes these pages to be printed and posted, protestors could well have rioted at Glastonbury because U2 don’t pay all of their taxes in Ireland. It must be difficult being (a) so very famous; and (b) so virtuous, in that any slight perceived dalliance from the course of righteous truth is splashed across the world’s media. Combine the most famous festival in the world with arguably the world’s biggest band, and it’s a powder keg just waiting for a match, and just one of a thousand stories that now emerge from and around the festival scene every year. The news that Festival Republic chief Melvin Benn is reigniting his bid to open a festival in the US, while Secret Garden Party organisers are also opening up an event across the Atlantic, does call to question whether America is the next big untapped festival market. It’s certainly a scene that’s driving innovation at the moment, at least if Coachella is anything to go by. Not only did the California favourite beat every European event to the RFID punch, but having announced it’ll run over two consecutive weekends next year, it’s trialling a completely new format. On the subject of new formats and innovation tips, we’re decidedly tech-focussed this issue. Social media, the watchword of ILMC this year, is explored by Charlotte Mceleny, music specialist for New Media Age (page 16). And hot on the heels of pop outfit JLS taking cinemas by storm, we consider the impact of 3D on live music and ask whether it’s a perfect match or a passing fad (p. 32). Moving on, as our slightly nationalistic cover suggests, this issue we’re publishing a market report on
Great Britain, the first by any trade publication such as ourselves. We’ve pulled together what available data is out there, and spoken to many of the key players from across the industry to hopefully build up a snapshot of what is such an important market for live music. If we’d just had another 50 pages, we might have been able to do it justice! Add to that a profile on Sonisphere boss Stuart Galbraith as he celebrates 30 years in the business (p. 20), Clive Rozario’s take on the merchandise game (p. 48), and contributions from Chris Carey, Shuki Weiss and even a chief policeman, and we’ve got more words than Glastonbury has bands. Oh, and one final word on festivals… this summer I’m setting off on something of a marathon trip to visit a whole bunch. I’ll be writing about it in the next issue, but if you’re interested, please check out www. facebook.com/RidetoLive2011. Until next time!
To subscribe to IQ Magazine: +44 (0)20 7284 5867 info@iq-mag.net Annual subscription to IQ is £50 (€60) for 6 issues.
News
In Brief...
Below: XL Video’s Des Fallon who sadly passed away in May at the age of 40 Top Right: Eddie Van Halen Far Below Right: Jonathan Brown
As the festival season kicks off, a smorgasbord of deals, disputes and demands keeps the industry on form and as vibrant as ever...
April
• New Zealand passes a three-strikes law that allows copyright holders to demand ISPs ban repeat illegal file-sharers. • Live Nation expresses interest in running the new Copenhagen arena after the tender process is restarted when AEG struggles to raise the necessary funds. • Dutch theatre producer Stage Entertainment launches a new division to focus solely on international touring. • LG Arena in Birmingham (UK) and local police confiscate more than £10,000 (€11,400) of bootlegged merchandise at a WWE show.
anonymously and marking them on set criteria. • The principal associations representing the UK’s live music industry unite to form the UK Live Music Group, with its nominated chair, Paul Latham, taking a seat on the board of trade body UK Music. • Former See Tickets MD Nick Blackburn is announced as the head of CTS Eventim’s UK operation.
June
May
• A California court rejects an appeal by legendary music producer Phil Spector to overturn his murder conviction. • Speaker manufacturer Klipsch signs a multi-year naming rights deal for Live Nation venues in New York and Miami. • In the UK, Live Nation and Festival Republic announce that they will begin posting out tickets soon after purchase in an attempt to cut-down on fraud. • Pollstar reports that a three-year partnership between Charmenko’s Nick Hobbs and Borek Jirik’s Berlin-based Transmusic dissolves with losses of “hundreds of thousands of Euros”. • Live Nation partners with discount specialist Groupon to form a new concert ticketing site – GrouponLive. • Organisers of the UK Festival Awards announce that this year’s festivals will be judged by journalists attending each festival
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• Irish promoter Denis Desmond is paid the $2.95m (€2.08m) in damages he is owed for a cancelled Prince show in 2008, just as the artist announces two European festival shows this summer. • The ticket service run by German promoter Karsten Jahnke is voted most customer-friendly in the country by a top consumer body. • Gil Scott-Heron dies in New York at the age of 62.
• Azerbaijan wins the 56th Eurovision Song Contest with Running Scared at the event in Düsseldorf ’s Fortuna Arena. • Galaxy Macau opens for business on Macau’s Cotai Strip. Owners of the HKD 14.9billion (€1.4bn) development pledge to increase the number of concerts by foreign artists. • US ticketing company Eventbrite (which integrates social media and mobile) announces a $50million (€35m) influx of venture capital finance. • Demand for downloading Lady Gaga’s latest album Born This Way for 99cents from Amazon brings down the online retail giant’s servers.
• Moroccan activists carry out a campaign of online and street protests against the government and sponsor-funded Mawazine world music festival, describing it as a “waste of money”. • Banks bailout beleaguered UK music retailer HMV with a £220m (€251m) refinancing lifeline, subject to high exit fees and interest charges of between £10-15m (€1117m) per year. • The insurer of Michael Jackson’s This Is It shows sues AEG Live and the late singer’s estate to nullify the policy it issued for the string of 2009 London shows. • UK ticket operation CrowdSurge sells what it claims is the first ticket via a fully integrated Facebook app. • Two festival-goers die of heat-related conditions at US festival Bonnaroo after temperatures at the Tennessee event stretch into the 90s. • Simon Fuller and ex-Island Records boss Chris Blackwell announce Blackwell Fuller, a new venture focussed on monetising artist content. • The Dutch government cuts its arts budget by 30% just before VAT in tickets rises from 6% to 19% on 1 July.
News
Aussie Festival Revolution Australian promoter AJ Maddah is testing the theory that there’s an
insatiable demand for the harder side of live. Maddah, the mastermind behind Australia’s b e h e m o t h Soundwave touring fest, is launching the Soundwave Revolution festival. Van Halen, Alice Cooper and Bad Religion will headline the new event, which begins the first of five dates 24 September in
Brisbane’s RNA Showgrounds, and will play a host of non-traditional rock ‘n’ roll venues. Social networking has played a big role in building the buzz for Revolution. Organisers whipped-up a frenzy when they discretely leaked names from the Revolution bill through Twitter ahead of the official announcement. Maddah was upfront about the considerable cost to stage Revolution, announcing on the micro-blogging site that he had stumped up
AUD$12.4m (€9.2m). The launch of Revolution flies in the face of the general industry consensus that Australia’s festival circuit has already reached saturation point. That was proved wide of the mark when Staple Group’s Destroy All Lines launched the six-date Australasian hard-rock and alternative No Sleep ‘Til Fest in December 2010, which sold more than 40,000 tickets nationally, according to co-founder Jaddan Comerford.
STAR Launches Kitemark This July will see the Society of Ticket Agents & Retailers (STAR) launch a new Kitemark to help consumers identify legitimate ticket agents in both the primary and secondary markets. Designed to combat rising levels of ticket fraud, the campaign will involve posting a trademark hologram on all STAR member websites so that customers know ticket inventory has been authorised and is safe.
In order to include all the UK’s major primary retailers, STAR recently changed its terms and conditions. Previously, See Tickets was not a member because it refuses to refund booking fees in the event of a show cancellation. According to secretary Jonathan Brown, the campaign will roll-out in two stages, with a trade launch on 4 July followed by a press and consumer launch in early
September. Sites will begin using the mark in July so that the public can identify it immediately after the consumer launch. “The trademark will have legal protection,” Brown tells IQ. “Each will have an inscription on the logo to show its authenticity.” The awareness campaign will then continue with STAR working alongside other trade bodies and running online advertisements.
Live Nation’s Private Chats Colombian Discos Partner Up Eighteen months after merging with Ticketmaster, Live Nation Entertainment (LNE) executive chairman Irving Azoff is reportedly considering privatisation with the company’s largest shareholder Liberty Media. According to the New York Post, privatisation is only one of the possible moves being discussed by Azoff and Liberty Media boss John Malone. Currently
Liberty Media owns 20% of the company. At its current price, $3.6billion (€2.5bn) would be needed to finance a buyout. News of the discussion saw LNE’s stock price rise 6%, then fall 3% and comes after LNE narrowed its Q1 losses to $48.5million (€34.2m) from a loss of $122m (€86,), over the same period in 2010.
Colombian record label Discos Fuentes and concert promoter AG Producciones, have become partners in a bid to cross-promote and develop their respective artists. Discos Fuentes will now use AG to help promote and manage its artists – which include Latin Brothers, La Sonora Dinamita, and Osmar Pérez y los Chiches Vallenatos – while Fuentes will release
albums by AG’s touring artists, which include La Misma Gente. The new partnership will initially focus on recordings and concerts around new soap opera El Joe La Leyenda, which is based on the life of Joe Arroyo, the Colombian salsa star. Arroyo is not currently signed to Fuentes but most of his catalogue was recorded with Discos Fuentes.
News
2012’s Olympic Legacy for Live Music
Tickets and T-shirts for Tesco
reach new audiences in East London,” says Tudor. “We are still looking at the different shows that the Multi-Use Arena will be able to accommodate, and there will be excellent transportation links developed as well.” Tudor, who previously worked as senior director of sales at Ticketmaster and as general manager of Wembley Arena, says that following the games, the Multi-Use Arena will be the most versatile venue, with the ability to host seated concerts or shows standing
in the round with a capacity of 7,500. It was announced in February that West Ham Football Club and their partner Live Nation would take over the 2012 Stadium after the games, but the decision is subject to legal action by football club Tottenham Hotspur and local club Leyton Orient. AEG, which had also bid for the stadium with Tottenham, is now said to be interested in operating the £300million (€342m) aquatics centre and 6,000-capacity handball centre. Live Nation, which was chosen in February to run live entertainment during the Olympics in London’s Trafalgar Square and three city parks, may also be considering the outdoor park at the Stratford site which can accommodate up to 40,000 people.
from the 1,000 sold each day in 2009 and 2010. Further safeguarding against secondary sales, on 4 May Paléo launched their sixth annual Bourse aux Billets platform allowing fans to sell or buy their tickets in a safe and fair environment. “The platform is just one of our ways to fight against the black market which is illegal in Switzerland,” Platel tells IQ. “It is a service to our
spectators – it allows people to get tickets if they couldn’t during the initial sale as everything was sold out in 48 hours.” The National, Robert Plant, Jack Johnson and The Strokes are among the artists scheduled to perform at the 36th anniversary event, while previous headliners include Iggy and The Stooges, Massive Attack and the Arctic Monkeys.
UK retailing giant Tesco has entered the ticketing market, selling tickets for 23 open-air concerts through its Tesco Entertainment website. Coupled with several recent retail exclusives on artist merchandise (it already runs its own record label, with exclusive releases having included Simply Red and Faithless), it marks a move into the live music space for the world’s third largest retailer. Partnering with concert production company the Liz Hobbs Group, the tickets are being sold for shows at various events at Jockey Club Racecourses across the UK between 8 June and 23 August. Ticket prices will start at £12 (€14) and will be capped at £33 (€38) with a maximum of ten per customer. All transactions are offered free of booking fees and credit card charges. “We know customers want to buy tickets for live music events but are often faced with unexpected and additional fees,” says Tesco’s entertainment director Rob Salter. “We wanted an offer that was really simple – one ticket, one price, no hidden costs.” In addition to offering online ticket sales, Tesco has moved into the merchandising channel, offering retail exclusives with several artists (see page 48). Meanwhile, Tom Jones, Scissor Sisters, James Blunt, Alexandra Burke and Scouting for Girls are among the artists scheduled to perform across racecourses including Haydock Park, Newmarket, Epsom Downs, Carlisle and Sandown Park.
Following London’s 2012 Games, three new venues will be available to host live music events, bringing a new range of options for live music in the capital. According to the Olympic Park Legacy Company’s recently appointed director of venues Peter Tudor, the 2012 Stadium, Multi-Use Arena and outdoor park in Stratford, East London, will all have the potential to host live music events from the spring of 2013 onwards. “There is real potential for promoters and artists to
Paléo Fights Black Market Switzerland’s Paléo Festival Nyon is helping combat black market secondary ticket sales by encouraging ticket-buyers to use print-at-home tickets and by releasing larger numbers of day tickets every morning of the 19-24 July event. According to Paléo’s head of press and media Christophe Platel, print-at-home tickets are more difficult to resell online because customers know they can easily be copied or printed multiple times. The 23,000-capacity festival will also sell 1,500 tickets each morning for that night’s events – an increase
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Top left: Peter Tudor Centre: The Strokes Top right: Eilen Jewell
News
Shock Stops Live Arm A reshuffle at Australia’s Shock Entertainment means that their fledgling touring division, Ragged Company, will be wound up, and the GM of the past two years, George Hatzigeorgiou has been let go. Based in Melbourne, Ragged has toured the likes of Kitty Daisy & Lewis, The Charlatans, Eilen Jewell, Hawkwind, Rodney Crowell, The Hotclub of Cowtown,
Elana James, and in recent months, the American singersongwriter John Grant. Hatzigeorgiou, who also handled national publicity duties for Shock Entertainment, is now “pursuing new opportunities” outside the Shock Entertainment family. Shock launched Ragged Company in October 2008, taking its name from a lyric in the Rolling Stones’ track
Coachella: So Good They’ll Run it Twice? Having successfully trialled new RFID access control systems this year, Coachella Valley Music and Arts Festival is going one better next year by launching an entirely new festival format. With demand
mounting, organisers have announced that the 2012 edition will run twice, over back-to-back weekends –1315 and 20-22 April – with an identical line up. “We had too many people who wanted to go [this
Dead Flowers. The following month, Ragged brought The Charlatans down under for their first Australian tour. However, the touring arm was never seen as a core asset, and failed to find a foothold in Australia’s supercompetitive live scene. Founded in 1988 as an import business, parent Shock Entertainment came to symbolise innovation in the independent music scene. But it emerged last year that the group nearly went bust
with more than AUD $4million (€3m) owed to creditors, and the brand was essentially rescued when it was bought out by CD and DVD replicator Regency Media.
year],” says Paul Tollet, the festival’s founder and Goldenvoice president. “It was hard watching people be upset that they couldn’t go last year because tickets were going for $500-$600 and that’s just not right.” A weekend pass for 2010 was $269.
Tollett told Billboard that he toyed with increasing the capacity, but was concerned it would spoil the dynamic of the Indio, Californian event. “I didn’t want to ruin the show by putting 40,000 more people in per day,” he said.
News
Production Sector Faces Consolidation A series of recent mergers, acquisitions and partnerships in the production world points to the beginning of widespread consolidation of the sector, according to some industry experts. The statements come after a number of smaller owner-operated companies were snapped up by multinational outfits over the last year, operations that are increasingly offering one-stop shop solutions. Last month saw New York-based Production Resource Group (PRG) announce the acquisition of Nocturne Productions, a leading concert touring video production company that has previously worked with Lady Gaga, Paul McCartney, Bon Jovi, Madonna and Elton John. The past year also saw PRG acquire Germany’s Showtec Beleuchtungs, Procon (formerly ETF Event Engineering), and Belgium’s EML Productions. “Our companies have been on the same tours and shared clients for years, so combining forces is a logical next step,” says Nocturne’s co-president Bob Brigham. In April, three leading audio rental companies in Italy came together to form
All Access. The new company has made a significant investment in Martin Audio’s Multicellular Loudspeaker Array and plans to compete with it on an international
presence there as well because we’re constantly collaborating on shows.” The ongoing increase in multinationals and companies forging increasingly close alliances is
playing field. And in May, Pennsylvania’s Tait Towers announced a strategic alliance with staging giant Stageco when the two companies opened a joint London office in time for the 2012 Games. “It’s a natural collaboration of our relationship because we now have an office together in Manheim, Pennsylvania, just outside Lidditz where our main office is,” says Tait’s president James ‘Winky’ Fairorth. “It made sense for Stageco to have a
allowing for significant costcutting on some productions. Australian pop princess Kylie Minogue’s current Aphrodite: Les Folies tour (see IQ Issue 35) has taken advantage of this new opportunity by using only two companies for the tour, which spans Europe, Australia, Mexico and South Africa. Tait Towers was able to provide the aquatic-themed Aphrodite tour with all water effects, staging, set, automation and performer flying, while all rigging,
lighting, audio and video was provided by Montrealbased Solotech – making Kylie’s tour the first international production of its size to strike such a deal. “There are economies of scale with them providing all the personnel and all the equipment,” production manager Kevin Hopgood said. In Belgium, Ampco Flashlight Group – itself the product of a merger between two leading rental companies – also offers a one-stop shop service. And while others stress the importance of relationships and track record, marketing director Marcel Albers says: “If you look at the music industry as a whole, you see that in a lot of territories worldwide, 80% of business is taken by four major companies. If you look at agents and promoters, that’s also the case. It’s a fact that you’re either small, and very small; or big, and very big.” “It’s an inevitability,” agrees John Penn, MD of SSE Audio (who oversaw the merger between SSE and Canegreen in August 2008). “It’s the way that things are going and a commercial reality.”
second day was geared towards effective audience communication tools. The GO Group was initiated in November 2010 by Bucks University, GreenEvents Conference, Green Music Initiative, and Yourope with the aim of highlighting the importance of sustainability within the music festival and event
industry. Participants included Festival Republic, WWF, Melt! Festival, Øya Festival, and Roskilde. The GO Group is currently planning the next workshop for spring 2012, and will act as a partner for the second GreenEvents Europe Conference in Bonn, Germany, from 2-4 November 2011.
GO for Green Group The Green Operations (GO) Group, the independent think tank created to encourage the European event industry to become greener, held its first workshop from 23-24 May in Amsterdam. A total of 35 festival managers, promoters and sustainability experts from
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eight European countries descended upon both the ID&T headquarters (the Dutch entertainment enterprise acting as cohost) and the Amsterdam Arena for the event. The first day of the workshop was dedicated to energy related issues, while the
Above: Kylie Minogue live in Paris. Photo: Christie Goodwin 2011 Right: Of Montreal
News
Festival Promoters Go Abroad
TWO UK FESTIVAL promoters setting up shop across the Atlantic this summer is said to be part of a wider trend as the increasingly swamped festival market forces organisers to look beyond borders. This August will see Secret Garden Party founder Fred Fellowes introduce the 5,000-capacity boutique festival Escape to New York, while Festival Republic’s Melvin Benn is organising a
new 50,000-capacity festival in Florida, Orlando Calling, in November. Orlando Calling is his second attempted foray into the US after 2008’s Vineland Festival failed to launch. According to Benn – the UK’s leading festival promoter whose other international events include Electric Picnic in Ireland, Hove in Norway and Berlin Music Week – the decision to go stateside is not a unique trend on the rise,
but a natural step for experienced promoters working in crowded markets. “It’s not only the British going to America – German promoters are starting events in Denmark and American events are expanding,” he says. “Lollapalooza has expanded into Chile and wants to go to Europe next year. The UK and German markets are both very crowded so it’s hardly surprising that we would look to expand overseas.” Fellowes had no plans to expand to the US until a chance meeting at SXSW led to contacts with the Native American tribes on New York’s Shinnecock Reservation. Normal US permit laws do not apply to Indian reservations, meaning that despite some large insurance premiums, Fellowes can run a European-style festival with alcohol and tobacco consumed in the open. “The decision to expand
came as the result of a chance contact with the Indian tribes in Southampton, USA. It is a unique legal position on a reservation which made it a very attractive position,” says Fellowes, who admits that he’s wary about entering the world’s largest entertainment market. “It’s not the easiest place to break. Many people have found licensing an event in America very challenging and a catalogue of events have fallen foul this year. “Still there is a huge chasm between us and Coachella (75,000) and the Burning Man (51,000) festival where we need to build up our position to,” he says. Escape to New York headliners include Best Coast, Patti Smith, Edward Sharpe & The Magnetic Zeros, and Of Montreal with tickets ranging from $100 (€70) to $289 (€202). Acts for Orlando Calling will be announced later this month.
French Market Gets Busy A number of new entrants and major moves are keeping the French concert business in a state of flux. At the beginning of May, French investment company Fimalac Développement announced its acquisition of a 40% stake in the concert company Auguri Productions. Fimalac already has a 40% stake in both Gilbert Coullier Productions, the market leader in the French concert business; and Groupe Lucien Barrière which
promotes approximately 2,500 shows annually via its subsidies Barrière and Fouquets. Also entering the live market is Lagardère Media Group (LMG), which opened a new division, Lagardère Unlimited Live Entertainment, in April. The company, which last year turned over €7.9billion in 2010, will promote tours and concerts and already holds a related stake in the Zénith concert hall in Paris. LMG’s entrance into the
market is considered as a move that could easily drive consolidation in the market. Meanwhile, record labels, which are historically active in the live business – as evidenced when Warner Music bought Camus Productions in 2008 and Sony music purchased Arachnée Productions two years ago – are no less busy. Independent distributor Discograph just launched its own booking department (D-Tour); and the largest French independent label
Wagram Music launched a new website last month, Wspectacle.com, adding a booking department with two agents. The ticketing industry in France has also seen the arrival of the corporates of late with Live Nation’s purchase of No 2 ticketer Ticknet in November last year. And at the end of 2011, Vivendi Universal took over ticketing provider Digitick, paying €45m for the e-ticket market leader.
Comment
Live Still the Driver PRS for Music economist Chris Carey says to look beyond the numbers... Festivals: Growing in value, reach, & season 2010 was a blip, and 2011 will bounce back European festivals performed strongly in 2010, After incredible growth over the last decade, UK live music revenues dipped in 2010 with revenue with IQ’s European Festival Report showing growth in from primary ticket sales falling 6.7% compared to supply (16% growth in festival capacity) and in demand 2009. Whilst primary ticket sales are a key driver of (6% growth in attendances). In the UK, the number of live music revenue, this single statistic needs to be festivals grew 16%, with festivals accounting for 25% of UK ticket sales in 2010. considered in context. Not unlike the football season, the festival season The good news is that this fall is a function of supply, not as a result of falling consumer demand. There was a seems to start earlier every year and go on for longer, and relative shortage of bands on the road in 2010 and some we have yet to see what impact it has on the rest of the live of those on the road (sensibly) opted to play smaller music market; and whether the two can grow together. venues in order to limit their risk. When the big bands get back on the road and they start playing the bigger Tickets: Purchase decisions & price signalling Ticketing is a complex area, and from an venues, the demand is there and revenues will economist’s 30,000-feet perspective there bounce back. More good news is that not 6% are some interesting dynamics at work. everyone experienced a drop in 2010. At Broadly speaking, there are two types of The Great Escape festival in Brighton live music ticket buyers: the ‘die hard (UK), Jessica Koravos (MD, AEG Live) 35% fans’ who will always prioritise time was quick to point out that revenues at 40% for a gig and queue for a ticket, and The O2 arena were up in 2010, and she the ‘late arrivers’ who wait to seek out was expecting further growth in 2011. a ticket and principally drive demand 2010 was a difficult year for the 19% in the secondary market. UK recorded music industry too, However, the introduction of which saw trade values fall by 11% widespread secondary ticketing means in the year, against the backdrop of a that two key market signals (price and strong 2009. What was interesting to Pollstar’s Top Grossing note for recorded music was that five Tours of the Decade, by Age quantity) are increasingly difficult for consumers to understand. The ‘face of the official bestselling artist albums of Lead Singer in 2011 value’ of a ticket does not always of 2010 were not released in 2010. 60s 50s 40s 30s reflect the price at which a ticket can (Michael Bublé’s Crazy Love; Paolo Nutini’s Sunny Side Up; Florence and the Machine’s be purchased and ‘sold out’ simply means the search Lungs; and Mumford & Sons Sigh No More were moves to the secondary market. This growing uncertainty is difficult for the market released in 2009, with Lady Gaga’s The Fame first to maintain, and could go some way towards explaining released in 2008.) It would be too easy for the live industry to the difficult experience of the US live music market in look at its relative strength and rest on its laurels. At 2010. It is certainly important for the live industry to ILMC 23, Flemming Schmidt (CEO, Live Nation help consumers make informed choices, and particularly Denmark), was at pains to warn against complacency to encourage them to buy sooner, rather than later, in and overconfidence, stating that live music risked order to ease the cash flow burdens and mitigate risk. Finally, we often (understandably) hear outcry “being where the labels were ten years ago”. The live industry’s imperative to build for the future is at tickets selling at well above face value. However, captured perfectly by Deloitte Research charting I suggest that the tickets that sell for less than face Pollstar’s Top Grossing Tours of the Decade by age of value are a far greater concern for the health of the live lead singer, and revealing that 40% will be in their music industry, as the cheap tickets bought at the last sixties this year, with a further 35% in their fifties minute may deter consumers from paying face value next time around. (see chart).
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Above: Source - Deloitte TMT Predictions, 2011
Comment
The Winds of Change Veteran promoter Shuki Weiss calls for more understanding of the needs of Israeli music fans… The Middle East is seeing some turbulent times, as it has for 63 years since the state of Israel was founded to provide a home for a people that know a thing or two about persecution. Regional politics has never been trickier, but over the last few months it at least seems like democracy is trying to shine a little light on the area. We’ve seen questionable leadership in several of the world’s leading nations this last decade (without pointing any fingers), and that didn’t stop artists from continuing to play for their fans, and from expressing their opinions whilst on stage. From my particular point of view, as an active promoter for 35 years – in Israel for the most part – we’ve been waiting for this particular wind of change for some time now. For as long as I can remember it was the sun, the beaches, the sights and the audiences’ passion for rock ‘n’ roll that brought artists to Israel, even if over the last few years, unexpected and changeable aspects have made such visits a little less stable. That said, Israel remains an exotic, modern, and democratic destination, with a warm, enthusiastic crowd hungry for music and eager to express their love for the artists that ‘dare’ to visit and play in their country, paying them the respect they deserve. The touring acts that come this way recognise this loving audience – often describing them as one of the best crowds they’ve seen. Recently, several touring artists unfortunately chose to pass on Israel, or even worse, to cancel confirmed shows, under pressure from organisations looking to delegitimise Israel and its current policies. I say ‘unfortunately’, not because I necessarily agree with current Israeli policy, but rather because these cancellations do nothing to affect policy, ending up punishing and hurting the fans. These cancellations have hit the local music industry hard, causing enormous financial damage to promoters and many others employed in the live music business. In fact, we’re seeing cynical use of the arts and entertainment to advance political goals, and, controversial as this may be, on a personal level, I do not see the justification for this. I’d much rather see music used as the means of communication we know it can be: bringing people together under an umbrella of culture and ideas. Over the last few months, talking with colleagues in
different parts of the world I’ve been happy to discover that most of us agree that it is crucial to allow the artists they represent the freedom they need to create and to connect with audiences wherever they deem fit. Playing Israel is not a political decision, or a question of conscience. It is a matter of establishing a relationship with the fans, and inspiring them to do good – as music so often can. In Israel, a few weeks ago, British novelist Ian McEwan told Reuters: “If you didn’t go to countries whose foreign policy or domestic policy is screwed up, you’d never get out of bed… No, let us come and engage, keep talking. The worst thing that is going to happen is when everyone stops talking.” Indeed, over the last few years we’ve worked on projects looking to inspire positive change by influencing music fans, such as artist workshops in Israel and the West Bank with colleagues from Palestine and the international community teaching kids to use music as dialogue rather than let hatred and fear rule, or simply live music events giving artists the stage in order to pass on their message, whatever that message may be. Israel is blessed with some of the world’s most unique venues and rising standards of equipment and expertise have recently helped establish a wonderful reputation for this market. Also, some of the industry’s leading companies have now set up shop here, such as Eventim Israel, who bring the latest global ticketing technology and know-how to the country, improving the fans’ concert-going experience and the promoters’ real time access to information. This has also enabled us to market more tourist packages throughout Europe and the world, inviting the international community to see their favourite artists in some very unusual and stunning venues. In September, we’ll have 3,000(!) tourists from Brazil travelling to see Roberto Carlos play in Jerusalem’s Sultan’s Pool – beneath the Tower of David, with the walls of Jerusalem’s old city as a magnificent backdrop. In a region desperately looking for answers, the arts should be leading the way; inspiring change rather than ignoring reality. Peace begins with education, not delegitimisation. Our hope is to be inspired through connection with the world’s artistic community. www.shuki.co.il
Comment
On the Beat Derek Smith, Association of Chief Police Officers Lead on Charging for Policing looks at the relationship between the festival industry and the Police in the UK… You know – most of us like most of you! The perceptions of the police from festival organisers (and vice versa) are often shaped more by urban myth than reality and, on both sides, are more influenced by history than the present. Let’s be clear: the festival industry is growing. Attendance at festivals in the UK has been increasing quickly in recent years. The number of festivals has also grown to well over 700 for 2011. As a result, the festival industry is a thriving commercial business. The top 20 festivals generate some £500million (€575m) – including tickets; food and drink; memorabilia, and accommodation. It is clearly very successful. But there is a range of threats and risks that continue to require police input. And these have changed over the years. There has always been less of a tribalism threat for public order than has existed within football, but as the number of festivalgoers rises, so there are safety and crowd control issues that must be addressed. Similarly, the ‘free spirit’ days of old have changed in character. There are still undoubtedly risks related to drug selling and using at festivals and some public order issues related to alcohol. Equally, on the sites there is likely to be the normal range of personal crimes. These can cover the full spectrum of offences but for the most part, they are thankfully, low level. The majority of people go to the events to experience being at a festival and to see and hear their favourite performers. As festival promoters and organisers, you have a number of issues and concerns: a) There is a wide disparity in the perception of the role of police and promoter. Some feel over policed as a result, not only onsite but outside. b) There is a wide disparity in the cost of policing involved and charged. National police guidance seems to be inconsistently applied. It is also true that forces are inconsistent in charging practices which leads to confusion. Some events that should be charged for are not. c) There is little negotiation – promoters often get told what policing is required. There is seldom any approach to risk mitigation that will help to offset the need for officers. This could be cost substitution where equipment (eg CCTV cameras) or stewards are used to reduce
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potential police costs. From the service’s viewpoint, all of these events mean additional preparation and policing. Each festival represents a new policing demand every time. There is no magic formula to deal with the relative risks at festivals. They reflect different numbers of different attendees at each event and each is affected by its own geography. This not only affects the sites but often the immediate communities. We shouldn’t underestimate the impact that festivals can, and do, have on neighbours. The limits of police cost recovery have been tested in the past and the service accepts that even where there is a policing requirement that stems from the existence of the event – where it is remote from the site – the policing may not be chargeable. Thankfully, the number of arrests and public order incidents at festivals remains relatively low. However, there needs to be an acceptance of the relevant roles that are required to deliver safe and trouble-free events. And this should be on both sides! An event that results in very few incidents requiring police intervention may be considered by the organisers to be over-policed, but it must be remembered that a police presence acts as a significant deterrent. A delicate balance needs to be struck regarding police numbers that must include a good degree of professional judgement. The requirements can be and should be honed by proper consultation and planning, and should be carried out on a risk-based approach, with agreement on what is the best way of dealing with each risk. In most significant events, policing will be part of the solution but it need not always be the whole solution. There is scope for alternative ways of addressing some risk. Policing is an expensive resource. Nobody has ever complained about being undercharged(!), but being underpoliced at times could be a tremendous risk to the public. I want the service to engage properly and consistently with the industry professionals. The national guidance has been amended to allow a proper dialogue to take place that will try to eliminate some of the inconsistency currently seen. I hope that it can help shape the future approach to what is a very successful entertainment industry for the country. I also hope it encourages perceptions to change. We do like you – really.
Survival...
Bob Paterson of BPA Live on life for the UK’s smaller regional agents, venues and promoters...
My background is in radio – Radio 1, Radio 2 and GLR, working with Johnnie Walker and Bob Harris and hosting my own show on various stations, but I became an agent in 1999 having promoted gigs in small clubs in London (The 12-Bar Club and The Spitz). Leaving the big city in 2002 to live in Suffolk I identified a gap in the market for quality live music, reacquiring the promoting bug in 2004, and then using the 120-capacity High Barn in Great Bardfield, Essex. Now, as Movers & Shakers Promotions we promote the likes of The Ukulele Orchestra of Great Britain, Bellowhead, Ralph McTell, Show of Hands, and Al Stewart, throughout the county. The smaller end of the market has never been easy, but the last two years of economic problems and restrictive licensing laws have been the toughest, with established promoters, venues and agents not taking any chances. This has opened the door for amateur promoters and with the internet, lesser known musicians and bands have found new ways of booking tours, oversaturating the market and driving down ticket prices. There is still an appetite for smaller gigs but with more competition, acts that tour too often are suffering and punters are attracted by the cheaper ticket to see something new or to save money for the special high priced ticket in exotic venues. Smaller venues and promoters have had to adapt and many have become very savvy. Some operate early-bird tickets to entice punters to purchase in advance as some are still waiting until the last minute for concerts they think won’t sell out. You can easily detect when there is a buzz on an act and those shows sell out fast. Most now use online ticketing, with systems like WeGotTickets seeming to be the most user-friendly as the punter, not the promoter, pays the commission.
“ Smaller venues and promoters have had to adapt and many have become very savvy.” But as the giant promoters still somehow manage to lose enormous sums of money, the smaller operators are still out there, and whilst we have seen a large number of venues close and festivals cancel over the last few years, we have also seen many flourishing. I would say that the present period could certainly be described as Darwinian during which the good ones are managing to survive.
PEOPLE POWER Social media has evolved enormously in two years, but its full impact on live music is yet to be discovered, argues Charlotte Mceleny...
A H B H A
lmost two years ago there was a lot of talk about social media, as MySpace was ousted as global frontrunner by Facebook, but while it excited many, a large shadow of doubt hung over the seemingly fickle audiences. Since then, there has been a seismic shift in the attitude towards social media by brands and companies, which has in turn started to bring in a sizeable increase in investment. Fast forward to the end of 2010 and spend on social media advertising topped $2.1billion (â‚Ź1.5bn) worldwide, according to media analysts BIA/Kelsey, and is expected to grow to $7.7bn (â‚Ź5.3bn) by 2015. No longer an afterthought, most companies, celebrities, musicians and organisations have in some cases opted against launching websites altogether in favour of a Facebook page. For most companies, the past two years
have been a process of getting the basics in place and then experimenting. But the next phase will see integration and, according to experts, the most exciting and effective use of social media will come from innovations in mobile, advertising formats, e-commerce, video and data.
A H B H A
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esitation over adopting social media has been based around concerns for consumers, particularly around technology such as mobile. For live music, the increasingly close tie between social media and mobile has only intensified its importance as it helps to link social media activity with physical events and venues. But while check-ins, QR codes and near field communication technologies have been nascent in the past, that giants such as Facebook are now wading into the game with their own versions can only help to
Social Media
encourage mainstream adoption. Dominic Cook, a former marketing and content director at MySpace (after 12 years in the music industry at Virgin and EMI) has now set up social media marketing and social tech PR agency, 33Seconds. He says that while the music industry has always been more tech-savvy than many, it has yet to get to grips with localisation and targeting. “Bands in general have always been forward thinking in this space,” he says. “From the late 90s, bands were building online communities and talking direct to their audience. MySpace helped take this to a new level and Facebook, Twitter and YouTube have taken it even further. Other industries can learn a lot from the music industry about how bands connect to their fans and give them a reason to engage and build a two-way relationship.” Advanced customer relationship management systems and data mining techniques have changed the field radically over the last 18 months, with many promoters, ticketing companies and artists are now beginning to deliver targeted messages and product to fans. But a common issue for a lot of social media activity is that there needs to be a steady flow of communication in order to maintain a relationship with consumers. This is something festivals or venues, with strong communities or narrow genres, are able to do with ease, but for venues that one night have a pop act but the next have classical, it is not an easy balance to strike. The commitment to creating the content and assets, beyond posting event links and information, is a challenge for some because the broad variety of music and tastes makes it incredibly transient. The more niche the offering, the easier it is to relate.
artists’ social media activity and says that utilising the increasing amount of assets that record companies hold is key in helping to promote live shows. Lucy Blair, digital marketing manager, says: “At the moment we help with social networks for our artists. A lot of them tend to tweet themselves and I tend to do the Facebook pages and blogs. For us, live music is an increasingly important part of our business.”
A H B H A
“We are of the view that social media is not an add-on. Our mindset is that social has to be a part of everything.” – Steve Jenner, Kilimanjaro Live Sonisphere festival, run by Kilimanjaro Live, is one of the biggest festivals on Facebook with over 600,000 fans worldwide. Steve Jenner, digital director of the company and founder of Virtual Festivals says social media is the company’s primary method for disseminating news and updates to its audience. “It is basically used as the first port of call for getting content out as you instantly get 130,000 in the UK, for example, seeing it in their newsfeed,” he says. “As a free source, you cannot beat it. We are of the view that social media is not an add-on. Our mindset is that social has to be a part of everything.” Ministry of Sound (MoS) runs a large majority of its
lair reports that some promoters are “savvy” to using social media, while others “aren’t so fussed”. But with ever-growing demand from fans for multimedia content, she says, “we have a wealth of content we can share, so we try and send over videos about what the acts are up to, for example, to help promote the event. The more you can do to convey the personality of the artist the better... push artists to do as much as they can.” Better collaboration between artists, management, labels and promoters is a key issue, but even once the content that will help drive engagement with fans is established, the large range of social media sites and social music services is growing and more complex than ever. According to web measurement firm Nielsen, Facebook is the dominant platform by a long shot. Globally, Facebook has over 600million users. Nielsen figures suggest that in its global statistics (which include the US, UK, France, Germany, Spain, Italy, China, Australia and Brazil), Facebook has 280million active monthly users, representing a reach of 63%. The social networking behemoth is still growing at a rate of 25% year-on-year according to stats, while Twitter has only grown 23% in the same time, to reach 52million users worldwide. “Bands have a number of platforms and tools that can help them reach their fanbase and ‘socialise’ their gig dates, their music, their videos, their products,” says Cook. “SoundCloud, Topspin, Bandcamp, ReverbNation, Music Glue are all tools and platforms that help bands reach their fans more effectively. For fans trying to discover live music, Facebook and Twitter are still leading the space in terms of volume and reach. While sites like Songkick are trying to provide a focused service.” Facebook has recently launched a Facebook for Musicians page, which includes tabs to help bands and venues get to grips with using the platform. A spokesperson for Facebook tells IQ: “Music has always been social. We all grew up sharing mixed tapes or CDs, going to concerts and movies with friends. Those experiences and conversations with friends are now being brought online, and Facebook is providing the platform. From up-and-coming bands, to chart superstars, Facebook provides the tools for any musician to create an engaging social experience.”
One site that is on the rise, particularly in use by my music brands is Tumblr. Nielsen figures reveal that the site has increased its global audience by 189% in the past year, from 9.18million in March 2010 to 17.38million in March 2011. Amy Kean, director of social media at media and advertising group Havas Media, says, “Tweeting can restrict creativity so Tumblr is a good alternative.” The link between Tumblr and music is getting closer as the blogging platform announced in June that it was allowing SoundCloud users to directly record and upload their music. Similarly, SoundCloud has also linked up with Songkick, tying the connection with recorded music to the live experience. In February, SoundCloud announced it had reached 3million users and David Adams, head of content and music relations, says, “our players can be embedded across the web and connected to third party applications. So users may be on SoundCloud, listening to a SoundCloud player on an artist’s site, or streaming a track via SoundCloud on an artist’s app; we put the audio at the heart of how fans research and discover acts.” Indeed, the SoundCloud and Songkick collaboration is just one way in which social media is evolving beyond a tool to publish and promote gigs, to being a link between real sales and physical experiences. White label ticketing company CrowdSurge claims to have just sold the first ticket in Facebook, and currently has dates on sale for the likes of Kaiser Chiefs, White Lies and Coldplay. Founder Matt Jones, says the company has spent over six months planning the Facebook application which allows consumers to purchase tickets without leaving the social media platform. “The response from the industry has been good – it has little barriers to entry and you can share events and purchases directly from it with friends,” he says. “White Lies initially launched in
the UK but will now follow in the US, while we are now rolling it out worldwide and for merchandise. “You get people when they are most receptive,” he continues. “If you look at an artist like Lady Gaga on Facebook, she has a huge captive audience but they need to be monetised. Direct purchases through Facebook make sense, particularly as almost 20% of online time is spent there now.” Jones also outlines how the CrowdSurge app gives users the ability to share and hold tickets for friends, allowing them to buy tickets in adjacent seats at a venue. But while such ideas are pushing the curve, the speed of evolution in the social media space is leaving many to catch up.
A H B H A
avas Media’s Amy Kean, who works with high profile brands including Domino’s Pizza, Santander, L’Oréal and Heinz, says there is an increasing pressure to innovate in order to gain cutthrough with audiences. “Everyone has done the housekeeping by getting their pages but we are now hitting a phase of that not being enough,” she says.“From a PR point of view, you’ll get no headlines for just having a Facebook page and consumers are not wowed by just another competition. There is now a pressure to go above and beyond to create something that has longevity, facilitating social occasions. And a page is not an occasion.” Kean highlights a recent campaign by Heineken which created Bluetooth bottle openers that automatically created an event on Facebook once a beer was opened. The branded event then invited people to join in having a beer, and the event with the most attendees each week won a free case to enjoy together the following week. And with engagement through social media increasingly coming from events and offline situations, the role of the mobile phone is growing rapidly.
Top 10 Music Sites, ‘global’ unique audience (9 key markets*) from home and work computers, March 2011 Mar-11 Rank
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Name
Audience Reach
Active Reach
Mar-10 Audience
Active Reach
YOY audience change
1
VEVO
54,157,358
12.30%
2,162,085
0,51%
2405%
2
AOL Music
23,146,367
5.26%
28,588,709
6.69%
-19%
3
Yahoo! Music
16,983,043
3.86%
21,415,427
5.01%
-21%
4
MTV Networks Music
14,297,823
3.25%
13,727,421
3.21%
4%
5
Terra Musica
13,678,796
3.11%
10,745,105
2.51%
27%
6
Jango Music Network
10,499,631
2.38%
11,155,302
2.61%
-6%
7
CBS Interactive Music Group
9,692,132
2.20%
n/a
n/a
n/a
8
Pandora.com
7,897,287
1.79%
5,267,383
1.23%
50%
9
iG Música
7,696,069
1.75%
n/a
n/a
n/a
10
Sony Music Entertainment
5,764,098
1.31%
6,618,677
1.55%
-13%
I Q Ma g a zin e Ju ly 2 0 1 1
Social Media
“Mobile is very exciting as up to 20% of our traffic now comes via a mobile device, so it is a big deal,” says Kilimanjaro’s Jenner. “As a result, all our sites are mobile enabled and we’re looking into launching iPad and tablet versions. QR codes are another way we are looking to expand our marketing. At the moment print ads are expensive and you have no way of telling how many people have seen them but QR codes can capture that by linking people and tracking how they arrive on your site.” “It is extremely important to make the connection from the online to the physical space,” adds SoundCloud’s Adams, “If you are playing a show, why not privately send a track to all those who signed up to your mailing list from last night’s show? It’s not just a track that is your only promotional tool but other forms of audio can help push social media to promote your live show such as an audio tweet or audio tour diary. Max Roachford recently audio-tweeted during a sound check at the Royal Albert Hall to excite fans about the show that evening.”
A H B H A
longside mobile, the most talked about trend in social media at the moment is social commerce, or f-commerce, as the majority of activity has so far been carried out on Facebook. There has been a broad reluctance to launch Facebook pages as there is concern from many companies that consumers have doubts about their privacy on the site, slowing adoption. Kilimanjaro’s Jenner says that although they have a Facebook store, they aren’t getting much use of it from consumers, although he believes that making the investment was important because consumers will warm to the idea of transacting on there. Similarly, UK music retailer and venue owner HMV has also set up a Facebook store but only sells CDs and DVDs as it does
“You’ll get no headlines for just having a Facebook page and consumers are not wowed by just another competition.” – Amy Kean, Havas Media not want to invest in the back-end support for tickets until sure of a bigger demand from consumers. Matt Potter, online content manager at HMV, says he isn’t yet persuaded to add the full product range. “It’s not huge but we’re seeing it work already,” he says. “For big-ticket events, the most important place to announce is via Facebook, but we link back to the site because they go so quickly. We don’t want to give our Facebook followers a worse experience.” HMV’s response highlights what an interesting stage social media is currently at for businesses. It has proved itself to be essential, yet the innovation and technology that will successfully monetise it are still developing. Because the barriers to entry are lower, it’s easy to be in the social media space, but as a promotional channel for promoters and artists, there are still more questions than answers. While Facebook is a dominant force in the market and will help to push key emerging trends for live music (such as location-based services) smaller start ups such as SoundCloud and Tumblr are also paving the way with easy-to-use services. The foundations have now been laid, and the future for social media is bright if not a little hazy. The challenge, however, will be to stay ahead of the curve; to innovate and arrive where consumers spend time before the competition.
Top 10 Music Communities, global unique audience (9 key markets*) from home and work computers, March 2011 Mar-11
Mar-10
Audience
Active Reach
Audience
Active Reach
YOY change in audience
280,333,570
63.67%
223,897,157
52.38%
25%
Blogger
119,514,370
27.14%
110,982,968
25.96%
8%
WordPress
56,879,947
12.92%
49,547,834
11.59%
15%
52,276,383
11.87%
42,632,241
9.97%
23%
Myspace
34,707,981
7.88%
60,898,286
14.25%
-43%
31,092,260
7.06%
23,305,579
5.45%
33%
Orkut
30,246,759
6.87%
28,143,712
6.58%
7%
Tumblr
17,380,696
3.95%
6,007,966
1.41%
189%
Badoo
15,428,692
3.50%
9,187,629
2.15%
68%
Yahoo! Pulsa
12,985,233
2.95%
n/a
n/a
n/a
Name
Charts: Source - Nielson, March 2011 *US, UK, France, Germany, Spain, Italy, Switzerland, Australia, Brazil
Reaching the Peaks Climbing mountains, competing in triathlons, building superstars and international touring festivals…there are very few promoters like Stuart Galbraith, writes Adam Woods...
S
tuart Galbraith had been due to ski Mont Blanc the week before he spoke to IQ about his 30-year career. In the event, a cold he thought he had shaken off came back with a vengeance when he reached altitude. So he went climbing instead. “This is where we were.” He waves a print of a terrifying spike of vertiginous rock on which a man stands, waving his arms. “That’s not me,” he notes. “I didn’t stand – I crouched.” It would have made sense to ask why climbing this thing was somehow easier than skiing down the snowy mountainside. Instead, we talk about stamina, which, according to Galbraith, is what climbing is all about.“I don’t think it’s any coincidence that most really renowned climbers are in their 50s and 60s,” he says. “Psychologically and physically, I think you embody stamina much more as you get older. Life’s not a sprint by that point.”
G
albraith founded Kilimanjaro Live after he explosively left Live Nation not quite four years ago, naming it after another successful climbing project. On the subject of stamina, the company he calls ‘Kili’ is clearly not just a means for a veteran promoter to keep his hand in. Described by Galbraith as a boutique promoter, Kili nonetheless sets itself big targets. Its travelling rock festival, Sonisphere, visits 12 markets this summer, with Metallica, Iron Maiden and Slipknot atop the bill. Kili is also the sole owner of Cardigan Bay’s wakeboarding and music festival Wakestock. The company’s touring artists include Placido Domingo, Grace Jones, Josh Groban, Katy Perry, Red
Hot Chili Peppers, Metallica and Wilco. Among its rising acts are Marina and the Diamonds, Band Of Skulls, Wolf Gang, Mona, and Ed Sheeran. As a joint venture with AEG, Kili also puts shows into the European O2 network, bringing the Royal Horse Gala, Festival New Orleans and Ozzfest in recent years. These four areas: festivals, touring, artist development and O2 spectaculars account for the full Kilimanjaro portfolio. Having launched on 1 January 2008, Kili inched over into profit after a couple of years of anticipated losses, and from his corner-office sofa in Southwark, London, Galbraith professes himself very pleased. “I am definitely having more fun now than I have ever had in my whole career, because the position I have got is very, very varied,” he says. “The good thing about Kili is it’s almost the best of both worlds for me, because we are able to be small and nimble, but equally if I need to draw upon the partnership with AEG, and the funds and global influence that they have, we can do so very quickly.” Having promoted Simply Red, Def Leppard, Guns N’ Roses, U2, Simple Minds and AC/DC, with MCP; and Bon Jovi, REM and the Red Hot Chili Peppers in his Live Nation days, Galbraith might perhaps have picked up a couple of big clients and operated as that kind of boutique promoter. But that would be to disregard the festivals – from Monsters of Rock to Download, Wireless and Hyde Park – which remain his abiding passion. Festivals need small bands as well as big ones, and so the four-pronged strategy was, he says, a straightforward choice. “For me, they are all interlinked,” he says. “I
Above: Galbraith in June 2011 Photo: Awais
Stuart Galbraith
have been involved with festivals since 1984, when I started at MCP, and I did Monsters of Rock until 1996. Without sounding clichéd, it’s in my blood. I know how to run festivals; I like running festivals. “But you can’t build a festival just on big bands. You have to have small bands, and you have to have a development team to book them. And there is no point me trying to book small bands, because I don’t eat, live,
“I am definitely having more fun now than I have ever had in my whole career.” sleep, breathe rock music, because I have got such a varied portfolio. People like [Kili bookers] Alan Day, Mark Walker, Steve Tilley and Sam Thomas do, and they know that genre collectively inside out. “It was never, for me, an option, just trying to do big bands, because if you want longevity and you want a broad base, you have to break new talent. It is brilliant for me that we are involved with things like Ed Sheeran or Wolf Gang and probably 20 or 30 other acts that we are breaking through, and those are our festival headliners in five years time.”
T
here is no doubt that the shape into which Galbraith has moulded Kilimanjaro can tell us a lot about the parts of his career he has relished, and those he hasn’t. Having taken the time-honoured route from university social secretary (at Leeds, from 1980 to 1984) to promoter at MCP, for 15 years thereafter, he himself isn’t shy to spell it out. “Kili is almost a combination of my previous two situations,” he offers. “MCP was just four of us, and we sat in a room, decided what we wanted to do and got on and did it, very, very quickly. Against the situation I ended up in at Live Nation, where we were obviously a
Ian Grenfell – Quietus Management 9 Sept 2010, 8.15pm Grand Couloir, 3300metres, Mont Blanc descent So we’ve been on our feet since 4am having had minimal sleep at the Tete Rousse Hut. Ninety mountaineers in four rooms, no running water, one toilet, dehydration, exhaustion, altitude sickness, elation. The snow is falling heavily now. It’s dark so we have head torches. The final danger is the Grand Couloir, a 100m pass, famous for stone-fall catching unsuspecting climbers. I’m first across. In an instant, a rock the size of a grapefruit hits me on the side of the head. It feels like a gunshot. I’m wearing a helmet so I’m shaken but alive. I look up and there’s Stuart – he’s just dislodged the rock unwittingly. Maybe he thinks he’ll get a better Simply Red commission rate with me dead. I first met Stuart in 1992 on Simply Red’s Stars tour and since then we have worked on many arena tours with the band and occasionally conspired on other business ideas. I’ve not met a promoter without a healthy ego but in my experience Stuart doesn’t let that get in the way. Issues come and issues go but I don’t think I have ever doubted Stuart’s advice regarding the UK live music business. As well as encouraging me to climb Mont Blanc, probably my hardest physical challenge so far, he cajoled me into doing a triathlon last year (he beat me in every discipline) .He is fiercely competitive, ambitious and open to new ideas. He can come across as hardnosed but he’s as sensitive as the next man and is never happier than when he is talking about his daughters achievements. Dean James – Mama Group Stuart is a good guy in an industry not known for good guys. Rob Prinz – United Talent I first met Stuart in the early 90s when he was working for MCP and we did a string of Bon Jovi shows together in the UK. He seemed quite a fresh and ambitious young man and I could immediately tell he was someone you could rely on (except when he’s climbing a mountain somewhere and claims no cell reception!). Roy Morley – Event Logistics I worked for Stuart at MCP for ten years and he guided me through the hurdles of organising outdoor events. This was prior to the Popcode but at the time MCP pretty well led the field in pushing standards to a higher level regarding organisation and planning of outdoor events. This was an amazing opportunity for me and I’ve been using the knowledge gained ever since. In
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Above: Summit of Mont Blanc, 9 Sept 2010 (L to r): Ian Ramage, Stuart Galbraith, Andy Perkins (guide), Ian Grenfell, John Cude and Tim Blakemore
Stuart Galbraith
multinational with a staff of 120 by the time I left, and things took somewhat longer.” This corporate heft isn’t the element of Live Nation that Galbraith wishes to capture at Kilimanjaro Live, but the sense of building something from scratch and by force of will. When MCP was acquired by Robert Sillerman’s SFX in 1999, independent promoters that sold out to the incoming Americans were not popular people. “We were despised within the industry,” Galbraith recalls. “We had sold out and we couldn’t get arrested on a street level. Slowly but surely, we brought in a booking
“You need to earn trust; you need to prove you are a good new promoter.”
between the ruthless efficiency we did occasionally manage to enjoy a few moments and I particularly remember going to pick him up outside the hotel in Milton Keynes (while we were looking after a couple of mad weekends with Guns N’ Roses and Metallica) at the appointed hour to find he’d been ‘playing golf’ all night. This match involved hitting the ball over the hotel... obviously a 100% success rate wasn’t achieved... Jim MacDonald – G4S Stuart is very much the successful entrepreneur – everything he touches seems to turn to gold; everywhere he goes success follows him. Wakestock has been growing since we got involved and to say that Sonisphere is successful is an understatement because it’s sold out where other festivals haven’t – it gives you an idea of the level of Stuart’s expertise. Javier Arnaiz – Last Tour International The day before the first Spanish Sonisphere in Barcelona, John Jackson called to say James Hetfield had suffered
team and we grew it. It was a case of plugging away for three years until we got the team built. You need to earn trust; you need to prove you are a good new promoter.” MCP was part of a shopping spree by SFX that autumn which also included Barry Clayman Concerts and Apollo Leisure, as well as Mojo Concerts in the Netherlands, and Galbraith vividly recalls the hostility. “I remember the ILMC in 2000, when the topic of the entire conference was how SFX was the end of the live industry as we knew it,” he says. “And sure enough, it has certainly changed the face of live music, without a shadow of a doubt.” Spectaculars aside, Galbraith derives his greatest satisfaction, he says, from building a team. Promoters such as Andy Copping, Steve Homer, John Dunn, Toby Leighton-Pope and others came up under his watchful eye in the Clear Channel/Live Nation days. “And now with Sam, Mark, Alan and Steve here, we are doing exactly the same again,” he says. “Each one of them has a musical genre they specialise in, and between them they make a great team. I like seeing the guys building their own rosters, helping them and providing a platform, the way I have done a couple of times already in my career.”
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ith AEG on board, with the funds and support that implies, and in a market that has long since reconciled itself to corporate creatures, Kilimanjaro Live wasn’t born into the same adversity and ill-will as SFX in its British incarnation. All the same, Galbraith’s abrupt split from Live Nation in September 2007 hovers persistently over the conversation. It is something the man himself has never publicly discussed, but rumours have certainly flown: that Galbraith was sacked when he was found to have been planning an
Above: Terrorvision © PG Brunelli
Stuart Galbraith
exodus to AEG (which never transpired); that he was given five minutes to clear his desk. He isn’t about to dish the dirt now. Although he is happy to discuss Live Nation, his pride in his achievements there and its role in his current thinking, legal undertakings prevent him from discussing the split in all but the vaguest detail. “Obviously, the departure wasn’t perhaps as I wanted it to be,” he says. “In fact, it definitely wasn’t as I wanted it to be. The fact is, in building Kili, I will learn from the mistakes we have made elsewhere.” He reveals that he thrashed out the terms of his joint venture with AEG in less than 48 hours, though he won’t say precisely when. “I was able to achieve within 48 hours with AEG what I had not been able to achieve with Live Nation in nine months,” is the summary he offers. And regardless of the birthing process, the company emerged fully formed. “The discussion with AEG was to set up the partnership with the four strands,” he says. “They made it very clear that their priority was filling The O2, and now filling their European network. “The festivals help us do that. The development of new talent helps us do that. We can point to examples, whether it’s Katy Perry, who is already playing The O2 – in that particular instance, Live Nation promoted her there; we do the Midlands – or whether it be taking Ozzy Osbourne and Ozzfest in there.” As Kili’s proud declaration of its boutique status
an injury during a show in Portugal and our show was at risk. The only thing we could do was keep our fingers crossed, and wait. It was a tough night but Stuart told me not to worry. The next day, he said had found a solution. If the band cancelled, we would flip a coin to decide which one of us would announce the cancellation on stage in front of 40,000 fans... then he turned around and went for breakfast. Luckily, James managed to recover and the show was just perfect. Stuart must have known something, mustn’t he?! Ewald Tatar – Nova Music Stuart is a very nice and straight forward partner and also a friend. When you speak to him you can be 100% sure that he knows what he is talking about and his personal opinion and know-how is always appreciated. He’s a very innovative businessman and promoter with lots of news ideas and concepts, which is definitely one of the secrets of his success. Jordan Berliant – The Collective Stuart is an incredible promoter and I look forward to the next 30 years. Rob Markus – WME Entertainment Stuart has always been a fair and responsible promoter and handles situations with grace – probably all reasons why he has been around for so long! Charlie Lister – William G Search Limited It was July 1993 when I first heard from Stuart, a date that’s hard to forget as it helped reshape my career. Nothing particularly unusual, just a fax asking for a quote for cabins and toilets. What was unusual for us was that it was for U2’s Zoo TV concert in Roundhay Park. It proved to be both the start of a lasting friendship between us and the beginning of our role as a major supplier to the music industry. I’ll always remember Stuart ringing me the day before our first Monsters of Rock to say Aerosmith would like a toilet and shower fitting in their cabin. Still a little green I recall saying “But you didn’t order one.” The reply was typical of the man: “I know, but they insist on having one... get it sorted and welcome to the world of rock and roll!” It’s been both a privilege and fun to work with Stuart over the years and he was certainly instrumental in my involvement in the business and for that I will always be grateful. When and if he ever leaves the event industry I’d urge him to consider a role as a trainer in advanced negotiating techniques. You know when he calls and mentions the great sold out gigs of the past, that
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Left: Monsters of Rock at Donington
Stuart Galbraith
the begging bowls coming to shave the price on the current one that’s struggling with ticket sales. That may be a better option for him than a career in golf, even though I can always say I witnessed his birdie on the tenth at the Belfry – the fact is that’s his only golfing claim to fame! Phil Mead – NEC Group We opened G-Mex in Manchester in 1987, a building converted into an exhibition and conference centre from Central Railway Station. At that time, I was part of the management operating G-Mex. Stuart and MCP were instrumental in helping us to make this venue work and in doing so teaching me the critical issues to address in order to run successful arena-capacity gigs. This was, of course, before there was a purpose-built arena in Manchester. Stuart’s determination to make this venue work and to attract world class acts no doubt made a serious contribution to the massive Manchester live music scene in the late 80s and early 90s. I have a debt of gratitude for his assistance in those early days and of course he has never stopped innovating in the entertainment industry since. Adrian & Ian Wilson – Creative Events It has been a real pleasure working with Stuart for over a decade on such great events as Wireless, Hyde Park Calling, Live 8, Ozzfest, Sonisphere and many, many more. Stuart has shown us unwavering support over the years and his endorsement has helped us grow from a fledgling Prince’s Trust Company to where we are today. His loyalty to those who work hard and deliver a great service is unquestionably a principled quality which is becoming harder to find in this day and age.
indicates, Galbraith is not terribly covetous of corporate scale. “I think there does come a point where scale becomes a restriction to momentum and actually provides inertia,” he adds. “It is not my ambition to see Kili become too big. We are currently 20 employees. I can’t see that we will become more than 30, maximum.” Sonisphere has its conceptual roots in the Live Nation days, and Galbraith offers it as an illustration of what he can do now. The original plan was to take the Download model and put it on the road, but with established Live Nation festivals in so many territories, it made no sense from a business point of view. Sometime later, in the company of John Jackson of K2 Agency, he took the proposal to other overseas promoters and then to AEG, who provided the funding. “Sure enough, year one, we lost money; year two, we have just about broken even; and year three, we will be developing it as per our business plan.
“Change means one of two things: you are either fearful or you love it, and I absolutely love it.” “Working in partnership with a private company has given us much more flexibility and the opportunity to try things that are not possible within the rigid structure of a public company,” he concludes. The Sonisphere concept came together at the Led Zeppelin show in December 2007, when K2 Agency’s John Jackson, who had been thinking along much the same lines, proposed a partnership. Three years in, Sonisphere still has to fulfil the global implications of its name, but Jackson says a number of promoters are already lined up for dates outside Europe. He takes particular pride in the rapid growth of the Knebworth UK flagship event, and credits the Kili team for much of its success. “Stuart and his team run the best festivals I have ever attended, end of story,” says Jackson. “Everyone who attends Knebworth says what a fantastic atmosphere we have, and that has to be down to Stuart and his brilliant team.”
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albraith speaks to his AEG colleagues, including AEG Live chief executive Randy Phillips, on a daily basis, and anticipates that the next 18 months in the life of the company will be particularly interesting. “[Incoming European CEO] Jay Marciano has just arrived, and he is three offices along, with the primary function of knitting together buildings and content providers in the AEG family,” he says. “Then there’s
Above: Rammstein set the festival alight Photo: PG Brunelli
Stuart Galbraith
obviously the changes to the ticketing landscape, which represent huge opportunities and scope for growth.” Ticketing and technology in general push his buttons, as do all elements of on-the-ground customer service, about which he is passionate. A veteran who doesn’t necessarily look – or climb mountains – like one, he doesn’t claim to be an expert on inbound technology, but he knows he wants to get on board. “Change means one of two things: you are either fearful or you love it, and I absolutely love it,” he says. “I would love to be able to talk in detail on a technical basis, but I don’t have that ability. But I have got a great technical team here, and that was one of the absolute priorities to me.” Accordingly, Sonisphere has nearly 700,000 Facebook followers across Europe, and its website, he claims, is the biggest dedicated rock site in the world, selling 90% of all the shows’ tickets. For each festival, there is a mobile app, and that is just the starting point. “With the advent of mobile technology, I can very easily see me selling you a ticket that comes straight onto your phone,” he says. “It will be an app, it will update you with information every week, it will have running orders and site maps, it will be an electronic wallet and it will help you find your friends.” It’s a long way from Leeds University at the dawn of the 1980s – although maybe not as far as all that. As social secretary, Galbraith booked ZZ Top, U2, Simple Minds and The Clash and was censured for turning a £10,000 profit, “because it meant ticket prices were obviously far too expensive.” Offered a job at Midlands Concert Promotions by Tim Parsons and the late Maurice Jones, whom he counts, with Barry Clayman as his professional role models, Galbraith postponed his place on his biophysics, microbiology and genetics course and ultimately, didn’t look back, catching an early wave with Simply Red. “He was industrious, he was very enthusiastic, very keen to please,” recalls Parsons, now retired. “He wanted to work with us and I wanted him to work with us, and he became what I’d consider to be a world-class event producer relatively quickly.” Q Prime’s Peter Mensch, manager of Metallica, Red Hot Chili Peppers and Snow Patrol, knows Galbraith from those days. “I met Stuart when he was Maurice Jones’ tea boy,” he says. “Or maybe I just thought he was Maurice’s tea boy. He went all the way from being a local Walsall-based independent promoter to being a London-based independent promoter, albeit with at least one major stop in-between. Q Prime works with Stuart because we remember those independent days and we celebrate them every time we see him. He is still enthusiastic about music. And he still cares. And that’s all you can ask.”
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From top: with John Jackson (right) and Metallica at Sonisphere 2009 with Jerry Seinfeld at The O2, June 2011 with Bob Geldof and family at Live 8, July 2005 Team Sonisphere at the UK leg, 2010
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3D
The Next Dimension? Life changing or a quick gimmick? The impact of 3D on live music has yet to be fully realised, but a strong demand for content is fuelling the format, reports Greg Parmley…
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arlier this month, UK pop band JLS premiered a 3D film across 270 cinemas in the UK and Ireland. The film, mixing concert footage and backstage reportage, sold 65,000 tickets on its first day of release, while a range of merchandise, including a branded sleeve for the 3D glasses and postcard set were developed specifically. JLS are the latest in what is fast becoming a very long line of artists to use the format. From 2008’s $15million groundbreaking U2 3D, to AEG Live/Action 3D-produced films by Justin Bieber and Dave Matthews, and more recently Kylie and Lord of the Dance, it seems that everyone’s having a go. But the technology itself is hardly that new. The concept of 3D film has been around since the early 20th Century, although the format’s ‘golden era’ in Hollywood was during the early 1950s when all the major studios released full-length 3D features, as they are doing once more today. So what we’re seeing is the reinvention of old technology, albeit supercharged for the new millennia. And opinion is widely split as to whether the current interest in the format is an inevitable game changer for live entertainment, or simply a passing fad. “It’s no longer the quirky trend people thought it was going to be 18 months ago,” says Paul Sanders at AV supplier Creative Technology. “It’s here to stay. Especially now the domestic market has taken hold of it.” Against this, renowned music video director Simon Hilton argues that, “there’s a lot of ‘emperor’s new clothes’ about it. A lot of people are throwing money at it, but it’s not a natural experience. 3D still feels very 2D, and most people report discomfort wearing the glasses for more than 30 minutes.” Hilton’s view is not, however, shared by Vicki Betihavas, whose company Nineteen Fifteen recently shot Lord of the Dance and The Prince’s Trust Rock Gala at London’s Royal Albert Hall. “It’s about understanding the demographic that will embrace this, and it’s not 45-year-olds, it’s 15-year-olds,” she says. “Ten years from now they won’t understand what 2D is about. There’s no reason they wouldn’t want to consume content entirely in a 3D space.” But a New York Times article in May asked whether the 3D boom had already gone bust after North American cinema-going audiences shunned the 3D version of Pirates of the Caribbean: On Stranger Tides.
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egardless of the longevity of 3D, insurance broker and aspiring film investor Max Robertson argues that it presents substantial opportunities. “Record companies aren’t putting a great deal of money into things at the moment, so there’s more opportunity for people with money to invest into rights,” he says. “There’s a lot of investment happening and it’s a unique window.” And of all the investors currently taking a stand, British satellite broadcaster Sky is arguably the most forthright. In April 2010, it began broadcasting 3D into pubs and clubs, before launching a home 3D channel in October. “We think it’s a very exciting space and offers a viewing experience that doesn’t exist anywhere else,” says Sky 3D channel director John Cassy. “There are loads of choices in the UK TV market, and if we’re asking the consumer to pay for something, we have to offer something bigger, better or unique. 3D is one of the ways of differentiating ourselves against our competition.” While the channel primarily screens sporting events (over 100 since it launched), arts and entertainment is also part of the mix. This summer, Sky “3D allows music to punch above its weight in terms of TV production because if you do it , it really transforms the viewing experience.” – John Cassy, Sky has signed-up Isle of Wight and Bestival, while Kylie’s Aphrodite: Les Folies film premiered on 19 June. “We led the charge with HD in the UK, and we now have 3.5 million homes paying £10 (€11) per month to watch HD channels,” Cassy says. “We don’t expect 3D to be as dramatic as that, but we think it has a longterm future. Throughout the history of TV, it’s always been about getting better picture quality or sound and 3D is the next step.” The Isle of Wight festival – the first European event to be filmed in 3D – was shot for Sky by Blink TV, which was also behind the Kylie production. And CEO Bill Lord says that Sky’s enthusiasm and investment is what’s driving the fledgling industry. “We’re lucky in
the UK in that we’ve got the most expert and progressive 3D broadcaster in the world, by some way,” he says. “Music is very much a part of our programming plans,” adds Cassy. “3D allows music to punch above its weight in terms of TV production because if you do it right it really transforms the viewing experience.” Aside from TV, the other principal application for 3D currently is in cinemas, and of the numerous distributors in the market, Omniverse Vision is proving particularly active both with 2- and 3D content. The management team hails from music television, artist management, cinema, theatre and ticketing. James Dobbin was formally at Vue Cinemas. “There’s an interesting marketing angle for 3D because it offers something slightly different for the consumer,” he says. “In Vue in 2008, 2% of films were 3D. This year it’s pushing 30%. So there’s a move towards it, but not every single production looks fantastic in 3D; it only works when you’ve got a big production and depth.” While film studios are pushing hard to keep audiences engaged and paying, cinemas are gradually upgrading their technology. In the top five European markets for cinema (UK, Germany, Spain, Italy and France) there are now 4,770 digital screens, 75% of the regional total. “It’s relatively easy to get 3D content into cinemas,” Dobbin says. “It’s easier for recorded than it is for live at the moment – live 3D broadcasts require a technical upgrade. In the UK, there are only 100 cinemas that can do it right now.” Last summer’s World Cup was broadcast live in 3D, Lucrezia Borgia became the first opera to be broadcast live in 3D in February, and in March, Sony signed a deal to broadcast tennis matches from Wimbledon this year to hundreds of cinemas worldwide.
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he possibility of simulcasting live 3D concerts of one-off performances or high demand tours is an attractive one, particularly in a time when many artists are being forced to explore alternative revenue streams. “It’s being done more as a PR exercise at the moment, but over the next couple of years you’ll start to see more and more of it,” Dobbin says. But outside the world of cinema and TV, does 3D have a use in the live environment? Here, at least, opinion is more consistent. “There are screens and there’s potential there, but
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the glasses are the limiting factor,” says Blink TV’s Lord. At Creative Technology, Paul Sanders agrees. “If you have a bunch of people at a dance event or festival bouncing up and down wearing glasses and they come off, they’re not getting the same experience,” he says. “There are LED screen solutions that are both passive and active, but a lot of it is down to cost. Using passive glasses and a passive set-up still requires resolution and manipulation of sorts within the display and for people to use glasses. You can brand the passive glasses and do a giveaway, but for active 3D glasses, there’s a significant cost.” Creative Technology recently showcased the technology – active, passive and 3D projection – to “It’s with the content people; the creatives who want to ask questions and push what can be done.” – Paul Sanders, Creative Technology many within the industry, an exercise that Sanders says has paid off. JM Rental is one of the world’s largest screen rental companies, with offices in Hong Kong, Shanghai, Beijing and Guangzhou. Operations director Kenneth Yip predicts “the advance of 3D manufacturing technology where the [polarizing] filter can be inserted onto each LED lamp”. And confident in even JM Rental’s larger outdoor screens to offer compelling 3D, Yip believes that the format is perfect for live music. “Through the actions of performers and 3D live-camera shooting, it narrows down and even breaks the barrier between the singers and fans,” he says. Another screen supplier, XL Video is also actively providing LED screen solutions that work with 3D, including for pantomime productions where actors interact with digital characters. Like Sanders, director Malcolm Mellows says that the use of 3D at concerts is currently limited. “To do it at places like The O2 in London? At this time there will be a lot of people that won’t benefit it,” he says. “I see a general impetus and requests from more and more customers to use 3D projection or LED product in large environs but it still has to be taken to that level.” And as far as giving up the glasses, Mellows says “the current small LCD plasma displays that don’t require glasses [the Nintendo 3DS being a prime example] are painful to watch for
Above Left: Creative Technology’s 3D showcase Above Right: The shoot for ‘Aphrodite: Les Folies’ in 3D takes it out of Kylie
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long periods.” And the development of the technology to a useable concert size is considered many years away. So for now at least, gig goers are stuck with the glasses, and it’s not something that will suit bigger shows. But while the technology might be limited, Sanders says that the “applications are far and wide and it promotes further creativity. A lot of dance acts are looking at 3D and it’s still evolving. People are coming out with 3D-ready products now and there are a few bands out there who’ll really ask questions of it and that’s the exciting bit. It’s with the content people, the creatives, who want to ask questions and push what can be done.” Couple this with demand for 3D content from broadcasters and cinemas worldwide, and it becomes an interesting proposition. “As more and more channels open up, there’s only a finite amount of Hollywood movies they can put on endless rotation,” says Lord. “They will inevitably target the entertainment industries as a source of content.” So while it may have drawbacks, 3D provides a unique opportunity for artists to engage fans both in underserved markets and in previously impossible ways.
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“There’s a lot of ‘emperor’s new clothes’ about it. A lot of people are throwing money at it, but it’s not a natural experience. 3D still feels very 2D.” – Simon Hilton
Giving up the Ghost
ood 3D effects aren’t just about screen technology, and one of the other main techniques actually predates 3D film by 60 years. An old theatre trick called Pepper’s Ghost has been resurrected and patented by a company to offer 3D holographic projection on stage. Musion set up eight years ago, and recent work has included creating a digital replica of Black Eyed Peas’ will.i.am for a Sheryl Crow tour, a 15-date holographic promo tour by German rockers Tokio Hotel, and a 26-metre-long effect on Sarah Brightman’s world tour in 2010. “A lot of people don’t understand how simple it is to apply our system into a live space – that’s been
our challenge – to meet with production people and get them to understand how exciting and artistic this can be,” says head of music Sanj Surati. “We get lots of phone calls from people who want to bring stars back although the challenge is to recreate that charisma.” Musion is also focussed on licensing its technology to permanent sites around the world, and then delivering 3D content. “For example, the Wimbledon museum has a permanent 3D installation of John McEnroe,” Surati says. “We currently have eight and we’re looking to grow to 300 in four years. It presents opportunities for A-listers to perform all over the world and get paid for it, without leaving home!”
Above: JM Rental’s screens in action during the World Cup in 2010 Below: Musion’s Black Eyed Peas show
Talent’s Got Britain With the second largest musical output in the world, Great Britain punches far above its weight in the live music stakes. Greg Parmley reports‌
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Great Britain
Introduction The naTions ThaT form Great Britain – England, Scotland and Wales – make up one the most vibrant musical landscapes in the world. By population, it ranks 22nd in the world tables, but in terms of musical output, it’s second only to the United States. Around this hotbed of creativity has sprung an industry dedicated to seeing it out on the road, and it’s proved so successful that in 2009 the value of the live music industry outstripped that of the recording industry for the first time (see chart). “Music is part of people’s lives here; we’re bombarded with it from the moment we’re born and people continue to go to concerts until they drop,” says Jeff Craft at London-based agency X-Ray Touring. “The sheer volume of people who go to gigs sets us apart. We have a phenomenon of many people in their 50s going to gigs regularly, which doesn’t happen anywhere else apart from in the US in the country music field.” In Scotland, Geoff Ellis, MD of DF Concerts concurs. “Britain is more of a rock ‘n’ roll country than any other,” he says. “Manchester, Glasgow, Liverpool are all hotbeds for producing bands; any night in Glasgow you’ve got 15 gigs to choose from. There’s so much live music here and people love it.” Ellis describes the news that last month (in another first) the industry’s principal associations united to join trade body UK Music as “a huge step forward”. That what had previously been disparate factions have finally pulled together to present a united
front reflects an industry that while still relatively young is gradually maturing, and Ellis says he hopes the British Government will begin to recognise the importance of the industry as a result. UK Music’s recent report on music tourism claims that the industry annually contributes £1.4billion (€1.6bn) to the British economy, although its value dropped 6.7% in 2010, according to collection society PRS for Music. “It’s vibrant and there’s lots going on but actually selling tickets at the moment is tough,” cautions Phil Bowdery, president of touring at Live Nation. “It’s not just live music; it’s theatre and many other forms of entertainment. It got to the Easter period and then box offices started to dry up.” Melvin Benn, MD of Festival Republic, reports a tough economic climate having also affected the sales of some festivals. “The British economy has been hit hard, and there’s a lot of uncertainty – people don’t know how much money they’ll have in their pockets in three or six months’ time,” he says. Recession might be a talking point, but it’s far from the only pressure that industry leaders face. With rising VAT rates; widespread cuts to arts funding proposed legislation, such as the late-night levy which threatens to further tax cash-strapped venues; a decline in ancillary spend; rising energy and production costs; and more pressure from artists than ever to deliver, it’s no easy street. Yet the British live music industry continues to thrive, innovate and grow.
Live and Recorded Revenue, in £m 1500
Recorded Music Trade Value (BPI) Primary Tickets (PRS for Music)
1200 900 600 300 0 2004
10000000 8000000 6000000
2005
2006
2007
2008
2009
2010
Source: PRS for Music
Great Britain
Promotion Developed and competitive networks of promoters keep Britain’s live scene vibrant… JusT as an unquenchable ThirsT drives musicians to perform across England, Wales and Scotland, so the number of promoters wanting to stage the show continues to grow. Since the likes of Harvey Goldsmith, Mel Bush, Arthur Howes, Barry Clayman, Danny Betesh and Barrie Marshall defined the business in the 60s and 70s, the landscape for promoters has filled with innumerable companies and characters that operate in every niche, region and style. On a national level, Manchester-based SJM Concerts is top dog. The company is currently in the midst of the UK’s largest stadium tour ever with Take That – 29 dates (including two in Dublin) totaling 1.8million tickets. It has a shareholding in Scotland’s DF Concerts, and co-promotes V Festival with London-based Metropolis Music, with which it also has a share of Academy Music Group alongside Live Nation. In fact, with frequent venue relationships and shared interests among Britain’s top promoters (and MCD Productions in Ireland) it can be hard to distinguish ally from adversary. “It’s still very competitive, but all that competition is good,” says Phil Bowdery, who cites recent Live Nation successes such as Rihanna’s Loud tour including ten shows at The O2 in London; Glee! Live! In Concert!, which notched up seven nights in the same venue; and the company’s annual run of shows in London’s Hyde Park N.Ireland Wales 3% Other 3% 1% North East 6%
London 23%
South West 9%
Scotland 11%
North West 12%
South East 18% Midlands 14%
The Geography of Live Music PRS for Music revenue by geographic region
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such as Hard Rock Calling and Wireless. But while some tours have struck gold, Bowdery cautions that others have underperformed. “Where we might previously have put two shows on sale, nowadays it’s one, with an option to add more if it works. The audience is really studying the ticket price more than before and they’re adding it up – two tickets, the babysitter, a meal etc. You have to be cautious about it.” DHP Group is a relative newcomer to the nationalpromoter-level having built on its ownership of five venues in Nottingham and Bristol. It promotes 1,500 shows annually, including dates for Rufus Wainwright, Imelda May, Flaming Lips and Dropkick Murphys. “The live scene isn’t a disaster, but it’s definitely a tough year, particularly with the VAT increase [to 20%],” says head of live Anton Lockwood. There are not as many shows around. Certain pop acts are doing well, but without tour support from the labels, ‘indie’ is hard at the moment.” And DF Concert’s Geoff Ellis warns that
“There are not as many bands coming through to arena level, and it’s not just about the recession.” - Geoff Ellis, DF Concerts a lack of artist development is beginning to be felt at the top end of the market. “There are not as many bands coming through to arena level, and it’s not just about the recession,” he says. “Tinie Tempah, Katy Perry and Bruno Mars have moved up relatively quickly, but a lot of artists haven’t. As a promoter, you need those arena shows to make money. Selling out smaller venues contributes to covering your overheads, but you’re not making any money.” Ellis says that Scottish promoters such as DF, Regular Music and PCL understand the country’s strong regional differences. “Geographically and culturally, we’re not the same. People [in Scotland] feel Scottish before they feel British and things that emanate from London are not necessarily embraced here. There’s also a big population gap between Bolton in the north of England and Glasgow.” National promoters sometimes include Wales on itineraries – either partnering with locals such as SWN Promotions or Orchard Entertainment, or promoting direct – but according to Lisa Matthews of the Welsh Music Foundation, many shows go to nearby Bristol or Liverpool, leaving a potential audience untapped. “Live music is a huge part of the Welsh Government’s strategy to attract new events here and support existing ones. Our biggest concern is that gaps in the venue infrastructure mean that tours ‘miss out’ Wales, as there is not an appropriate venue at certain scales.”
Festivals GB festivals are diverse, competitive and more popular than ever When iT comes To summer festivals, it’s fair to say that Britain’s got talent. What was once a niche market catering to rock fans and hippies with a high tolerance to dirt is now an industry that attracts 3.4million to events each year. At the top tier sit hardy perennials such as Glastonbury; T in the Park; Reading and Leeds festivals; Isle of Wight Festival; V; Download; and more recently, Sonisphere. Meanwhile, the mid-level and larger boutique events such as Rockness, Bestival and Latitude continue to find favour, while a patchwork of hundreds of smaller festivals cover the country from top to bottom, catering to every style of music and audience member. Indeed, the festival sector has proved so successful that it now runs from late May until September, warding off all but a few tours during that time. “It has dominated the summer season for a long time,” says Melvin Benn, MD of Festival Republic, which is responsible for Reading and Leeds, Latitude, The Big Chill, Ireland’s Electric Picnic, Hove in Norway, and a new venture in Orlando, Florida. The touring market in the summer season is pretty thin. “But it’s a complement to the touring market though, Attractions Spending £3 Million Overseas Tourists Concert Spending £198 Million
£1m Domestic £2m Overseas
Domestic Tourists Festival Spending £499 Million
and gives people an opportunity to see a band among many other bands for the first time. For the ticket price, they are fantastic value.” UK Music’s recent tourism report states that total festival spend around festivals is £546million (€618m), while considering data from primary ticket sales, PRS for Music’s Chris Carey notes, “Festivals continued to perform strongly [in 2010], with Wales nearly trebling revenue and the North West seeing 37% growth. Festivals accounted for 25% of ticket revenue in the UK in 2010.” While in relatively good health, each year brings casualties, and Benn cites the recent move to double, or in some cases Attractions triple, university fees as a concern. Spending “Students are a core constituent of festival-going, so the £3 Million Domestic impact of student fees £1m is something that none of us can ignore,” says. “And £2m theOverseas VAT rise has only added OverseasheTourists Domestic Touriststo Concert Spending the challenge. The festival industry is Festival in greatSpending shape but Million £499 we£198 do need to be cognisant of the hurdles in Million front of us when we’re looking at future pricing.” Looking to future developments, Benn predicts that few new large-scale events will emerge, “although SJM are very much looking at Milton Keynes, and there were a couple of events there last year around a festival environment. But the boutique area is where the younger, smaller players will continue to fuel growth.” Rob Challice is a partner at Coda Agency, books Summer Sundae in Leicester, is involved in the booking of Larmer Tree Festival, and sits on the board of the Association of Independent Festivals (AIF). “It’s reached a glass ceiling now – I don’t Overseas think theTourists market Domestic Tourists will take any more festivals,” he says. “This is the year Concert Spending Festivals Spending where established festivals have to consolidate £652 Million £47 Million and prove that they can survive.” AIF is currently repeating an economic impact Music Tourism Spending assessment of its 24 members which last year found that they contributed £130m (€147m)to the British economy with an average total spend per festival-goer of £346 (€391). Inbound cashless RFID technology is sure to bump that figure up over the next few years, but Challice says it’s still a tough market for the smaller players. “If you’re a major you can usually absorb a bad year but if you’re an indie and you have a bad year, it’s very difficult to bounce back.”
Spending by Music Tourists Domestic Tourists Concert Spending £652 Million
Overseas Tourists Festivals Spending £47 Million
Music Tourism Spending
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Total Concert Spend
£850 Million
Total Festival Spend
£546 Million
Total Attraction Spend
£3 Million On Attractions
Total Spend
£1.4 Billion
Great Britain
Venues Grassroot clubs can’t compete with mainland Europe, but mid range and top-end venues are well served... considering ThaT The Netherlands will shortly be opening its second multi-purpose arena, that Britain has some 17 arenas with plans for several more highlights just how important entertainment in this size of venue has become. According to figures from the National Arenas Association (NAA), music accounted for 47% of all entertainment at arenas in 2010, although attendance fell 21% on what was a record year in 2009. X Factor Live was the most attended show, followed by Lady Gaga, BBC Proms, Rod Stewart and Michael Bublé. “It’s very challenging at the moment,” says NAA chair and CEO at Capital FM Nottingham Arena Geoff Huckstep. “One of the key issues for us is the reliance upon quality acts coming through – where’s the next range of talent coming from that can fill 5,000-seat arenas and beyond? You’ve got the emergence of reality shows like Britain’s Got Talent and X Factor, so there is diversity but it needs to continue.” And while arena-level artists are spoilt for choice, big buildings carry big overheads. “There are rising venue costs – insurance and public liability insurance is astronomical. We’ve seen 200% increases in insurance and public liability insurance over the last few years and energy costs are phenomenal at the moment,” Huckstep says. “Coupled with the economic climate which means secondary spend is down in venues, it’s a real concern.” Leeds is the next city to gain an arena – the new 13,500-capacity £80m (€91m) project to be run by SMG Europe opens early 2013, the same year that the 12,500-seat Scottish National Arena opens in Glasgow. And with further arenas mooted in Southampton, Bristol and Brighton, there’s no shortage of potential sites, just
as the mid-level venue chains continue to expand. With 14 venues in its estate including O2 Academy Brixton (cap 4,900) and O2 Shepherd’s Bush Empire (2,000) in London, Academy Music Group (AMG) is currently focused on developing ties with student unions and universities (see page 57 for an extended Q&A with AMG CEO John Northcote). Meanwhile, Mama Group’s network includes the HMV Apollo (5,030), HMV Forum (2,350) and Jazz Café (350) venues in London; and HMV Picture House (1,500) in Edinburgh. “AMG and Mama Group have both done really good jobs of professionally running venues, both upping the standard and making it easier to put on shows,” says DHP Group’s Anton Lockwood. “There are going to be issues between those two companies in that they’re both fighting for survival. We’re looking in the gaps where they’re not slugging it out.” DHP’s six venues include Rock City (cap 2,450), Rescue Rooms (580), and The Bodega (330) in Nottingham, and just as Huckstep’s arena supplements live music with a resident ice hockey team, DHP’s student club nights are “what’s keeping the venues turning over”. Live and Recorded Reven “You can’t just survive on ticket income or wet 1500Dominique Czopor, owner of the 250-cap sales,” says Recorded Music Tra Boileroom in Guildford and chair of independent Primary Tickets (PRS promoter1200 and venue association we:Live. “You have to constantly be thinking about something else: how you sell to900your customer base. We’re doing a lot more discounted ticket offers at the moment than ever before.” 600 At the grassroots level, Czopor says that standards are lower than in continental Europe. “Creatively the UK 300 is at the forefront of music. We have so many amazing bands that play, but because the market is so saturated, it puts pressure on the venues. And because pubs now 0 put on so much music, it’s taken mystique 2004 2005away the 2006 2007 20 of going to a venue. At the entry level, there are more places staging live music than ever but fewer dedicated music venues.”
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Music performance in UK arenas 2005 - 2010
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Charts left: Source: UK Music Charts above: Source: National Arenas Association
Great Britain
Agency
Ticketing
Predominantly based in London, the agency scene is wide reaching...
Online sales and innovation drive the market forward...
The inTernaTional booking of artists’ tours was historically done by agencies based in London. Confined to a relatively small island, British artists of the 60s and 70s soon began to tour overseas, and their agents handled the bookings. For a long while London agents had much of the international pie to themselves, but the arrival of US multinationals CAA and William Morris (who opened London offices in 2006 and 2007 respectively) has allowed US-based agencies to offer worldwide representation, which also benefits from local market knowledge. It’s a model The Agency Group took to the US some time ago. John Giddings at Solo Agency straddles booking, promotion and festivals. “The agency business is still mainly in London, Los Angeles and New York because that’s where the talent comes from,” he says. “There are loads of decent acts out there and loads of decent agents. It’s a brilliant market and there are jobs for everyone.” But while agencies in mainland Europe have proved that artists can break there without help from London, the capital still commands respect. Key agencies include The Agency Group, X-Ray Touring, Primary Talent International, International Talent Booking, Coda Agency, Asgard, and in Brighton, 13 Artists. “Our responsibilities to artists are greater than they used to be,” says X-Ray’s Jeff Craft. “We have much more of a responsibility to earn the artists their income than we used to have.” And the role that agents are fulfilling for their clients is continuing to widen. “We’re more directly involved in the marketing of a tour now,” comments Coda’s Rob Challice. “On Bon Ivor recently we worked a ticket and album bundle, which required coordination with the promoters and the labels. You can’t say my job is just booking the show anymore; I have to adapt and be aware and I’m finding the established forms of advertising, marketing and announcing shows is changing by the month.”
The TickeTing landscape in the UK continues to feel the force of change, just as it does internationally. Ticketmaster is the undisputed leader, followed by See Tickets, Ticketline, NEC box office The Ticket Factory, HMV, WeGotTickets and many others. It’s an advanced market, with over 90% of sales made online. “As an industry we can shift tickets damn fast, as we proved with the Take That on sale,” says Will Quekett at The Ticket Factory, the former NEC box office that clocks over 2.5million tickets per year. “I don’t know many other countries that can shift a million tickets for a tour in ten hours.” “Buying trends have shifted, and people now look to book things in advance, even if it’s not likely to sell out – it’s a cultural trait,” comments Dave Newton at WeGotTickets, which now shifts close to 750,000 tickets annually. But the future of the ticketing market is all about innovation, as Ticketmaster UK MD Chris Edmonds details. “Dynamic market-based pricing solutions could be adopted more widely in the UK over the next 12 months. We will also see the development of new initiatives to distribute discounted inventory across the live entertainment sector.” Edmonds also predicts adoption of new RFID access control solutions, and that “music venues and events will see similar shifts in their distribution model, with tickets increasingly on mobile phones and payment or loyalty cards. The paper ticket could become a souvenir up sell. Selling a ticket is not enough anymore. We have seen great uptake where merchandise, downloads and limited edition souvenirs are offered alongside tickets.” Meanwhile, with See Tickets reportedly for sale and its former MD having signed up to Eventim, change is surely afoot. “It’s a smart thing for Klaus-Peter Schulenberg to have done; the combination of Nick Blackburn and Eventim will be a pretty formidable competitor,” says Quekett.
Left: Download 2011 Photo: Jess Gilbert
Great Britain
Production
Rates and Rights
Having developed close to the decision makers, the production industry is well served...
Insurance premiums are dropping, but costs are rising in other areas...
While finding The right rental kit, guitar strings or keyboard might be an issue touring some countries, production professionals say it’s not a concern in Great Britain. “We’re a plug and play country – you don’t have to bring anything,” comments Andy Lenthall, head of the Production Services Association (PSA). With fully developed rental and retail operations, the UK is also a hub for international touring, with many productions either coming out of it, or picking up kit for European tours on the way through. To list just two disciplines, dominant players in sound include Britannia Row, SSE Audio, Adlib Audio, Concert Sound and Orbital Sound; and for lighting, rental companies such as Bandit Lites, Entec, Lite Alternative and Neg Earth are well known. Production Resource Group, meanwhile, is fast becoming a one-stop shop for the lot (see IQ news). But it’s not just the kit that experts say is considered with pride. “The talent that comes out of this country is immense,” says Britannia Row boss Bryan Grant. “Production guys like Chris Vaughan, Jake Berry, Wob Roberts, Nick Levitt, Dave T. If you look at the big international touring acts, production heads still either come out of the UK or America. It’s because it’s still a relatively small bunch of people who do this sort thing.” “Grab a bunch of Facebook friends that are in production and see how far around the world they go every week,” adds Lenthall. “They follow the bands. We’re a net exporter. Nine Inch Nails a few years back had 100% UK production staff, just don’t tell the band!” “People feel they need to be based here,” continues Grant. “We have engineers and technicians working for us who gravitate here from all over the world because they’ve gone as far as they can in their own country. They come here to broaden their expertise and because they can get onto a more international level. In concert touring or major events, the decision makers and motivators are still mainly based in the UK and America, which is why production companies are based near those decision making centres.” But with numerous multinationals moving into the UK production scene (such as Tait Towers and Stageco’s new London operation – see IQ page 10), some believe the fragmented nature of some sectors will soon be changing. “The problem for sound companies, for example, in the UK is that the market is too fragmented and there are too many people operating in it,” says John Penn, MD of SSE Audio. “That’s why we have a bunch of companies that are all a similar size and it’s not the most efficient way to operate. When work declines it becomes a problem.”
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Right: British newcomer Tinie Tempah walked away with two Brit Awards in I Q Ma g a zin e February. Pictured live at Rock City. Photo: David Baird Ju ly 2 0 1 1
economic pressures on the British live music industry are currently stemming from several sources. The most controversial of these is a consultation launched by collection society PRS for Music in June 2010 to look at raising the live performance tariff. PRS claims that at 3% of gross receipts, it’s the lowest rate in Europe (Italy, Spain and Switzerland charge a 10% levy) but promoters, venues and agents argue that ticket price rises have far outstripped inflation leaving artist and songwriters more compensated than ever. The consultation is ongoing at the time of writing, although insiders predict little movement on the rate, given the outcry over the proposal. With the VAT hike to 20% on 4 January this year, an extra 2.5% has been added to the bottom line of shows, while a series of licensing issues continue to confound many. The 2003 Licensing Act which forced any premises offering live music to apply for a licence has yet to be updated to exclude small venues after it was proven to have seriously hampered grass-roots performances. Meanwhile, a proposed late-night levy designed to curb alcohol-related crime could see live music venues caught in the crossfire once more. “There is a lot of cost that’s put on to venue owners now,” says Dominique Czopor at the Boileroom. “If the costs and risks outweigh the benefits to your venue, people will simply stop putting on live music.” Thankfully, insurance premiums aren’t adding to the headache. At least according to Robertson Taylor spokesperson Steve Howell. “The insurance market is softening at the moment. It’s currently festival season, and I’m getting better rates than I was last year,” he says. Like every other sector of the British live music industry, Howell says that specialist insurance is a fiercely competitive market, although of the numerous brokers, Robertson Taylor is one of the largest with 40 staff split between the UK and US. And with a soft market, it’s not just competition driving down premiums. “A lot of that is down to clients’ history but as a specialist broker, our job is to find a good supportive market. We also spend a lot of time on risk mitigation – we work to help clients understand where the risks are and how to mitigate them so they can get cheaper premiums.”
United Kingdom
Shifting Gear Tighter margins, fierce competition, a constantly changing marketplace... who’d want to be in the merchandise game? Plenty, writes Clive Rozario‌
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Merchandise
U
ntil a few years back, the music merchandise industry was powered by black T-shirts and posters sold out of boxes at the back of sweaty venues. These days, a KISS fan in rural Malaysia can buy condoms printed with Gene Simmon’s tongue along the length of the latex, via Facebook. To most, this is an improvement. And as artists’ other revenue streams have declined, merchandise has become both a valuable source of income, and a pivotal branding tool. But the increase in merchandising services, and the subsequent dilution of the market is forcing companies to accelerate the speed at which they innovate or risk falling behind. With the demise of the CD, and the shift in music’s format to ostensibly a digital product, artists are beginning to realise the importance of having a footing in the physical world. “In the digital world, that T-shirt, that poster, that sticker, or that hat is the physical image and brand point for the artist,” says Aaron Rosen, director of Canadian company Kill The 8, which has Deadmau5 and Sony BMG Music Canada among its clients. “Merchandise is becoming an important bridge for creating, maintaining and nurturing their fan connections.” Rosen reports a mounting desire by artists to have greater creative input into their merchandise, whether it is self-designed clothing, as with pop-punk outfit Kids In Glass Houses and their range of self tiedyed shirts, or Radiohead’s involvement in the Stanley Donwood-designed newspaper edition about their album The King Of Limbs. And as the range of merch has widened, so too has the distribution network. More and more artists are emerging with their own fragrances, fashion lines, and even electronic accessories – as with the Dr. Dre-endorsed Beats headphones – in a move that has seen the merchandise sector link even more closely with the retail industry. “This is a huge area of growth,” says Keith Drinkwater, co-founder of premier merchandising company Bravado, which counts the Rolling Stones, Justin Bieber and Lady Gaga among its artists. “Over the past two years we have developed partnerships and relationships with the likes of River Island, Arcadia Store Group, Zara, H&M and numerous
high-street fashion multiples throughout Europe.” In addition, Bravado recently announced a global branding deal with Music Entertainment Sports Holdings (MESH), which includes Tommy Hilfiger as a partner, to create music- and fashion-inspired lifestyle brands. However, as major music and fashion companies start to compete for the top artist-branding opportunities, the emergence of corporate high-street and online merchandising deals pose a threat to the traditional role of the independent record shops. “A lot of the record shops and alternative clothes shops are moving to other lines, purely because they haven’t got the buying power to compete,” says Angus Choice, account coordinator for Loud Distribution, which has an annual turnover of £10million (€11m) and includes “A lot of the record shops and alternative clothes shops are moving to other lines, purely because they haven’t got the buying power to compete.” – Angus Choice, Loud Distribution
clients such as HMV and Play.com. In an attempt to provide emergency aid to the struggling independent shops, Loud Distribution has launched the Indie Collective range, and plans to twin an Indie Collective Day with next year’s Record Store Day. “We’re releasing exclusive T-shirt designs that are only available at the stockists, so you cannot buy them anywhere apart from the independent retailers that have them,” says Choice. “This is something we’re really trying to promote to get people back into the shops spending money.” Just as the big clothes retailers have shaken the indies, a recent deal might leave them feeling threatened in turn. With the arrival of the ‘value sector,’ or grocery and home shopping networks, a new merchandising channel is emerging. “The trend for licensed products and artist merchandise has seen more and more
Merchandise
volumes and ranges making their way into ASDA, Tesco, and Sainsbury,” says Ruth Blakemore, CEO of UK-based Firebrand, which marks its tenth anniversary this year, and has the venue per-head merchandise sales world record for Miley Cyrus at The O2 Arena in December 2009. When considered with Tesco’s recent announcement to begin selling booking fee-free tickets for selected summer shows (see IQ news this issue), it becomes a particularly interesting proposition.
M
ass market appeal might be one thing, but the direct-to-fan area is a current focal point for the retail strategists, with sales increasingly driven both pre- and post-concert via the artists’ online stores, and more recently, by their social media efforts. “Social media does have an effect on merchandise sales, as it does with ticket sales and brand building,” says Jeremy Goldsmith, MD of UK-based Event! Merchandising, which counts Jeff Beck, A-ha, and Imelda May as clients, and has secured official merchandising rights for the 2012 Olympics. “An artist can plug their merchandise from their Facebook or Twitter sites, to lead to an uplift in sales.” Fewer and fewer fans are subscribing their emails to fan sites, so the real time updates of Facebook and Twitter are becoming the most significant portals in which to announce an artist’s news – whether that be a new single, or a new range of shirts. “We are now seeing as much as 25% extra activity coming from the artist’s Facebook page, as opposed to their fan site,” says Firebrand’s Ruth Blakemore, “and that’s happened in the last few weeks.” However, while some companies such as Loud Distribution claim that most of its business is done via the internet, the majority of merchandise companies still make most of their profits from venue and retail
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sales. Dell Furano, CEO of Live Nation Merchandise counts KISS and U2 among his clients. He says, “If you have a major tour – like a Bruce Springsteen or U2 – it’ll gross maybe $10m [€7m] in concert merchandise, and they’ll do another 10% on their online merchandise sales, so it’s still about touring artists.” Universalowned Bravado reports similar statistics, saying that 8-10% of their sales are from online sales. But while
“We are now seeing as much as 25% extra activity coming from the artist’s Facebook page, as opposed to the artists’ fan site.” – Ruth Blakemore, Firebrand Live
the percentages are low, they’re rising. “We make a bigger and bigger effort on online sales, because we can reach our fans globally and directly,” continues Furano. “The business has definitely become more global in all respects.” Progress and the advent of the digital age might be one thing, but in many respects the merchandise sector is still following some very old school rules, particularly when it comes to what sells. “Ultimately, the be-all and end-all of music merchandise, the one product that will stand the test of time and be here through all the different fashion and innovation trends, is the T-shirt,” says Steve Lucas, owner of the UK merchandising company Green Island Promotions, which was established in 1992 and boasts MTV, ITV, Channel 4, and Sony Music as key clients. But that’s not to say that no one’s trying, and recent notables include an Ozzy Osbourne Ouija board game, the
Merchandise
Feature Title
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Above: xxx
Merchandise
infamous KISS coffin (the KISS Kasket) and the Snoop Dogg hot dogs (Snoop Doggs). All of which surround the digital age where fans are able to download or pick up recordings of the show they just attended via a USB stick, CD or Quick Response (QR) code.
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ith fans’ perennial love of the T-shirt, plus all these new items and on- and offline retail channels, merchandisers must be back-flipping for joy? Not quite, they say. The price of cotton has nearly doubled over the last 18 months, while escalating fuel costs have caused production problems and, in certain cases, led to dips in sales. Add onto that the decline in ancillary revenue spend at shows, increases in VAT in many European markets, plus the standard 20-25% venue concession rates, and the fact that the sector is making any money at all becomes all the more remarkable. “It has been somewhat of a challenge to fulfil orders for our clients and get it in on the price point they’re used to, “ says Kill The 8’s Aaron Rosen. “I don’t see the price of products going up for fans but we’re definitely affected.” Rosen’s is a sentiment shared throughout the sector: protect the customer. “Don’t make the deals so difficult on us, the merchandisers, that we have to pass the price onto your fans – the higher the royalty rates, the higher the prices,” warns Live Nation Merchandise’s Furano. Meanwhile, Ruth Blakemore from Firebrand says it’s about operating creatively: “We have to work very hard to try to keep the volumes and revenues where they are, and growing,” she says. “We do that by extending or shrinking the range – we do everything we can so that we’re not putting people off by having prices that are too high, despite VAT and cotton.” And by driving innovation in the sector, many companies are guaranteeing future business. Print-on-demand is one such idea, whereby the customer is involved in designing their merchandise. It’s a concept which cuts down on surplus stock, while the ability to buy on impulse, and on the move via mobile apps, is another area to watch develop, as is the opportunity that cashless
RFID wristbands and cards is sure to bring. This summer has seen a number of high profile trials, such as Coachella and Bonnaroo festivals in the US with Intellitix’s new access control system. In the UK, Wrist Marketing is working with Ticketmaster, Mama Group and AEG Live. Rory Musker, head of sales, says RFID bands remove the need for physical tickets and cash, but also work to deter ticket touts. “RFID wristbands are becoming a lot more attractive to live music events, to prevent cash shrinkage, to manage production staff and give the consumer a better time so they don’t have to wait to get into the event.” “We see the larger, corporate sponsored merchandise companies losing more of their clients to independents that are able to offer a more tailored service.” – Christiaan Munro, Sandbag
S
uch future innovation is likely to drive progress in an industry that has felt the full winds of change over the past few years, not least when the major labels sat up and took notice. “Merchandising is much more of a priority for record companies now, in an attempt to offer 360° deals and find additional revenue streams as a result of the downward trend in income from recording sales,” says Event! Merchandising’s Jeremy Goldsmith, referencing Universal Music Group’s purchase of kingpin Bravado in 2007, and EMI snapping up Loud Distribution in 2009. Bravado co-founder Keith Drinkwater has welcomed the integration of Universal into the sector he helped launch over 30 years ago. “Communications and planning are the big plus points,” he says, “but also dual marketing initiatives – we are endeavouring to make one plus one equal two and a half.” According to some, the ongoing effect of the big boys being involved could be consolidation, as the smaller companies struggle to find a foothold. “It may well
Merchandise be that the number of merchandising companies will shrink too,” says Keith Drinkwater. So should the merchandise sector be scared of major labels? “No, not really – they need to do something to help them survive,” says Green Island Promotions’ Steve Lucas. In fact, the involvement of the labels may add to business, as Kill The 8’s Aaron Rosen proposes: “They don’t have people who can source products, there’s no quality control function, and it’s hard to warehouse the stuff through their traditional channels. So a lot of record labels are outsourcing their merchandise initiatives – it’s been a very positive thing for us.” Perhaps no one understands the record labels’ sudden lunge for the merchandising sector more than industry pioneer Barry Drinkwater (brother of Keith Drinkwater), the co-founder and former CEO of Bravado, who left shortly after it was acquired by Universal. In 2008 he set up a new, independent company, Global Merchandising Services (GMS), which has seen some of his old and loyal clients move over to him from Bravado, including Iron Maiden and Motörhead, while scoring new clients such as The X Factor. “The margins in merchandise aren’t huge at all compared to the record business, and they’re seeing it as a natural adjunct to what they do with these acts because they spend a lot of money breaking them in,” says Barry Drinkwater. “But it’s not going to save the record industry. These are all big fat cats with massive salaries, and they are all clutching at straws to try and consolidate this by doing a land grab and bullying acts.” Guy Gillam, MD and founder of UK-based TCB Inc, which was established in 1989 and has clients including Orbital, The Flaming Lips, and Glastonbury Festival, says, “In my opinion, the current state of music cannot continue. Too many people want a
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bigger slice of every pie. There’s not enough money to go round, and the ‘big boys’ are just getting greedier and greedier.” Gilliam’s “big boys” also include the larger solo operations, but Christiaan Munro, director of UK-based Sandbag, the ethical merchandiser behind Radiohead’s inventive In Rainbows and The Kings Of Limbs campaigns, believes that it’s just a matter of time before the threat implodes. “We see the larger, corporate sponsored merchandise companies losing more of their clients to independents that are able to offer a more tailored service,’ he says. “This is because the lure of a whopping advance, firstly, isn’t as attractive to the more business savvy managers, and secondly, they won’t exist as the merchandise companies struggle with cash.” “[Merchandise] is not going to save the record industry. These are all big fat cats with massive salaries, and they are all clutching at straws...” – Barry Drinkwater, Global Merchandising Services
Territorial squabbles aside, as merchandise companies look ahead to the future – to the potential of corporate consolidation, the game-changing trends in innovation, and the increased participation from the artist and their management – they can be confident about one thing: that their sector has never been more vital. “Fans will always want a souvenir of the experience,” says Firebrand’s Ruth Blakemore, “and as long as the product is the best possible value for them, and innovative, merchandise will sell.”
Feature title
In Focus 1) 70,000 rock fans descended on the UK’s Download festival in June. Festival team (l to r) from back: Paul Cook, Hannah Farnham, Claire Collins (Scream Promotions), Michelle Stansel, Andy Copping, Kate Etteridge (LD Communications), Sarah Woodhead. Front: John Probyn, Carolyn Sims and Thomas Brook.
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2) Austria’s Novarock festival celebrated another sold out year from 11-13 June. Pictured (l to r): press agent Gerold Haubner, promoter Ewald Tatar and Red Bull’s Gregor Huhsovitz. 3) Echo Arena Liverpool in the UK welcomed its 2 millionth visitor in June. Girls Aloud’s Nicola Roberts (left) presented Lorraine Taylor with a golden ticket prize. 4) Europe Talks Tickets welcomed over 150 delegates to Berlin in late May. In the meeting Rights, Rates and Wrongs, IQ’s Allan McGowan (centre) discussed performance royalties with BDV’s Jens Michow (right) and Dave Newton from We Got Tickets.
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5) The Great Escape music festival and showcase took place in Brighton UK in May. Three days of panels included Understanding Your Audience in Changing Times. (L to r): Paul Lee (Deloitte), Steve Machin (StormCrowd), Jonathan Arendt (Planet Rock), Brian Southall, Dana Al Salem (Fanshake) and Mark Rock (AudioBoo).
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6) Hedwig de Meyer from Stageco (right) and James ‘Winky’ Fairorth from Tait Technologies (left) stand outside their new London office at the opening party in May. Both companies will be collaborating closely on shows together. 7) Yourope members attend the first Green Operations Group workshop in Amsterdam, 23-24 May (see page 10).
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7 Do you have a photo for inclusion? email info@iq-mag.net
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Insight
The MarkeT ProPerTies In his role as CEO of Academy Music Group (AMG) there’s very little John Northcote doesn’t know about venues. Long before The O2 upped the stakes for arenas, he was driving innovation through UK venues, promising cold beer, first class production, clean venues and a modern, enjoyable customer experience. The chain now boasts 14 venues in its estate, including a majority shareholding in O2 ABC Glasgow, a partnership with Leicester University Students’ Union for O2 Academy Leicester, and management agreements with three additional University venues in Hertfordshire, Liverpool and Bournemouth. As part of our UK market focus this issue, IQ grabbed a few minutes with him… Who owns AMG, and how active is the company?
disposable income which can effect spend-per-head while landlords and suppliers are looking for increases in their margins. Landlords still want rent increases and local authorities and energy suppliers want to increase revenues, so the market is certainly tight! You also have to consider your audience, and artists appealing to a middle-age range (often those
So how would you describe the UK venue market right now? Is it feeling the pinch as some tours are?
“You also have to consider your audience, and artists appealing to a middle-age range (often those with families) are increasingly difficult to sell tickets for.”
Live Nation Entertainment and Denis Desmond’s Gaiety Investments own 56% and Bob Angus (Metropolis Music) and Simon Moran (SJM Concerts) own the remaining 44%. We’re predicting that AMG venues will host over 4,000 events in 2011, hopefully attracting up to 3.5 million customers.
As far as the mid range and grassroots market goes, I’d say it was oversubscribed in some locations. The mid/lower end is difficult, due to a lack of product and the increased pressure on people’s pockets across the board. There are many hands trying to get into consumers’ wallets at present with gaming, cinema, sport, retail, all looking for their slice; so we have to offer value for money in terms of ticket prices. The difficulty is how we do this, while maintaining our margins as well. Over the last 12 months a number of London clubs have shut down – is this a sign of a market in decline?
My experience is that we are not struggling, but it’s harder to maintain margins and many artists are not touring, especially American artists, and tour support is difficult to obtain from the traditional record company source so alternatives have to be explored; ie sponsorship and flexibility in managing diary activity. Clubs are becoming increasingly important so space has to be flexible as competition becomes more ferocious. What pressures does the venue market face in the UK? What are the key considerations?
Well, there’s certainly an issue with declining levels of
with families) are increasingly difficult to sell tickets for. However, at our level it is more about a lack of quality touring acts who connect with 18-35-yearolds. And then there’s also the effect that festivals are having on the touring market each summer; with the increasing amount of activity, it’s becoming more difficult each year. How long do you see this situation remaining?
Until the economy picks up, the market will remain tough but a hot ticket is still a hot ticket and will sell. What effect the London 2012 Games will have on disposable incomes is unclear so I don’t envisage a sustainable bounce back until potentially 2013. Artist packaging and lower ticket pricing will in some cases help, with sponsorship becoming a key element to replace record company support. But while we might be facing a slight dip at the moment, I’m not overly worried. Fans will always want to see their favourite artists in the flesh, so there’s a positive future ahead.
www.academy-music-group.co.uk
Your Shout With just 12 months until the Olympics hit London, in this issue we’re asking...
“If you could be a record breaker at anything, what would it be and why?”
If you would like to send feedback, comments or suggestions for future Your Shout topics, please email: info@iq-mag.net
TOP SHOUT! Zac Fox – Kilimanjaro Live
I think a record attempt should be something that is pretty much impossible to do so I will go for answering all of the stupid questions I get asked over one festival weekend without the use of sarcasm. Brian Kabatznick – AEG Facilities
Women’s Beach Volleyball: there’s no higher sense of pride than winning on the sand in a bikini! Marc Lambelet – Black Lamb Productions
I am the nicest and most modest left-handed Frenchspeaking Swiss among the best blonde-haired kart drivers in their late 40s of the live music business professionals in the world! Gary Howard – The Agency Group
Having the world’s longest tongue. Will Page – PRS for Music
I’d hold the record for frequently getting five
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numbers or more in the National Lottery! Emiliano Tortora – Grinding Halt
I could easily be a record breaker at singing songs... I remember lyrics of an enormous amount of songs, even ones I hate. On the other hand I could be a record breaker at forgetting titles of songs, for some reason I never remember, even if I wrote the song. Sorina Burlacu – Events
If I could, as a promoter, I would break the record by selling one ticket for a U2 show. Why? All promoters try to make full house. I would sell the most expensive ticket in the world. Wesley E. Cullen – WWE
I would like to break the patience record, because that is what this business and this modern life requires maybe more than anything. If I can’t break the patience record, then the record for smiling through pain. ;) Sérgio Cardoso – Musica no Coração
Happiness in life is the goal everyone would like to achieve. So, if I could be a record breaker I would choose “longest streak of happy morning awakenings”.
Bryan Grant – Britannia Row
Would lip biting, deep breathing and counting to ten count as a triathlon? I reckon I’d be pretty good at that... John Gammon – Pollstar
I own more biros than anyone else I know. I have hundreds of the things. Rob Berends – Paperclip Agency
The record I’d like to break is: the increase in company turnover in one year. I’d like to break it twice: from 2010 to 2011, and then from 2011 to 2012. Ed Grossman – MGR Media
I would like to be the very first person to prove exactly how many holes it takes to fill the Albert Hall. Andrew Leighton-Pope
Not very funny but I would like to be Olympic champion at sourcing tickets for my local sports clubs and schools for the water events. We are five minutes from Dorney Lake with nothing. JC Corbishley – The Safety Officer
My grandfather ran a classical record shop in Knightsbridge back in the sixties. In 1964 at the age of nine I
saved up all my pocket money and asked him to get me a copy of A Hard Day’s Night. He flatly refused to order it stating that pop music was “a passing phase” and that “The Beatles would never last”. As you might expect his shop closed down and he lost everything but I ended up in the live music business. Could be a record for success out of failure. Martin Goebbels – Apex Insurance Services
I have two: 1) Scoring six goals in the World Cup Final – but I can’t say against which team for fear of upsetting Dougie Souness! 2) Paying more insurance claims despite cheapest premiums – because I don’t mind insurance but am not so keen on insurance companies! Gillian Park – MGR Media
I’d like to try to break the record for the most festivals visited in 30 days. Riding a spanking new 1200cc BMW motorbike 5,500 miles through 13 countries, I’d like to try to reach 26 major European festivals... Oh no wait a minute... I think my plan might be flawed! (Quite Gill – wait until the next issue to find out – Ed) Andy Lenthall – PSA
Closest ‘Your Shout’ to deadline?