Video Transcription:
Why are music festivals so expensive? | The Economist
I’ve never been to a music festival... ...until today Surprising I know, because in the past 20 years... ...they’ve become increasingly popular Let’s take California’s Coachella It’s been running since 1999 when it had 25,000 attendees In 2017 there were almost 250,000 of them And as festivals have grown... ...so have ticket prices In 1979 a ticket for Glastonbury, the UK’s biggest festival, cost £5 In 2019 it was £248 To put things in perspective, if ticket prices rose with inflation... ...it would be five times more expensive today In reality they’re 50 times more So why are festivals so expensive? <i>Running a festival takes a huge amount of work</i> This is Jennie Jordan, she’s a festival expert <i>We never imagined the level of detail you need to go into</i> Lak Mitchell is a festival producer He runs Boomtown... ...one of the biggest independent music festivals in the UK <i>It’s like setting up a small town</i> <i>We’ve got hundreds of lines of budgets</i> <i>You’ve got to make sure that you’ve got water...</i> <i>...to make sure you’ve got Wi-Fi...</i> <i>...internal traffic management, external traffic management...</i> <i>...toilets...</i> <i>...four different security companies...</i> <i>...food...</i> <i>...stewarding...</i> <i>...drink...</i> <i>...artist internal transport</i> <i>The list is just bonkers</i> At Boomtown it also takes 12,000 crew... ...1,596 tonnes of scaffolding... ...3m litres of water and 2,000 bins... ...and all that costs But then there’s one more thing that makes festivals much more expensive... ...the music And actually it all comes down to this <i>It’s much more difficult now to make money selling recorded music</i> <i>The rise of streaming has basically flipped...</i> <i>...the economics of the music industry on its head</i> This is Tom Standage He’s the head of all things digital at The Economist And... ...a drummer in his spare time <i>It used to be that you made your money...</i> <i>...from selling records, selling CDs, selling LPs...</i> <i>...and you promoted them by going on tour</i> <i>...and now you make your money by going on tour...</i> <i>...and releasing an album is just really an excuse for another tour</i> And as the importance of touring has increased... ...so have artists’ fees At Woodstock in 1969... ...Jimi Hendrix got today’s equivalent of $125,000 In 2019 at Coachella... ...Ariana Grande was paid $8m That’s 64 times more <i>People out there really think that we’re making millions...</i> <i>...but we barely broke even last year...</i> <i>...even though the festival completely sold out...</i> <i>...because it’s so expensive to put on</i> <i>Artists are really, really tricky...</i> <i>...because they will get offers from the big corporate festivals...</i> <i>...that are like five times what we can afford</i> Here’s the deal Over the past decade two companies Live Nation and AEG Live... ...have become a dominant force in the festival market They’ve been pushing prices up... ...and buying smaller festivals out Now they own close to a third of the British market alone Live Nation’s net worth in 2019... ...was estimated at $15.6bn And they’re scaling their business models... ...turning the likes of the Lollapalooza festival into a franchise... ...and exporting it to countries across the globe <i>Companies control the risk by running a number of different festivals</i> <i>That allows you to have mitigating factors...</i> <i>...if the weather’s awful one weekend...</i> <i>...you’ve got another festival with income potentially...</i> <i>...a couple of weeks later</i> <i>It allows them to get some economies of scale...</i> <i>...and it allows them to get the top artists’ tours...</i> <i>...so that they can offer them more than one date over the summer period...</i> <i>...and that’s very effective</i> And this means that the most popular acts... ...headline many of the big festivals While these economies of scale may be cost effective for the big companies... ...the risk is that festivals feel more samey And perhaps that’s one of the reasons why overall festival attendance... ...has declined since 2016 In Europe 18% of surveyed festivals reported a downturn in ticket sales As the market gets more challenging... ...some independent festivals have turned economic necessity... ...into an opportunity <i>When we launched Boomtown...</i> <i>...we had no chance of competing on big acts as well...</i> <i>...so we had to kind of create this model and this experience...</i> <i>...that was unique and had its own sort of identity...</i> <i>...that set itself out away from other festivals</i> This is where it gets interesting A ten-year, British-audience survey ...headline acts are a deciding factor for only 8% of festival-goers But 53% said the overall experience... ...is the reason they bought their ticket We asked these festival-goers why they’re here <i>A line-up will drag me in...</i> <i>...but when I’m here, sometimes I don’t even see any music</i> <i>I’ll be honest I don’t know any of the friggen music</i> <i>It’s nothing to do with the music...</i> <i>...it’s all atmosphere</i> And that’s part of a much bigger picture... In the past 20 years the Western world... ...has shifted from buying things... ...to buying these kinds of things In other words, experiences <i>My name is Joe Pine...</i> <i>...and I’m going to tell you all about the experience economy</i> Joe has written a book called... ...well, “The Experience Economy” <i>Well what’s happened is we’ve gone from...</i> <i>...an agrarian economy based off commodities...</i> <i>...through an industrial economy based off goods, through a service economy</i> <i>And today we’re in an experience economy</i> <i>What experiences really do is that they engage everyone inside of them</i> It’s this engagement that the likes of Boomtown are banking on... ...to pull in the punters <i>Do I know you friends?</i> In 2019 Boomtown hired 2,000 actors... ...to draw festival-goers into a variety of immersive experiences... ...spread across 110 venues throughout the festival <i>I have a question I would like to ask...</i> <i>...can you tell me...</i> <i>...who really was the man behind the mask?</i> And it’s all designed to create this unique communal experience <i>Living in the digital age that we are now...</i> <i>...there’s more need than ever for people to connect...</i> <i>...and that’s what festivals do the best</i> And the digital age also means we can document these experiences And of course show them off online <i>We take selfies not because...</i> <i>...we think we’re going to get the perfect picture...</i> <i>...but because we were there and it proves that we were there</i> <i>These are similar to...</i> <i>...that souvenir that you picked up on your seaside holiday...</i> <i>...that means absolutely nothing to anybody else...</i> <i>...but is so important to you</i> <i>That is if you like the kind of evolution of what happened before</i> <i>If you went round to someone’s house...</i> <i>...you could see what records they had, what CDs they had...</i> <i>...and that was a kind of social media </i> <i>Really posting stuff on Instagram is just the kind of updated version of that</i> And in the spirit of keeping up to date... ...pretty much every music festival is now selling the experience <i>Gather round...</i> <i>...the future</i> So what else will convince festival-goers... ...that their tickets offer value for money? <i>What’s the future of this incredible city?</i> In other words... ...what’s more experiential than experience? <i>There is an experience that changes us in some way...</i> <i>...and that we call a transformation...</i> <i>...and a transformation is the fifth and final economic offering...</i> <i>...this progression of economic value</i> <i>We’re using experiences as the raw material to guide people to change...</i> <i>...to help them achieve their aspirations</i> So expect to hear that a ticket to a festival in the future... ...will be an investment in a truly transformative experience... ...one that will offer an opportunity to help you discover your better self... ...and one that might even be worth it
