Showing posts with label Touring. Show all posts
Showing posts with label Touring. Show all posts

Monday, September 21, 2015

Live Music: Is Growth of the Industry's Largest Source of Revenue Sustainable?

Live music is the largest of the music industry's three major revenue streams, representing over 40%:

Accordingly, nearly half of the money that the average U.S. consumer spends on music is for live music experiences.

Over the past few years, the live concert industry has had a good run, globally as well as in the US, as shown in the chart below:

Pollstar reported that North American concert revenues totaled $6.2 billion in 2014 and 2015 may be another record-setting year for live music events, in terms of revenues, attendance and high ticket prices.  Many credit such growth in live music to maturing audiences, as evidenced by trade publication Pollstar’s list of top five concert tours worldwide during the first half of 2015, which includes just one act with fewer than two decades of history (i.e., One Direction):
  1. One Direction
  2. Fleetwood Mac
  3. The Rolling Stones
  4. Garth Brooks
  5. Paul McCartney

There is clearly a risk that the live concert industry (and industries that depend on it, such as pro-audio equipment), will suffer sharp declines as top-grossing entertainers and their audiences age out of the marketplace.

However, it is worth noting that the above list of top five concert tours during the first half of 2015 does not reflect the latest Taylor Swift tour.  Also, it does not reflect non-tour related events such as festivals and electronic dance music events, all of which attract a younger demographic of consumers with lower discretionary income than the typical Fleetwood Mac or Paul McCartney concertgoer, but who are likely to continue to attend music events for decades to come.

Regardless, some analysts believe that, as the over-saturated market for festivals contracts, live music revenues may decline.  Also, while electronic dance music has been a bright spot, notable EDM promoter SFX has struggled financially. 

The bottom line is that few experts think the record growth in live music is sustainable in the long term.