The concert industry has always considered itself recession-proof, and while the years immediately in the wake of the 2008-9 economic meltdown put that theory to the test, there’s no denying that the last few years have been rosy for most facets of the touring and festival business, including live sound.
According to the Wall Street Journal, concert revenues grew by a third between 2011 and 2015 in North America—a fact corroborated by 2015’s year-end numbers from Pollstar, which found the North American concert business breaking records right and left, notching an all-time high $3.12 billion grossed by the top 100 tours, up 14 percent over the previous year.
2016 will likely follow the trend, as it’s expected to be another good year for the audio providers of national touring systems, and likewise for those at the regional and local levels. Tour sound providers have had empty warehouses for much of the summer, whether providing full systems or just control gear to various tours. Likewise, regional and local providers have tackled audio for local events and provided support to ‘stacks and racks’ tours coming through their areas.
The fact that providers are busy is due to a confluence of trends; key among them has been the widespread change in consumers’ music consumption habits. Listeners continue to move away from purchasing music, but while streaming services are gaining footholds and momentum, they generated $2 billion for the music industry last year—a pie that was in turn split many ways between labels, artists, publishers and others. As a result, touring has become the prime money-maker for artists.
Fortunately, there’s a willing public ready to come out and see them, as the U.S. economy continues to improve. The Census Bureau announced in mid-September that 2015’s median household income was $56,500—a massive 5.2 percent jump up from 2014, marking the largest single-year bounce since 1967. More potentially disposable income on-hand usually leads to more spending, and that’s been happening this year.
At the same time, the economic presence of Millennials is increasingly being felt at the concert box-office. Nielsen’s annual “Music 360” survey, released in mid-September, found that for today’s teens and New Adults, spending on live music makes up 43 percent of their overall music spending, with 24 percent going to concerts, another 12 percent going to festivals, 4 percent going to DJ events, and small live sessions making up the last 3 percent.
Festivals continue to be a key part of the concert-going landscape, providing more economic value in terms of artists seen versus money spent. Given the increasingly niched-out musical landscape where it’s harder and harder for new acts to gain widespread mainstream traction, the trends of more and more festivals and a glut of smaller young acts dovetail together nicely, as the events provide a platform for artists to be sampled by larger crowds than they could draw on their own.
The catch is that the number of festivals keeps increasing while there’s a finite pool of artists playing live any given year, making competition for suitable headliners and mid-level artists more intense while making it harder for events to avoid carrying similar artist rosters and thus differentiate themselves to consumers. That was one of a number of theories spouted as to why the long-running Bonnaroo festival in Tennessee stumbled this spring, with ticket sales off by 28,000—an estimated $9 million in sales less than 2015.
Nonetheless, the number of festivals likely won’t thin out for some time, in part because their economic impact is so welcomed by the communities that host them. One case in point is Memphis’ Beale Street Music Festival, which drew 52,771 visitors who spent almost $21 million in total, creating more than $39 million in overall economic impact, according to a study by Younger Associates. All of this happened despite the fact that the Festival was part of a larger package of events, Memphis in May, that lost $243,000 in total.
However, the concert industry overall—and thus including audio providers—looks to be in good shape this year. At the half-year mark, Pollstar noted the top 100 tours raked in a record $1.48 billion in North America. With venues of all sizes booked up to make the most of Q4 and the coming cold months, all signs indicate 2016 will wind up as another one for the record books.