All industries are dependent on the state of the economy. The sound reinforcement business is no different—which means it’s been going full steam ahead this year, powered in part by low unemployment and a public in a spendthrift mood.
The U.S. Consumer Sentiment Index, tracked by the University of Michigan, hit 96.2 in August, not far from the 101.4 it reached in March—the highest point it’s hit since 2004. Despite signs of inflation starting to kick in, consumers are feeling good about spending money, citing future income and job stability. The university’s chief economist, Richard Curtin, observed, “Consumers have not yet judged the current rate of inflation as a significant source of erosion in their living standards or as a cause to reduce their buying plans,” and noted that personal consumption can be expected to grow by 2.6 percent in the year ahead.
All of this directly affects the sound reinforcement community, as consumers continue to shell out for concert tours and goods in retail settings. People only buy tickets when they’re feeling prosperous, and that’s definitely the mindset at the moment. Pollstar reported in July that at the 2018 mid-year point, the total gross of the Top 100 tours in North America this year hit a record $164.53 million and is on track to end the year breaking records again. The average ticket price saw a 14.1 percent increase—nearly $12—to an eye-watering $96.31 in the mid-year survey, causing the average show gross of the top 100 tours to hit $742,500.
State of the Industry 2017: Recording, by Strother Bullins, Oct. 22, 2017
State of the Industry 2017: Live Sound, by Clive Young, Oct. 24, 2017
State of the Industry 2017: Post/Broadcast, by Steve Harvey, Oct. 23, 2017
The public’s current sense of prosperity is also aiding the AV installation sector as brick-and-mortar stores and malls retrench against the growing presence of internet retail by renovating and creating shopping “experiences” to keep consumers away from their screens and in shops. With consumers increasingly used to quality sound found in home and personal electronics, retail spaces are upping their game and will be for the foreseeable future. As a result, according to a market report from Futuresource Consulting, installation is expected to be the main motor behind the professional loudspeaker market in coming years. Currently valued at $2.6 billion worldwide, it is on track to reach $3.6 billion by 2021, and the report notes, “Installed leisure and installed commercial verticals lead the way for market development, continuing to post healthy growth out to 2021 and beyond. Although the installed leisure segment provides higher-value projects, the number of opportunities in the installed commercial segment is far greater.” It also posits that the Americas will be the largest market for loudspeakers throughout that time frame.
As the public’s expectations for quality sound reinforcement rise, pro audio manufacturers are answering the call at all levels, with dozens of installation loudspeakers released in the last few years, as well as multiple new flagship digital audio consoles, and the emergence of increasingly sophisticated audio networking offerings from across the industry, to name only a few examples. The economic forces at play were underlined by the Winter NAMM show’s massive expansion in January of this year, when it debuted a new two-floor pro audio wing that leaned more toward live sound than studio gear.
Money has also been changing hands for audio companies themselves this year—staging, lighting and audio provider VER merged with competitor PRG in April, with the former entering bankruptcy proceedings, which it exited this month. Overseas, UK live sound powerhouse SSE Audio Group acquired London-based SR provider Capital Sound Hire, a move that followed a strategic partnership between the companies that began early in the year. On our shores, Ultrasound—longtime audio provider to the Grateful Dead, Dave Matthews Band and others—was acquired in June by Derek Featherstone (then the company’s vice president of tour & rental, now COO) and former VER Tour Sound executive Ralph Mastrangelo.
Acquisitions on the manufacturing side have been just as common this year, as Radial Engineering was sold to Ultimate Support Systems; Blue Microphones was purchased by Logitech; and Loud Audio sold off three major brands, with EAW going to RCF Group, Ampeg moving to Yamaha and Martin Audio undergoing a management buyout.
And the year’s not over yet. With a roaring economy currently in play and consumer confidence still bolstering it for the moment, who knows what may happen before the end of 2018?