A Concert Mogul Is Betting On Electronic Dance Music
Robert F. X. Sillerman has made his return to the music business by making a number of investments in electronic dance music, as the music sensation has become more and more popular. Sillerman has made some other important contributions to the way people connect with music in the past; in the 1990s, Sillerman was the media executive who combined regional concert promoters into Live Nation.
To build this music genre, Sillerman is pursuing independent companies that host dance festivals, DJ parties, and other events that gather larger crowds. Sillerman revealed on Monday that his first attempt is Disco Productions, a Louisiana company founded by Donnie Estopinal.
Sillerman, 64, also admitted to being in negotiations with nearly 50 other companies, and to having tentative agreements with 15 of them so far. Although Sillerman did not divulge the terms of the Disco Productions deal, he said that his new company – SFX Entertainment – is expected to spend $1 billion on acquisitions within a year.
SFX’s plan involves using the internet to connect EDM fans to one another.
“There’s a wave of interest in attending concerts that have less to do with the specific music and more to do with the experience attached to the music,” he said, referring to the appeal of EDM events. “Our thought is that the experience of attending an individual event can be perpetuated and made better by connecting the people, not just when they’re consuming the entertainment but when they’re away from it.”
When the original SFX took off, the company spent $1.2 billion buying dozens of regional promoters to combine into a national organization. In 2000, Clear Channel Communications bought SFX for $4.4 billion. Clear Channel’s concert division, Live Nation, later collaborated with Ticketmaster to create Live Nation Entertainment.
“Bob changed the game that had been in place for decades,” said Josh Baron, the editor of the music magazine Relix and co-author of the book Ticket Masters: The Rise of the Concert Industry and How the Public Got Scalped. “He brought together promoters who were archrivals, and he brought Wall Street to the rock business.”
Although SIllerman’s efforts are impressive, they are only the latest in the wave of corporate interest in dance music. This genre has catapulted onto the mainstream music scene in recent years. Over 100,000 fans attended festivals like Electric Daisy Carnival in Las Vegas and Ultra in Miami. Electric Daisy is sponsoring a business conference in Las Vegas called EDMbiz this week.
Live Nation is also following the trend. Last month, the company bought a big-time British festival promoter, Cream Holdings. Last week, the site announced that it was planning a two-night dance event called Sensation at the Barclays Center in Brooklyn in October.
Ultimately, Sillerman expects his new business venture to bring in profit as dance music’s popularity grows.
“I’m confident we’ll do an excellent job empowering these kids to be as good as they can be,” he said of the promoters he expected to acquire. “I’m also confident that we will create a better experience for the fans. Can we monetize that? If we can, this will dwarf the first SFX. That’s the whole game.”
Via NY Times