View From The Side: This Week, Dance Music Beat The Suits

How one man and his company tried to buy up the entire rave market, and why EDM isn't quite as commercial as everyone thinks...

View From The Side: This Week, Dance Music Beat The Suits

How one man and his company tried to buy up the entire rave market, and why EDM isn't quite as commercial as everyone thinks...

Like every other magazine staffed by knackered old rave bitches, we’ve bemoaned the commercialisation of dance music with the best of them. But it’s not all bad news – in fact it only seems fair that we also note when said commercialisation gets a good firm kick to the nuts. This brings us to this week’s news: SFX Entertainment- the company that have spent the last 3 years trying to take over the global rave industry- are on the verge of bankruptcy.

Here’s some background. The first incarnation of SFX was set up by Robert 'FX' Sillerman in 1989. Sillerman was a businessman who ruthlessly dominated the 90s entertainment market. His determination to own multiple radio stations in the same American region led to 1996’s Telecommunications Act, a change in America’s radio ownership laws (no doubt helped along by the lobbying cash Sillerman was gifting to the Bill Clinton led Democrats) that enabled the creation of radio monopolies. This had massive and far reaching consequences, particularly for hip hop. There’s extensive evidence that the hip hop radio monopoly created by Sillerman, and the subsequent top-down homogenisation of playlists, had serious, detrimental consequence for regional artists, conscious artists, weird artists - any artists, in fact, that weren’t pushing the gangsta rap tropes favoured by the majors. Don’t take my word for it though, here’s Chuck D going into the history in detail.

Sillerman applied the same approach to the world of concert promotion. As with many exponents of free market economics, his main aim appeared to be killing anything approaching a free market, swallowing up individual, regional promoters and venues into one massive corporation, creating another vast monopoly- a monopoly he sold to Clear Channel in 2000, laying the foundation for Clear Channel to transform SFX into Live Nation, currently the largest concert promoter in the world.     

In 2012 Sillerman decided to resurrect SFX Entertainment, this time with the intention of taking over what he called the global EDM market. In an interview with Billboard announcing his new venture, Sillerman (complete with handkerchief embroidered with the words ‘fuck off’ poking out of his breast pocket) admitted "I know nothing about EDM… But I sit in the meetings, to the extent that they are [meetings]. I meet the people whose places we're buying. And I haven't a fucking clue what they do or what they're talking about. Not a clue. And I love it. I just love it."

His gameplan remained the same – buy up regional promoters, create a monopoly and dominate the market. Sillerman committed to spending $1billion, buying ID&T who run the huge Tomorrowland brand, the Australian festival group Stereosonic, and the dance mp3 market Beatport.

The acquisition of Beatport was the most troubling purchase. Whilst fans of underground dance can – and often do- dismiss events such as Tomorrowland as mainstream fodder for novitiates, a company with vested interests in acts they book for their festivals also selling huge quantities on a massively popular online market place is always going to create problems. When the main market place for dance music becomes massively skewed in favour of the most obvious, crowd pleasing churn, the innovation that has characterised the scene for some 40 years is under direct threat. Sillerman’s keenness on complete control had already interfered with the development of hip hop through the 90s, and he looked set to pull the same trick with rave.

Sillerman in 2013. Probably not a raver.

Sillerman’s investments also coincided with – and quite likely played a part in- the meteoric rise in DJ fees. The last 3 years have seen artists from Diplo to Avicii trousering fees upwards of half a million quid a gig, and this increase has been largely detrimental to everyone other than luxury jet dealers. In such a high stakes game, everyone, from the promoters stumping up exorbitant DJ fees, to the punters paying exorbitant ticket prices to fund these exorbitant fees, to the DJs who need these exorbitant fees to cover the spiralling costs of their cocaine enemas, want to toe the line. The promoters are paying the DJs to play hits, the punters are paying the door tax to hear hits, and the DJs are terrified of playing anything other than hits. Before you know it you’ve got a culture caught in stasis, wary of doing anything that deviates from a rigidly set formula. When a huge majority of venues are owned by the same group, repeating this same formula, things look bleak.

But here’s the good news. SFX are now in tatters, and they’re in tatters because the dance music scene is still, despite a level of commercialisation that puts the worst excesses of the 90s stadium DJs to shame, a complete fucking shambles of nutters, innovators, dreamers and chancers. Thank God.

This week an interview appeared in Forbes Magazine where Sillerman announced that the game was up. Shares in the company had dropped from their opening level of $13 to a mere 91 cents. His own stake had shrunk in value from $220 million to $35 million. A buyer for SFX is being desperately sought, but right now the companies chance of survival looks slim. Rather than taking over the industry he’d been screwed by it. One of the main problems he’d encountered, which, credit to him, he readily admitted, was having a nightmare getting brands to sponsor events – the spectre of rave hedonism proved too much of a sticking point to the inherently conservative boardrooms of big spending brands. No one wanted to brand a gig where some kid OD’d on molly, and it didn't look likely that the new generation of ravers were going to abandon getting right on one any time soon. 

It also transpired that the big rave festivals were just as keen on spunking all their cash on massive eye popping light shows as they were in taking home a profit – as they got bigger, they weren’t making more money, they were just buying increasingly mental lazers. And despite Sillerman’s belief in the power of the dollar, a fair amount of the big players were defiantly not for sale. The behemoth Ultra Festival may appear to be a commercial, candy raver paradise, but Ultra CEO Russell Faibisch was quick to point out that he had been in the business of promoting dance events far before the big bucks came – "We are a very proud independent organization” he noted “and it is critical that we stay true to the music and close to the roots of the culture that we have grown with over the last 15 years.. EDM seems to be the flavour of the month for many corporations buying their way into our scene."

And this belief that EDM was ‘flavour of the month’ was the last problem for Sillerman. Despite dance music having been a global phenomenon since the early 80s, American executives were unconvinced it had any staying power. On an American commercial level, dance music has only been visible since David Guetta took the charts with his house/ RnB fusion in the late noughties. There seems to have been little acknowledgement that Guetta got to that position after a career spanning nearly 30 years of success. With potential investors having no belief in the longevity of the scene, and an enduring wariness of the drug culture that remained at it's heart, was combined with a hostility from promoters that Sillerman had assumed would fall over themselves to grab quick cash, SFX inevitably bombed.  

So whilst it’s easy to bang on about how things have changed, how everyone's in it for the $$$$, how all the music’s gone to crap, or whatever this month’s favourite gripe is, the fact remains that at the moment, there is still too much splendid chaos pulsing away at the heart of rave culture for it to be corralled into an easily flogged whole. Personally, I don;t care about a mad light show, but I love the fact that young promoters are more interested in blowing cash on huge production budgets than squirriling it away in a retirement fund. I love the fact that mainstream promoters still (admittedly only vaguely in many cases) understand that their culture is at odds with corporate bleed 'em dry money grabbing mentality. Whether that will be the case in another 10 years is a different matter, but fuck it, enjoy it while it lasts.

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