Concert Biz a No-Show Amid Pandemic, But There’s Glimmers of Hope

Concert Biz No-Show Amid Pandemic, There's
Variety Intelligence Platform

VIP Outlook on Concert Business

The prognosis: considerable short-term pain, but encouraging signs of innovation bode well for the long term.

Just when it couldn’t look bleaker for the concerts/events business, some fascinating innovation in livestream and virtual concerts holds the promise of a long-term fundamental redefinition of this business with the potential for a significant expansion. But in the shorter term, look for the steady trickle we’re beginning to see of small-ish shows (with fewer attendees and more barriers to entry) to do little to ease the considerable pain coming to this sector.

Damage Assessment: Key Stats 

  • Pandemic currently projected to deliver a $10-12 billion loss to the live entertainment business
  • PwC projected global live music to be worth $29 billion this year (global recorded music pegged at $22 billion).
  • This sector employs 50,000 salaried and contract employees, 200,000 part-time and seasonal freelancers
  • The pandemic has impacted 15 million tickets
  • 50,000 shows big and small have been postponed or canceled
  • The summer alone could deliver the concerts business’ a $5 billion loss
  • Summer 2020 concerts could have been a boom time for the business, on pace to post a 30% year-over-year increase in total volume; 50 million advance tickets sold
  • A concert blackout in the second quarter of the year would amount to $2.8 billion in lost ticket sales (no refund possible)
  • (sources include Pollstar, Billboard and Bloomberg)

Consumer Sentiment

47% agreed that the idea of going to a major public event “will scare me for a long time.” (Performance Research/Full Circle Research Co.)

59% of respondents are willing to attend a live event again within two months after the pandemic ends or a vaccine or treatment becomes available (MRC Data)

5% said that they would go to sporting events, concerts and shows when the lockdown is lifted (ASI/Screen Engine).

The Concert Biz Constituents

Live Nation Entertainment and AEG Presents are the twin titans of the live entertainment business, gobbling up approximately three-quarters of the sector’s revenues. But as hard as they’ve been hit by the pandemic, they’ve got the cash reserves to weather the storm over the long haul. The outlook for the many smaller operations they dwarf isn’t as rosy.

Musicians have become increasingly reliant on touring profits as recording revenues have been waning for decades due to the struggles of the streaming business. Even as platforms like Spotify represent a vast improvement over the lawless Napster years, royalties are still skimpy for even the biggest streaming hits. Hurting right alongside musicians are the support staff they rely on: managers, sound technicians, roadies and food services.

Short-Term Fix

Travis McCready almost took to the stage May 15th at Temple Live in Fort Smith, Ark., for what what would have been no ordinary kind of performance.

The show would have been the first careful attempt in the U.S. to begin to thaw the concert business out of the deep freeze that has gripped it since the pandemic began. To make the concert safe, less than a quarter of its 1,100 seats will be filled and those who fill them must wear masks and get their temperature taken before entering the venue. (Update: After a cease-and-desist order from the governor of Arkansas, Temple Live agreed to postpone the concert).

Welcome to the tip of the spear of a strategy dubbed “staged evolution,” which calls for the gradual return of a business, starting with smaller venues like Temple Live and working their way up over time to stadiums and arenas. There’s even such a thing as drive-in concerts in this phase.

But how much time will staged evolution last? 12-18 months seems to be the consensus.

This is band-aid, one that might not work. Even if it does, it will do little to stop serious bleeding this business won’t be able to avoid.

Long-Term Hope

But as bad as where things stand right now for the live music business, there’s an incredible ferment of innovation taking place on a number of fronts worth noting. The business models that will take these new new modes of performance have barely begun to take shape and there’s risk a return to post-pandemic life could wipe out gains as quickly as they’ve been made. Nothing is going on that holds the promise of the immediate short-term relief this industry needs, but the long-term potential of what’s bubbling is not to be underestimated.

After last year’s successful foray into virtual concerts with Marshmello, Epic Games’ Fortnite scored a smash hit again with an animated avatar of hip-hop star Travis Scott putting on a 10-minute show April 23 that drew more than 12 million players (four replays reached 27.7 million unique gamers). Scott scored himself a No. 1 debut for his new album, and there were ancillary merchandising revenues to be had as well.

    • Scott/Fortnite is just the beginning of the trend, where avatar creation is being put to use for the music industry by One Wave and others.
    • DJs like D-Nice and Porter Robinson are becoming buzzed-about sources for live music that get as close as you’re going to get to recreating a club atmosphere at home.
    • Twitch and Instagram Live are emerging as homes for new formats like “battle series” featuring name-brand artists i.e. Verzuz
    • While live-streaming concert performances have been around for ages, it’s truly flowering now on platforms like Bandsintown.

The Last Word

It’s not that any of this experimentation is going to come anywhere near making up for the massive losses coming to the concert business in the coming years. But at a time when the outlook is about to turn real dark, there’s a glimmer that could be the light at the end of the tunnel.

(Updated May 16th)