How SFX Is Marching Toward A Dance Music Monopoly

In just a few short years, the world of electronic dance music has gone from an underground movement to the hottest ticket across the globe. But this music scene that previously saw many options for fans through festivals and promoters is now dwindling with options while facing inflating ticket prices. Even though multiple festival options are still available, promoters are bowing out to acquisitions from larger companies.

Like any industry, business is business. These things will happen. However, in a genre so proudly built on freedom and individuality, could these mergers and buyouts leave fans isolated? Will the landscape of the fan base change? Is the culture of dance music headed towards an uncertain future? These and many answers will be revealed from Robert F. X. Sillerman and his SFX Entertainment.

SFX Reforms

SFX, formed in June of 2011, has become a major player in a short time. However, Sillerman's initial version of SFX was born in the '90s, and focused on the same business plan as the modern SFX: acquiring regional festivals to form one massive single-entity promotions company that covers the entire country. While you may not know it by its original name, you most likely have been to countless concerts held by SFX version 1.0 under its current name, Live Nation Entertainment.

In a New York Times piece, Sillerman made clear his intentions for dance music domination. This domination would come from a billion dollar investment right out of the gate. With a huge stake in the dance music scene, SFX Entertainment was off and running.

When the Times piece ran, Sillerman had already been in aggressive negotiations with 50 companies. Evolving from SFX's original plan would see the use of the Internet to spread the word and message of SFX's agenda. While that has been successful at spreading the word, many fans have begun to question the future of the genre they love so much. Sillerman's comments probably did not help quell the anxiety in dance music fans.

“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...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."

Powerful Purchases

Dutch mega promotions company ID&T had been the major player hosting beloved festivals and events like Mysteryland, Tomorrowland, Tomorrowworld, and Sensation. Until recently, no one would believe they would ever hear founder/CEO Duncan Stutterheim saying he worked for anyone. That is until SFX stepped up their purchasing power. Recently, Stutterheim was quoted as saying, “Now it’s very clear, I work for SFX" during the recent Amsterdam Dance Event. The acquisitions have not stopped at powerhouse promoters.

Three of the most recent companies to be purchased have been online mobile app builder Arc90, digital marketing company Fame House and Canadian startup Tunezy. Judging from these purchases, SFX is looking to do everything in house in what gives a hint of a vertical monopoly where the giant company could essentially control everything from pre-production to press coverage of the event.

Other recent purchases include the travelling event Life in Color, as well as the Electric Zoo festival, previously owned by Made Event. One of the top sources for electronic music news and purchases, Beatport, was also acquired. This has led to a reshuffling of the company's business plan almost immediately after the purchase.

In a recent IPO offering, the company continued to re-brand the dance music scene from the well-known "EDM" (Electronic Dance Music) label to "EMC" (Electronic Music Culture) for further immersion for all fans. Further proving SFX/Sillerman's acumen was the report that attendance at festivals was up over 40% from 2007.

Knowing that all things trendy are cyclical, the IPO also gave mention that, "It is possible that the public’s current level of interest in electronic music will decline.” However, seeing what is being done, it appears that SFX has a plan to keep things fresh and interesting.

Where Do They Go From Here

The backlash from the dance music community may be massive, but will it really stop SFX's plans? Not likely. At this point in the process, SFX has already branched well beyond the original dance music fan, creating the culture that SFX has been referencing for the past few years. A new controversy is brewing on the stove for SFX, as fans of the beloved Rothbury, Michigan festival Electric Forest recently received news of an uncertain future for the summer art and music festival.

Some are claiming that the story has been blown out of proportion and all will go on as planned for the festival. This has not stopped a deluge of hate being directed at SFX via the Internet, the tool that would connect SFX to the fans. The fervor heated to such a degree that SFX recently released a statement,

“There is absolutely no truth to the rumor that SFX is doing anything to halt Electric Forest. In fact we agreed to rescue the property owner and then another party began a legal proceeding much to our surprise. Electric Forest is a great festival held on a great site. We regret the actions of others but we assure all fans of Electronic Music that we only are interested in expanding the offerings available to EMC fans.”

Depending on how you look at the situation, SFX could be enhancing or destroying this beloved scene. A scene so deeply underground is now in the forefront of the world. Maybe it is time for the fans to adapt to Sillerman and SFX, because if it wasn't SFX how long until some other company figured out this strategy?

Then again, maybe SFX needs to step back a bit on the aggressive overhaul of the scene to allow fans to catch up. Regardless of where this situation goes next, it is clear that the bubble is only continuing to grow. The only question is when will it pop?

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