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    Sound Check: How High Costs Are Silencing China’s Music Festivals

    With rising costs, shifting consumer demands, and stricter regulations leading to a wave of music festivals being canceled, festival organizers are struggling to attract price-sensitive audiences while maintaining profitability.

    Days before the Wuyishan Midi Music Festival in early May, 23-year-old Li Keying had everything lined up, from hotel reservations to train tickets, eager to see her favorite band. Her plans were abruptly derailed when the festival was called off at the last minute. Again.

    “They just said it was due to ‘force majeure,’” Li tells Sixth Tone, adding that it was the second festival to be canceled in quick succession for the same reason, following the Taizhou Feilong Lake Midi Music Festival in mid-April.

    Amid the outcry that followed, Zhang Fan, principal of the Beijing Midi School of Music — which runs the festival — apologized to fans on the microblogging platform Weibo. He also hinted at deeper issues with a cryptic message: “Regarding ‘force majeure,’ I will write an article to tell you where that ‘force’ comes from.”

    While Zhang’s promised explanation still remains elusive, a wave of festival cancellations continues to sweep the industry. In 2023, despite a record-setting 560 music festivals across the nation, 91 were either postponed or canceled, according to Xiaolujiao, a domestic research institute focusing on the Chinese music industry.

    This troubling trend has continued into 2024: By June 12, at least 26 music festivals had been postponed or canceled this year, according to Xiaolujiao, most citing “force majeure,” without further explanation.

    This includes one in the southern tech hub of Shenzhen, where the organizer cited heavy rainfall as the force majeure. The explanation triggered doubts and mockery among fans, given the show was due to be held indoors.

    In a recent admission to the domestic media outlet Southern Weekly, music festival organizers said that the term “force majeure” is often used to disguise low ticket sales. This pretext was cited for the cancellation of the Starnest Mystery Music Festival, a major event in the southern Guangdong province, during the May Day holiday, which had sold only 30% of its tickets.

    Organizers also face skyrocketing production costs and changing consumer behavior, while digital entertainment options have made younger audiences more selective with their spending. Moreover, overexposure of popular bands has further reduced the exclusivity of performances, leading to staid lineups.

    Compounding these financial woes, a central government guideline this March criticized local governments for extravagant spending on massive public events. It specifically directed financially-strained local governments “blindly following trends to organize large-scale music festivals” to cut back on “new image projects.”

    The following month, a statement released by an investor behind the Macaron Music Festival in the southwestern Guizhou province revealed that they had to cancel the festival due to this regulation. Organizers say that several other festivals have been canceled since, and many more in their early planning stages have vanished following the introduction of these regulatory measures.

    In response, some festival organizers are seeking new strategies to remain viable. For example, some have started lowering ticket prices or eliminating tiered pricing to attract more attendees, while others are including more international artists in their lineups to offer a more unique experience.

    Adapting to these changing market dynamics and regulatory landscapes is essential for survival, industry insiders tell Sixth Tone. Jian Cui, a rock band agent, says the recent wave of cancellations is an opportunity for the industry to focus on quality over quantity. “It will help weed out the unqualified and preserve those truly dedicated to the industry.”

    Small town surge

    Driven by a surge in demand for escapism and social connection post-pandemic, music festivals soared in popularity across China in 2023, with the number of events more than doubling the peak recorded in 2017.

    This growth extended beyond major urban centers, as smaller towns also emerged as significant festival locales — over 100 of these festivals received backing from local governments and tourism bodies, according to Xiaolujiao.

    According to Jian Cui, local authorities leveraged such festivals to spur local tourism and demonstrate their organizational capabilities, despite the significant logistical challenges involved.

    “With full attendance, a music festival could potentially generate revenue for the region five times that of the initial investment,” says Jian.

    But with the costs associated with hosting such outdoor events and securing top bands surging, the financial landscape has become increasingly challenging. Organizers and investors, aiming to minimize business risks, often rely on the same popular artists, which has intensified competition and made profitability harder.

    “While sweeping regulations have impacted the sector, festivals that were canceled typically had weak ticket sales,” explains Zhou Chenghao, an industry veteran since 2016 and founder of LiveShop Uni, a Hangzhou-based musical event organizing company.

    He adds that during the recent May Day holiday, four of the five festivals his company was involved with failed to proceed, primarily due to poor ticket sales and the withdrawal of financially strained investors.

    Huang Dezhen, chief director of the Youth Music Festival — a major rock and pop festival in the eastern Shandong province — asserts that securing a “good” lineup for a festival in China now costs over 10 million yuan ($1.38 million), accounting for approximately 70% of all event expenditures. Industry standards suggest that expenses should ideally represent only 55% to 60% of the total for sustainable operations.

    This year, Zhou admits he faced numerous challenges while planning a music festival for a local media conglomerate for the second consecutive year, making it nearly impossible to generate a profit.

    “The cost for the same group of artists has more than doubled compared with three years ago,” says Zhou, adding that security expenses have increased too following tighter safety regulations enforced by authorities.

    “While a music festival previously needed about 8,000 daily attendees to break even, it now requires more than 18,000 attendees each day due to the increased financial demands,” he explains.

    But in major cities, regulatory caps often limit event sizes to 20,000 attendees, says Zhou. This is partly due to strict safety controls and minimal government incentive to promote such large-scale events.

    In China, organizing a music festival requires approvals from cultural, tourism, and public security authorities who set strict limits on attendee numbers based on the venue’s capacity and local infrastructure. This introduces uncertainty for organizers, as they must interpret and adhere to these rules, which are often not spelled out in clear, detailed guidelines.

    Even when organizers successfully secure approvals, they often encounter a sales dilemma: the bands and artists they’ve invested heavily in may lose their appeal due to overexposure.

    According to Zhou, under an imbalance between supply and demand, artist management agencies are over-utilizing their artists, thus reducing the exclusivity of their performances. This also shifts the risk of unsold tickets onto the festival organizers.

    He says, “Despite the nationwide high demand for music festivals, which allows artists to command steep fees, they face the continuous risk of cancellations tagged as ‘force majeure’ by financially unstable organizers.”

    Fan fatigue

    Since her first music festival in 2021, Li Keying has become increasingly frustrated with the repetitive nature of festival lineups.

    Despite hoping to encounter new and niche bands, she says, “Most festivals repeatedly feature the same popular singers, resulting in a predictable and uninspiring experience. This also restricts opportunities for emerging artists to grow.”

    The monotony is compounded by rising ticket prices. “A one-day pass that used to cost around 200 yuan now often ranges from 300 to 400 yuan, and sometimes up to 600 yuan,” Li explains.

    The declining appeal of music festivals recently trended on the microblogging platform Weibo, where a poll indicated that high ticket prices and increasingly “commercial” lineups were turning attendees away.

    According to an industry report by Dengta, an entertainment market database, less than one-fifth of young adults aged 18 to 29 are willing to spend over 500 yuan on a festival ticket, despite prices ranging from 200 to 800 yuan per day, with premium tickets costing at least 600 yuan.

    Despite these concerns, Zhou contends that ticket prices have not risen significantly relative to the costs associated with securing top musical acts. “While we are cautious about raising prices due to potential impact on sales, the demand for entertainment remains strong. However, consumers have become more price-sensitive,” he explains.

    But beyond the debatable price, Jian points out that many organizers lack the expertise and experience to host a show of high enough quality to generate revenues for themselves. The situation was exacerbated after many new players flocked to the sector, seeking quick money amid the craze instead of establishing a sustainable business.

    “While (organizers) leverage their networks with government officials and spend most of their time dealing with them, they show a very limited knowledge toward music and hosting a musical show,” Jian says. “Eyeing on a craze in a single year, they never think of making their own festival a long-term brand.”

    In recent months, a series of incidents at multiple festivals across the country has brought significant public scrutiny to the management capabilities of festival organizers. For instance, the Dayu Youth Music Festival in the eastern Zhejiang province faced intense criticism for operational issues, including a half-hour walk to the main stage and last-minute changes to the schedule, causing many attendees to miss some shows.

    However, amid the criticism and a fiercely competitive market, some music festivals have begun to adjust their strategies to attract attendees.

    According to domestic media reports, several festivals have reduced their ticket prices and abandoned the practice of assigning different price tiers for different viewing areas — a method that had previously drawn widespread disapproval.

    Some festival organizers are seeking to innovate by incorporating more international acts into their lineups. For instance, the Kiloglow Music Festival in Hangzhou, the provincial capital of Zhejiang, garnered rave reviews in May for offering a distinctive experience, with half of its performers hailing from overseas.

    Other festivals, such as the Tideverse Music Festival, the Bubbling Boiling Music & Art Music Festival, and the Cactus Music Festival, have featured well-known international artists, including U.S. acts The Chainsmokers and Fall Out Boy, and Japanese band Yoasobi, to expand their audience base.

    While some view the recent spate of cancellations as beneficial for fostering higher-quality growth within the industry, Zhou underscores that the market will remain tough for a while. “Artist costs are still rising, and we see a lot of investors who lack industry knowledge wanting to get involved.”

    But the most significant factor determining the scene’s prospects, Zhou believes, lies in people’s spending power. “The demand for music festivals reflects a fundamental human need, but whether people are willing to spend money on such events in the next two years remains uncertain,” he says.

    Editor: Apurva.

    (Header image: At a music festival in Tianjin, July 2023. VCG)