Welcome to 2020. A pessimist would say we’ve just capped the second decade of the 21st century; an optimist would suggest we’ve just begun its third. Either way, we arrive at this mellifluous sounding year with a helluvalotta stuff going on. There’s so much going on around us on the business and technology fronts that it’s getting harder to remember to listen to the music. (Fortunately, the music is getting better and that makes it easier: For example, Billie Eilish and the return of guitar-based rock!) But while you’re enjoying the tunes, here are some key biz trends that I think will help define the New Year.
Live Is Large
- It’s not just music anymore. The notion of a concert as a stand-alone thing is, well… quaint, in the new decade. Concerts were once live events; now, they’re part of a broader live-event industry in which mega-corporations are vying to deliver ever-bigger experiences to consumers. But the entire event needs sound, which is very good news for live-sound system providers, operators, and manufacturers.
Pro audio go-getter Jack Kelly (his Group One Ltd. company distributes DiGiCo, Calrec and SSL consoles) agrees the future is focused on events. “I think 2020 will continue to see above-average growth in the event market, including not only traditional live music shows, but other areas of the entertainment business as well,” he says. “This will drive demand upward for audio rental systems.”
Which leads us to trend #2:
More, More, More
- More brands, more consolidation — The sheer number of P.A. system brands on the market today is underscored by a walk through the InfoComm Show, the annual AV confab that itself has transformed from a tech-geek fest to a fashion-forward catwalk for cool AV. The number of sound system manufacturers filling the demo rooms has steadily increased in the last decade, reflecting how brands from around the world are converging on the U.S., where the confluence of clubs, tours and event venues make it ground zero for all things live sound.
This has been a good thing for most industry players. It had seemed for a time that the so-called rider-ready handful of brands had locked up the juiciest high-profile tours and projects. However, it’s turning out that the market has become so broad that everyone can have a place at this table (even though some will inevitably have to sit at the kid’s table).
“There is bound to be both brand and company consolidation as a result of where professional audio is in the business cycle,” Kelly continues. “I don’t know that this trend will lead to more brands or audio companies. That is often a function of someone with a good new idea or a passion for what we do. And isn’t that how we all got here to begin with?”
On the other hand…
Mergers & Acquisitions
- Success brings its own problems, and one of those is that getting a brand out above the noise costs a lot of money. When that drives margins into the danger zone, the M&A route becomes more attractive. We saw plenty in the last couple of years: Focusrite/Martin Audio; Biamp/Community; Samsung/Harman; RCF/EAW, and so on.
The acquired companies can continue to leverage their particular technologies and build their market niches, and the acquiring companies can expand their product offerings and market reach by writing a check.
This kind of market turmoil does produce casualties — the merged companies do not need two complete sets of sales forces, bookkeepers or tech support staff — but the business right now and into the foreseeable future is robust enough that few made redundant will stay without a gig for long.
Speaking of Gigs…
- The live-event industry is going to need more people than ever to run its engine rooms, and as the industry moves deeper into a networked environment, more — and more kinds — of expertise and knowledge will be required than ever before. The good news: what had seemed like an overabundance of pro-audio academies teaching Pro Tools to aspiring beatmakers has shifted its keel and has begun incorporating more live-sound education tracks. This is already creating a steady stream of entry-level workers who can fill some of the growing void at the bottom of the pyramid, from hotel ballroom projector jockeys to A1s for corporate-announcement rollouts. Combine that with this year being a presidential election year (which will create a seemingly endless round of live events and rallies) and the hardest job in live sound might be not having a job.
The bad news: they’re going to need those jobs, because much of that workforce is entering the industry with anywhere from $15,000 to $80,000-plus in student-loan debt, a sad fact that their studio-based engineering brothers and sisters have been learning for 20 years. Media arts academies are putting in some very sophisticated learning environments (including live performance venues intended to teach sound, light and video) and many of these are as good if not better than any performing arts center in a mid-sized city. These are excellent teaching platforms and will allow graduates to walk into the real work conversant with the tools they’ll find there. But they cost money, and that’s driving up tuition costs. The maybe-good news is that after this election cycle, Washington will make good on long-promised financial aid for college students. But even if that happens, it’ll take a while to come about and have an effect. In the meantime, get used to rice & beans, beans & rice.
A Few Final Points
- Now that live music is established as the industry’s main moneymaker, expect more regulatory oversight. For instance, in November Congress launched a bi-partisan investigation into the ticketing industry aimed at long-standing consumer complaints about the primary and secondary ticketing manipulation. The industry is already feeling the effects of hedge funders messing with music; now, the politicians are piping up.
- You will not escape climate change. By its very nature, touring consumes tons of fossil fuels and the pushback is underway, as Coldplay puts its touring plans on ice for as much as two years while the band says it looks for a way to make its travel modes less environmentally impactful.
- The East is Red and TikTok is coming to your iPhone (if it isn’t there already). China is the last remaining frontier for a middle class that will pay money for tickets for pop music — assuming the lyrics and costumes have been properly vetted first. So get your visa (credit card, passport or both) updated and learn a few key phrases in Mandarin by Jan. 25.
(Happy New Year!)
