Back in July, this column underscored how UK Music, the British non-profit trade and lobbying organization, has been helping that country's live music industry, both by quantifying it and through legislative advocacy. For instance, this year, a UK Music survey found that large-scale live music events, such as festivals, are contributing over £1.4 billion a year – that's nearly $2.2 billion – to the U.K. economy from all sources, including ticket sales and travel to the event locations.
The survey further found that in 2009 there were at least 7.7 million visits to music-themed events, and added that what people spent on them was enough to sustain nearly 20,000 jobs. Overseas tourists alone spent $317.5 million on concerts and more than $76 million on festivals in 2009 in the U.K. On the legislative front, UK Music has been actively (and successfully) encouraging live music at the grass roots by encouraging Parliament to exempt small venues from the restraints of the U.K. 2003 Licensing Act, which imposed strict live-performance licensing regulations on even the smallest of venues.
Gauging the Benefits
This kind of data is useful specifically for giving companies in the business of live sound some contextual base for making financial projections, and more broadly useful for offering the rest of the world a sense of the value that live sound and music bring to the larger economic picture. The legislative initiatives keep live music on the front burners and it's apparently effective. In September, the U.K. ministry responsible for culture announced plans for a wholesale deregulation of entertainment licensing in the U.K., which would lift the burden of licensing imposed by that 2003 legislation, – a direct result of the lobbing by UK Music, the Music Industries Association and other organizations.
Where, I wondered, was this kind of data and effort for the U.S. live music industry on a national basis? Aside from what we can glean from the few bits of corporate information out there, most notably Live Nation's annual reports and Pollstar's mid- and end-year data dumps, there wasn't much. But thanks to SXSW, the annual music, film and media gathering in Austin, there's another source of information that can at least lead to some predictive conclusions. A study commissioned by SXSW puts the financial impact on the city of Austin of this year's conference (SXSW) at $167 million – $44.6 million from festival-specific expenditures by the SXSW organizers and its sponsors, and $123 million in attendance revenues.
SXSW is comprised of multiple silos. There are nine days of industry conference activities, a four-day trade show, and a nine-day (and night) film festival with 300 screenings in seven venues. But the jewel in the crown is a six-night music festival featuring more than 2,000 artists on more than 90 stages, capped with three nights of free concerts at the Austin public park known as Auditorium Shores. Altogether, some 116,000 fans attend. (That number is split between crowds attending paid and free shows, but even the freebies result in concession and hospitality revenues). The financial impact study didn't break out music revenues specifically, but it's obvious they are a primary draw. (Just for some context, 86,000 fans paying the approximate average concert ticket price this year – around $64, according to Pollstar – would have generated about $5.5 million dollars at the box office alone.) In other words, the heavily music-driven SXSW event is a foundational and quantifiable event for the live music business in the U.S.
Granted, it's a single (if complex) event, but by making clear the positive economic benefits that such a firmly music-driven event can have on a city or a region, the SXSW study can be used to encourage investment at the municipal and county levels for live music of all types year round. At a time when some localities might be rethinking the costs of live music events in the wake of a string of weather-related disasters here and abroad this year, and in the face of a lingering economic malaise, hard numbers are the best tonic to keep live music and sound on civic and corporate radars as ways to generate revenue and good will.
Live Music Task Force
But the report, compiled by market researchers Greyhill Associates, doesn't come in a vacuum – there's an infrastructure the city has put in place to help support Austin's second-city-type standing in the music industry as the self-proclaimed "Live Music Capital of the World." The Live Music Task Force was created in 2008 by the city council to address issues and challenges confronting Austin's musicians and music community, with subcommittees covering entertainment districts, incentives and financing for live music venues, and assistance programs for local musicians. There is also a seven-member Music Division of the city's Economic Growth and Redevelopment Services Office.
The SXSW financial impact study, which has been done for the past three years, combined with Austin's existing live concert administrations, offers a useful profile of how live music and sound impacts the economics of a city. A few other cities and states, notably Nashville, Macon, GA and Memphis, have also periodically commissioned impact studies, though live music is only one of several components and not separately broken out. Taken together – and with more than a little interpolation – a national picture can be pieced together inductively, along with the aforementioned Live Nation and Pollstar information. But a truly clear image remains elusive. The North American Concert Promoters Association, which did address key industry issues, such as violence at venues, in the past, is pretty much on life support, marginalized as the two dominant players, Live Nation and AEG Live, have rolled up the concert production business. What the SXSW report shows us is how good live music can be for cities in America. Imagine how that could look for the entire country.
