Media mogul and Live Nation founder Robert F. X. Sillerman is set to invest $1 billion into dance music in the next 12 months as the trend of companies looking to tap into the electronic dance music market continues.
With the US rave market booming two decades behind the rest of the globe, 64-year-old Sillerman is hoping to re-ignite the dance market in the same way he 'transformed' the live music business in the '90s by forming industry powerhosue Live Nation by acquiring and combining regional promoters and reports from the US indicate that he's planning a similar strategy with dance music.
The American dance music scene is considered fragmented at the moment and industry observers believe the move could be a dramatic swoop to rejuvenate the industry from an economic viability perspective.
The New York Times are reporting that Sillerman's company - SFX Entertainment - has tabled offers to 50 promoters and companies around the US, with 15 looking like they will accept. Sillerman has announced that the first acquisition in the spree (for an undisclosed amount) is Louisiana's Disco Productions, a promotion company founded by rave promoter Donnie Estopinal. Estopinal is affiliated with Insomniac Events as well, who host the Electric Daisy Carnival festivals.
In announcing the deal Sillerman said that he expected to spend $1 billion in the next 12 months.
"Our thought is that the experience of attending an individual event can be perpetuated and made better by connecting the people," he told the paper, "not just when they're consuming the entertainment but when they're away from it.”
Speculation is that the new strategy will involve connecting fans through the internet and then selling an aggregated audience to advertisers.
He added that SFX will likely leave the regional promoters to continue to run their own events as they have been.
“I'm confident we'll do an excellent job empowering these kids [acquired promoters] to be as good as they can be. I'm also confident that we will create a better experience for the fans. Can we monetize that? If we can, this will dwarf the first SFX. That's the whole game.”
That 'first SFX' was the $1.2 billion spending spree Sillerman went on in the '90s, which then saw SFX bought by Clear Channel Communications for $4.4 billion in 2000. Clear Channel later launched its concert division under another name Live Nation, which became Live Nation Entertainment in 2010 after a merger with Ticketmaster.
There has been a noticeable shift to dance music investment this year. EMI launched their Dance Music Network internal structure, which EMI executive Bart Cools described to us at length. Live Nation Entertainment have made a move themselves by buying Creamfields.
