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How Electronic Music Moved the Masses in 2011

Electric Daisy Carnival 2011 pyro L

While the live music market is still struggling, one sector is seeing explosive growth. THR explores the recent paradigm shift which finds companies such as WME and Live Nation positioning themselves for 2012 just in case DJs really are the new rock stars.

If 1991 was the year punk broke, 2011 was the year club music crept into the heart of America.

In a trend that was born in the EU and Scandinavia and has been building stateside for the better part of a decade, the floodgates burst open this year with everyone from Rihanna to Britney Spears riding the coattails of Euro-styled synth hooks to the top of the charts. In-demand DJs are now pocketing as much as $200,000 a show and selling out multiple nights in cities from New York to Los Angeles.

Perhaps the best example of the electronic revolution? Insomniac Events’ Electric Daisy Carnival, a dance festival that has attracted tens of thousands of revelers to stadium-style venues for years. It made national headlines in 2010 when a 15-year-old girl died of an ecstasy overdose after the concert in Los Angeles. Since then, attendance has exploded, reaching 230,000 when the event moved to Las Vegas this year — and injected some $136 million into the Clark County economy, according to one study.

Scouring YouTube, Twitter and the club scene for future headliners are companies such as William Morris Endeavor, early adopters of the dance trend who opened up an electronic music department in 2008 that now boasts more than 150 acts. Others followed suit: APA recently formed an electronic music division, as has Live Nation in the U.S. and Canada (both launched this year).

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“It’s exciting to see it crossing over,” says Insomniac president and CEO Pasquale Rotella. “It’s something I dreamt of 20 years ago.”

What Rotella might have not imagined, however, is just how large the EDM (electronic dance music) movement would become. While the genre doesn’t outsell hip-hop in recorded music, it performs well on iTunes worldwide and has surpassed rap in the live arena.

Once word slowly tricked out that Rotella and companies such as Holland’s ID&T (which does analogous events in Europe) were making millions via house music-centric events that mimic old school “raves” with top-tier DJ talent and experiential lighting elements, the mold was set a few years ago for what has now become big business.

But it’s not just festivals anymore where real money is being made in the live electronic music market. DJ-producer Deadmau5 recently sold out six consecutive nights at New York’s Roseland Ballroom, eclipsing the venue’s previous record holder Rage Against the Machine in a symbolic passing of the torch from rock to house music for teens and twentysomethings.

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Earlier this month in his hometown of Toronto, Deadmau5 played to more than 20,000 at Rogers Centre, a venue usually reserved for names such as U2. Tiesto, who is ranked among the top-grossing live acts in the world, recently headlined the Home Depot Center (capacity: 27,000) in Carson, California (last year, the Dutch trance titan took in nearly $900,000 in one three-night stand at L.A.’s Shrine Auditorium). To compare, Taylor Swift can pull in similar-sized crowds, but few others come close.

Live Nation, still smarting from a weak 2010, wants in on the action. Rotella says Insomniac has been “in talks” with the live events giant regarding a possible partnership, but the original West Coast player might not need them. In the coming weeks, Insomniac, which already announced a return to Las Vegas for its crown jewel summer blowout (presales have been strong) is expected to soon announce a massive expansion of the Electric Daisy Carnival concept, with 2012 stops planned for the highly populated East Coast corridor and Brazil, although not all will be EDC-branded.

“We’re doing 16 festivals in 2012,” he said. “Some are locked down and some are getting there.” To be clear, not all the events will be EDC-branded. Only five will carry the EDC name, yet the fact that Rotella is rolling into so many new markets, some international, shows the strength of the dance music sector, even in a still-lingering recession.

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Still, despite the expansion, Rotella says it’s all about going where the demand is: EDC in Colorado will not happen in 2012 as it has the past few years. “We couldn’t gross enough [there] to support people’s expectations,” he said, noting that already the mile high market was buying tickets to the larger annual Las Vegas edition of EDC in sizable numbers.

When it comes to DJ-based electronic music experiences in a live setting, large-scale events, be it 20,000-seat arenas or 70,000-capacity stadiums, are increasingly where the movement is heading, in part because the overhead is so much lower -- a DJ needs little more than a laptop, as opposed to a pop star like Lady Gaga who requires a few dozen trucks’ worth of production and gear. Dance acts, which are mostly vocals-free, also don’t rely on radio play and aren’t restricted by a promotional calendar. Fans are devotional in a way the big music labels are only recently starting to understand.

Take, for example, Miami’s three-day Ultra Music Festival, which last year featured more than 130 acts. It’s already at 70 percent capacity in presales, say promoters, who haven’t even revealed the talent lineup yet. “Last year, we sold out six weeks prior [to the event],” says Russell Faibisch, co-founder of the fest, which launched in 1999. “This year, we sold 100,000 tickets within the first week, and we haven’t even announced one artist yet.” Ultra’s website crashed briefly after more than 1 million page views put the squeeze on its servers as fans snapped up early-bird tickets.

“We can see this trend getting stronger by how fast we’ve achieved certain milestones,” UMF’s Director of Business affairs, Adam Russakoff, added. This without as much as a press release or single ad taken out…all that UMF organizers needed to do was send an email blast and post on their Facebook page. Around 165,000 are expected in 2012 to hit the spring break-like dance music festival over three days in March.

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But it’s not just festivals attracting fans at a record clip. Less reported than the hundreds of thousands that turn up at annual blowouts such as Ultra and EDC are the countless mid-sized shows at venues which typically host bands that take place from Atlanta to Chicago by DJs most Americans have never heard of.

Bassnectar sold 21,000 tickets over two nights at Verizon Wireless at Encore Park in Atlanta last month in a co-headline with Pretty Lights. Avicii has sold around 9000 tickets so far for an 11/18 gig in Washington D.C. Swedish House Mafia sold out their forthcoming December Madison Square Garden engagement in less than 10 minutes during a September pre-sale (around 15,000 will attend the sold out show).

On Nov. 26, promoters in Washington D.C are expecting around 15,000 at RFK stadium for an event featuring France’s Martin Solveig (who recently cracked the U.S. pop charts with his “Hello,” which peaked at No. 19 on the Billboard Hot 100), Moby, Armand Van Helden and others simply called “Fall Massive.”

In Los Angeles, one venue co-owner remodeled his entire club to better serve dance music fans in addition to the Music Box's busy weekly schedule serving rock fans at traditional live gigs, which sell slower and are less profitable (no VIP “table service” at an indie rock concert).  “It’s amazing what’s happening,” says Kobi Danan of Hollywood’s Music Box. “The minute we put the tickets on sale for some of these [electronic] artists they sell out…we don’t even have to spend any money advertising or marketing on acts like Nero,” he said, adding that he does “eight times the business” at the bar on a dance music night versus a typical rock or rap gig where fans leave as soon as the show is over.

According to the co-owner and talent booker, it wasn’t like this just two years ago. Back then, he “paid a small fracture” of the kind of guarantees The Music Box must cough up today to land a hot name such as Afrojack, which the club recently did. “It wasn’t as popular as it is now,” he says of electronic music. “The demand in this market is so high it’s almost hard to keep tickets [in stock].”

An emerging trend over the past few years is bigger DJs who can sell thousands of tickets at arena shows doing high-ticket-price one offs at clubs such as The Music Box and Playhouse in Hollywood ($100 per ticket entry) or multiple night stands at mid-sized venues, as Tiesto did at his three-night stand at the Shrine Auditorium.

As 2012 approaches, it’s not just big names like Tiesto who are ready to do the kind of numbers the Dutchman did in 2010 and 2011, either. “What’s interesting to us is how quickly this is exploding,” says Huston Powell, an Austin-based promoter at C3 Presents, which produces the increasingly dance-heavy Lollapalooza annually.

Adds WME agent Joel Zimmerman, who helped put together this year’s Identity Festival, a summer tour featuring some of dance music’s ascendant names, and whose agency represents such acts as Axwell, Calvin Harris and Kaskade: “The number of big DJs on the rise that can do this kind of business now is substantial. It’s hitting a lot of different people.”

WME isn’t the only agency in L.A. making moves in electronic music circles. “After a vibrant underground following for decades, electronic music is now viewed as a legitimate art form,” says Josh Humiston, partner and co-head of concerts at APA. “We continue to focus on growing this division,” said the agent, who recently landed Paul Oakenfold as a client for the agency’s growing department.

Powell has seen growth of a different kind at his own company over the past year, as he and co-workers found themselves shocked at the explosive sales in the Midwest at some of their EDM shows. “We started to see all these DJs develop a following in the Chicago area so we booked Deadmau5 show at the Congress Theater last year,” Powell said. The response was so great they immediately secured the DJ-producer for a series of 2011 shows in the Windy City. “We did 21,000 tickets in three plays over five months in Chicago,” he continued. “We could have done more.”

So what does the promoter attribute the large ticket sales, surprising to almost all industry watchers? Social media, in part. “They have this open dialogue with their fans, more than rock bands,” he said of DJs that boast formidable Facebook and Twitter followings. “They just tell their people they’re coming and the fans come.”

With new hotly tipped artists from France’s Madeon to Sweden’s Dada Life on the rise this winter, get ready for even more DJs to amass audiences set to surprise promoters, fans and even the artists themselves in 2012. “There’s a whole wave coming,” said Powell.