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PD House receives finance for nearly 100 million RMB to focus on EDM market PD house has recently received a new round of finance reaching 100 million RMB invested by Saifudongshi Fund and a short-video leading company.

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admin 2018-04-19 Collect

According to the news this month, PD House has recently received a new round of finance reaching 100 million RMB invested by Saifudongshi Fund and a short-video leading company. It has already received a series A round of finance with 4.5 million RMB from Prometheus Capital. PD House also founded an EDM focused subsidiary corporation — Brothers Times Culture Media.

According to PD House’s official website, PD House is a media company that has very diverse functions and services. Its service covers brand services, business planning, performing & entertainment, movie and TV investment, and advertising campaign. PD House was founded in 2011 as an advertisement company but stepped into performing and entertainment businesses in 2013. Starting with The Voice of China TV show’s world tour in Shenzhen, PD House gradually found a place in the market of performance and live shows.

So far PD House has participated in over a dozen middle- to large-scale concerts either as a stock trader or with stock share. It has collaborated with a lot of artists all over the world including Eason Chan, GEM Deng, EXO, Terry Lin, Jane Zhang, Karen Mok, Bigbang, etc. After this round of finance, PD House will focus more on extracting and expanding in the EDM market. It will also host 16 big EDM activities and music parties in various EDM subgenres.

In fact, EDM is getting more popular in the world, as well as in China over the past 2 years. The storm of EDM brought a lot of new opportunities for the newcomers in the music industry. iiMedia Research published a “2016-2017 China EDM market research report”  last year reporting that the scale of Chinese EDM users has reached 197 million people and is expected to reach 286 million by 2017 with a 45.2% rate of increase, over 300 million by 2018 and over 400 million by 2019. With the statistics, PD House signed a strategic cooperation agreement with well-known British EDM brand Creamfields, bringing in the super IP to China. PD House plans to spread the series of Creamfields China events to 7 main cities in China including Guangzhou (just finished its event recently), Beijing, Shanghai, Taiwan, Hong Kong, Chengdu, and Xiamen. Each of them will have thousands of audience to participate.

Other than the Creamfields China events, PD House also plans to host a Cream Tour for an audience size of 2,500 – 6,000 people and a LICHT EDM brand performance for venues under 1,500 people. Compare to Creamfields EDM festival, Cream Tour will mainly focus on the smaller cities in China while still having live shows in cities like Wuhan, Hangzhou, Changsha, Shenzhen, and Chongqing. On the other hand, LICHT Qiyao EDM will focus on special events on EDM’s subgenres. Qi Huang, the CEO of Brothers Times Culture Media said that PD House expects to form a small ecosystem of its own within the EDM market. It has already gotten its own land in Shenzhen, “RB775 is a field for about 15,000 square meter which includes a 6,000 – 7,000 squared meter outdoor area and 2,000 square meter venue that can hold over 3,000 people. We have already finished our first show on March 17th for 3 hours. The crowd was overloaded”, said Huang.

However, Creamfields is facing quite a challenge.

While many local Chinese companies are spending a lot of time and money on their own EDM IP, other internationally well-known brands such as Ultra, Life in Color, Electric Zoo, and EDC are all stepping into the market to make the competition even more intense. As a response, Huang said that Creamfields aims to make the brand more compatible to everyone which is a completely different approach from EDC and Ultra. He said, “EDC and Ultra are the high-end brands but we are going to reach to the general audience in a more down-to-earth way. If they are the five-star hotels in the EDM festival market, then we will be the affordable hostels”. Huang pointed out that although Creamfields has a history of 20 years in multiple countries in the world, it’s always portrayed as an affordable music festival for everyone.

It’s obvious that PD House focuses more on making EDM accessible. Huang believes that most of the big-name DJs and EDM festivals take place in major metropolitan cities but do not fulfill the EDM needs for people in smaller cities or suburban areas. “People from outside of the big cities need EDM too. Maybe they are not as picky on the music quality as those who are from the cities, nor would they know who is Martin Garrix, but they have a need to follow the trend of the society and a need for music too. This is music. It makes people happy and excited. A good live music scene is a scene that can get the young people excited no matter where it takes place”, said Huang. Making EDM accessible to everyone is definitely the main theme for PD House in the future.

According to iiMedia, there were 32 EDM festivals in China in 2016 and doubled the amount to 86 in 2017.  It also predicted that the amount of EDM festival may go over 150 in 2018. At the same time, while many famous EDM festivals collaborate with well-known DJs to raise the bar of EDM festival quality, the quick profit from this field is leading the market to a chaos.

First of all, the appearance fee of the artists will rise as EDM festivals grow, which will exponentially increase the cost of a festival.

Right now most of the EDM festivals in China gain profit from ticket selling, sponsorship, and derivatives. However, the latter two only take 35% – 40% of the gross profit. Xubin Xu, the CEO of Tianmao Culture, said last year that the appearance fee of artists increased 20% in general, some even increased by 50%. To Xu, large-scale EDM festival is now in a chaos. Although you can see a lot of EDM festivals gradually making their ways into many big cities in China, they are still in an early growing stage. After EDM festivals being consumed to an extreme for profit only, the local artists are facing limited resources to develop their career within EDM festivals. It’s rather disappointing to both EDM festivals and the entire EDM industry in a long term.

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Before bringing in Creamfields China, Huang organized live concerts for both Jacky Cheung and Eason Chan. He believes that the looting phenomenon of well-known artists’ shows started even before the heatwave of EDM. “We used to be able to pull together Jacky or Eason’s concert within a couple million RMB. But the one Jacky had in Huizhou in 2017 cost over 16 million which almost doubled a normal amount”, said Huang. He believes that in order to lower the cost of an EDM festival, all sponsors and organizations need to be on the same page to prevent foreign artists raising their appearance fee. On the other hand, to promote local artists is also a way to lower the cost of a festival.

It’s already a pretty difficult job to organize large-scale shows in China, let along an EDM festival which is new to China and requires extra attention on security. Therefore, it will be challenging for EDM to go far in China with all the strict policies. However, Huang believes that EDM festival market would be fine as long as the show organization and sponsors can follow the regulations and policies. Due to the fast money from this market, the festivals may get overdrawn very quickly. Although it needs time for the audience to get to know about EDM, the future of EDM festival is still optimistic due to the attention from capitals.

According to Huang, PD House’s rich experience in the performing arts field makes it easy for PD House to lower the cost of festivals and improve their stage and lighting effect. In terms of artists resources, PD House has signed strategic cooperation with Live Nation to bring in support in DJ management. Creamfields China also has business cooperation with other brands like Budweiser and Hennessey.

Besides launching smaller scale live shows with Creamfields, PD House also plans to reach the upstream industry and will look for quality Chinese EDM artists and DJs in the future. It’s also planning to build its own live show venues to dig the EDM market even more.

Translated by Paris Wu

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