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Ultra Music Festival Beijing Postponed, Disturbing EDM Market There are mix signals for the electronic music industry, but the market is generally optimistic.

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admin 2018-06-15 Collect

This afternoon, Ultra Music Festival’s promoter officially announced the postponement of their Beijing stop only two days before its previously announced date of June 16th, citing the obstruction from “a major force.”

Instead, Ultra would host a “ULTRA Beijing Club Takeover” on June 16th and 17th. Three clubs in Beijing, Sir. Teen, One Third, and Circle will be the venues these events.

Ultra’s official Wechat account also posted the schedule of performances in these three clubs. Vicetone, The Chainsmokers, DJ Snake and many famous DJs will be performing in One Third. The ticket prices range from 100 RMB to 780 RMB and the supply is very limited.

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Fans were really disappointed by the arrangement. Many fans didn’t even notice the change and were still worrying about of lines and crowds. Obviously, they didn’t realize that the music festival would not be a festival anymore.

On May 9th, Ultra China announced that its Beijing stop will be on June 16th and 17th. However, since this announcement at the press conference, they hadn’t given out any information about ticketing. Netizens are speculating that it might be due to the inability to get higher authority’s approval.

According to an industry inside, June would be the difficult month for any big festivals and activities to get approved by the police department because of the World Cup, which lasts for a month starting from mid-June. Besides, June 26th is the International Day Against Drug Abuse and Illicit Trafficking. Considering the reputation of EDM festivals, the timing is just not great. “It’s a rough month to host a big event. It doesn’t matter whether it’s an EDM festival or not.”

A manager from another event promoter told China Music Business that it is very normal to not get approved by the authorities in Beijing, many music festivals were relocated to the near-by Hebei province.

Speculations aside, we don’t know if the real reason behind the postponement of Ultra Beijing is because of the authorities until we can further observe the implementation of the Club Takeover. However, in light of this incident, combined with the bankruptcy rumor of A2Live’s (promoter of Storm Electronic Music Festival), many people start to worry about the prospect of electronic music in China.

Whether the Storm Electronic Music Festival is going to die off has been widely discussed among electronic music fans and in the general music industry. Last year in May, the A2Live announced a very aggressive expansion plan into 11 cities in 2017 during their press conference in Shanghai. CEO of A2Live, Eric Zho said during an interview that Storm Electronic Music Festival is expected to sell over 200 thousand tickets in 9 cities in China and 300 thousand in box office. Mr. Zho also said that his company’s artist management, record label and venue management subsidiaries already started to operate, and that Storm Electronic Music Festival would publish the location and lineup information in May 2018.

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However, problems started to surface since last year. The Guangzhou stop got cancelled the day before due to typhoon; Australia stop got indefinitely postponed; Shenzhen stop got very negative press because of a security fighting audience member incident.

More surprisingly, only a year after massive expansion, A2Live got into serious financial troubles. They were rumored to refuse to pay the employees’ salaries and lay off a large amount of their employees.

China Music Business has contacted Eric Zho of A2Live and he said that they would host a press conference soon and release their plan for this year. So far only Shanghai and Chengdu stop were confirmed. Interestingly, the editor of China Music Business got an email from Korean entertainment company YG asking about the licensing fee for the Storm Electronic Music Festival. They later noticed that they have sent it to the wrong email address. We don’t know if the festival would land in Korea yet, but hopefully we will hear more about it at the press conference soon.

Besides that, Eric confirms the rumors of the financial trouble of his company and is currently undergoing debt restructuring. He said, “It’s a difficult time for us, but we are not giving up.”

In China, music festival is a very new territory. The majority of the music festival promoters are losing money. Storm Electronic Music Festival’s trouble looks a lot like SFX’s before they went bankrupt due to over-expansion and inability to pay back debt.

SFX operated many music festival brands in North America, including Electric Zoo, Tomorrowland, TomorrowWorld, Sensation, Corona Sunsets, and Life in Color. They also acquired electronic music online store Beatport and ticketing company Paylogic.

As a result of their rapid expansion and inconsistent cashflow, they accumulated 345 million dollars in debts and declared bankruptcy. In November 2016, SFX regrouped into LiveStyle and restarted with a clean slate.

According to the 2018 Global Electronic Music Industry Report from International Music Summit, Chinese electronic music market has the biggest potential, electronic music festival has been developing at a particularly remarkable speed. In 2018, the number of Music Festivals in China is expected to double, from 32 in 2016 to over 150 in 2018. However, the unexpected setbacks the biggest two music festivals in China encountered seems to suggest an electronic music market slowdown.

Song Yang, the CEO of  Mai Ai Culture Communication, said electronic music industry is not just about the music festivals. “I have always been bullish about China’s electronic music industry. There are many opportunities. For example, our artist Xu Mengyuan’s rise in popularity has brought us big financial gain.” However, Song Yang also had concerns about the industry. “Electronic music festivals need to work on their branding. They need to figure out who their fans are and how to position themselves in the industry. There’s so much profit to be made from the huge population in China and such rich popular and traditional culture to draw from.”

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According to Song Yang, Intro Music Festival, a music festival brand of Mai Ai, successfully implemented their first performance in Hebei province. They are going to be in Ulaanbaatar, the capital of Mongolia in August this year as a cultural exchange program. Besides China, artists from Japan, Korea, Mongolia and Lithuania are invited as well.

Ni Bing, the head independent record label DrumRider and the founder of the blog and the podcast, Voice of the Future (Wei Lai Zhi Sheng), has expressed his optimism towards the Chinese electronic music market. He said that companies are becoming more and more rational, making careful decisions and they stopped recklessly spending money on famous DJs. “For Example, Life in Color did better than last year. Jungle Events also repositioned themselves. Techno music will become more popular. Many big corporations are investing in electronic music. So overall, the future is bright.

Ni Bing is currently the music director of Rave Now (Ji Ke Dian Yin), a new electronic music variety show co-created by Tencent and Can Xing media entertainment. The show is set to premiere on Tencent Video in October 2018. In addition, after Hong Tao left Singer, he joined another variety show Electronic Knight (Dian Yin Qi Shi), which will be broadcasted this fall. These two electronic music variety shows are going to compete head on for attention.

On one hand, foreign music festival brands having a hard time entering into the Chinese market and local giant A2Live facing a financial crisis seem to signal a rough time for electronic music. But on the other hand, EDC China turning a profit the first year it landed in China and many electronic music variety shows set in motion seem to suggest otherwise. How is the Chinese electronic music market going to mature? And how many companies will be successful in this market? 2018 will be a key year to answer these questions.

The postponement of Ultra Festival doesn’t mean there’s a crisis coming. Chinese electronic music festivals and related companies are adjusting themselves and becoming better.

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