HONG KONG — At the 2010 World Expo, AEG unveiled its stunning new Shanghai arena. The 18,000-seat venue, now called the Mercedes-Benz Arena, was designed to be China’s version of Los Angeles’ Staples Center and a showcase for the concert giant. Jackie Chan and Andrea Bocelli christened the building, making it abundantly clear that the company — and its competitors — believed the future of the live business was in the East.
A decade later, the deadly coronavirus is threatening those plans. On Jan. 24, the Chinese government closed the Mercedes-Benz Arena indefinitely. The venue's promoter and its joint-venture partner, a media group owned by the Shanghai government, have postponed over a dozen shows until the virus is contained, and when that will be is alarmingly unclear. As of Sunday, the deadly epidemic has claimed more than 1,600 lives and infected over 69,000 people in at least 27 countries. More than 50 million people have been quarantined across China.
About 20,000 music shows between January and March have been canceled or postponed in China and Hong Kong, costing RMB 2 billion ($286 million) in ticketing and box-office losses, according to the China Association of Performing Arts. Local authorities in mainland China canceled over 20 arena-size concerts in February, says Tony Yapp, managing director of AC Orange International, a large music promoter in China, including a major EDM festival with Martin Garrix, Dimitri Vegas and Like Mike; multiple shows by Hong Kong artist Eason Chan; and 12 nights for Cantopop star Andy Lau at the 12,500-capacity Hong Kong Coliseum. Concerts by Malaysian artist Liang Jingru, Taiwanese singer Jolin Tsai and the 25-year-old Chinese pop-punk band New Pants have also been postponed.
AEG announced on Friday that Khalid’s Free Spirit Asia Tour has been postponed due to travel advisories related to the virus. The tour would have taken the "Talk" singer to Bangkok, Singapore, Jakarta, Manila, Kuala Lumpur, Tokyo, Seoul, Mumbai and Bangalore. That said, several shows in February and March with international stars like Avril Lavigne, Yungblud and Marilyn Manson remain on the schedule, but will likely be canceled, according to promoters in China. Most of the cancellations to date have been Chinese acts because those can be rescheduled more easily, an AEG source tells Billboard.
If the crisis continues, "the Chinese government will not grant any permits to organizers and promoters, to prevent large crowd gatherings that may lead to the spread of the virus," says Yapp. (Promoters in China must apply for two local permits, one for "performance culture" and the other for public security.)
The longer these cancellations continue, the worse it could get for Asia’s live sector. If the virus is contained soon, the best-case scenario is that promoters will have to spend the entire second half of 2020 just making up shows from the first half. That could hurt Hong Kong and South Korea, which were just starting to adopt Western production capabilities, says Steve Dixon, who has managed tours for BTS, Blackpink and BIGBANG’s 2015 Made world tour. In Asia, "it takes three days or four days to set up [an arena] show [and] a couple days to tear it down," says Dixon, compared with 12 to 24 hours in the United States. A sudden attempt to reschedule so many major music events in a short time span would be a logistical nightmare for the Asian concert business, he says.
Even if the coronavirus is contained before China's busiest live music season, June through October, planning large-scale festivals on short notice could be disastrous. On the other hand, if the virus isn’t contained by summer, K-pop and C-pop bands could inundate the U.S. and European live markets, causing more upheaval. "[They] are going to try and find a way to perform," says UTA’s David Zedeck.
Jim Wong, managing director for Live Nation Electronic Music Asia, predicts that many music companies in China will not see revenue until August. "We also canceled many shows in China," says Wong. "The company already paid deposits for booking venues, marketing promotion fees and artist fees. It is a terrible and devastating blow for China’s music industry."
The struggling live music sector is but one less diversion for a Chinese population that has been reduced to a solitary society by the health crisis. Aside from Wuhan, which is a virtual ghost town, the cities of Beijing, Shanghai, Chong Qing and Shenzhen (where Apple manufactures iPhones), have strengthened lockdowns on public gatherings, leaving city streets abandoned as companies order their employees to work from home. Officials have shuttered nightclubs, movie theaters and major theme parks like Disneyland across the country; imposed rules around when supermarkets and pharmacies can open; regulated mask-wearing in public spaces and prohibited private get-togethers that could further spread the virus.
In Shanghai, Jimi Wang, an artist manager and music producer, is holed up in his house in a voluntary quarantine. He says he has delayed plans to go to Japan in March to record new songs with a Chinese artist. "Most of the time, I lay in bed and sleep," Wang tells Billboard. "If we need to buy food, we have to go out. Everyone in the streets is wearing masks. Everyone in the neighborhood stays isolated and does not go out."
In Hong Kong, Simon Robson, president of Warner Music Asia, says he is focused on ensuring there are enough masks and alcohol-cleaning solution for the 120 or so Warner employees in Hong Kong and mainland China (Warner has close to 600 throughout Asia). "In Hong Kong there has been a run on [toilet paper], because it got around that the people who manufacture it are now moving on to making masks," he tells Billboard.
Over the last two weeks, BMG and Bertelsmann have sent more than 10,000 masks to the region for their employees and their families, and for hospitals and doctors, says Marian Wolf, vp for global writer service and China at BMG.
The virus has forced Warner and BMG to cancel or postpone all corporate events, concerts and public gatherings in China as precautionary measures, as well as songwriting camps with Chinese artists in both China and Los Angeles.
In recent days, Hong Kong chief executive Carrie Lam introduced further infection prevention and control measures, including requiring all people entering Hong Kong from mainland China to be placed under a mandatory quarantine, as of Feb. 8, for 14 days, the upper end of the incubation period for the virus.
As it happens, the coronavirus has hit at a time when the majors are putting renewed focus on A&R in Asia. Universal Music Group opened an office in Singapore last year with the intent to push deeper into Southeast Asia. Just last week, Warner’s first official director of A&R for Asia, David Strouck, moved to Hong Kong from New York; he has already traveled to Thailand.
Robson, for his part, says he plans to continue to travel in Asia while "taking precautions" to ensure his own safety. "It’s a bit of an arms race [for finding an] Asian superstar," the Warner executive says. "We are still very active from a domestic A&R perspective, and that is not intended to stop," Robson says. "But the live sector needs to be put on hold."
Additional reporting by Alexei Barrionuevo.