EDM's Big Asia Play: Promoters Look to Break New Market With Festivals, Conferences
On Sept. 29, 300 delegates from all sectors of the electronic music industry will converge in Shanghai for the third International Music Summit in the Asia-Pacific region to discuss one thing: how to unlock the world’s largest untapped market for dance music.
In many ways, the shift is already happening. In 2012, Ultra Music Festival expanded to South Korea, adding events in Japan, Indonesia and Singapore in the following years. In 2016, the promoter threw eight events in as many locales -- South Korea, Thailand, Singapore, Taiwan, Bali, Hong Kong, the Philippines and Japan, with headliners including Afrojack, DJ Snake, Deadmau5, Kygo and Martin Garrix -- which attracted more than 350,000 fans, a 56 percent increase over 2015, bringing in an estimated $29.5 million in ticket sales. IMS launched its Asian conference in 2014 in Singapore, shifting to Shanghai for a China-focused event last year before expanding its scope to Asia-Pacific for the 2016 edition.
Now, others have joined in. Over the past two months, two of the largest dance music promoters in the world -- SFX's Made Event and Insomniac -- have announced plans to expand Electric Zoo to China and Electric Daisy Carnival to India, respectively, joining home-grown events such as A2Live's STORM Festival in China, now in its fourth year, and Sunburn Festival in India, which started in 2007.
"Asia is a great market, and I think it's exciting for the fans to see quality events coming in," says Russell Faibisch, co-founder, CEO and executive producer of Ultra, which has put on 24 events in Asia since 2012. "I don't see it slowing down. And we're not at the end of it -- we're still going, there's a lot more to be done for us."
Clearly, the dance-music industry is ramping up its investment in Asia, looking to tap into its population of 4 billion -- some 60 percent of the world's population -- to grow business at a time when North America’s market is beginning to slow down. But will the challenges of the region -- lack of infrastructure, conservative cultural norms and stringent governmental regulations -- stop the expansion in its tracks?
"America had a huge explosion five years ago, and I think everyone was wondering when Asia would 'pop,'" says Ben Turner, partner at IMS and co-founder of the Association for Electronic Music. "It really feels like that moment is now."
The numbers support his hunch. In 2016, the global EDM industry was worth $7.1 billion, according to IMS’ 2016 business report, up 59 percent from just three years ago. But that explosive growth has slowed -- between April 2015 and March 2016, the global industry grew just 3.5 percent as the North American market cooled. At the same time, Asia-Pacific is rising: In 2014, the most recent year data was available, IMS estimated the region’s industry to be worth $950 million, or 15 percent of the genre’s global worth -- and that was before the number of international festivals ballooned.
With 60 percent of the world's population, promoters are understandably eager to tap into Asia, and its revenue potential for the music industry is beginning to mature. In 2015 alone, for instance, China's recorded music market grew 63.8 percent, the second-highest single-year growth of any country in the world. And the growth of streaming, combined with increased access to the internet, means more fans have more tools to discover more music than ever before.
And brands are close behind. One source says that Budweiser, A2Live’s partner in the Storm Festival, has invested $5 million in promotions surrounding the event, while such global brands as Sony, Samsung, Mercedes-Benz and Heineken are also in the field.
"It’s one of those music genres that every single brand can say, 'This is what the millennials like,'" says A2Live founder Eric Zho. "And it's a very healthy scene -- unlike the West, where people associate dance music with drugs, here they’re very inaccessible and the penalty is insane."
Still, there are significant challenges. Club culture has existed throughout Asia for years, but despite its cleaner, purer image, the influx of international festivals has brought deeper scrutiny in drug-intolerant countries like Indonesia and Malaysia, heightened by six drug-related deaths at Future Music Festival Asia in Kuala Lumpur in 2014. "A lot of the international brands -- the Ultras, the Insomniacs -- are coming into markets where they're dealing with situations they've never encountered before,” Turner says. “It's not an easy business to be in."
Corruption has also played a part, with local authorities occasionally demanding hundreds of tickets in exchange for concert permits, as well as technological barriers that stifle homegrown scenes from developing and mar international acts from making a footprint. The Chinese government, for instance, has banned social networks such as Facebook and Twitter in the country, and banning YouTube and SoundCloud has only made it harder for the genre's underground to establish itself across a vast and diverse region.
“[Asia is] such a big proposition,” says Turner, “but it doesn’t feel like it’s really built on solid foundations yet.”
But as events like IMS unite promoters, agents, labels and artists across the region, a stronger industry network is taking shape. "That’s the beauty of dance music; you’re not confined by language," Zho says. "China is on the cusp of that J curve journey. I think this [boom] is going to go over the next two to three years."
A version of the article was originally published in the Oct. 8 issue of Billboard.