Taking Seoul to the Next Level: AEG Asia CEO Adam Wilkes on Laying Groundwork for Live Music in Pacific Rim
Earlier this month AEG said it would partner with a subsidiary of CJ Group, the Korean media and entertainment giant, to build a 20,000-seat arena in Seoul, the Asian capital’s first state-of-the-art facility since the 1988 Olympics.
For Los Angeles-based AEG, the project, currently slated to open in the first quarter of 2024, is the latest in a series of new venues it is building in the Asia-Pacific region. AEG made inroads in China with the Cadillac Arena in Beijing, and then in 2010 opened the Mercedes Benz Arena in Shanghai in partnership with the NBA and Oriental Pearl Group.
It is also developing two venues in Bangkok -- a 6,000-capacity theater and a 16,000-seat arena -- in partnership with The Mall Group, Thailand’s leading retail developer, which are scheduled to open in the fourth quarter of 2022.
AEG is racing against Live Nation to create a truly global venue infrastructure, as artists increasingly orient their businesses and careers toward a global touring mindset. The Pacific Rim nations represent the next growth opportunity in live entertainment, and for the music industry broadly.
Adam Wilkes, AEG’s Asia CEO, recently spoke with Billboard about how the Seoul Metropolitan Arena fits in with its Asia strategy, and how K-pop fans in Korea could be the biggest beneficiary of the new venue.
What drove the decision for AEG to pursue building the Seoul Metropolitan Arena?
We have looked at the map across Asia. And at the very top has always been Seoul. You have a vibrant and affluent population of over 25 million people. You have a thriving live entertainment industry, and all that we know and love about K-culture and how that has become a global phenomenon on the music side. Interestingly, what you lack there is the right kind of infrastructure to properly develop the live entertainment industry. Pretty much all the venues in Seoul are 1988 Olympic venues. They are outdated and were purpose-built for the Olympics. Because of the lack of infrastructure, it is almost like there is an artificial ceiling on the market. And without that infrastructure in place it is very challenging for a live entertainment industry to develop to that next level.
What will be different about the tech of this arena that will make it an upgrade from previous facilities?
One idea is allowing for an indoor-outdoor experience. Part of that is when an artist plays indoors there are also elements for people that are in the overall district can experience the show, through streaming or other technology. But the idea is how can we step further than that? How can we connect performances in this venue to other channels in which people consume music, whether it is on their mobile devices or to other arenas that share this technology? Our hope is to build something that is as cutting edge as it comes. For a market like Korea, that is really necessary.
Without K-pop’s surging popularity would this arena have made sense to build now?
I think they all go hand in hand. The Korean market has always been a strong market. But it is important that when you get involved in a real estate project, the venue is going to be full throughout the calendar year. So [K-pop] is a very large anchor of domestic content that is going to fill this building, and it will probably end up being the majority of the programming. The idea is that this can become a destination for fans around Asia and around the world to come and experience and enjoy all aspects of Korean culture.
How does your previous experience in Shanghai inform your project in Korea?
When we came in with the Mercedes Benz Arena, the existing venue was an older gymnasium that had been built 25 years prior and they were doing 45 shows [per year]. Our feeling was if we were doing 45 shows we would have cornered the market. What we didn’t account for was the halo effect around a new building. There was so much excitement around coming to enjoy a show in a proper-built facility. So we ended up doing 67 or 68 shows our first year. And, ironically, the venue that we considered our competitor continued to do 45 shows a year. So we realized there is this artificial ceiling until proper infrastructure is in place. The difference in Korea is you have a larger and more affluent population than in Shanghai. And you have such a larger domestic concert industry that comes specifically out of Seoul. With the Chinese music industry, a lot of it comes from Taiwan, it comes from Hong Kong. So [Korea’s] own domestic live entertainment industry has yet to be able to perform locally in the same way they do when those same Korean artists like BTS play at the Staples Center or at the O2 in London.
What is the ceiling for Korea?
For us Seoul has always been at the top of the list for Asian market, right after Tokyo. Whereas in Tokyo you already have a lot of the infrastructure in place. So in that regard Seoul was even more attractive for us. You are always struggling to find a venue to operate in.
We just had Ed Sheeran there. And we couldn’t secure a football stadium for him. So we ended up playing in a park out near the airport. Fortunately, due to the popularity of Ed it did very well. (The crowd in the end was around 30,000 people). But at the same time, you have to wonder, if he had played the right venue and the right location in town, that had proper infrastructure and transportation all around it and bells and whistles that go along with a proper entertainment district, what would the commercial opportunity have been in that regard?
Are there other markets in Asia that you are pushing into?
We are really looking all across the region. We just made a big push into Australia with our partnership with Frontier Touring. We are looking really closely at Japan right now, especially with our real estate business. Osaka is a market we are really focused on and would love to be more active in. It checks a lot of boxes for us. We are also doing more in Singapore with the content side of our business.
Is there anything about K-pop that dictates how you are designing these arenas?
One of the things that is common across K-pop is they are technically very interesting productions and very large productions. It is important that we are building best in class -- like you would see in a London or New York or LA -- and be able to stage these shows in their full design and full production. These artists are able to put on larger shows when they go to LA because of the technical infrastructure in place than when they are in their home market and they are trying to play in older buildings. A lot of influence comes from the U.S. There are a lot of practices that are copied and emulated. With K-pop and some of the top artists that have come out of Korea they have been influenced but I think they have also taken it to another level. And in some ways the influenced started becoming the influencers. And these productions are unparalleled by anyone else out there right now.