The New Las Vegas Music Market

DJ Paydays In Las Vegas: More Money, Less Opportunity

The-Chainsmokers-Kick-Off-Three-Year-Wynn-Nightlife-Residency-2017-billboard-1548-1-1583269718
David Becker/Getty Images for Wynn Las Vegas

In the wake of KAOS' closing, one casino nightlife executive says it's now a "buyer's market" for talent. Others predict a 2020 recession for the business

DJ paychecks were growing in Las Vegas last year even as average salaries worldwide for the highest-paid electronic dance-music acts declined 12% from 2017 to 2018, and EDM's share of the recorded-music market slid from 3.5% to 3%, according to a 2019 study by the International Music Summit. But, with the autumn 2019 implosion of The Palms' KAOS nightclub and its reported $60-million deal with Marshmello, DJs may see their hot streak start to cool in Vegas, too.  .

Music-business sources tell Billboard that a superstar DJ, like Calvin Harris, Tiësto, Diplo or The Chainsmokers, can still pull in a low seven-figure fee for a single club appearance, and upwards of $300,000 a show for residencies. "It's steadily gone up in Vegas," says Randy Phillips, the veteran promoter who recently stepped down as CEO of EDM festival company LiveStyle but retains an ownership stake. "The superstars are on multi-year, multi-week deals at some of the bigger hotels. Electronic music, and the DJ, is very compelling entertainment when you're going away for a weekend to get wild and crazy."

EDM’s popularity in Vegas has gone through "gullies" over the past five years, says Phillips, but overall the trajectory for DJs’ salaries is up. The latest dip came in November, when the Palms abruptly shuttered its KAOS night and dayclub after just seven months because, management told financial analysts, the club had lost $13.2 million in its first year and the economics weren't working. In addition to the record two-year $60-million residency it had reportedly struck with Marshmello -- what amounted to $600,000 a show for 100 shows -- the club was paying some DJs just as much for a single appearance, which a music-industry source says was 400% to 500% more than the market norm.

The source says that the closing has sparked a number of developments in the Vegas nightlife economy. DJs who jumped to the Palms from the more established Wynn Las Vegas and other resorts will now have to fight their way back into rotation at the nightclubs left standing --with significantly reduced negotiating clout. On a larger scale, the industry source says Vegas promoters and managers worry that young hedge-fund managers and others reliant on Wall Street revenues might scale back on high-end entertainment spending, especially this summer:  "DJ fees have now frozen, and there's lots of fear in Las Vegas that there's going to be a recession in 2020."

Not everybody in the industry shares this view. “You’ve got to get the talent. You’ve got to get the Marshmellos and the Calvin Harrises and the Chainsmokers,” says Josh Binder, an attorney for Marshmello, as well as Kendrick Lamar and other artists. “That’s where the power is -- it’s with the artist.”

In 2015, dance-music sources say, a major casino typically paid $175,000 for a bankable DJ, but demand soon drove the price to $350,000. Major stars with recognizable hits and the ability to fill casino tables and draw bachelor and bachelorette parties, were commanding even more -- from high six figures to “well into the millions,” according to one, who also says, “there’s no boilerplate” -- top talent continues to get top dollar.  "The difference is," says a second music-business source, "There are way, way fewer [mid-tier] acts getting $250,000 and $150,000. Those acts are now getting $50,000 to $125,000. The middle fell out quite a bit."

Meanwhile, the low-end of the pay scale has stayed virtually the same from 2015 to 2019: DJs in this class make $10,000 to $30,000 a show, but demand is not what it used to be. "A lot of DJs in that $30-75K a night range did well when EDM was booming, but weren’t big enough to keep bringing people,” says Matt Colon, Steve Aoki's longtime manager:

"It’s a buyer’s market now in Vegas," says Sean Christie, president of events and nightlife for MGM Resorts International.  Artists can negotiate payment terms, hotel amenities, digital billboard advertising and budget for custom production, but they also need to know the market.

"Vegas clubs want to know you can do more than cater to your fan base," says Colon.

Vegas clubs are also hedging their bets by putting hip-hop and open-format DJs in rotation with electronic dance music . “Music is splintering - people want to hear all different things,” says Christie.  “We’re entering a new era of consumer taste.”

Additional reporting by Jack Tregoning.

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