Digital Marketing Efforts Music Festivals Are Acclimating Towards

Photo Credit: http://www.indonesiagoesdigital.com/tag/indonesia-digital-marketing/

As the music festival circuit blossoms across the nation, the start of summer draws nearer and nearer, and the music rings in a fresh new season for avid music festival enthusiasts. But there is also a new sound that major brands are chirping their digital marketing song to. It tends to be the sound of money that draws them in, but what it really boils down to is the sound of target audiences responding their specific sentiments back to them. Music festivals provide a mass-market atmosphere where brands can interact with consumers of all demographics, incomes and places of residence in a low-pressure environment, kind of like a real-life social media atmosphere. Not to mention, many celebrities and famous people who can actually afford high-end products frequent these festivals (Lamb, 2013).

Music festivals are entirely new landscapes thanks to digital marketing plans of today’s thriving industry. According to a study done by a research commissioned media agency called Target Media, going to a festival is the most exciting thing 44% of respondents have ever done. This makes the target audience far more open-minded, allowing sponsors and advertisers a better chance of getting their message across (Roberts, 2009). Target Media trading director Adam Hopkinson was quoted saying that, “The big problem is where brands just talk to the audience. The marketing press is reporting that all media is devaluing year on year. This unfortunately commoditizes target audiences. It’s very easy to fall into the trap of targeting a core audience for the cheapest possible price. If brands think like that they’re not thinking about the environment and therefore will not get their message and media right together.” Studies have shown that positive emotion appears to leave a lasting impression on brands that associate themselves with these music festivals. Out of the 2,000 respondents, 41% have positive feelings towards the brands that sponsor music festivals, while 40% have positive feelings towards the brands that advertise at festivals (Roberts, 2009).

Not all luxury brands can make a flock towards sponsoring music festivals or advertising with them. Some brands just will not fit the environment of a music festival, for examples cars and auto insurance, banks, etc. Brands in these categories tend to see the quick success and serious return on investment of other companies; and their partnerships in the alcoholic beverage line for example is a big factor. Alcoholic beverages seem to work best amongst the music festival circuit because they have something they can give back to their audience that stands out. 

SXSW Distribution Buzz

The SXSW Music and Media Conference has reached its 27^th year in Austin, Texas and continuously grows its large reputation as the biggest and most anticipated convergence of all things music. According to the people at SXSW, their spirit is being kept alive by their continued effort to offer compelling daytime programming and stellar nighttime showcases. As most people familiar with the SXSW team are aware that at night, SXSW showcases hundreds upon hundreds of musical acts from around the globe on over one hundred stages in downtown Austin. In the day time, thousands of conference registrants network in the halls of the Austin Convention Center on their way to do business deals in the SXSW Trade Show, sit in on informative panel discussions featuring some of the industry’s key players, and gain insight from legendary keynote speakers.

Active conference participants fight to get their creative content and projects distribution deals. Throughout most of the festival artists, producers, and filmmakers flock to the halls to network and gain a distribution platform for their projects that they did not have before. But something new that has shown up on the radar for SXSW is their take on ticket distribution. The Austin music conference looks at how third party distributors are creating new channels for promoters. According to researchers, the era of exclusive ticketing contracts has not come to an end yet, many venues are actively seeking new ways to get tickets in front of fans (Venues Today, 2013). “Distribution is the biggest issue in ticketing that no one is talking about right now”, says Qcue CEO Barry Kahn. There is a new shift in sales strategies for ticketing where primary ticketers look at distribution models. Even big players in the game like Ticketmaster, who was an adversary to anything that took tickets off their own channels, now sees value in third-party distribution and have created integrations to quickly move tickets on and off the platform.

Massive Music Festival Distribution Deals

Distribution deals take many forms in today’s world of new media and diverse content. Brands are seeking out new creative content to reach their audiences in every way possible. The music festival industry specifically is taking new leaps with how they deliver their various streams of creative content. Ultra Music, the top electronic music label and Machinima, the dominant video entertainment network, have announced their new exciting partnership this year. Machinima is the number one global video entertainment network for young males ages 13-34 years old, specializing in gameplay videos, scripted animated series featuring video game characters, and official game trailers according to Billboard Biz. In this new deal, Machinima will exclusively manage ad sales for Ultra’s YouTube content and share in the ad revenue. The partnership also requires that the companies collaborate to match up Ultra artists with Machinima’s videographers, to produce original content that will be distributed within Machinima’s network of over 6,000 channel partners with over 262 million viewers a month globally.

“As YouTube is now one of the most powerful platforms being used to distribute digital media, this partnership with Machinima is a great step forward for our artists and our music,” said Patrick Moxey, President of Ultra Music. “Music today is increasingly an audio-visual experience.” Ultra now produces approximately 100 new music videos per year and numerous full-length concert experiences (Machinima, 2013). These numbers are amazing given that music festivals can capitalize on all the fans that cannot physically attend the festivals. With the wave of distribution deals hitting viral channels like it is, newer and broader audience reach can be achieved. Currently, Ultra Music is the number one viewed YouTube channel for electronic music resulting in over 1 million subscribers with over 2 billion views. Electronic music is still a fresh face amongst the other music genre veterans, to have a fan base as large as this is astronomical. Ultra Music has several projects currently in the works including over 70 videos in production and a video specific A&R representative. 

Hear It From The Industry Experts

Podcasts are known as multimedia digital files that are available through the Internet, mostly for downloading to portable devices like iPods and various media players. To help highlight important lessons learned from the Advanced Entertainment Law course at Full Sail University, we turn to podcasts to help keep audiences up to date on entertainment law issues in the industry. Keeping up to date on podcasts helps the research that goes into music festivals and live concert issues for future business plans. This blog post will demonstrate and incorporate the skills and techniques learned and employed in the course to identify business liabilities. 

Gordon P. Firemark, Esq. is an attorney and the publisher of Entertainment Law Update, a newsletter for artists and professionals in the entertainment industries. Firemark has several episodes of his podcasts available on this site; the first podcast up for discussion involves James Taylor v. WB Records. In this case, Taylor is a musician fighting for digital royalties and argues that digital downloads should be treated as licenses. Taylor has been auditing records and royalty statements seeking $2 million dollars in damages since 2008. One of his main disputes is that there are numerous unpaid foreign royalties. Taylor is trying to get 50% of royalty licenses as opposed to the traditional artist royalty rate on a sale. As Firemark and a guest attorney discuss the issues on the podcasts, they raise valuable questions regarding the three years max on audit rights (most of the time it is 2 years). Should Taylor get paid the 50% royalty when he originally agreed to a 10-12% before he got famous? The experts advise that Taylor should not get the 50% royalties when the statue of limitations has lapsed already.

The second podcast discusses 360 Deals and the Talent Agencies Act, which was enacted for the protection of the artists. Firemark and his guest attorney explain how there are basically two types of 360 deals: (1) ownership of rights deal, and (2) income participation deal. What this tells us is that 360 deals are not traditional record deals; they can encompass all the details such as live touring, merchandising, and literary rights, or just encompass a few as opposed to everything. According to the experts, there has been a change in landscape for the deals, for example the Marathon Entertainment v. Rosa Blasi case. This case involves talent managers who procure work for their clients. Under the Talent Agencies Act, only licensed talent agents can procure jobs for clients, managers cannot do this. Rosa Blasi is an actress that ended the relationship with Marathon Entertainment, she stopped paying commissions, and Marathon Entertainment sued. Blasi got the Labor Commissioner to declare the deal void because work was procured. The new trend has been that courts will severe the contract for the illegal parts and the parts that are still okay remain intact, instead of voiding the whole contract.

The third podcasts discusses the J. Geils Band Trademark Dispute, to evaluate the lessons learned and the expert advise for cases like this, we must first understand the facts of the case.

J. Geil of the J. Geils Band is suing his band mates for trademark infringement and deceptive business practices. Geil registered his name as a trademark in 2008, and was granted a year later, but the band had no prior knowledge of this activity. Geil argues that the other band members are “seeking to misappropriate and steal” the name from Geils by touring without him. Delving deeper into the case, band members claim that Geil signed a document that prevented band members or other shareholders from using “J. Geils Band” for a commercial purpose that did not involve the rest of the band. The experts in the industry advise that at the end of the day, the rights of Geils will be upheld over the rights of the other claimants of the band since he holds the trademark rights.

Recent Industry Liabilities & Rulings

Creating a successful business plan requires many things, but some of the most important elements include all of the legal concerns and financial liabilities that have the potential to negatively affect future investors. Non-disclosure agreements (NDAs) with third parties, non-compete agreements, conflicts of interest, privacy concerns, and the protection of one’s trade secrets fall under industry liabilities. As a part of the curriculum in the Advanced Entertainment Law course, students are required to analyze legal liabilities associated with their business plan. To begin such an analysis, three recent court cases were identified to help understand the impact they had on the entertainment industry. The first case involves the New York Yankees v. Stubhub concerning on-going ticket scalping. The second case takes a look at the Trade Union of Russian Citizens v. Madonna, seeking damages after the singer’s pro-gay rights speech. The third case will touch on Comcast’s recent win for the anti-trust appeal from the U.S. Supreme Court.

According to the New York Post, the Yankees are argued that the pick-up location represents the “completion of sale” of online ticket purchases and violates their 1,500-feet rule already in place. The Yankees also have complaints concerning Stubhub’s unrestricted online market allows speculators to push resale ticket prices below face value. This undercuts the Yankee’s prices and drives down future attendance. My opinion has always been that Stubhub is a ruthless scalping system that is truly un-honorable to the live concert and event business. Selling tickets under face value so close to the event venue is infringing upon the venue’s rights.

The second court case that impacts the live concert and event industry relates to Madonna and her recent involvement with the Trade Union of Russian Citizens. In this case, The Huffington Post reports that the lawsuit against Madonna for allegedly traumatizing minors by speaking up for gay rights during a concert was dismissed. The Moskovsky district court in St. Petersburg dismissed the $10.7 million dollars that the Trade Union of Russian Citizens sought for allegedly exposing youths to “homosexual propaganda.” This case impacts the live concert industry because it ties in directly with freedom of speech in our country, and what that can be interpreted in another country like Russia.

The third case to review involves Comcast and their anti-trust appeal that passed recently. On March 27, 2013 The Hollywood Reporter published the Comcast victory against a class-action lawsuit that challenged how it has allegedly monopolized the Philadelphia cable market. Throughout Comcast’s business dealings they managed to acquire competitor cable provider systems in the region in exchange for systems outside the region (Gardner, 2013). What this means is that Comcast made dealings that bolstered its local market share, resulting in an estimated 60% of pay-TV subscribers in Philadelphia. My opinion of this case is that it is not a full-fledged monopoly, but an enterprise. This case leaves an impact on the entertainment industry because it demonstrates a new way for corporations to expand and offer new ways of trading services and connections.