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Music festivals endure tough summer amid surprise funding cuts, waning attendance


Putting on a festival, let alone a successful one, is daunting, and failures have a ripple effect not just on the music industry, but the broader economy

Tim Potocic has had quite the eventful summer.

The director of the long-running Supercrawl Festival in Hamilton has been constantly working against the clock to transform 18 downtown blocks into an all-ages, multi-genre and free celebration of the arts on the Sept. 13 to 15 weekend: booking musicians, licensing food and alcohol vendors, reaching out to local artists and supervising around 20 fashion designer runway shows. That’s on top of leading 180 to 200 staff and volunteers and worrying about any of the acts dropping out at a moment’s notice.

Potocic used the record label, Sonic Unyon Recording Co., which he co-founded in 1993 along with Mark Milne and Sandy McIntosh, to fund the first iteration of Supercrawl in 2009, when about 3,000 people showed up for the four-hour event. In its 2018 edition, Supercrawl brought in 250,000 people, including many tourists from the U.S., which he said had a $16-million economic impact on the city of Hamilton.

“We just felt a real kinship to being Hamiltonians and when we saw this momentum, this shift start to happen and we wanted it to grow,” Potocic said. “We’ve grown from a little upstart. We actually didn’t even measure (economic impact) in the first couple of years.”

Supercrawl has also received provincial grants to make a go of it. Last year, the festival got $275,000 — about 20 per cent of its budget — from the Celebrate Ontario fund, which reserves money for festivals of all stripes.

But the Celebrate Ontario fund was reduced by $7 million in April, while the Ontario Music Fund, which provides funds for those more broadly in the music industry, was cut to $7 million from $15 million. Both agencies fall within the purview of Ontario Creates, under the wider jurisdiction of the Ministry of Tourism, Culture and Sport.

As a result, Supercrawl’s provincial funding was cut to zero with only a few months to go until the festival, even though Potocic said he was told in February by Michael Tibollo, then-minister of Ontario Ministry of Tourism, Culture and Sport, that his festival could expect a similar amount of funds, despite the government’s budget-busting ways.

Potocic said he was blindsided by the funding cuts, which have only dampened the overall festival mood in the province as organizers of several notable events cancelled their plans this year, following the demise of many other festivals in recent years, and that does not bode well for the music business in Canada.

“With apologies to the rest of the country, Ontario really is the centre of the universe when it comes to music, especially southern Ontario and Toronto,” said Alan Cross, host of The Ongoing History of New Music, a syndicated radio series. “That’s where almost all the music income and almost all the business are generated. We continue to do really well because Canada as a whole exports far more music to the rest of the world than a country of our size and breadth has a right to.”

Canada’s live music revenues in 2017 totalled US$711 million and are projected by PricewaterhouseCoopers to hit US$808 million by 2021. Ontario accounts for 80 per cent of all live music revenues in the country, up from 65 per cent in 2005.

Going hand-in-hand with that revenue, 95 per cent of live music companies active in the province are Ontario-based and controlled. Last year, $20 million from Celebrate Ontario went to a record 328 festivals.

By comparison, British Columbia this year set aside $1.7 million of its $15-million music fund for live music, while Quebec provided $11.6 million in music-related grants and funding, with its top-funded organization being the Orchestre symphonique de Montréal at $1.8 million. In 2018, Saskatchewan doled out $241,000 solely for touring acts.

“The government will work with Ontario Creates to modernize the Ontario Music Fund to focus on activities that bring the biggest return to the province, and refocus its investments into emerging talent to create opportunities to achieve success,” a spokesman for Michael Tibollo said in a statement when the cuts were announced.

A report from the same ministry in December 2018 stated, “Every $1 of Celebrate Ontario funding results in $21 of visitor spending.” By comparison, Manitoba’s music industry in 2016 generated $4.12 for every dollar invested by the provincial government, according to a study from Nordicity Group Ltd., an independent business consultancy.

Live music accounts for around 20,000 jobs in Ontario, but the economic benefits of festivals such as Supercrawl aren’t shared by just those in the music industry.

“It’s not just impact for the artists and companies and stakeholders there’s a lot of indirect impact. Hotels, airlines, restaurants, corner stores, taxis, gas stations, you name it,” said Erin Benjamin, chief executive of the Canadian Live Music Association (CLMA).

Moreover, live music really is the only way forward, financially speaking, for a musical act in 2019, given that physical media sales are slumping and Spotify pays a paltry 0.6 cents to 0.84 cents per stream to the holder of music rights.

Given Ontario’s previous support for established and nascent music acts, Potocic was stunned by the funding cut. But he got to work on slashing his budget, starting with marketing spends south of the border. He also spent the next several weeks attempting to contact “every level of everything (in government)” to no avail.

It wasn’t until July 19 that he received a call from new minister Lisa McLeod, who did not respond to requests for comment, with the hail-Mary reveal that Supercrawl’s funding had been all but restored to $250,000. The whiplash was not lost on Potocic.

“Some of my spends were cut to zero, some were cut to 50 per cent where I could, so now I have to look at the budget and re-evaluate next week. There are some things that I’ve cancelled that now I know I can’t reschedule, but we can try to fill the gaps,” Potocic said. “I had always intended on the festival looking exactly the same as it had in the past. The general audience wouldn’t have known, but we would have felt it internally.”

Even without the looming threat of funding cuts, putting on a festival, let alone a successful one, is a daunting task, as evidenced by the number of high-profile festivals in Ontario either cancelled or put on hiatus in recent years.

In 2017, the WayHome Music and Arts Festival, an attempt at a Coachella-calibre event, went on indefinite hiatus after a three-year run. The U.K. import Bestival and Chicago import RiotFest are also no more, as are Toronto’s Urban Roots Festival and EdgeFest.

“Here’s the problem with a music festival,” Cross said. “It is inherently risky, it is inherently expensive and you have a very limited window in which you can stage one of these things. Basically, you have the 90 days of the Canadian summer.”

The cuts to the Ontario Creates fund also served as a harbinger to a festival season full of plot twists usually only seen on daytime television.

The main culprit was the would-be inaugural Roxodus Festival, which had booked the likes of Aerosmith and Lynyrd Skynyrd. It was cancelled on July 3, eight days before it was supposed to begin, initially citing overly wet grounds. The owners later stated it was due to low-ticket sales, despite previously saying that they had already sold over 20,000 tickets.

MF Live Inc., the company behind the festival, filed for bankruptcy on July 12. The company had assets of $154,075 and liabilities of $18,261,874.10. Nearly 200 creditors are listed as having outstanding debts, including Clearview Township, the would-be site of the festival. The town is considering a civil lawsuit. Some have likened Roxodus to the Fyre Festival, the infamous 2017 event that flamed out in a hailstorm of controversy.

MF Live is also under a Nottawasaga Valley Conservation Authority (NVCA) investigation for allegedly clearing 18 hectares of woodlands and 10 hectares of environmentally sensitive wetlands without proper permits.

But Roxodus isn’t the only Ontario festival to disappear. The Welland-based Hair in the Fair hair-metal festival announced cancellation at the beginning of July, citing “economic hardship” after the Trailer Park Boys and Motley Crue’s Vince Neil pulled out.

The Journey Cannabis and Music Festival in Vaughn was also cancelled in July, although that was due to city’s new by-laws that only permit cannabis use by those with the proper medicinal credentials, something the organizers say they were not made aware of prior.

The Nordstock Music Festival scheduled to take over Lansdowne Park in Ottawa, Aug. 9 to 11, with an assortment of cover bands paying tribute to the original artists who played Woodstock 50 years ago, was cancelled due to low ticket sales.

And Toronto’s popular Field Trip festival in January announced it wouldn’t be returning to Fort York for 2019, although it is hopeful for a 2020 comeback.

That’s not to suggest Ontario is the only place where festivals are struggling.

The Squamish Valley Music Festival in B.C. ended a six-year run in 2016. The Pemberton Music Festival in B.C. in May 2017 announced its bankruptcy, citing the Canadian dollar and lower sales. Victoria’s Rifflandia Festival in May announced a hiatus, citing economic instability in the festival market, and the Skookum Festival in Vancouver is taking a year off despite attracting 51,000 people last year.

The only festivals in Ontario enjoying consistent success are genre-specific, such as the country-focused Boots and Hearts in Oro-Medonte (since 2012), or the electronic music- focused Ever After (since 2015), Digital Dreams (since 2012) and Veld (since 2012), which Cross attributes to their sense of community. There’s also the Drake-centered OVO Fest, though even that received $300,000 in provincial funding in 2015.

Although Toronto is the third-biggest music market in North America, and has attracted 31 per cent of the national concert attendance in 2019 so far, it just does not seem able to hold a large festival akin to Montreal’s Osheaga.

Cross sees several problems with Toronto and the adjacent market. One is the sheer number of festivals that put on an abundance of bands, over-saturating the appetite for live music. Another is the lack of a festival-going culture like that found in the U.K.

It also takes years for producers to build a festival’s reputation into a must-see event. Without that sort of legacy — something the 10-day RBC Ottawa Bluesfest, which despite its name is multi-genre, has built since starting in 1994 — many just stay away.

“Sometimes festivals that are slightly smaller and aren’t in a major city do much better,” said Wayne Petti, frontman for Cuff the Duke and head of funding and strategic partnerships at Straight and Narrow Artist Management. “Mariposa in Orillia or Hillside in Guelph, families go to them every year no matter what. In some ways, Toronto just doesn’t have that, that thing that everyone goes to.”

A festival itself is also something of an intrinsic gamble. Those in the industry refer to the concept of the “green banana.” That is, when festivals are looking to book artists they often try for those that seem like they might blow up in the next year or so, right around the timing of the planned festival. This way, the artists are booked for a much cheaper price than would be required once they become more nationally or internationally known. Thus, the green banana ripens by the time of the festival.

“The thing with that is you’re still potentially booking an artist that the masses aren’t aware of yet. If you’re in the know, it makes sense, because you can see six to eight months from now that this band is going to be huge,” Petti said. “But the average festival-goer, they don’t know that. They want to see the band that’s already established, that costs 10 times as much as that other band.”

Ontario’s music-related cuts have the potential to hurt the label side as well, said Shauna de Cartier, founder of Six Shooter Records, which has released more than 100 albums since its creation in 2000, including ones by Polaris Prize winner Tanya Tagaq.

“(The funds) stimulate new artists development which also has an impact on studios and other ancillary businesses,” de Cartier said. “Without any funding to take those risks it certainly changes the A&R approach… I don’t know if a modernization of that fund, which is only six years old, needs to happen.”

As for Potocic, he doesn’t plan on getting caught off-guard again.

“What I had been doing before was nurturing a relationship. Now I think I have to have a more firm understanding of where they’re headed on some of these things,” Potocic said. “We’re clearly going to be in close touch with the ministry going forward. I’m going to be making more phone calls more often than I have in the last couple of years”

Financial Post

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