Big money is flowing into electronic dance music. In the latest example of corporate interest in this once-ignored market, Live Nation Entertainment said on Tuesday that it had acquired Hard Events, a Los Angeles company that has put on popular festivals and concerts across North America.
Yet such investments are fueling fears that a bubble is taking hold in the world of electronic dance music, or E.D.M., jeopardizing the creative and commercial health of the music. The issue has been intensely debated inside the music business, and recently some of the genre’s stars have sounded alarms as well.
“E.D.M. has turned into a massively marketed cruise ship, and it’s sinking fast,” the D.J. and producer Deadmau5 wrote on his Tumblr page on Tuesday. “All I’m trying to do is put on my life jacket and swim as far away from this shipwreck as fast as I can.”
The stakes are high for dance music. So far this year Live Nation has also bought Cream Holdings, a major British dance promoter, and the media mogul Robert F.X. Sillerman has begun what he says will be $1 billion in acquisitions. Young and relatively untested D.J.’s like Avicii have had mixed success playing in amphitheaters and arenas this summer, leading some industry leaders to say they are preparing for a “market correction.”
For many of the independent promoters who have dominated the dance market over the last two decades, Wall Street investment could provide a welcome cushion in a risky business, and fuel expansion in to new markets. But they also worry that corporate involvement will damage the culture of E.D.M.
In an interview earlier this year with The New York Times, Gary Richards, the veteran promoter and D.J. who founded Hard Events, was one of those people voicing concern, saying, “You can’t just franchise this like McDonald’s.” On Tuesday, he defended his decision to sell to Live Nation, saying that the deal would help him expand Hard, while maintaining its character.
“I’m always going to fight the good fight,” Mr. Richards said. “The reason I’m different from other festivals is that I bring the new thing, develop it and bring it to the masses. This will only be able to help, because now instead of just L.A. and New York, I will be able to do this in South Africa, South America. It’s only a good thing.”
Financial terms of Hard’s deal with Live Nation were not disclosed. In interviews, Mr. Richards and Michael Rapino, the president of Live Nation, both said it would expand into new markets, although they indicated that nothing was imminent; Hard’s major festival, Hard Summer, will be held in Los Angeles on Aug. 3 and 4, with Skrillex, Chromeo, Squarepusher, James Murphy and dozens of others.
Live Nation has taken steps to establish itself as a credible force in electronic music. When it bought Cream Holdings, it made the company’s respected founder, James Barton, president of Live Nation’s electronic division. Mr. Barton said he had the confidence of Mr. Rapino to build stable dance properties.
“Are we going to be put under tremendous pressure to change?” Mr. Barton said in an interview. “No, not frankly. I don’t see that today, and I’m not seeing that in the future.”
Others in the business worry that the integrity of the festivals, which have developed an idiosyncratic culture since the music first became popular in the 1980s, would be compromised under corporate control. Neil Moffitt, the chief executive of Angel Management Group, a live entertainment company in Las Vegas, was critical of Live Nation’s stewardship of major dance music events, citing a joint venture deal in 2006 for the British festival Global Gathering, which he said quickly deteriorated.
Mr. Moffitt said he was concerned about the long-term intentions of investors like Mr. Sillerman, who in the 1990s combined regional rock promoters into a national entity, and sold it to Clear Channel Communications for $4.4 billion. (Clear Channel later spun it off as Live Nation, which since going public in 2005 has never turned an annual profit.)
“If their objective is to create a second generation of electronic music, where they’re well-funded and have great infrastructure, and the music has a great future, then I’m all for it,” he said. “But if the intent is to sweep up an untapped part of the music industry, take it to the stock market, and everybody cashes out and watches it dissipate, that would be very disappointing.”
Mr. Rapino said that while large-scale E.D.M. events have long been popular in Europe, they are relatively new in the United States, and therefore few promoters had long experience with them.
“It’s not like anyone’s been doing this for a long time,” Mr. Rapino said. “No one has a historic ownership of the space. This is a fragmented marketplace, and we believe that if we can hire credible players that have been in this space, doing what they do best, that we’ll be able to build a smart division.”
Yet promoters like Mr. Richards are part of a generation of independent operators who have been at it for as long as 20 years, and lived through more than one music industry hype cycle in which electronic music seemed on the verge of a mainstream breakthrough, only to retreat into subcultural status.
“The music business is always like this,” Mr. Richards said. “Some genre comes along, and there’s all this attention on it all of a sudden, and then when you look at it you say, who were the pioneers of that genre? And those are one ones that always last.”