How the Music Industry Uses a Pervasive Secret Weapon to Keep Bands From Freely Touring
Illustration by Kristina Collantes

How the Music Industry Uses a Pervasive Secret Weapon to Keep Bands From Freely Touring

In February, one of the most popular DJs in the scene played a set in downtown Los Angeles. While this artist sold out several dates in L.A. last fall, only a small percentage of his fans even knew the February show was happening, because his name wasn't on the bill.

This wasn't an oversight on the part of the promoter; it was a way for the artist to perform without breaking his contract with another (and more powerful) local promoter. The situation was a manifestation of one of live music industry's most pervasive secret weapons: the radius clause.

A radius clause is a common component of the contracts artists sign when they agree to play a show, especially a major music festival. These clauses create restrictions on how long that artist must wait before and after that show to play in the same market, and how many miles outside of that market they must go to play another show within that time frame.

For example, a band may sign an L.A. festival set contract stipulating that they are not allowed to play within 150 miles of Los Angeles for two months before or after the event, which would prevent them from playing for four months in L.A., Palm Springs, San Diego and any other venue inside this geographic net. Mileage and time vary between promoters, with some particularly severe clauses extending hundreds of miles and a few covering entire regions of the United States. One L.A.-based festival stipulates that an artist is not even allowed to announce any other shows until the festival has sold out.

"The main reason is to protect the festival," says a source familiar with festival talent acquisition at the corporate level, who would only comment on radius clauses on condition of anonymity. "Festivals are the biggest risk/reward venture you can possibly have in music. It's huge volumes of money. If you win, you can win huge, but you can also lose huge."

While radius clauses have long been standard, in the past few years promoters in Southern California and beyond have increased their scope as music festivals have become big business and a handful of corporations have taken primary control of the industry.

Radius clauses in Southern California function as they would in any other major U.S. market; the difference here is the number of major festivals taking place in the region, including FYF, HARD Summer, Stagecoach, Camp Flog Gnaw, Knotfest and nearby EDC Las Vegas. Coachella, the biggest of them all, attracts hundreds of thousands of attendees from around the world each April, generating $95 million in ticket revenue, making it the world's highest-grossing festival until it was eclipsed by Desert Trip's $160 million gross last fall.

"This warrants that [destination festivals] are a bit more vigilant about their radius clause," says Jake Schneider, a former partner, director and booking agent at Colorado-based Madison House, which handles booking and management for such artists as Bassnectar, The Orb and Michael Franti. "I'm not vindicating their radius clauses, because they can be absolutely egregious at times, but when your festival is spending that much money and there's volatility in the market, you need to protect your investment."

As albums sales have dropped precipitously, festivals have become one of the most profitable areas of the music business. Festival promoters want to ensure they're making as much cash as each market has to offer, and one way to do that is by booking acts fans can't see anywhere else.

Never mind that bands also are harmed by the drop in album sales — and that smaller acts are further harmed by vast limitations on where they can tour.

While artists want to play more, they also don't want to risk their relationships with the promoters that pay them. Multiple artists declined to comment for this story, but an industry source who works closely with numerous DJs and EDM artists confirmed that most won't openly complain about radius clauses for fear of losing out on lucrative festival bookings.

The politics of radius clauses have evolved with the consolidation of the festival industry. In SoCal and beyond, two companies maintain primary control over the live-music business. L.A.-based AEG Live, the world's second largest promoter of live music, owns Goldenvoice, the company that puts on Coachella, Desert Trip and FYF and launched Panorama in New York last summer. (Panorama took place less than two months after New York's long-standing Governors Ball Music Festival, with the promoters of that event telling Billboard that the launch of a similar festival in the same location was "shortsighted and disappointing.") Goldenvoice controls venues across the country, including L.A.'s El Rey Theatre, Fonda Theatre, Shrine, Roxy and Fox Theater Pomona. It's no coincidence that these venues host the majority of "Localchella," the glut of shows that happens the week between Coachella's two weekends. (Goldenvoice declined to comment for this story.)

Beverly Hills–based Live Nation is the world's largest live-entertainment company and in the past few years has acquired myriad festival brands including Insomniac, which puts on EDC Las Vegas and operates L.A. nightclubs Create and Exchange. In 2012, Live Nation also acquired the L.A.-based HARD Events, the company behind HARD Summer and the Holy Ship! EDM party cruise. Local venues controlled by Live Nation include the Palladium, the Wiltern and the House of Blues Anaheim.

Such consolidation makes it possible for talent buyers to offer artists multiple festival dates over the course of the touring season, effectively buying out talent and, in some cases, making it nearly impossible for other promoters to book them. Last year, for example, LCD Soundsystem announced a reunion tour that included headlining sets at Coachella, FYF and Panorama, all festivals operated by AEG Live/Goldenvoice. The band later added shows at Pomona's Fox Theater and Colorado's AEG-operated Red Rocks Amphitheatre, effectively announcing their initial tour dates via a single promoter. (Appearances at the Live Nation–controlled Bonnaroo and Lollapalooza were later announced.)

While this system can homogenize lineups across the country, it also ensures festivals that fall within one another's radiuses will offer a largely unique collection of artists. Of the more than 200 acts that played EDC Las Vegas in 2016, only five of them also played Coachella that year. There was no overlap between last year's EDC and HARD Summer, which insiders say have competing radius clauses despite being controlled by the same parent company, Live Nation. (Insomniac declined to comment for this story, and HARD did not respond to requests for comment.) Other lineup comparisons tell similar stories.

Consolidation can benefit headlining acts, who are able to demand millions of dollars and top billing in return for exclusivity. But for smaller bands that depend on touring revenue, agreeing to a radius clause means being elbowed out of markets for long periods of time and grinding harder to make ends meet, in exchange for the slim hope that a daytime slot at a mega-festival might make them the next Arcade Fire or Daft Punk.

"Smaller to mid-tier acts are one of the toughest things, because they need to be able to tour and make money out on the road," Schneider says. "If they can't play markets that are within reasonable drives, they are literally having to travel 500 miles every night, which is dangerous and expensive."

Radius clauses also present challenges for independent festivals that can't offer the cachet of playing an internationally known event or the six- and seven-figure paychecks now paid by some mega-festivals. While these restrictions force smaller festivals to get creative in terms of lineup curation, the impact can be stifling.

"In the early years we always had difficulty navigating radius clauses, and it didn't necessarily force us to go in a certain direction, but it didn't allow us to go in the directions we really wanted to," says Jesse Flemming, a co-founder of the Do LaB, which puts on boutique festival Lightning in a Bottle. "As we tried to book bigger artists and more bands as opposed to DJs, it was challenging because they were all playing the bigger festivals, who would block them from playing other fests."

Since launching Lightning in a Bottle in 2004, the Do LaB has cultivated a relationship with Goldenvoice. Do LaB began hosting its own stage at Coachella in 2005, which, along with the company's overall growth, has helped smooth the booking process for LiB.

"As we got bigger and built more relationships with artists and other fests, we were able to navigate through it all a bit more," Flemming says, "although some promoters still won't budge and allow you to book an artist, even if they're sold out and we're not really competition."

As for the artists themselves, and agents who represent them, they are often willing to deal with particularly restrictive clauses in exchange for fat paychecks. But this creates a vicious cycle, as promoters argue that increasing artist fees necessitate ever-more restrictive clauses.

"We have to use radius clauses because the agents want so much fucking money at this point," says the source in talent acquisition. "They've leveraged everyone against each other, and artists are getting paid astronomical amounts. Festival budgets have doubled and tripled. These artists sell a thousand tickets [at a club] and agents think they can get $30,000 to $50,000 for a festival instead of $10,000."

Schneider emphasizes that artists and agents are never forced to sign anything they're not comfortable with, and that promoters often offer radius-clause exemptions in exchange for a lowered fee or a less attractive time slot. But while agents and deep-pocketed festivals work it out among themselves, independent venues often take the biggest hit.

"Radius clauses hurt all independent promoters and in the end the artist, because instead of marketing their name, they are co-branding on a festival," says Mitchell Frank, president of Spaceland Presents, which has been doing shows in L.A. since 1995. Frank says his company, which runs the Echo, Echoplex and Regent Theater, has lost hundreds of bookings because of festival radius clauses. (All three of Spaceland's main venues will host Coachella bands during Localchella this year. A representative for Frank and Spaceland declined to comment on how these shows were booked, but a source close to Spaceland confirmed that Goldenvoice sometimes allows artists to play non-Goldenvoice venues once Coachella is sold out.)

Even the city of Los Angeles itself has become competition. Frank says downtown's Pershing Square has a six-figure budget for its free concert series, and that organizers have maintained a hard line against any plays during their radius clause.

"So the city of L.A. that I pay [tax money to] is competing for talent at excessive pricing," Frank says. "But also, the city is now restricting local promoters' purchases due to city radius clauses."

While promoters are often left with their hands tied, for artists the solution is often to play under the radar. Secret sets, for which artists are unannounced until the day of the show or the moment they take the stage, have become increasingly common, particularly in the electronic world.

L.A. party promoter Space Yacht teases the names of secret guests by putting on their fliers the same number of question marks as there are characters in that artist's name. In 2015, the manager for one of L.A.'s buzziest rappers demanded the artist be cut out of the event's recap video so fewer people would find out he had been there.

As acrimonious as the power dynamics between festivals and local promoters can sometimes be, the fiercest competition is between the festivals themselves. Most agents can list the distances between arbitrary cities off the top of their heads as they try to book their artists as many shows as possible, and screaming matches between agents and promoters are not uncommon as companies scramble to curate the most innovative and exclusive lineups each season.

"Remember," Schneider says, "people's mortgages are on the line with these festivals."

Correction: An earlier version of this article misquoted Mitchell Frank as saying that the City of L.A.'s free downtown concert series takes place in Grand Park, when it in fact takes place in Pershing Square. We regret the error.

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