Australia has been well known for having a vibrant music scene and having iconic music festivals like Big Day Out and Splendour in the Grass, drawing crowds from across the country and all around the world. However, it seems lately that many festivals have been facing financial and logistical challenges. Festivals like Groovin’ the Moo, Falls Festival and Splendour have cancelled their festivals for the 2nd year in a row. Bluesfest initially made their 2025 instalment the last (though they have announced they are coming back next year for an encore), and many others have either downsized, postponed, or cancelled altogether. Many have claimed that there is a music festival crisis happening in Australia now, with some companies like ITP Music Pty Ltd and Timeless Events Australia going into liquidation. So, what exactly is going on?
Why are festivals being cancelled?
There are many factors into why music festivals are being cancelled. While low ticket sales is one factor, some other reasons include:
- The costs of running a festival have increased. This doesn’t just include booking the artists but also people to set up the festival, insurance, hospitality (food and drink), emergency services, and security. Running a festival in NSW can cost around $3.9 million. For some, it just isn’t feasible to run festivals if they do not have the money.
- With the cost-of-living crisis, a lot of people are unable to afford tickets to festivals. As these festivals tend to happen outside of cities, people aren’t just paying money for the festival tickets, but also travel and accommodation, which may make things unaffordable.
- Lack of an appeal. Some festivals have been criticised for having a “weak” lineup or not having an artist that would be a main draw to the festival. Many have noted that Groovin’ the Moo’s cancelled lineup was billed in a way in which the headliners were not clear.
- People don’t want to take the risk with festivals. Some people are concerned that an artist may pull out of the festival for whatever reason, or due to wild weather, which may result in the festival being cancelled altogether. People are also more interested in seeing headline shows because they are less risky. An example is the band, Oasis, who last year announced their reunion shows in Sydney and Melbourne and managed to sell out in hours.
- Red Tape can also be a contributing factor to festivals being cancelled. From noise restrictions to curfews and even stringent safety protocols. Recently, the Esoteric Music Festival in Victoria was cancelled as a permit was not granted at the last minute.
What is causing these companies to go into liquidation?
- Music festivals have a very tight margin. As post-pandemic inflation has drastically increased prices, it’s hard to run festivals on the scale of something like Big Day Out nowadays. The only way to do that is to hike ticket prices, which would result in lower ticket sales, as the majority of people would not be able to afford them.
- In order for a lot of festivals to survive, they needed to borrow money from elsewhere to cover costs. With interest rates increasing and consumers being more cautious about spending, it has made these debts harder to manage.
- Corporate sponsors are re-evaluating their event investments. Many of them are redirecting their budgets towards other ventures in which they are more guaranteed to make their money back, which results in festivals needing to scramble to fill in revenue gaps.
- Due to the risk of running a festival with things like weather and the COVID-19 pandemic, insurance costs have risen, which puts a lot of festivals at risk in the event of a cancellation, especially if the insurance policies
- The lack of government support has meant that many festivals have been struggling without a lifeline to help them when things have been tough. While the NSW government has been able to help support established large-scale festivals with funding up to $500,000, some believe this does not go far enough.
Is there a way to fix this crisis?
As the industry is in dire need of a shakeup, festivals will need to rethink what they do in the future. It isn’t as simple as booking “better artists”, but rather the following:
- Diversified revenue models (merchandising, digital streams, year-round engagement)
- Innovative financing (better investor relationships, more flexible credit)
- Stronger contingency plans (weather, health, supply chain risks)
- Industry collaboration to advocate for better insurance solutions and policy support.
Yes, the liquidation headlines are concerning, and it’s not good news to hear your favourite music festival has been cancelled, but they’re not inevitable. With smart adaptation and collective action, the Australian music festival scene can evolve to meet today’s challenges and thrive in the future.
The best thing we can do in today’s climate is to support our local artists as if there’s anyone who is affected the most in this crisis, it’s our local producers.
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