It's been a sad year for music festivals.
Beyoncé cancelled her Coachella performance. Frank Ocean cancelled his Hangout Festival and Sasquatch! Festival performances. Fyre Festival was a complete disaster. More recently, Pemberton Music Festival was fully canceled, as the event organizers have now declared bankruptcy. Another Canadian music festival, Squamish Music Festival, was also cancelled last year. Overall, the past few years have seen a disappointing trend in a lack of great lineups and festival attendance, while more and more festivals are being canceled.
There's a simple explanation for the reason why music festivals seem to be dying: It's an oversaturated market.
Music festivals became trendy a few years ago, and with many investors seeing that they could make money off music-loving young adults, many people rushed into the development of their very own festival. As with any trend, there becomes a point where there are too many people in the market and it becomes unsustainable.
Many festival-goers can only afford to go to one festival every year, and now there are simply too many options. People usually either go to the one with the best lineup or the closest one. Too many festivals means that the music festival customers are spread out, so not every festival gets its money back. You also have situations like Fyre Festival, in which an oversaturated market leads to incompetent planning, and ultimately, some pissed off customers.
It's important to note that almost always, music festival tickets are a good deal. They're expensive, but in terms of how many artists you're able to see, it's definitely worth it. For example, Coachella had 233 acts this year, and general admission tickets were $399. That's $1.71 an act. Obviously you can't see every single show, but it's still a good deal nonetheless. However, low prices for music festivals means that there's not much revenue to be given to artists. Headliner acts, like Drake, cost upwards of $500,000 for a set. For a four-day music festival, that means it costs $2,000,000 just to have four headlining acts. You'll need to sell at least 5,000 $400 tickets to make your money back on the headliners alone. You also have to pay other artists, set up a venue (if you can even find one), hire security and staff, etc. Overall, unless your festival sells out every year, you won't be making much money back, if at all.
It's also important to note that the popularity of music festivals depends on how good their lineup is, and these are decided by which artists become popular each year. The problem here is that there isn't always a lot of great, new artists every year, so festival lineups begin to look the same. When the lineup looks boring, tickets don't sell, and when tickets don't sell, the festival gets canceled.
However, that isn't to say that music festivals can't be saved. Maybe a scaling back on festivals will be a good thing, and eventually they'll bounce back. In the meanwhile, there are cool things happening within the festival community. LiveNation just announced their music festival "season pass" for $799, for example.