DETROIT LAKES, Minn. — Now that WE Fest has been sold, this small Minnesota lakes country city has another issue over which to fret and whisper.
Is the new owner going to move the waning country music festival to the Twin Cities area?
It's a possibility, if not next year then perhaps in 2021 or beyond, simply because of economics.
WE Fest apparently was not making much, if any, money for previous owner Townsquare Media and there'd be no reason for new owner Live Nation to acquire a festival (or at least the brand name of a festival) if it didn't intend for it to be profitable.
On an earnings call Tuesday, Aug. 6, during which Townsquare CEO Bill Wilson said the company was selling off some of its live events (concerts and music festivals including WE Fest) for $10 million, he pointed out that the divestment was meant to eliminate "non-core" and "low- or non-margin events." Townsquare intends to stay in the concert promotion business, Wilson said, but on a smaller, more profitable scale.
The $10 million figure is interesting.
According to media reports at the time, Townsquare purchased WE Fest from Twin Cities promoter Rand Levy in 2014 for $23 million, which included $21.5 million cash and $1.5 million in stock.
The value of WE Fest has plummeted in just five years.
The issues with WE Fest the last few years are well-documented. Attendance is down, tickets are more expensive, the economic impact to Detroit Lakes has shrunk as Townsquare made the the festival more corporate and insular, the main acts aren't quite as big as they used to be.
The focus on local disappeared when ownership went national.
Live Nation would seem to have a couple of options if it wanted to return WE Fest to maximum monetization.
One would be to return to its glory days by losing the corporate feel and trying to ingratiate itself to the locals again. What if Live Nation hired Levy to manage WE Fest and do what he did from 1985-2014 when he owned part or all of the festival?
Another would be to take the name and move it to an area with millions of people, tens of thousands of whom would be willing to pay premium ticket prices for premium acts. Like the Twin Cities, for example.
Live Nation is similar to Townsquare in that it is a corporate giant. But it is a much larger corporate giant whose specialty is concert promotion and tickets sales, while Townsquare's specialty is owning radio stations and developing websites. Live Nation has an out-sized influence on the live concert industry, in terms of both promoting artists and selling tickets, and the company flexes it.
It's not crazy to think Live Nation would uproot WE Fest to a Twin Cities suburb — Shakopee is the hot rumor going around Detroit Lakes, on an area the Minnesota Vikings once explored for a new stadium — in order to take advantage of the 3.3 million people and massive radio audience (ticket buyers) in the eight-county metro area.
It won't happen next year, if it ever does. Word is Live Nation has reserved blocks of hotel rooms and made other preparations in Detroit Lakes for 2020.
Matt Brenk, the city's mayor, said he's heard the whispers for years that WE Fest was going to move and it has yet to happen.
"It seems like every year we hear those rumors," he said. "We all know it's a positive for the community and we don't want to see it moved. ... It doesn't make any sense that they would move it because everything they need is already in place out at the Soo Pass Ranch. The infrastructure, campgrounds, all that stuff is already there. So why would they move it? I guess they could, but then they'd be starting from scratch somewhere else.
"Does that make sense?"
Logically, no. But if the bottom line says a move would be more profitable, that is how the decision will be made.
There is nothing imminent, as far as we know. Messages to Live Nation, Levy and others were not returned, unsurprisingly.
It is something on which to keep an eye over the next couple of years, though. With a deep-pocketed, mega-corporate owner, WE Fest seems ripe for change.
A Detroit Lakes summer without WE Fest. Now that would be odd.