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The Fyre Festival Fiasco Shows How Insane The Festival Market Has Become

"You always have to be upping your game because the competition is so fierce."

Posted on April 29, 2017, at 12:05 a.m. ET

Ja Rule and the people behind Fyre Festival were the subject of an epic dragging today after the would-be luxury getaway devolved into a nightmare disaster zone.

Expectation v. Reality for the biggest scamming festival in the 21st Century #FyreFestival @WNFIV @FyreFraud

But it's not totally surprising that a new music festival would go off the rails like this, especially in the context of the modern festival industry.

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As festivals like Coachella and Bonnaroo have helped turn what was once an alternative pastime into a business worth hundreds of millions of dollars per year, competition has intensified.

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Big festivals have gone to extremes to stand out from the pack, offering deluxe amenities like personal chefs, catered cabanas, and 24/7 golf cart access.

At Desert Trip, the classic rock Coachella spinoff last year, festival-goers could pay $179 for a "wine and food experience" featuring โ€œa program of wineries crafted by [a] World Renowned sommelier.โ€
Frazer Harrison / Getty Images

At Desert Trip, the classic rock Coachella spinoff last year, festival-goers could pay $179 for a "wine and food experience" featuring โ€œa program of wineries crafted by [a] World Renowned sommelier.โ€

"You always have to be upping your game because the competition is so fierce," said Janine Small, a lawyer who represents Bonnaroo and Outside Lands and has worked in music festivals for decades.

Frazer Harrison / Getty Images

For a new festival trying to lure customers from more established names, the pressure is even higher.

And even if they donโ€™t crash as spectacularly as Fyre did, failure among new festivals is pretty common. Even just putting on a modest, multi-day outdoor experience is insanely hard.

The dinner that @fyrefestival promised us was catered by Steven Starr is literally bread, cheese, and salad with drโ€ฆ https://t.co/GjBxQygxV9

Many festivals take over a year to prepare, and given all of the expenses involved โ€” including talent booking, property rental, permitting, insurance, sanitation, security, and event staff โ€” it usually takes a few years before a new one sees its first profit. "The idea is that maybe you break even in year three," Small said.

In 2002, the first Bonnaroo got notoriously out of hand, with up to 18-hour traffic jams on the road to the grounds in Manchester, Tennessee. And in 2014, the original producer of BottleRock festival in Napa Valley was forced to file for bankruptcy after failing to pay staff and sustaining $8 million in losses.

Alex Wong / Getty Images

"A lot of people out there think 'I wanna get into this business because itโ€™s a good way to rack up some money,' and they donโ€™t really realize all thatโ€™s involved," said Small.

For the new generation of high-end festivals, Fyre Festival was a perfect "case study in what could go wrong."

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