AUX-IN'S NEWS YOU CAN USE, OR LOSE
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This is a brief overview. Interested in reading the well-written article for which this post is based? Here's the
We Got This Covered blog link:
Breaking Beatport: Examining How SFX Entertainment Destroyed A Beloved Brand
For those following industry news with regard to electronic music, the SFX Entertainment saga is an interesting one. It is, in many ways, a classic story of corporate hubris, especially when considering their handling of Beatport, a preeminent music-download service geared toward DJs and electroheads alike. Not long after buying Beatport, SFX, led at the helm by founder Robert F.X. Sillerman, began struggling with a large debt load as they took on multiple acquisitions, largely with a focus on music festival promoters.
My focus is going to be on Beatport. Beatport was founded in 2004 as a way to help navigate the transition from vinyl to digital that was going on at the time.
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Around the same time, Pioneer had just begun selling the CDJ 1000s – and enticed by the prospect of not having to lug crates of vinyl from gig to gig, DJs across the world ditched vinyl in hordes.
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Not only did MP3s reduce the amount of gear DJs had to carry around, but being able to buy music files on services like Beatport saved them a lot of time, too, as now they didn't have to convert all of their music files themselves. Over the next several years, Beatport would become an accepted standard for electronic-music downloads. Indeed, even regular dudes like me could now buy tracks from them that I couldn't find anywhere else.
Enter Sillerman, stage left. And he was on a mission:
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The entertainment entrepreneur founded SFX Entertainment in June of 2012 and pledged to invest $1 billion in EDM before buying up companies like Disco Donnie Presents, ID&T and Beatport over the course of what Billboard dubbed “The EDM Arms Race.”
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Given what Beatport's original mission was, which certainly didn't include people running the show who knew nothing about the culture, SFX's ownership has gone the way that many of these types of buyouts do -- i.e., not swimmingly, and definitely not without its growing pains.
Quote:
In a broader sense, every blunder made by SFX reinforced that the executives making decisions on Beatport’s behalf didn’t care enough about the outcomes of the business to acquaint themselves with electronic music – or even take advice from the very entrepreneurs they said would retain control.
“The board didn’t know anything about EDM,” a source said, “and every conversation that I recall where [Stout] was talking about his interactions with Sillerman, they boiled down to ‘I don’t know anything about electronic music, I don’t care, I just wanna own Beatport,’ basically.”
The series of SFX oversights that would prove most detrimental to Beatport, however, was the board’s blatant disregard for the technical logistics necessary to plan and execute updates and add-ons to the existing platform.
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It's from this point that the
We Got This Covered article tells the rest of the tale, from layoffs and staff reductions, to battles with site engineers about the functionality of Beatport, all the way to SFX's recent Chapter 11 bankruptcy filing. It's a fascinating read, so check out the link at the top of this post if you're so inclined.
Additional:
According to this
AP article, SFX Entertainment will restructure $300 million in debt and be taken private, all the while remaining operational.
Personal anecdotes:
- I was using what can now be called "classic Beatport" before they switched to Beatport Pro. There was nothing wrong with the site originally from a user perspective, although it was noted in the article that the structure was outdated and was experiencing scaling problems.
- I've seen this story a few times, particularly with what happened to a tech network called TechTV back in 2004, and also from having gone through a buyout myself with a company for which I worked. That is, the new management team promising that nothing will change, but as is often the case, everything changes. Is it all bad news? Perhaps not. As a consumer, I have yet to experience any direct side effects involving Beatport other than a site redesign, but I will undoubtedly be keeping an eye out on any further developments.