The Profits Behind Coldplay Concerts

The excitement of the audience is directly proportional to the economic potential and multiplier effect of holding a music festival like this. This industry is predicted to continue to grow in the future.

Translation: Data from Statista Market Insights (August 2023) shows that the global music industry is projected to generate a revenue of 30.14 billion US dollars or IDR 467.3 trillion at a rate of IDR 15,503 per US dollar on Wednesday. The figure is expected to continue to increase, at least until 2027 with a value of 36.71 billion US dollars equivalent to IDR 569.1 trillion. Its growth is also around 5 percent per year.

Also read: Coldplay Brings Jakarta Closer to Becoming a Music City

Music observer, Wendi Putranto, assesses that Indonesia has great potential to hold international-class music concerts. So far, music events held in Indonesia have gone according to plan, both in the form of solo concerts and festivals featuring internationally renowned guest artists.

"International concerts have the potential to generate tens of billions to hundreds of billions of rupiah in revenue, depending on the popularity of the artist and the capacity of the venue," said Wendi when contacted from Jakarta on Wednesday (15/11/2023).

He estimates that the revenue from Coldplay's concert in Jakarta is only from ticket sales, reaching up to IDR 200 billion. The music festival will be enjoyed by 70,000 live spectators.

Apart from ticket sales, souvenir sales, food and drink sales, and sponsorships boost the turnover during concert events. Music festivals, especially international ones, have a charm that attracts many people. The event is not only able to attract out-of-town tourists, but also foreign tourists.

The occupancy of hotels around GBK is full. The hotel room occupancy outside the GBK perimeter has also increased, but not significantly.

Follow-up impacts

According to researcher at the Tourism Study Center Gadjah Mada University, Yogyakarta, Sotya Sasongko, music concerts have a positive impact on various sectors. Some of these include the transportation, accommodation, hotel, lodging, restaurant, souvenir and parking sectors.

"Tourists from outside the city, apart from boosting the transportation, lodging and restaurant sectors, they also (it is estimated) buy merchandise, maybe even entrust them to their friends. "It often spreads to others," said Sotya when contacted from Jakarta, Tuesday (14/11/2023).

Also read: Jakarta Welcomes Coldplay

Previously, the Ministry of Tourism and Creative Economy informed that by mid-May 2023, hotel reservations in the GBK area would reach more than 90 percent. The occupancy rate for hotels outside the GBK area will reach 40-50 percent on November 15 2023. In fact, the concert event was only announced at the beginning of that month.

The Chairman of the Indonesian Hotel and Restaurant Association in Jakarta, Sutrisno Iwantono, stated that hotel occupancy around GBK is full. Hotel room occupancy outside the GBK area has also increased, but not significantly.

"If it's full from there (around GBK), usually there are also other areas, (occupancy) can increase by 10-20 percent outside GBK. Tourists come from outside Jakarta and overseas, such as Singapore and Malaysia," he said.

Also read: High Tourist Movement, but Low Length of Stay

The Secretary General of PHRI, Maulana Yusran, expressed a similar opinion. The areas surrounding the event location will be the most affected. To what extent the potential of music festivals in Indonesia should be seen from the size of the fans of the musician or music group invited. In addition, the scale of the performance also needs to be calculated. These two indicators can be used as a measure of the impact of music festivals on hotels and restaurants.

Another impact is that international events, regardless of their form (concerts, conferences, sports), contribute to the movement of foreign tourists. This is because the guest stars bring foreign media with them, which can bridge the promotion of Indonesia to the international realm. International events are considered significant news for foreign media.

Homework

Indonesia, full of potential in hosting international events, is not free from challenges that hinder the development of the industry. If this industry is not seriously addressed, Indonesia risks not being able to maximize the multiplier effect that can be felt by many parties.

Digitalization for licensing, ticket sales, and cost transparency will provide more certainty in organizing those events.

According to Wendi, the big challenge is still homework to complete. First, event locations or venues that are adequate to accommodate large audiences (show stadiums) are still minimal in number. Apart from that, licensing for public gatherings is still considered complicated and complicated.

"Sometimes (with) permission to go out on H-1, as well as various convoluted bureaucracy issues in organizing concerts," he said.

Maulana believes in the importance of implementing digital technology in the organization of large events, such as music concerts. Digitization of licensing, ticket sales, and cost transparency will provide greater certainty in the implementation of these events.

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