Mega music festivals rake in sweet millions

When American music festivals got their start five decades ago, fans paid $6 for their fill of peace, love and rock 'n' roll.

But those hazy days of the '60s have given way to something much larger with brighter lights, bigger crowds and booming business, CBS News' Adriana Diaz reports.

Some 32 million Americans attend at least one music festival each year, and they are part of the $6 billion concert industry in North America.

There are now more than 1,500 festivals worldwide. Coachella is the highest-grossing; with half a million attendees in 2015, it made over $84 million.

Lollapalooza is a festival pioneer that Jane's Addiction frontman Perry Farrell launched in 1991.

He wanted to create a live experience that reflected people's playlists.

"It's not about one headliner. It's about your personal selection of music," Farrell said. "You probably have on your computer or your phone now 100 songs that you love, right? Well that's what we have here."

This year, that selection included music legend Paul McCartney, electropop princess Charli XCX and heavy metal heavyweights Metallica. The band played its first fest in 1986 in Denmark, and drummer Lars Ulrich said festivals have become a big part of their touring.

"It's a great chance to kind of play to some people that are maybe seeing you for the first time," he said. "The diversity at a festival is now something not only people expect, it's something they depend on."

Diversity that now includes DJs. The sea of Coachella fans swarmed the stage for Kaskade, a 44-year-old Mormon and father of three.

"The growth of festivals right now is insane, I can't keep up with it," he said.

But he is taking advantage of it. He played a festival every weekend this summer.

"When I produce my own shows, there's always that risk: 'Am I gonna sell 10,000 tickets? Am I gonna sell 25,000 tickets?' With this, I get a fee, I show up, I do my bit and go home," he said.

Artists are also trying to counter the 67 percent decline in album sales since 2000. That's why the Cold War Kids played festivals before they even had an album 10 years ago.

"We started at the time of Myspace. I don't know if we ever thought about making money off of physical sales of music. It's just always something that we've accepted," frontman Nathan Willet said. "Festivals are a huge part of why we can exist."

But they don't come cheap. A one-day pass at Lollapalooza costs $110. A three-day VIP ticket at Coachella costs almost $900. On top of that, corporate sponsors spend $1.34 billion to be where consumers are.

"Back in the early '90s, to have sponsorships was frowned upon," Farrell said.

According to him, it was like selling out.

"So I resisted to doing it. Other festivals started to come up, and they were using sponsorship to get the acts that I wanted," he said. "I had to jump in there and come up with some clever idea. I look at it like it's a racecar. Racecars have sponsors all over them, right? So that's how you have to look at it."

One company, C3, produced four festivals in 2015 and is already booking next summer's Lollapalooza.

"It's a farm system. I mean, there's clubs all over the country. If a band sells out immediately at 2,000 capacity and you've never even heard of them, then you better pay attention to that band because that could be the next Bastille, that could be the next Mumford & Sons," C3 co-founder Charles Attal said.

But he admitted he's worried the music festival fever could fade away.

"I mean, the attention span of kids is, you know, it's a little bit shorter now," Attal said. "We have to just keep up with it, and hopefully they stay interested."

"Live music is the oldest form of expression and entertainment on the planet," co-founder Charlie Jones added. "If we all went away tomorrow and had to start over, the first thing people are going to do is start playing the drums."