NEW YORK • For the concert industry, the recent disastrous failure of the Fyre Festival in the Bahamas was an outlier - a sad spectacle, but an isolated one.

However, the collapse of another event, the Pemberton Music Festival, in the mountains of Canada, has put the business on edge, with veteran talent agents and promoters warning that it could have wide implications for the booming festival market.

Pemberton, planned for July 13 to 16, with acts including Chance The Rapper, Muse and A Tribe Called Quest, was abruptly cancelled on May 18, when the two companies behind it declared bankruptcy.

In a break from standard practice, ticketholders were not offered refunds, but were instead told that they could "file a proof-of-claim form as an unsecured creditor", reported The New York Times.

Music executives are aghast over the failure to provide refunds and the manoeuvring of investors in the weeks before the festival fell apart.

Mr Marc Geiger, head of music at William Morris Endeavor and an outspoken voice in the business, called Pemberton's collapse "a fraud and a scam" that could have a domino effect on the industry, hurting smaller promoters the most.

Pemberton, held in a picturesque spot about 160km north of Vancouver, British Columbia, was a typical entry into the frothy festival business.

It was revived in 2014 by Huka Entertainment, a well-known independent promoter, after an earlier iteration failed.

According to bankruptcy filings, the festival lost money for three years and sold 18,000 tickets this year, down from 38,000 last year.

After the cancellation, fans took to social media to vent.

The complaints were not quite the supernova that followed the dissolution of the Fyre Festival, when planeloads of millennials arrived to find a ramshackle site that was far from the luxurious beach paradise they had been sold.

The event had been scheduled over two weekends in April and last month.

But the collapse of the Fyre and Pemberton festivals has once again focused the industry's attention on what has become a perennial question.

Has the ever-expanding festival market hit its peak?

High-profile failures such as Pemberton and Fyre - which is now facing numerous lawsuits from ticket buyers and others - could erode consumer confidence, Mr Geiger said.

Fyre organisers reportedly sold a US$400,000 (S$554,000) Artist's Palace package that boasted VIP tickets and even dinner with one festival performer.

"Well-produced and curated events at a site the public loves will continue to do well," said Mr Gary Bongiovanni, editor of trade publication Pollstar. "But too many events mean the best will survive and the weak will wither."

Meanwhile, the hugely successful Coachella looks set to be on another roll next year.

Billboard magazine reported that the music and arts festival will take place from April 13 to 15 and between April 20 and 22.

One mega act has already been confirmed - Beyonce, who was originally slated to perform at this year's edition.

But after doctors advised her to take it easy because of her pregnancy with twins, Beyonce, who is married to fellow superstar Jay Z, pulled out of the event held in California in April.