THE 1970 Isle of Wight Festival may have gone down in music history as the English Woodstock, but, after an invasion of one million hippies helped seal the event's reputation as emphatically as the iconic performances of rock legends such as Jimi Hendrix, The Who and Joni Mitchell, promoter Ron Foulk was none too optimistic about its future.

What a difference 35 years makes!

Next month, the Isle of Wight Festival - or the Nokia Isle of Wight Festival, to give its full name - returns for the fourth year in its new and improved form and boasts a line-up every bit as impressive to today's music fans as Hendrix and co must have been to the love and peace generation.

Highlights of the three-day bash at Seaclose Park in Newport include such world-class acts as Morrissey, REM and Roxy Music.

The festival made its tentative return in 2002 with Ash, The Charlatans and Robert Plant, and an audience of just 8,000. This year, 35,000 fans - equivalent to more than one-quarter of the Island's population - will descend on Seaclose Park in Newport, bringing with them a boost to the local economy.

Summer 2005 is shaping up as one to remember for festival-goers, and not just on the Island.

Hampshire is holding its own in the live music stakes, with such high-profile events as the Homelands dance music festival near Winchester, one-off gigs by Elton John and Oasis and a series of concerts on the Broadlands estate in Romsey set to pull in thousands of revellers from all over the country.

The re-casting of St Mary's Stadium and the Rose Bowl - the former will be playing host to Elton John on May 28, while the Gallagher brothers bring their UK tour to the latter on July 6 - as multi-purpose entertainment arenas makes sound business sense for the venues and has certainly helped boost Hampshire's profile as a purveyor of top-drawer live entertainment.

But for the real financial success story we must look across the Solent, where the Isle of Wight Festival has not only been good news for serious music fans but has had a considerable impact on Island economy.

"For the first year or two the festival didn't make as much progress as people wanted it to, but in the last two years it has started to produce some good results for the Island," says Hal Matthews, marketing manager for Isle of Wight Tourism.

"The three most tangible results are that the festival has started to produce more visitors at a time of year we wanted them there; it provides press coverage for the Island out of all proportion to the number of people who come here - we saw an absolutely staggering increase last year, with £2m of positive press coverage, compared to the norm of £1m - and it encourages other event organisers to consider the Isle of Wight."

The success of the festival led to the creation last year of another three-day festival, Bestival, while new to the Island this year is a series of one-off concerts featuring artists such as Ronan Keating, Suzanne Vega and Jools Holland.

"They are a first for us and I believe that's down to people in the music industry beginning to believe that the Isle of Wight is a place where you can come and hold an event and make some money," says Mr Matthews.

Ageing Dylan fans may blanche to hear it, but making money was instrumental to the festival's revival.

In a survey conducted by the Isle of Wight Chamber of Commerce, Tourism and Industry, more than 70 per cent of businesses canvassed were in favour of bringing the festival back, believing it would bring economic benefit to the Island.

"As a result of that, we had a couple of conversations with a couple of important people, and a year or so later we had the first festival," says Kevin Smith, chief executive of the Isle of Wight Chamber.

"We are really pleased that the festival has had a positive impact so quickly. Last year the hotels we spoke to all reported 100 per cent occupancy. Retailers, hotels, holiday camps, campsites and caravan parks have all reported increased business.

"Some of the supermarkets in Newport were even selling out of food last year."

The festival is listed as a "gold standard" event by the Isle of Wight Economic Partnership, which works to attract investment in the Island.

Managing director Mike King explains: "We have identified four events throughout the season which stand for what the Island wants to be known as - forward-looking, innovative and a place everyone can enjoy.

"There is a huge economic benefit in the sheer number of visitors the festival attracts, but the image and positive media coverage it generates are just as important."

Other beneficiaries of the festival include Isle of Wight ferry companies Red Funnel and Wightlink.

Wightlink marketing manager Kerry Jackson said: "Our sponsorship of the Nokia Isle of Wight Festival and other events on the Island such as Bestival is very important to us.

"Wightlink last year carried about 20,000 people to the Isle of Wight Festival. They also carried all the stage and lighting and sound equipment, as well as most of the acts taking part."

Such unapologetic commercialism may be a far cry from the hippie ideals that informed the original Isle of Wight Festival, but when the music's this good, who's complaining?

Summer 2005 Music Guide

SUMMER 2005 MUSIC GUIDE

The what, when and where of the best of this summer's live pop and rock entertainment in the south.

We Love Homelands 2005

What: All-night, open-air dance extravaganza

Where: Matterley Bowl, near Winchester

Who's there: Beck, The Streets, Groove Armada, Grandmaster Flash and dozens more top-flight DJs and dance acts

When: May 28, 1pm-6am

Nokia Isle of Wight Festival 2005

What: Fourth annual outing for the successfully revived 60s/70s legend

Where: Seaclose Park, Newport, Isle of Wight

Who's there: REM, Morrissey, Razorlight, Supergrass, Roxy Music and plenty more rock and pop A-listers

When: June 10-12

Elton John

Where: Friends Provident St Mary's Stadium, Southampton

When: May 28

Power in the Park

What: Teen-friendly afternoon of chart-based pop action

Where: Southampton Common

Who's there: Mel C, Lemar, Rachel Stephens, Rooster and many more

When: June 5

Oasis

Where: Rose Bowl, West End, near Southampton

When: July 6

Jools Holland

Where: Broadlands estate, Romsey

When: July 30

Ronan Keating

Where: Osborne House, East Cowes

When: July 30

McFly

Where: Broadland, Romsey

When: August 7

Bestival

What: End-of-the-season blow-out featuring hundreds of live acts and DJs

Where: Robin Hill Country Park, Isle of Wight

Who's there: Super Furry Animals, Soulwax, Lee Scratch Perry among others