It depends on your definition of "alive". You mentioned that disco "oldies" are popular in Japan, well the same is true here in the U.S.A. - but the problem is that new disco songs are usually overlooked, sometimes intentionally. New disco songs that became hits in most other countries were hardly played on American radio because of the anti-disco bias of many radio programmers and perhaps also a lack of promotion and payola (Examples are "Ready or Not" by the boyband A1 -- it was released when boybands were huge, but A1 had violin backing, which people think sounds "old", and "Murder on the Dancefloor" by British diva Sophie Ellis Bextor, which as far as I know only became a top 20 hit in the city of Boston). New disco songs, even those released as singles, struggled compared to non-disco songs from the same artists (Examples are "Strong Enough" by Cher and "They Dance!" by Barry Manilow, and all disco songs by Jamiroquai - on the other hand "Believe", "Turn the Radio Up", and "Virtual Insanity" by the same three artists got lots of play but they were not disco. George Michael went top 10 with "Jesus to a Child" and "Fastlove" in 1996; guess what happened to his disco "Outside" two years later. The Spice Girls were popular in America in the 1990s with songs like "Wannabe" and "Too Much" but their disco "Never Give Up On the Good Times" wasn't given a chance; a reviewer said "it could have been a hit in 1979". Guess what happened to Lionel Richie's disco "Don't Stop the Music" compared to his more techno hit "Angel". So many missed opportunities! "Don't Stop Movin'" by S Club 7, a boring disco song which actually deserved its lack of airtime in the U.S., somehow got approved by Radio Disney, so many American kids know that one.
Then we have a problem where most American people deny that new disco is really disco; even when they hear it, they can't allow themselves to believe it - they fall into two camps, those who believe disco died in 1979 (the "1980s had no disco" myth) and those who believe it died in 1983/1984 (the "1990s had no disco" myth). Anything after those arbitrary dates they dismiss as "house" or something else even if it's 100% disco styled. Some of them are obviously psychologically scarred by the "Disco is Dead" crowd who persecuted them because they allowed the ideology of enemies to become their own. Others think they can't today effectively recreate the ambience of '70s discos/nightclubs and complain that the hustle is "dead"...even though there are places they can go where the hustle is still danced and the disco music still plays all night long.
But at least old disco did remain popular, as evidenced by some facts I gathered:
* The American TV game show "Family Feud" aired "Disco Fever Week" matches February 10-14, 2003.
* The American TV game show "Pyramid" aired "Disco Week" shows April 28-May 2, 2003.
* ABC aired a two-hour prime-time television show called "The Disco Ball...A 30-Year Celebration" on January 16, 2003.
* The "Get Up 'N Dance" disco tour came to many American locations during 2003, including Philadelphia and Baltimore.
* K-BIG 104.3 FM's "Disco Fever II" music festival came to Hollywood, California on June 28, 2003.
* The talent-search TV show "American Idol" aired disco-themed shows on April 1 and 2, 2003.
* Great American Ball Park, home of the Cincinnati Reds baseball team, hosted "Disco Night" on August 27, 2003.
* Anita Ward sang "Ring My Bell" at Times Square in New York City on New Year's Eve December 31, 2002.
* Disco songs by Barry White and Gloria Gaynor were on recent American TV sitcoms, etc.
* The movie "Saturday Night Fever" was revived as a musical.
* Buffalo, New York holds a "World's Largest Disco" every year for thousands of people.
* Richard Simmons tuned people on to his "Disco Sweat" exercise video tape.
* In the late 1990s there were some American disco-oriented radio formats like "Dancin' Oldies" and "Jammin' Oldies" that had a lot of listeners for about a year but dropped off soon after that (I think it's because they allowed their playlists to go stale by not ever adding new songs. People got tired of hearing the same 40 songs each day, and the ratings went down.)
There were also some new American toys and video games with disco themes - like "Bratz Formal Funk Super-Stylin' Runway Disco" by MGA Entertainment and "Disco Stars" on the Sony EyeToy.
I think the words "alive" and "oldies" contradict each other. The facts objectively support the case for "alive" rather than "old", if we look at this in an academic way. But it's not alive to the extent it could be.



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