We are pleased to serve as the primary source of sponsorship information and analysis for news media around the globe. Our current annoucements and news releases are viewable through the links below.

Live Nation Plays to the Crowds

Financial Times, June 01, 2011

By Andrew Edgecliffe-Johnson

After a decade in which CD sales halved and concert ticket prices climbed, the live entertainment business has replaced record labels as the object of fans’ love-hate relationship with music industry money men.

When Live Nation, the world’s biggest concert promoter, proposed a merger with Ticketmaster, the world’s largest ticket seller, Bruce Springsteen warned that it could be “the one thing that would make the current ticket situation even worse for the fan”.

Attendance at Live Nation events fell by 9.4 per cent last year, and it sold 7.6 per cent fewer tickets, sending the group to a net loss of $206m – its fifth year of losses – and prompting warnings that consumers had finally had enough of ticket price inflation.

“The recession was a hell of a wake-up call for everybody,” admits Michael Rapino, Live Nation’s chief executive. “This is a business that was on a 20-year growth curve, rising 10, 12 or 13 per cent a year, funded by ticket prices.” But he adds: “Don’t panic.”

Live Nation’s ticket sales in the first quarter were up 11 per cent, auguring well for summer concerts such as the Download festival in England and Copenhell in Denmark. Big artists such as Lady Gaga and U2 are having no trouble selling out, Mr Rapino says, and the club business is booming. Only “a segment of the middle” is still weak.

“I’m pretty confident in saying this will not be the second year of an extended decline,” he says, claiming that Live Nation has an incentive to keep prices affordable because “we do better when more people are in the building”.

Outside North America and western Europe, “it’s nothing but a straight line up in Latin America and Asia”. Lady Gaga has just played Mexico City, and “in Brazil, you can’t get enough shows to meet demand”.

Tours were once dictated by record labels, which typically sent artists only to places where they could sell albums and were not worried about bootleg copies. Now, “I’m the distributor,” Mr Rapino says, and international expansion is “incredibly accretive”. International revenues are in double digits this year and Mr Rapino says he plans to open in two or three new markets a year, starting in Latin America. His next priority, he says, is to use Ticketmaster’s database of customer information to “upsell” products to concertgoers, and identify customer segments such as “Guilty Dads”.

The group has added features from seat maps to buttons allowing customers to invite Facebook friends to concerts they have bought tickets to. It is working to build more content on its sites by prompting customers to write reviews or tag panoramic crowd photos, and looking at offering anything from T-shirts and concert downloads to signed guitars.

It is also looking to tie the site more closely to its sponsorship business.

Sponsorship revenues have reached $200m a year, says Russell Wallach, who runs Live Nation’s sponsorship business in North America, and are running 19 per cent ahead in the second quarter.

According to the IEG Sponsorship Report, music sponsorship is a $1.8bn global business, but dwarfed by the $13bn sponsors spend on sport. “I look at it as a $15bn business out there. We can chip away in music but also focus on shifting more dollars out of the sports arena,” Mr Wallach says.

That puts Live Nation in competition with traditional media companies, but there are limits to Live Nation’s media ambitions, Mr Rapino says, as he rules out two deals which have been rumoured.

He says a merger with Sirius XM satellite radio would merely rebuild the old Clear Channel radio and concerts business from which Live Nation spun out. He also says he will not buy a record label, despite “kicking the tyres” of Warner Music. Having seen the live music industry’s success, labels are trying to get into touring, but Mr Rapino says he sees little threat.

“Anybody can write a cheque, but when you do 22,000 shows a year and have 1,300 people in call-centres, it’s a logistics business,” he says.