Curtains Up!

The company that claims to be “the world’s largest producer of live music” was created in 2005 as part of a solution for Clear Channel Entertainment to avoid anti-trust issues that were arising. However, from the looks of things could the spin off company (Live Nation) be headed down the same road?

Since the company’s formation, Live Nation has continued to dig its’ hands deeper and deeper into the pockets of the live music business. The company has grown to such an extent that if you live in certain cities and you want to attend a show, there are extremely high chances that Live Nation’s original parent company Clear Channel Entertainment owns the radio station that you hear that particular artist on as well as the announcement of the concert. Live Nation might also own the artist as well as the entire tour. They might own and operate the venue where the concert is held as well. When you search for tickets the only place you might be able to buy them soon is LiveNation.com or at the Live Nation box office of the venue, etc. If you can see where I am going with this, you can tell that almost every dollar that is exchanged within this event can in fact be forced to travel through Live Nation’s hands at some point.Recently, Live Nation sold its theatrical division to Key Brand Entertainment for $90.4 million. Why sell a division of this company that had revenue of over $200 million in 2007 of which $8.5 million resulted in income? Due to the fact that Live Nation has currently sold $260 million in assets since 2006, the only reason I can think of is so the company can solely focus more on music.

So what does this mean for everyone? Since the company owns so much of the industry will they pass on the savings to the consumer by lowering ticket prices, or will they continue along with the ever growing trend of driving ticket prices so high that the average fan can’t afford to see the show? Will smaller promoters be able exist in 5 years? Will the up-and-coming rival AEG close in on them or will Live Nation’s market tactics continue to widen the gap within the industry?

-Murdock