Thanks to U2, Live Nation can master the ticket business
It’s perhaps just as well that Live Nation has just signed the coveted box-office draw that is U2, as the concert promoter is soon to embark on a what could be a very bloody battle. Ticketmaster currently issues the tickets for most Live Nation shows – a deal that accounts for more than 15 per cent of Ticketmaster’s annual $1 billion revenue. That partnership is due to conclude at the end of the year.
Anyone buying a ticket for a gig, with their annoying “convenience” charges, knows that there is a lot of money in the ticket service business. As previously noted, concerts are one of the few growth areas of the music industry. And it’s not just the revenue from ticket sales that’s at stake: there’s also all the consumer data (e-mail addresses, etc). And that’s precious to an ever-expanding company such as Live Nation.
Live Nation and Ticketmaster are two of the giant powers in the music business. The latter will not be thrilled by Live Nation muscling in on its territory. But now that Live Nation has the exclusive rights to both Madonna and U2 live performances, the company is operating from a position of considerable strength.
As it stands, Live Nation sells a limited number of tickets to shows through its website. The company will now have to either greatly expand its own small internal ticketing operation or link up with another outside ticketing agency.
According to Live Nation chairman Michael Cohl: “Ticketmaster is already our rival. We’re now looking at not just content [ shows], but at hardware [a ticketing system] and we’re trying to line up as much of both as we consider meaningful and beneficial.”
Certainly, when it comes to launching a new ticketing service, it does help to have what is known as “desirable inventory” in the shape of U2 and Madonna.
It is unclear if U2 had any part in moving Live Nation into the ticketing business. The New York Times says the deal “may offer ways for the band to address problems that arose on its last tour”. At the beginning of the Vertigo tour, the band offered members of its online fan club access to tickets before they went on general sale. Some fans complained that instead of getting the best seats in the venue, they ended up with the worst.
There’s no suggestion that Ticketmaster (which handled the Vertigo tour) was in any way to blame for the presale fiasco. U2 were greatly annoyed by how some of their most loyal fans felt shortchanged. It happened because of a sudden, massive demand for the best seats in the house – and also, it is believed, because sophisticated ticket touts had joined U2’s online fan club in the knowledge that it is common for a band to offer the best seats to club members.
As part of the deal, Live Nation is now responsible for running of U2’s official web site. “We feel we’ve got a great web site,” says Bono in a statement. “But we want to make it a lot better.”
With Live Nation due to unveil “Ticketnation” (or whatever it will be called) at the end of the year, it’s difficult to know what further areas of the music business are now left for the company to buy up. Chairman of global music Arthur Fogel believes Live Nation is now unstoppable in reshaping the traditional boundaries of the music industry map. “It’s clear that the lines that were in place historically are breaking down. Companies such as us are best positioned to execute on that basket of rights.” firstname.lastname@example.org
U2: “problems on their last tour”