Live Na­tion, the world’s top con­cert pro­moter, bets big on video

It plans to build video shows and films around its con­cert acts “We have these mag­i­cal two hours” to mon­e­tize in new ways

Bloomberg Businessweek (Asia) - - CONTENTS - Lu­cas Shaw

Live Na­tion En­ter­tain­ment is the world’s largest con­cert pro­moter, han­dling live per­for­mances for 3,300 artists, from Bruce Spring­steen to Black Sab­bath. This sum­mer the com­pany is host­ing some of the in­dus­try’s high­est­pro­file tours, in­clud­ing those by Bey­oncé, Drake, and Guns N’ Roses, as well as pop­u­lar out­door fes­ti­vals such as Bon­na­roo and the U.K.’s leg­endary Glas­ton­bury Fes­ti­val. More than 70 mil­lion peo­ple at­tend Live Na­tion mu­si­cal pro­duc­tions each year, and the com­pany sells many of them tick­ets via Ticketmast­er, which it also owns.

Now, in an ef­fort to reach con­sumers who’ve never set foot in an arena, Live Na­tion is rac­ing to crank out video and vir­tual-re­al­ity pro­gram­ming fea­tur­ing acts whose con­certs it pro­motes.

The com­pany has hired MTV alum Heather Parry to build a TV-and-film pro­duc­tion stu­dio and has an­nounced plans to pro­duce pro­grams with

Vice Me­dia, Hulu, and vir­tual-re­al­ity com­pany Nex­tVR. By let­ting fans ex­pe­ri­ence the con­cert vibe at home or on the go, Live Na­tion hopes to draw more ad­ver­tis­ing rev­enue, which al­ready brings it more prof­its than the low-mar­gin con­cert pro­mo­tion business. The com­pany and its artists also hope ex­pos­ing TV and on­line view­ers to videos of their acts will bol­ster ticket sales for live con­certs.

Chief Ex­ec­u­tive Of­fi­cer Michael Rapino says Live Na­tion’s ad­van­tage is sim­ple: ac­cess. “We have these mag­i­cal two hours hap­pen­ing, and we have ac­cess to the en­vi­ron­ment, whether on­stage or back­stage in­ter­views,” he says. “We’ve been on a quest to take those two hours-plus and start bring­ing those to life on­line, on TV, and any screen we can mon­e­tize.”

Live Na­tion will pro­duce its first TV show, Earth Works, with Vice’s new ca­ble chan­nel, Vice­land. On the show, set to pre­miere this fall, mu­si­cians travel to im­per­iled ecosys­tems to high­light cer­tain threats through song. In one episode, the band An­i­mal Col­lec­tive treks to the Ama­zon jun­gle to record an­i­mal sounds.

Earth Works grew out of Live Na­tion TV, a ven­ture Live Na­tion and Vice cre­ated in 2014 to pro­duce short­form se­ries and doc­u­men­taries from mu­sic events. “We’ve built a me­dia com­pany in a year, and now is the big mo­ment with our sales forces com­bined to sell those to the big­gest brands in the world,” says Hosi Si­mon, the Vice ex­ec­u­tive who helps run Live Na­tion TV.

Be­sides li­cens­ing the joint ven­ture’s ma­te­rial to Hulu, Live Na­tion will also make a few vir­tu­al­re­al­ity con­certs with the stream­ing ser­vice, the com­pa­nies an­nounced on May 4. Nex­tVR, which streams sport­ing events and con­certs in vir­tual re­al­ity, re­cently struck a deal with Live Na­tion to pro­duce long-form live con­certs for the next five years.

Live Na­tion could use some new profit-spin­ning busi­nesses. The com­pany gen­er­ated al­most $5 bil­lion in sales from con­cert pro­mo­tion last year, but that business lost $105 mil­lion. Its ad­ver­tis­ing and spon­sor­ship unit, with sales of only $333 mil­lion, was its most prof­itable divi­sion. Live Na­tion al­ready has a team sell­ing spon­sor­ships of con­certs and its var­i­ous Web prop­er­ties, so it says that ped­dling ads to go with its videos is a nat­u­ral next step.

To make more com­pelling videos, Live Na­tion ac­quired Greenlight Me­dia, which spe­cial­izes in pro­duc­ing so­called branded con­tent for ad­ver­tis­ers. Greenlight helped ar­range In­tel’s video morph of Lady Gaga’s face dur­ing the tribute to David Bowie dur­ing this year’s Grammy Awards tele­cast. Says Do­minic San­difer, co-founder of Greenlight: “It doesn’t mat­ter [to view­ers] if the con­tent is cre­ated by a me­dia com­pany or a brand” as long as the en­ter­tain­ment value is high.

Live Na­tion and Greenlight are al­ready trad­ing ideas for brand in­te­gra­tions at fes­ti­vals, such as a fes­ti­val con­fes­sional where they edit fans’ ad­mis­sions for videos on YouTube and Snapchat. Live Na­tion also has ac­quired InDMu­sic—a com­pany that spe­cial­izes in ex­pand­ing view­er­ship of videos on YouTube and other on­line por­tals—and says the new out­fit is help­ing boost the au­di­ence at many of its venues and events.

Rapino says the draw of prop­erly ex­e­cuted per­for­mance video shouldn’t be un­der­es­ti­mated. “We’re not try­ing to sell two hours of den­tal work,” he says. “This is a very share­able, con­sum­able piece of con­tent. There are only so many peo­ple who can get to a cer­tain show, that tour; it drives more aware­ness.”

Live Na­tion’s new video ven­tures will likely of­fer higher profit mar­gins than pro­mot­ing con­certs

Bey­oncé in Mi­ami on her cur­rent tour, which Live Na­tion is pro­mot­ing

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