I’ve been watching Live Nation pretty closely since the company was spun off from Clear Channel Communications Entertainment Division. I believe that it is positioned to do quite well about two years out.
Live Nation currently operates three areas of business, Events, Venues and Digital Distribution. Venues and distribution needs happen to be where musicians and artists will be needing help as they leave or avoid major record labels.
A major rift is scheduled for 2009, where Live Nation will be selling tickets for all of its venues without help from Ticket Master. According to the Wall Street Journal the major breaking point was that Live Nation wanted to be able to sell Ticket Master tickets directly through the Live Nation website. Clearly Ticket Master wasn’t willing to give up the brand identity.
Live Nation Hit a 52 Low Yesterday Thanks to a Bad Market and Slow Quarter As It Works To Expand Operations
Or perhaps, Live Nation was simply asking for more than they possibly could have recieved because Music Today’s ticketing operation is ready to scale to replace Ticket Master by 2009. Dave Matthews Band’s official fanclub, The Warehouse distributes barcode-laden tickets to its members that are scanned in parallel with Ticket Master tickets at its shows. Getting that integration right is a small example of the learning curve Live Nation bought when it picked up a majority stake in Music Today.
The Q3 press release from LiveNation highlights the hiring away of Madonna from Warner Music Group as a big win for the company. Some people have been been piling on the decision as a bad one. Warner’s Edgar Bronfman Jr wrote his employees that ‘We remain committed to maintaining financial discipline. We simply will not enter into agreements with artistes that fail this test – whether or not the artistes are well-known, and regardless of media reaction.”
However, Madonna means a lot more to Live Nation as a symbolic first step towards building the Artist Nation division than she did as simply a money maker at Warner. In Live Nation’s press release claims her to be “one of the most influential artists and business women in the world” meaning they intend to position her as a savvy person in the music business as much as a veteran entertainer. Most likely Live Nation expects her to be a catalyst in signing more artists to the company.
No doubt, Radiohead turned just a few heads when they released their album in a new and unexpected way recently. All artists took note, and with Madonna appearing to lead the way for full service deals with Live Nation it may be that 2009 is very successful for Artist Nation.
So what about 2008? I think that next year will be a growth period for the company where it works to lure more artists and work out the kinks of its scaled operations for the first time. It will make mistakes and also make and lose deals to bring over some big names. However, it will not hit its mode for at least another year.
As a final note, I’d like to assert that 2008 will be an opportunity for smaller companies to work the Live Nation model on smaller bands.
Trent Reznor recently lauded Musicane’s digital distribution service for Saul Williams’ new album. I think that Musicane has the opportunity to expand beyond simply digital distribution and into other needed markets.
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