By: Alex Young
Ticketmaster is the single largest concert ticket printer and ticket distributor in North America. The company’s control over the market for tickets to musical performances, sporting events and live comedy is unparalleled. Other than the short-lived anti-industrial revolutionary protest against Ticketmaster that was spear-headed by Pearl Jam in 1995, there has not been any large scale protest against the choke-hold Ticketmaster has over live entertainment in North America, until now.With the rumor mill flying wild these days, there has been a lot of speculation about whether Ticketmaster might be merging with North America’s single biggest live entertainment promotion company Live Nation. The rumor that Ticketmaster and Live Nation might be hopping into bed with each other has been largely fuelled by outcries from artists, fans, and large-scale music publications like Rolling Stone uniting in opposition. The rumored merger would $2.5 billion dollars and would give birth to Live Nation Entertainment Inc. Mainstream musical acts like Bruce Springsteen, and Trent Reznor of Nine Inch Nails have discussed the impacts a merger would have on artist, venues, independent promoters and customers, which are rarely acknowledged as the fans. If this merger were to go through, Ticketmaster and Live Nation would become the only gate keepers of mainstream concert promotion in North America, and no one, not even artists, could stop them. Should this merger take place, it would change the market for live performances in the music industry in North America forever.
What would happen if the single biggest ticket distribution company and the single largest live entertainment promoter became one entity? First, on a strictly business basis, it raises questions of monopoly and restraint of competition. On a sociological, or values, basis, it threatens the role of popular music as a hedonistic refuge to which the fans can retreat when the soullessness of consumer culture overwhelms them. Secondly, one can argue that the idea of music as a hedonistic refuge has always been a fantasy, even in the days of the counter-culture. But this gargantuan company would make it impossible for even the most naïve consumer to keep believing in that fantasy.
In 2007 Ticketmaster made $8.3 billion in ticket sales. It programs 140 major venues in the US alone and works closely with the companies that manage Aerosmith, Van Halen, Guns N’ Roses and the Eagles and up to 200 major artists. After looking at the daunting numbers Ticketmaster and Live Nation individually has under their belts, it is intimidating to think of what kind of revenue they would take in as one entity. Independent artists would be forced if they had any hope to associate themselves with the mainstream regardless of how big their audience was or how many albums they sold. Even established artists would be unable to continue putting on large scale live performances unless they agreed to the conglomerate’s terms. Immediate collateral damage would include the elimination of independent promoters and carte blanche for the new monopoly to inflate service charges.
The economic climate for being a large-scale touring band is brutal enough these days as it is, now that live performance has become the primary source of income for many musical artists considering the falling number of CD sales in the new millennium. On top of that, there is currently an economic recession in North America, and many mainstream artists are slashing ticket prices cutting travelling costs to keep fans coming back and their salaries coming in. Even large-scale bands such as KISS, who have a renowned reputation for their massive stage show and excessive use of special effects, are cutting back on the amount of stage equipment they’re bringing on tour with them in 2009. KISS Manager Doc McGhee told Rolling Stone in January 2009 that “We try to be the most cost-effective- what bells and whistles we bring and what ones we don’t”. Even mainstream heavy metal titans that draw out major crowds and ticket sales such as Lamb of God and Killswitch Engage are being more conscientious about their costs on the road. An agent named Tim Borror that works for both Lamb of God and Killswitch Engage commented on the economic climate for mainstream touring bands by saying, “The tours would have done great last year are doing good. The tours that have done good are doing OK. The tours that would have done OK aren’t doing good”. If Ticketmaster and Live Nation were to merge would increase convenience charges on tickets while many mainstream bands are struggling to maintain their ticket sales. This increase in ticket prices would likely drive more mainstream acts to license their music out to advertising and other commercial ventures to make up for the loss in ticket sales but might convince many fans their favorite bands are “selling out”. In reality, these artists are striving to maintain a living in the ever-changing landscape of the modern music industry without making much more money than they already do. The fact is that an increase in service charges if Ticketmaster and Live Nation merged would be inevitable considering Live Nation’s in house ticket fees are currently as high as Ticketmaster’s to begin with. Live Nation CEO Nathan Hubbard broke down how Live Nation earns its yearly gross income by highlighting the fact that 17% of the company’s profits are derived from service charges while 43% comes from beer and merchandise sales and 24% from tour sponsorship. Despite Hubbard commenting on the issue of Live Nation selling its own tickets by saying, “The current model [Ticketmaster has] is broken, pretending a ticket is $75 when the fan understands the ticket is $100”, Live Nation service charges for major touring acts including Katy Perry, Phish and Dave Matthews Band are the same as Ticketmaster’s.
When interviewed on the subject of a possible merger between Ticketmaster and Live Nation, one employee said, “Yeah, I’ve heard this rumor. I’ve heard people talk about it, but there’s still legislation outstanding on it”. When asked about the possible benefits or consequences of a merger between the two titans of the entertainment industry they commented by saying, “I have to admit, knowing what Ticketmaster technically is or is about, I don’t think it’s going to change much. Live Nation is a promoter and Ticketmaster is essentially a glorified printing inventory system.” When asked who would be affected the most through a merger of that caliber, the employee stated, “I think the old school days of being a promoter, like ‘This is my venue, I book it five days of the week’, will move away from that. That’s just a guess, but that’s a shame because there’s a lot of people that put a lot of hard work and are amazing at what they do as promoters. Here in town [Toronto] you have Dan Burke at the Silver Dollar and Don Blais at Rancho Relaxo who put on A LOT of shows. There’s a lot of really great rock and roll, a lot of great music going on there and they don’t do it through Ticketmaster. With Live Nation becoming further and further widespread, they own the arena scene basically and the larger clubs have everything to do with Live Nation. The next thing would be naturally would be to get it [Live Nation] into places the size of the El Mocambo [in Toronto]”.
Regardless of where you sit on this issue, there are still a lot of decisions to be made and a lot of regulations to be passed before Ticketmaster and Live Nation become one company. Who do you think would really win in this war between the Goliath size companies like Ticketmaster and Live nation and the David caliber local promoters? Who knows? This could be a cry of desperation for big businesses struggling in the entertainment industry themselves. One thing that is for certain is that even though the times are indeed changing, it is ultimately ticket purchasers that hold the ultimate power and can decide where they take their business and determine ticket sales. Regardless of what the future may hold, the power now lies with the audience to decide what the future of the industry will be and what model of ticket sales they choose to support.