Live_Nation - Celebrity Encyclopedia

Mainly a concert promoter, Live Nation "signs" artist as "record label", but predominantly takes the role of a promoter, rather than "owner of music". The deal with U2 and Madonna for example does not include copyright of the artists' future recordings. The 2007 deal signed with Jay-Z includes the rapper's future recordings. Other artists that recently signed with Live Nation include Nickelback and Shakira.^[2]^[3]

Business

In 2005, Live Nation promoted or produced over 28,500 events, including music concerts, theatrical shows, specialized motor sports and other events, with total attendance exceeding 61 million. As of September 30, 2005, Live Nation owned or operated 117 venues, consisting of 75 US and 42 international venues. These venues include 39 amphitheatres, 58 theatres, 14 clubs, 4 arenas and 2 festival sites. In addition, through equity, booking or similar arrangements Live Nation has the right to book events at 33 additional venues.

Deals

In October 2007, Live Nation announced a new contract with pop singer Madonna throughout the next decade after leaving Warner Music and Warner Bros.. She will be the founding recording artist for the new music division Live Nation Artists, formerly Artist Nation. Shakira signed a contract with Live Nation in July 2008. The singer would have to fulfill two more albums and a greatest hits cd under her old contract with Sony BMG, but all touring and other aspects of the singers musical career would be in effect with the Live Nation contract.^[4]

In January, 2008, Live Nation sold its North American theatrical business (including the Broadway Across America business) to Key Brand Entertainment for $90.4 million. Key Brand Entertainment is a private investment company owned by British theater producer John Gore and led by senior entertainment industry executive Tom McGrath.^[5]

In April 2008 a deal for $150 million deal between Jay-Z and Live Nation was confirmed. The deal covers financing of Jay-Z's own entertainment venture, live shows, tours and future recordings for the next 10 years.^[2]

House of Blues

In 2006 Live Nation acquired House of Blues. Currently there are 11 House of Blues venues located in New Orleans, Los Angeles, Chicago, Myrtle Beach, Orlando, Las Vegas, Anaheim, Cleveland, San Diego, Atlantic City and Dallas. Additional HOB clubs are being planned for Houston and Boston. House of Blues is headed by President Deb Eybers.

Controversy

As a previous subsidiary of Clear Channel Communications under the Clear Channel Entertainment name, Live Nation was party to some highly visible controversies. The 2005 SEC filing for the creation of Live Nation listed several reasons for pursuing the split, including avoiding regulatory and legal pitfalls faced by Clear Channel.

Live music recordings

In 2004, Clear Channel acquired a key patent in the process of producing Instant Live recordings, in which a live performance is recorded directly from the sound engineer's console during the show, and then rapidly burned on CD so that audience members can buy copies of the show as they are leaving the venue. This had been intended to provide additional revenue to the artist, venue, and promoter, as well as stifle the demand for unauthorized bootleg concert recordings made by audience members for profit. However, some media critics, as well as smaller business rivals, believed that Clear Channel was using the patent (on the process of adding cues to the beginning and ending of tracks during recording, so that the concert is not burned as a single enormous track) to drive competitors out of business or force them to pay licensing fees, even if they do not use precisely the same process. The patent was transferred to Live Nation when Clear Channel Entertainment was spun off, [1] but the claims of the patent were cancelled on March 13, 2007,[2] after the patent owner failed to respond to a final office action in an inter partes reexamination proceeding. All originally issued claims were rejected as being anticipated or rendered obvious by earlier publications for products developed by Telex.[3]

Comments about Jazz in American Culture

On June 17, 2008, with regard to musical acts that would be selected by Live Nation to perform at a proposed festival in Fort Lauderdale, Florida, Mike Luba of Live Nation Artists stated "We're doing everything we can to eliminate jazz from American culture, so, no jazz!"^[6] On June 18, Luba explained that he had made the comment in jest. As of June 20th, however, the company has not issued a formal apology for their remark. ^[7] At the time, many people^[who-] felt that an apology wasn't necessary and that the entire controversy was the result of media sensationalism since the comment at the meeting was clearly made in jest.

Corporate governance

Live Nation Music Group and Live Nation Artists

As of July 30, 2008, CEO Michael Rapino is considering doing licensing deals on an artist-by-artist basis, a source inside Live Nation said. Under that scenario, Warner Music Group could end up handling the marketing, promotion and distribution of albums by the very acts that defected from it to join Live Nation: Nickelback and Madonna. "Rapino wants to outsource everything," said a second source close to the situation. "He doesn't want to build an infrastructure or carry any overhead." The move is mirrored after the "rent-a-system" model used in Hollywood, whereby one studio produces a movie but licenses all the other functions to another studio that already has a distribution and marketing infrastructure. ^[8]

Live Nation's talks, which sources say are still in their early stages, represent the latest retrenchment from the strategy of former chairman Michael Cohl, who sought to transform the touring giant into a multi-faceted powerhouse, including a record company. News of the potential outsourcing move follows last week's dismissal of industry veterans Bob Ezrin, Bob Cahill and Bill Hein, all of whom were Artist Nation employees hired by Cohl to create a label infrastructure for Live Nation's newly signed acts. Instead of banking all the upside on album sales, as was once envisioned with these so-called "360 deals," Live Nation would likely collect a less lucrative outsourcing royalty of between 25 percent and 35 percent, based on other industry licensing deals. It would then be responsible for using that money to pay the artist's royalty - a fee that, at the superstar level, can come close to equaling the licensing royalty the company is apt to get from a label. Sources cautioned, however, that without a new album due to Live Nation for at least 18 months, the company is in no rush to make a decision. ^[9]

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