It isn’t hard to find people lamenting the passing of the cash cow era for recorded music.
Just do a google. Or track billboard sales for units moved in 2011 versus 1999 for #1 charted Billboard Albums.
Next up: the live entertainment business. Concerts.
Oh, I’m not talking small venue club (<3K attendance) and even theater sized capacity (<6K attendance) shows. Although the theater size is getting shaky as well. Specifically, the arena sized show (~10K attendance capability).
As is usually the case, the people standing to profit the most from making that niche a healthy one, are the very ones tearing it down. We now live in a vertical monopoly world for live entertainment. One company, LiveNation Entertainment, financially controls almost aspects of the concert going experience. Artist management, venue ownership, promotion, ticketing, even merchandising and recording for some artists. The Standard Oil of live entertainment.
The standard retort is there are still strong independent promoters and venue owners in Washington DC, Chicago, LA, etc. My response is okay. Nitpick specific markets you want and talk about AEG. Overall, it is what it is.
Most smart people when they see the LiveNation integration setup would think prices would rise. That is the logical conclusion. We are all taught in economics101 that less competition=higher prices. The more steps in the product delivery chain you control, the greater the profit. That is the whole foundation of most anti-trust laws and litigation.
Let's live in fantasyland for awhile.
During the congressional hearings for the TicketMaster+LiveNation merger, Irving Azoff, now Executive Chairman of LiveNation Entertainment, said that prices would actually go down in this new post-merger world. Truth. And he said it with a straight face. So, I believe him.
Now, let's take the case of one Britney Spears. Her last tour was promoted by AEG. The pricing for this tour can be found on the Houston Toyota Center’s page here.
Or, you can trust that the pricing was:
$750, $500, $375, $250, $125, $95, $55, and $39.50
The pricing for Nassau Coliseum in Long Island was:
$153.50, $69.50, $39.50
2011. The world we live in.
Britney Spears can still tour! Rocking. What has happened since 2009 to Ms. Spears? Tons of new recordings? Alot of new hype gaining traction with a wider audience? Unparalled fan access to keep in the spotlight? Etc? No, no, no, and no.
LiveNation is now promoting the latest tour. Care to guess pricing for tickets?
We live in a new world right? Irving Azoff said prices would go down. I believe him!
Let’s check TicketMaster. Let’s do the homework together….
Prices:
US $96.00 – US $346.50
US $96.00 Ticket + US $19.05 Fees/Additional Taxes =
US $115.05
US $346.50 Ticket + US $26.25 Fees/Additional Taxes =
US $372.75
Ooooookay.
So the cheapest seat to see Brit Brit will now be $96 face cost.
Last tour? $39.50
This tour $96
Hmmmm.
Must be a mistake. $96 is more than $39.50. Hell, it is higher than the second tier price in 2009 of $69.50.
So, for the worst seat in the house. The kind you need a telescope and a personal amp to get benefit from the show is now $96.
Took roughly two or three hours after the announcement for this tour the opening act, Enrique Iglesias, to bail. His appearance on the bill must have been a mistake.
Lower concert prices promises? Must have been a mistake.
This current price point of $96? Must be a mistake.
If I was an investor (enter disclaimer here about this blog not constituting formal financial advice. And if you come to this site for investment help you are probably slobbering on your keyboard anyways), and I was asked for my investing opinion on this tour? I have an immediate response.
“Can I go short?”
If I was asked the same question on the stock of the company promoting this tour? Same.
I am sure that LiveNation will blame the artist(s). Whatever. People take what you pay them. What you offer. You guys put in the highest bid and this is what you got. Enjoy it. I know the fans won’t.
The tour of Spears in 2009 was crazy. Platinum seat holdbacks. “Sellouts” with huge ticket drops near showtime. The whole nine yards. Looks like LiveNation took the bait. I don’t know whether to laugh or laugh harder at all the gaps in this 2011 tour schedule. Obviously holds for adds. Yikes. I’ll wait for the lower prices then. Not, really. Next. I wouldn’t attend this sideshow if you paid me. The business side is farrrr more entertaining. And I get that for free, in a seat of my choice! Maybe Irving Azoff was right after all.
EDIT JUNE 16—All the 50% discounted tickets you can ever want to Brit Brit on Groupon. Just sayin’. And I called it. Do I get a free tie with my soup?
