Livenation-Would Someone Check Their Pulse!

Livenation, the king-of-entertainment wannabe, is setting the record for reinventing themselves.

This ill advised attempt at vertical integration in the concert and entertainment business is getting ready to fail yet again.

The idea of owning every component of  an entertainment venture from the performer to the venue was a bad one from the start.  Livenation continues to prove how bad an idea it was every single day.

Their stock (LVY) has lost 40% since the beginning of the year and is down a whopping 200% over the last 12 months.  Their sale of controlling interest in many of the theatres  they ruled to a British theatrical producer during the winter gave them a little breathing room, but their most recent spending spree on artists may be the final nail in their coffin.

It appears that the strategy of controlling venues and ticket distribution is now morphing into ownership of artists.  They are paying ridiculous sums to concert performers in exchange for their future earnings in performance, recording and merchandising and the stock market continues to vote with investors’ dollars.  The vote is a resounding “NO”.

Today’s announcement regards Nickelback, a band that’s been over for longer than they were popular.  Livenation has made a deal for somewhere between $50 million and $70 million for these Canadian has beens, and  the stock is now flirting wtih its 52 week low.

Add this deal to those for Madonna ($120 million), Jay-Z ($150 million), U2($120 million), and its obvious that Livenation won’t be alive much longer.

Even still relevant acts like U2 and Jay-Z (hasn’t he retired a couple of times already?) can’t possibly generate enough revenue to make these deals pay off.

Every move that Livenation has made into the entertainment business has been bad for the consumer and for local venues.  We can only hope that their continued failures will lead us back to local control and booking of venues, fair pricing of tickets, and the chance for new entertainers to reach an audience.

Lets hope that this is the beginning of the end for this failed experiment.

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