CEOs talk Live Nation-Ticketmaster merger
Irving Azoff, Michael Rapino share vision for the businessThe much-anticipated merger agreement between Live Nation and Ticketmaster to create Live Nation Entertainment brings together two of the most influential players in the music industry: Ticketmaster Entertainment/Front Line Management CEO Irving Azoff, and Live Nation CEO Michael Rapino.
The deal combines Live Nation, the world's largest concert promotion firm, with Ticketmaster's industry dominating ticketing company, also bringing into the fold the numerous artist and venue relationships encompassed by both companies. Pending regulatory approval, the newly formed company could dictate the course of the music industry for decades to come.
In an interview with THR sister publication Billboard, Azoff and Rapino were relaxed, at least off the record. When the conversation turned to the merger, Azoff said he and Rapino had discussed various deals in the past, "but we really got serious and [the merger] happened very quickly."
"It's real simple," Azoff said. "What's right for the artists will be right for the fan and therefore right for our businesses."
Both Rapino and Azoff professed similar visions regarding the potential for connecting artists and fans via commerce. "Irving's views are historic, loud and proven," Rapino said.
And both men are adamant that joining forces is not about eliminating competition. "There's a bunch of other ticketing companies out there already, and as technology has changed it's really easy to get into the ticketing business," Azoff said. "I think my 11-year-old could come up with a system to sell a few tickets here and there. This [merger] is a marketing decision."
Asked if there was a potential conflict of interest when the management company is trying to get the best concert deal out of the promoter and both are under one corporate umbrella, Azoff and Rapino said no.
"We run a very decentralized operation [at Front Line], our managers make those decisions with their artists, the artist has the final decision. And every artist has an individual manager at Front Line, plus their agent, plus their business manager, plus their lawyer," Azoff said. "It's a collaborative process. I would think that Live Nation will probably have to bid harder than they did before."
Rapino concurs that Front Line would put the artist's interests first, citing the credibility and track record of Front Line managers such as Azoff, Simon Renshaw and Howard Kaufman. "Their job is to get the best deal for their artist, whether it's us, Jam, or whoever it is," Rapino said.
Still, Azoff is a notoriously tough negotiator. So, what if a tour deal benefits a specific artist more than it does Live Nation? Both men say "never" regarding that scenario. "I've never over-charged for an artist in my life," Azoff said.
Asked how third-party venues should view this merger, Azoff said, "At least from the Ticketmaster side, our accounts should look at this as an attempt from us to stop just being a technological solution for delivering tickets and to have the ability to help them market and sell more seats. And remember that Ticketmaster has very deep relationships with professional sports teams, college teams, arts organizations, charitable organizations, Broadway. We also thought about all of them when we talked about this deal."
Rapino and Live Nation spent a huge amount of time, money and effort in launching their own ticketing company on Jan. 1. Will Live Nation Ticketing be scrapped? "No, not at all," Rapino said, adding that the underlying goals that led to Live Nation being in the ticketing business in the first place remain the same.
"The fundamentals are simple," Rapino said. "A promoter needs to be in the e-commerce ticketing business. In a fundamental, sense the promoter's job is to buy a show and go and market and sell the tickets. In 2009, you can't be a marketing, ticket selling company if you outsource that. All I've ever said for three years is if we're charged to be the greatest marketer and seller of concert tickets then we need to control that mechanism."
Faced with five years or building Live Nation Ticketing or the opportunity to "accelerate that jump and bolt Ticketmaster onto our strategy today and excel, [the latter] is the strategy," Rapino continues. "But in the interim, it's business as usual until this has full approvals from everybody, and we'll 100% continue to build on our ticketing platform and insure it's working and firing up some of the early learning curves. This weekend we'll be on-sale with Coldplay on our ticketing platform all across America."
What would Rapino say to fans, so many of whom have expressed distaste for this merger in the blogosphere? "Our job is we work for the artist and we service the artists' fans," he said. "And the better service and the better company we can provide for the artist, the better job we can do for the fans, from flexibility in selling to lower service fees.
"Our job is to build a company for the future that can meet the demands of the artist and fan of the future. All those things that we want to fix that the consumer has identified is how we'll become that great company."