How a Live Nation Deal Cornered Justin Timberlake

Timberlake Money Graphic - H 2013
AP Images

Timberlake Money Graphic - H 2013

The superstar rolled out his album “20/20” in three months instead of the usual year as a $20 million deal with the concert industry giant came due.

This story first appeared in the April 5 issue of The Hollywood Reporter magazine.

The seemingly flawless rollout of Justin Timberlake's new album, The 20/20 Experience, which sold 968,000 copies during its first week of release, has confounded many in the music business. After all, it wasn't long ago -- June 2011, to be exact -- that the 32-year-old singer declared in Playboy, "Music is not my focus right now," shortly after telling Vanity Fair: "I wouldn't say I'm not going to put out another [album]. I would say that would be a bad bet, if you were betting."

One entity that was putting money on the former 'N Syncer's musical future: Live Nation. In 2008, the concert industry giant entered the business of Timberlake when it acquired Signatures, a leading merchandising company that counts the pop star among its exclusive licenses. Months later, it announced a multiyear agreement to feature 901, the premium tequila brand Timberlake launched, as the official tequila of Live Nation venues.

According to multiple sources, a 2009 partnership with Timberlake, structured after Jay-Z's game-changing $150 million Live Nation 360 deal and Timberlake's AEG-promoted, $126 million-grossing 2007 FutureSex/LoveShow tour, was quid pro quo for a touring commitment to Live Nation. In exchange, Timberlake received about $20 million -- $5 million of it free and clear, or "a gimme," as one insider describes it. (Worth noting: Timberlake could have returned it had he not toured.)

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So it's understandable that upon hearing of Timberlake's intended hiatus, the company would become uneasy at the prospect of waiting endlessly for its star, who had garnered accolades as an actor, appearing in Oscar-caliber films and rom-coms. Timberlake next will be seen in the Coen brothers' Inside Llewyn Davis, but not before he takes part in the massive Live Nation-promoted Legends of the Summer tour, which he'll co-headline with Jay-Z.

Says one high-ranking source, "There is a due date by which you have to start touring -- at some point, [Live Nation] has to call in the loan."

Typically, an album launch for a megastar of Timberlake's stature would take a year to set up at radio and retail, in addition to recording time. But with 20/20, the public first got word of its March 19 release in January, after which Timberlake kicked off a massive TV and marketing blitz that included a hosting stint on Saturday Night Live, a week's worth of appearances on Late Night With Jimmy Fallon, a surprise performance at South by Southwest and a national ad campaign for Target, which is selling a deluxe edition of the album in addition to devoting prime retail space to the pop star. Timberlake also has been approached for an endorsement deal with Diet Coke.

Talk about going from zero to jet speed in a minute. Which begs the question: Was the album rushed so there would be product to sell in addition to concert tickets? Longtime Timberlake manager Johnny Wright told CNN during the network's 30-minute special, The Justin Timberlake Experience, that 20/20 was made in only 20 days, which might account for the mixed reviews it has received. The New York Times called it "primarily a paean to brand maintenance." Said Jody Rosen in Rolling Stone: "There are no songs as instantly infectious as 'SexyBack.' … But eventually the music sinks its teeth in."

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There also was a hitch leading up to the Feb. 22 tour announcement. The album's first single, "Suit & Tie," with its retro groove and '70s-esque falsetto, seemed to have a slow start at radio after its Jan. 15 debut -- so much so that, according to an insider, the promoter worried whether Timberlake, six years removed from his previous tour, could fill arenas.

Enter rap legend Jay-Z, who recently befriended the pop star and suggested the two hit the road together. Driving the nepotism home, the stars share close ties with Timbaland, who produced 20/20, signed to Roc Nation in January and is in the studio with Jay-Z. As for the Legends trek, while Jay-Z's addition upped the venue size to stadiums, a Timberlake source asserts that the headliners will split revenue 50-50. The summer tour should bring in north of $60 million, estimates one insider, which is more than enough to cover Timberlake's obligation to Live Nation.

A rep for the concert company tells THR: "Live Nation always envisioned an arena tour for Justin Timberlake. After their successful studio collaboration, Justin and Jay-Z approached us, and we are thrilled to promote their stadium tour."

The team-up strategy seems to be working: According to StubHub, Legends of the Summer is outselling Jay-Z's previous Watch the Throne outing with Kanye West by a 5-to-1 margin. As for "Suit & Tie," it's at No. 4 on the Billboard Hot 100, with follow-up "Mirrors" hot on its heels. All this momentum will lead to Timberlake's own headlining outing in the fall, a Live Nation rep confirms, without specifying what size venues he'll play.

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In a way, Timberlake's insta-arrival is a testament to his pop-culture staying power. It's a rarity, but don't call it a comeback. "That implies that Justin was 'down' at some point," says on-air personality Chris Booker of Los Angeles' AMP Radio. "I see it more as a pause. He stepped away on top of the pop world, and nobody filled the void. I hope he gets the music bug more often; it's his strong suit and tie."

Twitter: @shirleyhalperin