Concert promoter releases second quarter earnings
Live Nation, the world’s largest concert promoter, couldn’t be more ready to get live concerts going again as it has lost 98 percent of its revenue during the COVID-19 pandemic. The company detailed the loss during its second quarter financial results that ended June 30th.
“Over the past three months, our top priority has been strengthening our financial position to ensure that we have the liquidity and flexibility to get through an extended period with no live events. Our expectation is that live events will return at scale in the summer of 2021, with ticket sales ramping up in the quarters leading up to these shows.” the company says in a statement.
Live Nation says despite more fans holding onto their tickets than requested refunds following tour postponements earlier this spring, they’ve lost over $431 million dollars of revenue.
“Our strongest indicator of demand is that fans are holding on to their tickets, even when given the option of a refund. Through the end of the second quarter, 86% of concert fans are keeping their tickets for rescheduled shows, demonstrating their continued desire to attend concerts in the future despite the current uncertainty,” they say.
Two-thirds of fans have held onto canceled festival tickets which allow them to attend in 2021. They also say early ticket sales for the UK festivals Download and Isle of Wight are so strong, they’ve outpaced last year’s ticket sales.
“Between the tickets held by fans for rescheduled shows and these festival onsales, we have already sold 19 million tickets to more than four thousand concerts and festivals scheduled for 2021, creating a strong baseload of demand that is pacing well ahead of this point last year,” Live Nation shares. “At the same time, surveys continue to show that concerts remain fans’ highest priority social event when it is safe to gather, with almost 90% of fans globally planning on attending concerts again.”
The company says they’ve been forced to get creative to produce live events during the pandemic. Virtual concerts have been proven to be in huge demand by fans, so the Live Nation established the Live From Home platform to provide a convenient place for fans of all types to find performances from their favorite artists.
Sixty-seven million fans viewed more than 18 thousand concerts and festivals globally during the second quarter when most live in-person shows were at a stand still. Last weekend, Live Nation streamed 150 performances for its Virtual Lollapalooza Festival. The company is looking at livestreaming to become part of the long-term component to the concert industry, giving fans in other cities, or those who can’t attend, an option to enjoy concerts as well.
Live Nation has also launched socially distanced shows, where permitted, for fans who want to attend in-person shows. Cities throughout the United States, New Zealand, France, Denmark, Spain, Germany and Finland have participated in these events.
“While this is a challenging time for everyone – the live events business in particular – there are a few things that I am confident about: we are well positioned to weather this crisis, and we will get through this; when it is safe to return, we will have an abundance of fans and artists ready to enjoy live music again; and Live Nation will do everything in its power to meet our responsibilities to artists, fans, our employees and everyone else affected by this shutdown by bringing back as much live music as fast as possible when it is responsible to do so,” Live Nation President and CEO Michael Rapino shares.
Earlier this summer, Live Nation was under fire for demanding some major changes for artists it promotes in 2021 and beyond, referring mostly to festival performances. An internal memo says artist guarantees — money paid to artists before performing — will be cut by 20% across the board. Artists will receive a deposit of 10% one month before the concert/festival, contingent on an executed agreement and fulfillment of marketing responsibilities. The balance, minus standard deductions for taxes and production costs, will be paid after the performance.
The memo claims the pandemic has “changed the world in recent months and with it the dynamics of the music industry.” It says the world is in “unprecedented times” and the company and its artists must “adequately account for the shift in market demand, the exponential rise of certain costs and the overall increase of uncertainty that materially affects our mission.”
It also claims that if an artist cancels its performance in breach of the agreement, the artist will pay the promoter two times the artist’s fee, and only be paid 25% of the guarantee if a show is canceled due to poor ticket sales.
Many musicians and industry professionals alike spoke out strongly against these terms. Live Nation has not spoken publicly about this memo.
Author: Buddy Iahn
Buddy Iahn founded The Music Universe when he decided to juxtapose his love of web design and music. As a lifelong drummer, he decided to take a hiatus from playing music to report it. The website began as a fun project in 2013 to one of the top independent news sites.