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Is it time for Live Nation to Die?
It's High Time for artists to have a fair partnership in their live touring business...
Carl Hitchborn
September 09, 2023
When I was planning out the different posts for The Baker Say’s, one that I knew would create compelling reading was a discussion about the massive levels of exploitation by promoters, venues, and ticketing companies in the live music segment of the music business.
Some would say that the words 'promoters, venues and ticketing companies' could easily just be replaced with two words: Live Nation.
However, the truth is that this exploitation goes far beyond Live Nation as the biggest live music promoter in the world and is prevalent at all levels of the live music business.
I brought writing and publishing this post forward, to jump onto the bandwagon of noise created recently by The Senate Judiciary Committee hearing - the first of many that will be investigating the dark side of the live music business - which was brought about by a catalog of issues and problems seen with the recent sale of tickets to superstar Taylor Swift's Eras Tour.
Clyde Lawrence Reveals the Truth
The primary focus might have been on the Swift Eras Tour issues, but the sobering reality of just how exploitative Live Nation (and the wider live music business) is for artists came via the words of the only artist witness called to take questions from the Senate; Clyde Lawrence.
In his testimony (which you can see here), Lawrence spoke about the conflict of interest created by Live Nation being the venue owner, live promoter and ticketing company in one, and how costs could be and are inflated drastically as a mechanism to reduce the profits generated from the show itself.
The sentiment is that Live music is a fair partnership between the live music business and artists, however, Lawrence pointed out this is just not the reality:
"Since both our pay and theirs is a share of the show's profits, we should be true partners aligned in our incentives: keep costs low while ensuring the best fan experience.
But with Live Nation acting not only as the promoter but also as the owner and/or operator of the venue, it seriously complicates these incentives."
And he touched on some of the inflated costs charged by Live Nation:
"At the end of the show, costs will have eaten into most of the money made that evening and due to Live Nation's control across the industry, we have practically no leverage in negotiating. If they want to take 10 percent of the revenues and call it a 'facility fee,' they can—and have."
If they want to charge $30,000 for the 'house nut' [operating costs of a theater] they can—and have.
And if they want to charge us $250 for a stack of 10 clean towels, they can—and have.
Once these costs, some of which went to Live Nation's subsidiaries, are taken into account, the remainder is split between Live Nation and the band.
In a world where the promoter and the venue are not affiliated with each other, we can trust that the promoter can look to get the best deal from the venue."
However, in this case, the promoter and the venue are part of the same corporate entity so these line items are essentially Live Nation negotiating to pay itself. Does that seem fair?”
To add further to the next level of exploitation being exerted, Lawrence highlighted how Live Nation also profits at an excessive level via their wholly owned subsidiary Ticketmaster:
"The tickets were listed at $30 and our pay ended up shaking out to about $12 of each ticket. But in this hypothetical show, the fan did not pay $30 for that ticket.
The fan paid $42 because Ticketmaster tacked on a 40 percent fee and for the record, we've had them go as high as 82 percent."
For many independent live promoters out there, they'll be breathing a sigh of relief that Live Nation is taking all of the heat in this debate, but the unfortunate truth is that they are just as exploitative.
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