UMG, AEG, Live Nation, RIAA, CAA, Others Band Together to Demand Live Concert Government Relief

Music industry mainstays including Universal Music Group (UMG), AEG Presents, Live Nation, and the RIAA have banded together to demand that the federal government provide relief to the live event sector.

Joining Universal Music Group and the other above-noted entities in backing the initiative, which has been dubbed #SaveLiveEventsNow, are the Recording Academy, Paradigm, CAA, Endeavor, and 21 others, for a total of 29 supporting organizations and companies. Worth noting is that in spite of UMG and the RIAA appearing on the coalition’s website, Warner Music and Sony Music were unlisted at the time of this writing.

The #SaveLiveEventsNow landing page opens by reiterating the devastating impact that the COVID-19 pandemic and lockdown measures have had (and are continuing to have) on live music. Additionally, the brief introductory message quickly moves past previous support of the Save Our Stages Act, characterizing the shelved bipartisan legislation as “one component of what our industry needs.” Instead, the concise text emphasizes the individual side of the trying situation, including the effects on musicians “and most importantly the 12 million people who are working behind the scenes to bring shows to life.”

From there, the participating businesses and organizations encourage supporters to contact Congress – including by emailing a pre-written letter, which seems to automatically choose and reach the appropriate representatives based upon the sender’s inputted address. (A social-media counterpart produces post-ready tweets, with one’s senators and House representative tagged at the outset.)

The letter itself, which can be edited prior to sending, cites renewed $600 weekly federal unemployment bonuses and an expanded edition of the aforementioned Save Our Stages Act (“to include support for small venues under 5,000 seats”) as the live event sphere’s foremost needs. Next, the approximately 560-word-long document calls on Congress to approve “employer retention tax credits” (to encourage businesses to retain team members) as well as a healthcare subsidy “to keep employees insured on their job-based healthcare plan.”

Lastly, the comprehensive letter requests that legislators pass the Mixed Earner Pandemic Unemployment Act, which was introduced in July, and the Performing Artist Tax Parity Act, which has been stuck in committee since June of 2019. In summary, the former would expand CARES Acts benefits (and presumably those of any subsequent stimulus packages) to those who are still employed but cannot continue to earn money as a freelancer, while the latter would increase above-the-line tax deductions available to individual, non-corporation artists.

According to a recent survey, most live music execs believe that concerts will return in 2021, though the majority of these respondents expect the comeback to arrive during the second or third quarter. Earlier this week, we reported that Coachella organizers could be considering pushing their event back from April to October of next year.

Nearly 90% of US Independent Venues Face Permanent Shutdown Following COVID-19

Photo Credit: Vishnu R Nair

According to a newly published survey from the National Independent Venue Association (NIVA), 90 percent of independent venues may be forced to permanently close their doors in the next few months, owing to the fiscal strain of ongoing coronavirus lockdown measures.

At its start, the analysis of independent venues’ status reiterated that the businesses were among the first to close because of the novel coronavirus pandemic – and will likely be among the last to reopen. Similarly, the report emphasized that these live entertainment establishments are unable to draw revenue presently, but must still find a way to cover bills, insurance costs, and other expenses.

In terms of the study itself, NIVA conducted a survey of its nearly 2,000 member venues and promoters, 90 percent of whom indicated that “they will close permanently in a few months without federal funding.” It was specifically noted that “current PPP [Paycheck Protection Program] funding will not solve the crisis.”

NIVA disclosed a couple of other points of interest in its report, which shed additional light upon the challenges venues are currently facing.

First, the organization stated that any plan to reopen venues with partial capacity (as some in America have done and as Live Nation is currently doing in New Zealand) “is not economically feasible …  payroll, taxes, insurance, and artist pay are not on a sliding scale matching the capacity we’re permitted to host. They are fixed costs.”

Plus, owing to the “national routing” of contemporary tours, NIVA signaled that “our industry will not recover” until each state has fully reopened its economy. The point is potentially problematic given the differing approaches that governors (and local leaders) are taking in directing their reopening initiatives.

For instance, Missouri Governor Mike Parson said last month that fans can immediately resume attending concerts and music festivals in his state. Today, however, Chicago officials nixed Lollapalooza 2020 as part of a blanket ban on live events.

NIVA’s report closed by describing the support that some members of Congress have offered the live event industry thus far, as well as possible ways of helping venues to weather the COVID-19 crisis’s financial fallout.

Norwegian PRO Warns of COVID-19 Revenue Hit Ahead

Oslo, Norway, during a winter afternoon. Photo Credit: Gunnar Ridderström

Norwegian performance rights organization (PRO) TONO revealed all-time-high earnings in its latest financial report, but warned that a coronavirus-fueled revenue hit is imminent.

The PRO recently published the mentioned report, which highlighted 2019’s income benchmarks.

TONO’s 2019 revenue surpassed $83 million (NOK 771 million), a more than nine percent uptick from 2018. Additionally, the entity distributed about $72.71 million (NOK 674 million) to its rightsholders after accounting for fees and operational costs.

The report also painted an encouraging picture of Norway’s live-event sphere and concert scene – through 2019, that is. Concert revenue almost doubled from 2014 to 2019, to over $10.83 million (NOK 100 million) last year. For reference, the Scandinavian nation is home approximately 5.37 million people.

Shifting into an analysis of this year’s performance, TONO CEO Cato Strøm noted that the “projected loss of income from March to the end of August is NOK 107 million, with concerts and background music being hit hardest.”

In dollars, the figure exceeds $11.54 million – a sum that’s enough to offset 2019’s gains and then some.

Expanding upon the point and its implications for his 91-year-old PRO, CEO Strøm said: “It is with very mixed emotions that we present record-breaking financial statements at a time when rights holders, music publishers and artists are experiencing the biggest crisis ever in our field.”

To date, medical professionals have diagnosed 8,567 COVID-19 cases in Norway, where 239 persons have perished as a result of the disease’s complications.

The COVID-19 pandemic has hit the music industry especially hard, and companies and artists are only beginning to take preliminary steps towards welcoming back physical audiences.

Leading concert promoter Live Nation, for instance, is testing quarantined concerts in Auckland, New Zealand, presently. In theory, the safety protocols instituted to assure attendees’ safety will lay the groundwork for the eventual return of shows in other, more populous states. About 4.89 million individuals reside in New Zealand.

SiriusXM Announces $1.5 Billion Debt Offering to Counter Coronavirus Ad Drops

Satellite radio mainstay SiriusXM has announced that it will issue $1.5 billion in senior secured notes as part of an effort to offset a coronavirus-fueled drop in ad revenue.

SiriusXM revealed the debt offering in a series of press releases, which were shared with Digital Music News.

The New York City-based brand laid out the bonds’ specifics in an initial press release. As required under the Securities Act of 1933, the senior notes will be offered only to “qualified institutional buyers” – not individuals in the United States.

Along with “cash on hand,” SiriusXM stated that it will use the debt’s generated revenue to pay a previously issued round of senior secured notes, which are set to mature in 2025.

Shortly after publishing the first press release (presumably following interest on behalf of investors), SiriusXM upped the debt by $500 million, bringing the sum to a total of $1.5 billion. Additionally, the brand relayed that the notes will be due for repayment in 2030, at an annual interest rate of 4.125 percent.

This second press release also indicated that SiriusXM will use the debt offering to cover the previously mentioned 2025 senior secured notes, as well as a second set of secured notes that will mature in 2023.

SiriusXM’s stock, bought and sold under the symbol SIRI, dropped slightly (about 2.4 percent) following the debt-offering announcement. At the time of this writing, the company’s shares were trading for $6.36 apiece.

In late April, we were first to report that SiriusXM had parted with 143,000 net subscribers during 2020’s first quarter, in what was otherwise an encouraging overall performance (including revenue and profit growth of six and seven percent, respectively).

Predictably, however, advertising revenue has fallen as part of the coronavirus’s overall market shakeup.

Leading concert promoter Live Nation issued $1.2 billion in debt last month, for “general corporate purposes.” The offering was initially worth $800 million, but was subsequently increased by a third.

AEG Announces Major Staffing Cuts as Concert Cancellations Stretch Further

Owing to the novel coronavirus’ ongoing impact upon the live event sphere, Anschutz Entertainment Group (AEG) is preparing to layoff, furlough, and cut the salaries of a number of its team members, according to preliminary reports.

AEG President and CEO Dan Beckerman revealed the unfortunate development to his employees via an internally circulated memo. The document cited the COVID-19 crisis – and especially its far-reaching implications for crowd-based entertainment – as the chief reason for the cost-cutting measures, which executives will begin implementing on July 1st.

Each of AEG’s divisions, including Coachella organizer and live-event giant AEG Presents, is expected to be part of the saving initiative, though it’s unclear at this time exactly how many jobs the cuts will encompass. Moreover, AEG hadn’t publicly addressed the matter prior to this piece’s publishing.

AEG isn’t the only live-event company that’s been hit hard by the coronavirus crisis, the risk of which continues to prevent artists from playing before physical crowds. To be sure, today’s leading event promoter, Live Nation, furloughed more than 2,000 employees last month, as part of a previously planned effort to reduce costs and stay afloat until concerts and music festivals return.

It’s uncertain if AEG’s much-anticipated Coachella Valley Music & Arts Festival will take place this year.

The annual event is tentatively scheduled for October, having been delayed from April due to COVID-19 concerns. Travis Scott, Frank Ocean, and Rage Against the Machine are still listed as headliners, but reports have surfaced that top acts are being asked to push their performances to 2021.

Many governments, including those of Germany and Australia, are injecting cash into their struggling live-event industries. Moving forward, it’ll be worth monitoring the results and effects of these aid packages, as well as their meaning for the music industry as a whole.

More as this develops.

Summerfest Milwaukee Officially Cancelled After September Postponement

Photo Credit: Hanny Naibaho

Summerfest Milwaukee executives have canceled their much-anticipated event’s 2020 edition due to uncertainty stemming from the coronavirus (COVID-19) crisis.

The Milwaukee World Festival, Inc.’s board of directors made the unfortunate announcement this morning; the news was quickly shared with Digital Music News.

Previously, the directors moved to postpone Summerfest from its original dates in June until September. Now, however, the continued risk presented by COVID-19 – and particularly for crowd-based live events – prompted organizers to opt out of 2020’s iteration.

Former MLB executive and current Summerfest President and CEO Don Smiley indicated: “Given the information available today, and the uncertainty surrounding very large gatherings, we cannot in good conscience proceed with the festival this year. The immediate future presents multiple levels of risk for our fans, and we choose the side of safety.”

The 64-year-old Wisconsin native proceeded to state that the cancellation decision was especially hard to make given the preparation efforts of employees during the last couple months, besides the $186 million economic impact that Summerfest would have had on the local market. Additionally, Summerfest 2020 was set to take place in the newly constructed American Family Insurance Amphitheater.

This cancellation marks the first time that Summerfest has been nixed in its 53-year history. Refunds are currently available for those who purchased general admission tickets via Ticketmaster or Summerfest.com, and Summerfest 2021 dates are expected to be announced in the near future.

The coronavirus pandemic has forced organizers and artists to delay or cancel virtually all upcoming music festivals and concerts. Coachella and Bonnaroo, two of today’s foremost festivals, have been postponed until October and September, respectively – though it’s far from guaranteed that they will actually take place this year.

To be sure, Coachella 2020 headliners have reportedly been asked to move their performances to 2021’s edition.

That said, promoters are slowly (and carefully) welcoming fans back to concerts. Live Nation began testing socially distanced shows in Auckland, New Zealand, last Friday, and Travis McCready successfully staged America’s first socially distanced performance.

Warner Music Group Is Back With the Biggest IPO of 2020

Warner Music Group (WMG) has announced that it intends to price its IPO shares at $25 apiece, as part of what will accordingly be 2020’s single biggest stock-market debut.

Warner Music Group officials revealed the IPO’s price in a press release, which was emailed to Digital Music News (and the broader market) this morning.

Additionally, WMG has upped its total IPO shares by 10 percent, from 70 million to 77 million. At the planned per-share price of $25, the offering’s value will just exceed $1.92 billion.

The Big Three record label, which boasts deals with artists including Ed Sheeran, Camila Cabello, and Wiz Khalifa, is set to begin trading on the stock market later today, under the symbol WMG. The financial professionals who underwrote the IPO will be granted a 30-day window to purchase as many as 11.55 million WMG shares.

In early February, we were first to report on Warner’s return to the public market (Access Industries, a multinational conglomerate owned by billionaire Leonard Blavatnik, brought the then-struggling asset private in 2011).

Owing to the onset of the COVID-19 crisis, the IPO was shelved in March, only to be revived in May. However, it bears mentioning that rumors of Saudi Arabia’s making an offer to buy WMG circulated in the interim. The Middle Eastern nation has worked to bolster its tourism and entertainment industries as of late, and in April, it purchased a $500 million stake in leading concert promoter Live Nation.

As Saudi Arabia completed the Live Nation investment on the public market, via common stock, it’s certainly possible that it will do the same for WMG (assuming that the rumors of its interest in the label are true, of course).

Similarly, reports have emerged that Chinese conglomerate Tencent is looking to secure a $200 million stake in Warner Music Group. Back in March, Tencent closed a $3.3 billion deal with Vivendi-owned Universal Music Group (UMG), for which it received 10 percent ownership.

Is Coachella Cancelled? Headliners Reportedly Being Asked to Move to 2021

photo: DomCarver

Is Coachella cancelled for 2020? As the prospects for a near-term reopening of live events in California continue to dim, organizers are reportedly asking artists to shift their performances to next year.

Coachella’s iconic festival may not happen this year, after all, thanks to a grindingly-slow reopening schedule in California. Several weeks ago, California Governor Gavin Newsom and other state officials indicated that live concerts and sporting events would likely be the last things to return, with 2021 a realistic rescheduling point. All of which means that Coachella 2020 — which was initially scheduled for October — may not happen at all.

Now, there’s more evidence the Coachella owner AEG is making plans to cancel the double-weekend mega-festival. According to a report surfacing in Bloomberg this evening, artists scheduled to headline Coachella are being quietly asked to reschedule for 2021’s event. Headlining artists like Travis Scott, Frank Ocean, and Rage Against the Machine were mentioned, though it’s unclear exactly which artists have been approached or agreed to the date shift.

Either way, Bloomberg called the overtures “the clearest sign yet that this year’s show will be cancelled,” though Coachella’s website still lists the event as happening on the double-weekend of October 9th-11th and 16th-18th.

The behind-the-scenes shift would make sense for AEG and its subsidiary, Goldenvoice, which runs Coachella.  A shifting of the bill to 2021 would give fans the ability to roll their tickets over into the following year, thereby saving Goldenvoice/AEG the financial pain of having to issue refunds.

Realistically, the chances of Coachella pulling this thing off in October are now low.

Just recently, nearby California venues like the Hollywood Bowl and The Greek Theatre mass-cancelled their 2020 events.  For the first time in 98 years, the Hollywood Bowl nixed its iconic summer season.  The Greek Theatre hasn’t cancelled a season in its 90-year history.

Also Read:  Glastonbury Organizers Officially Cancel 50th Anniversary Festival

Elsewhere, most 2020 tours are now cancelled, with AEG and its rival, Live Nation, potentially nixing or postponing all events this year. Just recently, Live Nation CEO Michael Rapino pointed investors to a 2021 restart: “We believe 2021 can return to show volume and fan attendance at levels consistent with what we’ve seen in recent years,” Rapino stated.

Incidentally, nearby Coachella Valley casinos have already reopened, thanks to loopholes enjoyed by Native American tribes.  But casinos represent an entirely different animal than a packed festival, where thousands of fans remain in extremely close contact for hours every night.

More as this develops.

Live Nation Wriggles Out of Its $400 Million Acquisition of Ocesa Entertainment

Live Nation’s high-priced acquisition of a majority share of Ocesa Entertainment — which tipped the scales at an estimated $400 million — has now been called off.

The acquisition was first announced in July of 2019 — back when a complete shutdown of all live events was outright unthinkable. Instead, Live Nation was charting a high stakes land-grab in Mexico and Latin America, with part-owner Grupo Televisa looking to move away from the live events space. The deal called for Live Nation to assume a 51% controlling interest in Ocesa, with potentially greater percentages acquired down the road.

Currency exchange rates have fluctuated considerably since the first announcement, though the price tag of $8.835 billion MXN currently translates into roughly $400 million USD.

Now, Grupo Televisa, along with fellow Ocesa Entertainment owner CIE, are left holding the bag on the suddenly-distressed property. As is customary in these types of transactions, the mega-deal itself wasn’t done until all contracts, due diligence, regulatory checks, and legal details were finalized. In this case, Live Nation is moving to exercise an out-clause, and effectively wriggle out of a mega-property it simply cannot afford.

Both CIE and Grupo Televisa are understandably unhappy about the move, and have vowed to contest its legitimacy.  But it’s unclear whether the duo will launch formal cross-border legal proceedings, or even enter into legal arbitration.  Another alternative is to wait out the COVID-19 crisis, and hope that a deal can be consummated on the other end (with bridges unburned).

Either way, news of the cancelation is hardly surprising given Live Nation’s extreme financial distress.

Just recently, Live Nation issued more than $1.2 billion in bond debt as its business has been ground to a halt.  Just recently, the concert giant furloughed roughly 20% of its workforce, or 2,100 people.

Also Read:  BTS Joins the Growing List of Coronavirus Tour Cancelations

“We want to delay the cash payment of the deal until we both know how and when we’re on the other side of this crisis,” Live Nation CEO Michael Rapino stated in the company’s latest quarterly earnings call. “So that’s the intent.” Just last month, Rapino agreed to forego his full salary, and other top executives have taken significant pay cuts.

One interesting wrinkle here is that Ocesa owns Ticketmaster Mexico, which initially offered a nice consolidation opportunity for Live Nation. Now, consolidating global Ticketmaster properties looks more like a liability than an opportunity, though Live Nation recently noted that 90% of its Ticketmaster customers are holding onto tickets for postponed shows — even though they have the ability to receive refunds.

Class Action Lawsuit Against StubHub Expands Into Canada

(photo: StubHub)

In April, Digital Music News was first to report that an angry U.S. customer had filed a class-action lawsuit against StubHub over its ticket-refund policy amid the COVID-19 pandemic. Now, the legal complaint has expanded into Canada.

Toronto’s Koskie Minsky LLP is spearheading the class-action undertaking, which, like its stateside counterpart, centers on StubHub’s refund-policy switch-up during the early portion of the novel coronavirus crisis. On March 31st, StubHub indicated in a statement that the global pandemic’s devastating impact on the live event sphere had made it fiscally impossible to provide cash refunds.

And so, StubHub opted to offer vouchers for 120 percent of tickets’ respective values, which fans could then put towards the cost of future events.

According to a statement from Koskie Minsky, all Canadian residents who bought tickets via StubHub before March 25th (for shows that were canceled, but didn’t provide refunds) are eligible to join the class-action suit.

Addressing his firm’s class-action filing against StubHub, Koskie Minsky partner Kirk Baert said: “StubHub has reneged on its promise to refund Class Members’ money. This is obviously wrong and hurts everyday Canadians whose household budgets are stretched right now.”

Just prior to announcing that it would be unable to provide cash refunds to customers, StubHub furloughed a reported 67 percent of its team in an effort to trim costs and stay afloat. Like most other companies that operate in the live event sphere, the San Francisco-based ticket-resale platform has been hit particularly hard by the coronavirus outbreak.

Today’s leading concert promoter, Live Nation, was also forced to furlough more than 2,000 employees earlier this month. Six days back, the Beverly Hills brand raised $1.2 billion in capital via senior secured notes; the funds will be used for “general corporate purposes.”

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Since the domestic onset of the novel coronavirus pandemic, disgruntled would-be attendees have filed refund-related lawsuits against SXSW, Live Nation and Ticketmaster, the MLB, and other companies.

Live Nation Canada, Budweiser Officially Kicking Off ‘Stage at Home’ Series

Photo Credit: Isabel Piñeiro

Live Nation Canada and Budweiser have teamed up to broadcast Budweiser Stage At Home, a live-performance showcase that will feature sets from a number of prominent artists.

Beginning this Saturday, May 30th, Budweiser Stage at Home will deliver artists’ in-studio or at-home performances to fans. Many viewers will enjoy the shows, undoubtedly, but they’re likely to be particularly appealing to those who were eagerly anticipating attending concerts at Toronto’s Budweiser Stadium (which have been put on hold due to the coronavirus pandemic).

The Saturday-evening program will begin at 8 PM in the east (five in the west), on Citytv and Citytv.com. (Live Nation’s Live at Home platform is also scheduled to stream Stage at Home.) Georgia-based rock band The Black Crowes and Nova Scotian hard-rock group The Trews are set to entertain music lovers who tune in for this debut edition.

Moreover, Live Nation Canada and Budweiser intend to air a trio of additional Budweiser Stage at Home productions during the following three Saturdays, before deciding whether to proceed with the endeavor by ordering new episodes.

Toronto-based country-rock band Blue Rodeo will co-headline the second Budweiser Stage at Home event with folk-rock mainstay and Great Big Sea lead vocalist Alan Doyle. The next two Stage at Home lineups are being finalized presently.

This innovative joint venture isn’t the only way that Live Nation is working to (safely) entertain music fans. On Friday, the Beverly Hills-based company will test a socially distanced concert in Auckland, New Zealand.

At the time of this writing, the company’s per-share value was up more than two percent on the day, to $46.49.

Also Read:  Live Nation Secures Emergency $120 Million Loan — CEO Michael Rapino Foregoes Entire Salary

Other artists and entertainment professionals are too pursuing innovative means of entertaining fans while simultaneously minimizing the risk of infection presented by COVID-19. YouTuber Marc Rebillet, the Texas Rangers (with acts including The Eli Young Band and Whiskey Myers), and New Jersey’s Lighthouse Film Festival are preparing to welcome attendees in drive-in settings.

And one week back, Travis McCready successfully staged America’s first socially distanced concert, possibly laying the groundwork for traditional live performances’ eventual return in the process.

John Malone Isn’t Worried About Concerts Coming Back — “Human Beings Are Gregarious By Nature”

The Liberty Media logo.

Billionaire businessman and Liberty Media Chairman John C. Malone doesn’t believe that the novel coronavirus will have a material impact on the long-term viability of the live-event sector.

The 79-year-old indicated as much during Liberty Media’s annual virtual meeting with stockholders, which took place this morning. “Human beings are gregarious by nature,” said the Connecticut native when explaining his stance on the matter. “Here in Florida, the bars are open, and they’re pretty packed.”

Further, Malone struck a hopeful tone when discussing the potential relief – to individuals and, in turn, the market – that will be created by a vaccine or other form of COVID-19 therapy.

On that front, the federal government announced today that the Department of Health and Human Services will provide up to $1.2 billion to the UK’s AstraZeneca as it moves quickly to develop a viable vaccine; the company believes it can deliver initial doses as early as this September.

Liberty Media’s holdings stand to benefit tremendously from a relative return to normalcy and the reemergence of crowd-based live events. The publicly traded business owns the Atlanta Braves, Formula One, and a controlling share of SiriusXM, among other properties.

Some early signs – besides the reopening of economies across the United States and the world, as well as the immediate popularity of public gatherings – appear to support John C. Malone’s assessment. Fans quickly purchased tickets to America’s first socially distanced concert, which took place on Monday. Plus, ticket sales for drive-in film festivals and concerts have been encouraging.

Also Read:  Tribal Casinos In Coachella Valley Are Reopening — Is This Bad News for Coachella the Music Festival?Live Nation is preparing to test a socially distanced indoor concert next Friday, in Auckland, New Zealand.

Additionally, the leading concert-promotion company said in its Q1 2020 earnings report that only a small portion of ticketholders have asked for refunds. Also offering an upbeat take is Microsoft veteran Greg Maffei, who serves as Live Nation’s chairman and as Liberty Media’s president and CEO.

To date, medical professionals have diagnosed about 5.17 million worldwide COVID-19 cases, and nearly 330,000 individuals have perished as a result of the disease’s complications.

Live Nation Successfully Completes $1.2 Billion Bond Offering

 

Live Nation has successfully completed its $1.2 billion bond offering.

The leading concert promoter announced the significant fundraising benchmark in a press release, which was shared with Digital Music News.

We first reported on Live Nation’s plan to generate capital by issuing senior secured notes one week back. The company initially intended to raise $800 million, but quickly upped the sum to $1.2 billion; the press release attributes the increase to substantial demand from investors.

Financial professionals who purchased the senior secured notes (they weren’t made available to individuals in the United States) will enjoy a 6.5 percent annual interest rate, and the bonds are scheduled to mature in 2027.

On the day, Live Nation’s stock, traded under the symbol LYV, hiked 6.45 percent, to a per-share value of $47.73. For reference, the S&P 500 gained 48.67 points (1.67 percent) today, whereas Nasdaq jumped 190.67 points (2.08 percent) during trading hours.

Expectedly, the novel coronavirus has had a particularly devastating impact on Live Nation’s operations and revenue stream. Since April, higher-ups have furloughed approximately 20 percent of their team – roughly 2,100 employees. And some angry fans have named Live Nation and its wholly owned Ticketmaster subsidiary in lawsuits.

However, the Beverly Hills-based company has enjoyed some good news as of late. U.S. states and many countries are starting to reopen their economies – which is, of course, the first step towards bringing back crowd-based live events. In this vein, Live Nation plans to begin holding socially distanced concerts in Auckland, New Zealand, next Friday.

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Plus, Live Nation revealed in its Q1 2020 earnings report that 90 percent of ticketholders who could have received refunds opted instead to keep their passes.

Two days ago, artist Travis McCready staged America’s first socially distanced concert, performing a set for 229 fans at TempleLive in Fort Smith, Arkansas.

 

Live Nation Furloughs More Than 2,000 Employees as Arenas Remain Empty

Since April, following the domestic onset of the coronavirus (COVID-19) crisis, Live Nation has furloughed 20 percent of its team – approximately 2,100 employees – to cut costs and weather the pandemic’s unprecedented fiscal and operational strain.

Company officials recently confirmed the unsettling figure, and an array of reports are being published presently. However, the furloughs hardly come as a surprise, given that lockdown measures and health concerns have prompted the postponement of nearly all concerts and crowd-based events.

Moreover, as first reported by Digital Music News, Live Nation indicated in an April Securities and Exchange Commission (SEC) filing that it would take major steps to cut costs, including renegotiating rent agreements and furloughing some workers. CEO Michael Rapino, for his part, has voluntarily relinquished his entire salary.

In late April, the Kingdom of Saudi Arabia purchased a $500 million stake in Live Nation’s common stock, which amounts to over 12,337,000 shares and 5.7 percent ownership. As one would expect, the Beverly Hills-based company’s per-share stock value has suffered amid the pandemic.

However, investors appear to have approved of the mass furloughs; at the time of this writing, Live Nation’s stock, bought and sold under the symbol LYV, was trading for more than $45 per share, an approximately $5 per share (almost 13 percent) uptick on the day.

Three days back, we reported that Live Nation intends to issue $1.2 billion in debt (up from a previously planned $800 million), via senior secured notes. It’s a move to raise emergency capital ahead of a summer season that may lack some or all concerts and crowd-based live events. The notes’ investment window is expected to close this Wednesday, May 20th.

Also Read:  Metropolitan Opera Is Furloughing Dozens as COVID-Related Losses Mount

Live Nation isn’t the only live-event or entertainment-industry company that’s been forced to reduce expenses as of late. Endeavor, the Metropolitan Opera, Billboard parent Valence Media, StubHub, and Paradigm have also reigned in their payrolls.

Since March, approximately 36.5 million Americans have filed for unemployment assistance.

Live Nation Issues More Debt to Survive the Summer — $1.2 Billion In Senior Secured Notes

Earlier this week, Digital Music News was first to report that Live Nation intended to issue $800 million in senior secured notes for “general corporate purposes.” Now, the leading concert promoter has upped the debt offering to $1.2 billion as part of an effort to continue operations through the summer.

As with the previously planned $800 million in debt, this $1.2 billion package will be made available through a private placement and will mature in 2027. Certified investors who back the senior secured notes will enjoy a 6.5 percent yearly interest rate, and the investment window is expected to close next Wednesday, May 20th.

If obtained, the additional $1.2 billion debt tranche will hike Live Nation’s total creditor obligations to approximately $4.85 billion.

At the time of this writing, Live Nation’s stock, bought and sold under the symbol LYV, was trading for just over $39 per share, having started the week at slightly more than $41 per share. Shares dipped into the $36 range following the senior secured notes announcement and a credit downgrade from Standard and Poor’s Global.

Predictably, with essentially all traditional concerts and crowd-based functions postponed because of the coronavirus (COVID-19) crisis, Live Nation disclosed a significant revenue drop in its Q1 2020 earnings report. However, the fiscal analysis wasn’t entirely negative, as Live Nation indicated that an impressive 90 percent of ticketholders are opting to keep their passes even when refunds are available.

Meanwhile, artists and venue professionals are experimenting with innovative methods for safely delivering live music to fans. For example, America’s first drive-in concert is set to initiate next month, after successful pilots in Europe. Undoubtedly, other such performances will follow – particularly if this pioneering effort proves successful, attendance-wise.

Also Read:  Is Coachella Getting Cancelled?

Similarly, artist Travis McCready was set to play the United States’ first socially distant concert in Arkansas today, until Governor Asa Hutchinson shut down the attempt.

Separately, the Event Safety Alliance (ESA) laid the groundwork for concerts’ return by penning a comprehensive guide to simultaneously reopening venues and protecting fans.

Live Nation Issues $800 Million Debt Offering for ‘General Corporate Purposes’

Live Nation has issued an $800 million debt offering for “general corporate purposes.”

Today’s leading concert promoter announced its debt sale in a statement that was shared with Digital Music News. The $800 million worth of “senior secured notes” – or those that must conceivably be repaid before other debts in the event that the issuer declares bankruptcy – will mature in 2027, per the top-level description.

Live Nation “intends to use the net proceeds from the filing for general corporate purposes,” which weren’t specified.

At its close, the document emphasizes that the debt “will be offered through a private placement and will not be registered under the Securities Act of 1933.” Accordingly, only “qualified institutional buyers” — not U.S. individuals — are eligible to purchase the notes under the Securities Act’s Rule 144A.

Live Nation’s stock, which is bought and sold as LYV, is down 70 cents per share (1.83 percent) on the day. Currently, a single share of the Beverly Hills-based company will set buyers back $37.45.

The stock-price dip may also have resulted, in part, from Live Nation’s S&P Global credit rating downgrade. Today, Standard and Poor’s Global reduced the company’s credit rating from “BB-” (which was assigned in March) to “B+.”

S&P Global’s website notes the following of companies with “B” credit ratings: “Adverse business, financial, or economic conditions will likely impair the obligor’s capacity or willingness to meet its financial commitments on the obligation.”

Late last month, Digital Music News was first to report that the Kingdom of Saudi Arabia had invested $500 million in Live Nation’s common stock, thereby assuming a 5.7 percent ownership of the company.

Live Nation’s per-share price dipped as low as $21.70 during the domestic onset of the novel coronavirus pandemic, but has bounced back considerably in the interim. Exactly one month ago, we reported that Live Nation had secured a separate, $120 million emergency loan.

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Is Saudi Arabia About to Acquire Warner Music Group?

A shot of Jeddah, Saudi Arabia. (photo: Tahir mq)

Late last month, Digital Music News was first to report that the Kingdom of Saudi Arabia had bought a $500 million stake in Live Nation – covering some 5.7 percent of its common stock. Now, as the Middle Eastern nation eyes additional entertainment industry investments, rumors are circulating that it’s made an offer to purchase Warner Music Group (WMG).

Only time will tell whether the speculation proves true – various media outlets have cited individuals with knowledge of the matter while failing to provide much in the way of concrete details – but there’s no doubting Saudi Arabia’s intention to bolster its entertainment sector and tourism industry.

Saudi Arabia Crown Prince Mohammed bin Salman has curtailed some previous limitations on rights in his country. He’s also welcomed female (and male) artists to hold concerts and recently secured a far-reaching contract with the WWE. These steps represent just a portion of the Vision 2030 project, which aims to diversify and expand Saudi Arabia’s economy during the next decade.

Of course, Saudi Arabia’s broader human rights record is routinely called into question — and for good reason. But few batted an eyelash when Saudi Arabia plunked down $500 million for a piece of Live Nation. Perhaps COVID-19 desperation offers the perfect moment for some low-cost, scrutiny-free acquisitions.

Earlier today, Nasdaq approved Warner Music’s stock market listing request; the company’s shares will be bought and sold under the “WMG” symbol. Evidently, the Big Three record label’s parent company, Access Industries, as well as CEO Stephen Cooper, are unconcerned with the effect of the market downturn on WMG’s stock price.

Also Read:  Endeavor Cuts, Furloughs, or Slashes Pay for One-Third Of All EmployeesAt the time of this writing, Warner Music Group officials hadn’t commented publicly on the Saudi Arabia buyout rumor.

Warner Music posted losses of $74 million during its most recent financial quarter; the income shortcoming is attributable, at least in part, to the fiscal strain of the novel coronavirus pandemic. However, the company also experienced a substantial uptick in music streaming revenue – a point that seems to bode well for its ability to overcome contemporary economic difficulties and operational hurdles.

If true, this story is just getting started.  Stay tuned for updates on Saudi Arabia’s rumored buyout of Warner Music Group.

90% of Ticketholders Aren’t Requesting Refunds to Postponed Shows, Live Nation Says

In its Q1 2020 earnings report, Live Nation indicated that over 90 percent of ticketholders have decided to keep their tickets for postponed shows as opposed to requesting refunds via the Ticket Relief Plan.

The leading concert-promotion company revealed an array of other interesting points in the quarterly filing, which was shared with Digital Music News this afternoon. In terms of the 90 percent figure, the company states that “over 90% of fans are holding on to their tickets for rescheduled shows where refunds are available.”

Furthermore, Live Nation conducted a “global survey of ten thousand live music goers,” and more than 90 percent of participants stated that they will return to concerts “once possible to do so” – presumably when coronavirus (COVID-19) health concerns can be safely and efficiently mitigated.

In this vein, Live Nation surveyed 8,000 North American fans about their requirements for returning to concerts, and 85 percent signaled a desire for bolstered sanitization efforts and access to hand sanitizer. The financial report also pinpointed smaller crowds and touchless concession stations as means of further reducing the COVID-19 risk presented to attendees.

Finally, Live Nation struck an optimistic tone for 2021, because “80% of shows have been rescheduled rather than canceled,” but nevertheless, the vast majority of ticketholders are opting to hold out for the rescheduled dates, once again.

On the income side of things, Live Nation reported predictably lower figures than during 2019’s opening quarter; as first reported by Digital Music News, the company indefinitely postponed all its upcoming shows in March. Q1 2020 concert revenue dropped by a quarter from Q1 2019, to $993 million, whereas ticketing revenue fell by 16 percent, to $284.3 million.

Year-over-year sponsorship and advertising revenue, for its part, increased by 20 percent, to $90.3 million.

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Live Nation’s stock, traded under the symbol LVN, is up over two percent on the day, to $39.37 per share. Late last month, the Kingdom of Saudi Arabia purchased a $500 million stake in Live Nation.

Ticketmaster Furloughs Hundreds of Staffers After Issuing Millions In Refunds

Ticketmaster has furloughed hundreds of staffers as part of a broader plan to cut $500 million in expenses amid the coronavirus (COVID-19) pandemic.

The impacted employees represent approximately one-quarter of Ticketmaster’s team, according to preliminary reports. At the time of this writing, neither Ticketmaster nor parent Live Nation had publicly addressed the massive expense-reduction measure, but additional money-saving initiatives are expected to be announced in the near future.

Two weeks back, Digital Music News was first to report on the imminent cuts, which Live Nation highlighted in an SEC filing. Importantly, the layoffs closely follow Ticketmaster’s decision to issue tens of millions worth of refunds follow intense public pressure, though it’s not clear if the refunds are directly linked to the furlough decision. Live Nation had been resisting the move in a desperate effort to conserve costs.

“For context, Live Nation has had more than 8,000 concerts and festivals impacted since March, with 6,500 events postponed and 1,500 events cancelled,” Live Nation CEO Michael Rapino recently emailed staff. “And to date, we’ve already refunded $80 million to fans.”

Ticketmaster’s furloughed employees will cease receiving paychecks at the start of next month, though their health insurance benefits will remain in place. It bears mentioning that the ticketing platform intends to bring the affected workers back onboard once normal operations resume. But with states and countries only beginning to take preliminary steps to reopen their economies, it’s unclear when that will be.

Moreover, some health professionals anticipate that live events will require an especially long time to return, relative to other business spheres, because of their inherent person-to-person contact and close-quarters interactions.

Last month, Live Nation placed each of its upcoming shows – including Bonnaroo – on ice in response to the COVID-19 crisis. (Now, Bonnaroo is tentatively scheduled to take place on September 24th.)

Also Read:  New Jersey Congressman Says Pearl Jam “Has Been Led Astray” by “Corrupt” Live Nation/TicketmasterPredictably, Live Nation has been forced to weather severe fiscal and operational hurdles, which were amplified by widespread customer dissatisfaction with the refund policies of Ticketmaster. Live Nation and Ticketmaster have addressed these concerns by debuting the Ticket Relief Plan.

Two days back, the Kingdom of Saudi Arabia purchased a $500 million stake in Live Nation, via common stock. While it seems likely that the government will hold onto the investment for the foreseeable future, as part of a long-term plan to bolster its entertainment industry and tourism sector, the shares have already become over $50 million more valuable.

That’s because Live Nation’s stock hiked nearly seven percent today, to $46.53 per share. This price is far from the company’s 52-week high of $76.60, but it’s more than twice the low of $21.70 that the shares touched during the domestic onset of the pandemic, and roughly 10 percent more than the $38 or so per share that Saudi Arabia paid.

Saudi Arabia Buys a $500 Million Stake In Live Nation

Saudi Arabia’s capital city, Riyadh (photo: lawepw)

The Kingdom of Saudi Arabia has purchased a nearly $500 million stake in leading concert promoter Live Nation.

The transaction’s details were revealed in a Securities and Exchange Commission (SEC) filing, which was shared with Digital Music News. For a total cost of approximately $500 million, Saudi Arabia bought 5.7 percent of Live Nation’s common stock – some 12,337,569 million shares – via its Public Investment Fund.

At the time of this writing, Live Nation’s stock, traded under the symbol LYV, was up more than 10 percent on the day, to over $42 per share. Significantly, the concert promoter’s per-share value had dipped as low as $21.70 in the immediate wake of the coronavirus (COVID-19) crisis, down from a 52-week high of $76.60.

Stay-at-home orders, social-distancing guidelines, and nonessential business closures (besides concern for attendees’ health, of course) prompted Live Nation to indefinitely postpone each of its previously planned shows. Additionally, widespread fan disapproval over Ticketmaster’s COVID-19 refund policies (which have since been changed) also had an impact on Live Nation’s stock price.

Saudi Crown Prince Mohammed bin Salman has taken a number of steps, relating both to social-policy changes and tech-based improvements, to diversify and open his country’s economy. Now that his nation is (literally) invested in today’s foremost concert-promotion company, it’ll be interesting to see which artists move to perform in the rapidly evolving Middle Eastern state, which is home to nearly 34 million individuals.

During the last two or so years, Saudi Arabia has welcomed an unprecedented level of foreign entertainment. New movie theaters have been built in the country, and Saudi Arabia also enjoyed its first live concert (featuring Toby Keith) in more than two and a half decades. The WWE also signed a decade-long deal to host domestic shows, and the construction of a Six Flags park commenced.

Earlier today, Digital Music News was first to report that Live Nation’s Ticketmaster had quickly updated its refund policy to prevent fans’ money from becoming tied up while event organizers select new dates. It was the second change in a matter of days.

And last week, irate ticketholders filed a class-action lawsuit against Live Nation, Ticketmaster, and the MLB; the legal complaint stemmed from refusals to offer refunds to cancelled games.

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Ticketmaster Updates Its Refund Policy for Shows That Remain ‘In Limbo’

Following this piece’s publication, a Ticketmaster higher-up reached out to Digital Music News with a suggested clarification, which bears mentioning. The Ticket Relief Plan is technically Live Nation’s program – not Ticketmaster’s – even though the latter is a wholly owned subsidiary of Live Nation.

Moreover, while Ticketmaster is the exclusive ticketing distributor for Live Nation events, the platform also handles ticketing for an array of other promoters and organizations, some of which aren’t yet offering refunds to ticketholders whose events have been postponed because of the coronavirus crisis.   

Ticketmaster has quickly updated its Ticket Relief Plan, which now allows ticketholders to request refunds for shows that event organizers have postponed for 60 days without officially announcing new dates.

Live Nation CEO Michael Rapino announced the change on Twitter: “Fans, we hear you. We don’t want you to be waiting in limbo while shows are being rescheduled. Thanks to your feedback, @LiveNation has revised our refund policy. If new dates aren’t set in 60 days, you’ll be able to get a refund at that time.”

The alteration comes after some fans voiced their dissatisfaction with the refund policy and, specifically, its failing to account for shows that had been postponed, but not rescheduled.

Under the Ticket Relief Plan, ticketholders automatically receive refunds for cancelled shows, while rescheduled shows afford ticketholders the opportunity to request a full refund or, for select events, a voucher for 150 percent of the original purchase price. However, the refund status of shows that have been postponed, but not rescheduled, was previously something of a gray area.

On Twitter, Ticketmaster parent company Live Nation wrote: “We also saw your feedback on postponed shows, and you’re right, you shouldn’t have to wait for a refund if it takes extra time to figure out new dates. Thanks to you, we have updated our refund policy. If a new date isn’t rescheduled within 60 days of your show being postponed, you’ll be able to request a refund at that time.”

Also Read:  Madonna Abruptly Cancels Paris Show After Falling OnstageSome social media users’ responses to the Ticket Relief Plan update have been positive. “Thank you, this is the right move! Glad your company is listening,” one customer tweeted.

At the time of this writing, the Ticket Relief Plan update had been announced on Live Nation’s Twitter account, as well as that of CEO Michael Rapino, but not Ticketmaster’s profile. To be sure, both the Ticketmaster Twitter handle and the Ticketmaster Fan Support Twitter handle have remained conspicuously silent as of late – the former for three days, and the latter for more than one week.

The Ticket Relief Plan debuted following widespread fan dissatisfaction with Ticketmaster’s refund policy changes amid the coronavirus (COVID-19) crisis.

Surprise! Ticketmaster Isn’t Technically Offering Refunds on All Postponed Shows

On Monday, in response to ample fan criticism over its COVID-19 refund policies, Ticketmaster announced that it would start offering refunds to ticketholders whose events have been postponed, as opposed to solely reimbursing fans whose shows have been canceled outright. Now, it appears that the company’s Ticket Relief Plan isn’t technically offering refunds for all postponed shows.

Previously, Digital Music News was first to report that live events initially scheduled to take place on or after August 1st wouldn’t be part of the Ticketmaster Ticket Relief Plan. Ticketmater owner Live Nation intends to reevaluate the coronavirus crisis, as well as the sentiment and plans of event organizers, before deciding whether to issue refunds for post-July events that have been put on ice.

However, Ticketmaster has introduced a few new stipulations to its Ticket Relief Plan, and posted the fine print on a recently launched webpage.

First, if an artist (or an event organizer) is rescheduling a concert, but has yet to officially select a new date, ticketholders will be temporarily unable to receive refunds. “If you have tickets to a show that is postponed, you will have to wait until the rescheduled date is announced to select your refund option,” the Ticket Relief Plan website reads.

Significantly, when an organizer or artist has postponed an event for 60 days without selecting a new date, ticketholders will automatically become eligible to receive refunds. Then, ticketholders have just 30 days to ask for refunds after their respective events’ rescheduled dates have officially been announced, according to Ticketmaster’s terms.

Also Read:  Live Nation CEO Buys $1 Million Of His Own Stock, Loses $250,000 In 4 DaysThis point may result in ticketholders’ money remaining tied up for quite a while longer — in many cases, months more.

Additionally, the Ticket Relief Plan is less than clear in terms of the refund status of events that were postponed and rescheduled well before April 1st. Those postponements are already older than 30 days.  The Ticket Relief Plan states: “Tickets will automatically be valid for the new date, unless you opt for a refund within 30 days of the new show date being announced.”  Until Ticketmaster issues more guidance, it’s unclear what will come of tickets to events that were rescheduled or postponed more than 30 days back.

Ticketmaster ticketholders will automatically receive refunds for functions that are canceled outright; some artists have made a point of canceling their shows so that fans can more easily get their money back.

Finally, those who’ve bought tickets to (rescheduled) shows at Ticketmaster venues will have the chance to secure vouchers for 150 percent of the initial purchase price; these funds can then be put towards future Ticketmaster events.

Ticketmaster’s 30-day-long refund window will open on May 1st, at which time eligible ticketholders will be notified of their options via email.

Live Nation, Ticketmaster, MLB, StubHub Sued for Refusing to Issue Refunds

An aerial shot of Yankee Stadium. (photo: Groupe Canam)

After facing intense heat from both music fans and members of Congress, Ticketmaster reluctantly agreed to allow refunds on postponed concerts — with a few strings attached.  But that’s music: now, two frustrated Major League Baseball ticketholders have filed a class-action lawsuit against Live Nation, Ticketmaster, StubHub, and the MLB.

The plaintiffs, New York residents Matthew Ajzenman and Susan Terry-Bazer, submitted their lawsuit to the U.S. District Court for the Central District of California; a copy of the filing was shared with Digital Music News earlier today.

In essence, Ajzenman and Terry-Bazer are suing because they’ve yet to receive refunds for the MLB tickets they purchased. Ajzenman, for his part, bought some $1,730 worth of tickets directly from the New York Mets’ front office, while Terry-Bazer bought $926 worth of Red Sox-Yankees tickets via Ticketmaster.

Technically speaking, the games Ajzenman and Terry-Bazer have tickets to are “postponed,” which is why they — and many other fans — are still waiting on refunds. However, the legal document emphasizes that “should any [Major League Baseball] games be played this year, it is almost certain that they will be played without spectators.” As such, the plaintiffs should receive their money back sooner rather than later, the complaint indicates.

The New York Mets’ front office hasn’t reached out to Ajzenman with a reimbursement or exchange plan, according to the filing, while Terry-Bazer requested and was denied a refund from Ticketmaster in March.

The MLB’s 30 teams are also named as defendants in the case, for the role they allegedly played in delaying refunds. The plaintiffs allege that Ticketmaster (and Live Nation) “continues to act on its own behalf and jointly with Defendants as to the unlawful conduct alleged herein.” Lastly, StubHub’s status as the “Official Fan-to-Fan Ticket Marketplace of MLB.com” means that it too is responsible for ticketing refund delays, per the court filing.

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At the time of this writing, neither the MLB nor the other defendants had addressed the lawsuit publicly. The MLB is reportedly exploring the possibility of initiating the 2020 season in closed-door stadiums in Arizona, Florida, and Texas.

Last week, following much controversy and fan criticism, Ticketmaster and AEG Presents announced that they would start issuing refunds for postponed shows. However, said refunds won’t begin rolling out until May 1st, and the process will be governed by several stipulations, the most notable being a 30-day window to apply for reimbursements.

Jay-Z Donates Millions to COVID-19 Relief, Then Furloughs His Own Employees

Jay-Z and members of Roc Nation in a meeting with NFL Commissioner Roger Goodell in 2019

Jay-Z’s Roc Nation is furloughing employees and issuing pay cuts across most of the company.  The move comes after Jay-Z himself donated several million dollars to COVID-19 relief funds.

Perhaps charity doesn’t always begin at home.  According to Variety, furloughs at Jay-Z’s lifestyle and marketing enterprise Roc Nation will encompass a broad percentage of employees, and pay cuts are in the 10% to 20% range. They extend across all Roc Nation departments and include Tidal, the music streaming service.  Jay-Z first started Roc Nation in 2008, and most recently ushered the company into a controversial deal with the NFL.

In terms of who’s getting furloughed, sources say the marketing and events departments are the most affected. Roc Nation’s music touring and sports departments are at a standstill during the pandemic; lower-level employees appear to be the most heavily impacted by the changes.  It’s unclear at this stage if Roc Nation is permanently laying off staffers, or how heavily Tidal is being impacted.

Roc Nation has offices in New York, Los Angeles, Nashville, and London.

The company is a partnership with Live Nation, which currently owns more than 50% of the company. Maybe that’s part of the problem: several days ago, Live Nation itself announced its own furloughs and pay cuts to weather the pandemic. Live Nation CEO Michael Rapino will forego his $3 million-plus salary this year, while other execs are taking huge pay cuts.

The furloughs stand in stark contrast to Jay-Z’s high-profile philanthropy. In the past few weeks, the rapper’s Shawn Carter Foundation has donated millions to several coronavirus relief efforts. Those donations have made big headlines along with Rihanna’s Clara Lionel Foundation, with multiple millions pledged to groups impacted by the virus.

Both singers’ charities donated $1 million to support undocumented workers and the children of frontline healthcare workers. Additionally, the two foundations joined with Twitter CEO Jack Dorsey to raise $6.2 million in coronavirus relief grants. Against that backdrop, furloughing employees while supporting coronavirus relief efforts isn’t the best look.

With sports potentially returning with no audiences, at least one wing of live entertainment may return soon. But health officials across the globe don’t seem confident that music events and festivals can return in 2020.

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California Governor Gavin Newsom is weighing banning summer festivals. Germany, France, and Belgium have already canceled live festivals through the summer.

Indeed, 2020 is shaping up to be a nightmare for the live event space.  Events like Coachella and Bonnaroo, which postponed from their earlier dates, may be facing cancellation altogether.  Meanwhile, it’s unclear if any shows will be resuming in 2020.  Perhaps the depressing reality is now settling in – the economy isn’t going to spring back from a global pandemic overnight. Instead, it could take many years to return to form — if we’re lucky.

Is Liberty Media Too Powerful? Artist, Consumer Groups Oppose iHeartMedia Acquisition

The Liberty Media logo.

Several artist and consumer-rights groups have written to the Department of Justice (DOJ) to voice their disapproval and criticism of the potential Liberty Media-iHeartMedia acquisition deal.

The concerned organizations—including the Artist Rights Alliance, Open Markets, Public Citizen, the Institute for Local Self-Reliance, the American Economic Liberties Project, and the Center for Digital Democracy—relayed their misgivings in an open letter addressed to Assistant Attorney General Makan Delrahim.

The message cut right to the chase—“we urge you to reject this massively overreaching effort to monopolize music radio”—before disclosing the specific reasons why its authors believe Liberty Media’s acquiring iHeartMedia will signal trouble for the music industry.

First, the letter took issue with Liberty’s controlling stake in SiriusXM (71 percent), as well as the implications of this stake if iHeartMedia is brought into the fold. “Liberty dominates non-streaming, non-retail music distribution,” the text stated, largely due to SiriusXM’s ownership of Pandora.

After that, the organizations set their sights on Liberty’s 33 percent ownership of Live Nation (through common stock), chiefly by reiterating the antitrust provisions that accompanied the Live Nation-Ticketmaster merger.

Shifting gears, the firmly worded critique emphasized iHeartMedia’s immense popularity, including its being “the single biggest AM/FM radio broadcaster” and reaching approximately 275 million monthly listeners.

The artist and consumer groups then expanded the argument, noting their opinion that the Liberty Media-iHeartMedia deal “will almost certainly mean fewer options, less diversity, and higher prices” for listeners and additional career difficulties for musicians. That includes a higher barrier to receiving radio plays and negotiating fair royalty rates.

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Liberty Media is a Colorado-based conglomerate that owns the Atlanta Braves, the aforementioned Live Nation and SiriusXM stakes, and pieces of multiple other companies, including a five percent share in Indian music-streaming service JioSaavn. Last month, Digital Music News was first to report that Liberty had repaid a $130 million margin loan to Live Nation.

Said loan came at a critical time for Live Nation, which saw its per-share stock price dip as low as $21.70 in the immediate wake of the COVID-19 pandemic. After surging and losing value several times in the interim, Live Nation stock, traded under the symbol LVN, is currently hovering around $36 per share.

At the time of this writing, neither Liberty Media nor iHeartMedia had addressed the open letter publicly.

Ticketmaster Slammed by U.S. Congresswoman: ‘Worst Customer Service In Any Industry’

U.S. Congressional Representative Katie Porter (D-Ca.)

Ticketmaster’s decision to quietly modify its stated policy on ticket refunds is rubbing a lot of people the wrong way — including U.S. Congresswoman Katie Porter.

Ticketmaster has now been put on blast by U.S. Congresswoman Katie Porter, thanks to an extremely unpopular decision to withhold refunds from ticket holders. The decision to refuse refunds while thousands of shows were rescheduled or postponed indefinitely has generated an outcry from fans, some of whom are left holding the bag on thousands of dollars worth of useless tickets.

“I applaud Ticketmaster for continuing to shine in what is apparently a competition to provide the worst customer service in any industry,” the California Democrat tweeted yesterday evening. “Exorbitant ticket fees for negligible benefits — now taking advantage of a crisis to line their pockets? Next level. 👏🏼👏🏼👏🏼”

The tweet drew more than 1,000 responses and nearly 50,000 likes in less than 24 hours, with irate fans urging the Representative to punish the ticketing giant. “Sounds like a case for the House Committee on Financial Services, Subcommittee on Consumer Protection and Financial Services,” one person responded. “Know anyone on that?”

Others quickly lumped Ticketmaster into a bucket with major airlines, who apparently also have a problem offering refunds on rescheduled flights. “It really takes work during this pandemic to make the airlines look good!” another noted. “But Ticketmaster has done it.”

Earlier today, Ticketmaster issued a terse statement on the matter, clarifying that its policy had remained unchanged.

But screenshots prove otherwise: as COVID-19 started shutting down shows nationwide, the ticketing giant covertly eliminated refund offers for anything postponed or rescheduled.  In other words, if it’s not flat-out cancelled, ticket-buyers are stuck with the purchase.

Of course, none of this is good for Ticketmaster or Live Nation executives, a company now fighting to get through 2020 alive.  Just yesterday, Live Nation secured a $120 million emergency loan to weather the storm, with every last show on the schedule either canceled or rescheduled.  Live Nation CEO Michael Rapino, who invested $1 million in depressed Live Nation stock to boost investor confidence, has temporarily given up his multi-million dollar salary.

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The meltdown closely follows a U.S. Department of Justice investigation of Live Nation, which focused on the company’s wholly-owned Ticketmaster division.  Live Nation was accused of violating various consent decrees that accompanied the DOJ’s approval of Live Nation’s acquisition of Ticketmaster, which competitors alleged had been violated.  The investigation was wrapped-up in January, however, and critics slammed the DOJ for going easy on Live Nation and closing the case with few penalties.

Ticketmaster Buys Company Started by Ex-Ticketmaster CEO Nathan Hubbard

Rival founder Nathan Hubbard

Ticketmaster has purchased Rival, a ticketing startup founded and led by Nathan Hubbard, who served as Ticketmaster’s CEO between 2007 and 2013.

News of the acquisition was first reported by Billboard; the acquisition apparently followed approval from the Department of Justice (DOJ). At the time of this writing, neither Rival nor Ticketmaster had commented publicly on the deal.

Hubbard founded Rival in 2018, after a three-year-long executive stint with Twitter, in the hopes that the brand would ultimately compete with Ticketmaster. However, Rival had difficulty getting off the ground, despite receiving substantial investments and securing a valuable contract with Kroenke Sports & Entertainment. Kroenke owns the Los Angeles Rams, the Denver Nuggets, multiple other sports teams, and an array of valuable sports arenas.

In July 2019, Ticketmaster began providing transitional support to Rival and Kroenke as the latter’s agreement with AXS drew to a close.

The Ticketmaster-Rival acquisition includes the Kroenke Sports account and Rival’s tech and staff, excepting Nathan Hubbard. Expectedly, the involved parties haven’t yet released information relating to the transaction’s value.

It’s certainly possible that Ticketmaster has delayed announcing the deal because of controversy surrounding its refund-policy reversal. As first reported by Digital Music News, the Live Nation company revised its refund terms to include only “canceled” events, thereby leaving many ticketholders whose shows have been “postponed” between a rock and a hard place.

The policy change-up continues to draw the ire of those on social media; currently, Ticketmaster is trending on Twitter once again, and virtually all the associated posts are negative.

Earlier today, Live Nation announced that it had secured a $120 million loan in an effort to weather the financial impact of the COVID-19 crisis. CEO Michael Rapino voluntarily gave up his salary, while executives temporarily halved their earnings. Also, Live Nation signaled that it will explore cost-cutting measures, including furloughs, renegotiated rental agreements, and lessened contractor work.

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Having sold Rival, Nathan Hubbard will explore new, as-yet-unspecified career opportunities, according to the report. He currently serves on Gibson’s board and is involved with Spotify’s The Ringer.

Live Nation Secures Emergency $120 Million Loan — CEO Michael Rapino Foregoes Entire Salary

photo: Paweł Czerwiński

Live Nation has taken a number of steps to enhance its liquidity and ability to overcome the financial difficulties of the COVID-19 coronavirus pandemic, including securing an emergency $120 million loan, cutting costs, and, on the part of CEO Michael Rapino, foregoing a base salary altogether.

Live Nation described each of its COVID-19 coping strategies in a recent Securities and Exchange Commission (SEC) filing.  As part of an amended credit agreement with an existing lender, Live Nation has gained $120 million in additional debt-spending capacity; if so obliged, Live Nation can boost the credit line to $150 million, provided that the process is initiated prior to May 9th.

Factoring for this new sum, the leading concert promotion giant has $940 million in available credit and roughly $1.84 billion in total liquid capital, after accounting for $914 million in free cash. This substantial liquidity may enable Live Nation to more easily weather COVID-19-related fiscal troubles and operational concerns, compared to other concert organizers.

It’s also worth noting that the company has $2 billion more on the books as deferred revenue (expected income for services or products that will be delivered in the future), but traditionally, these funds are considered assets only after the corresponding work is performed.

To help his company through the coronavirus pandemic, CEO Michael Rapino has temporarily ceased drawing his $3 million annual base salary (though historically, stock has comprised the lion’s share of CEO Rapino’s multimillion-dollar compensation).

Plus, other Live Nation execs have voluntarily halved their yearly earnings.

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Finally, Live Nation indicated that it will explore cost-cutting measures, including rent renegotiations, hiring freezes, furloughs, and more. The company hasn’t yet made cuts to any of its approximately 9,000 employees in response to the coronavirus crisis.

Live Nation’s stock, traded under the symbol LYV, experienced a modest upsurge following the SEC filing. At the time of this writing, the company’s per-share price was hovering around $39.50, a roughly three percent increase from the previous close of $38.27.

Live Nation has postponed each of its upcoming concerts because of the coronavirus pandemic.  Last week, we reported that the live industry sphere could experience losses of nearly $9 billion if shows are unable to resume in 2020.  It all depends upon when event promoters are able to resume normal operations, a question that remains unanswered.

Ticketmaster Quietly Changes Its Refund Policy (TL;DR: You’re Screwed)

Ticketmaster is facing ample fan scrutiny and criticism after quietly changing its refund policy to exclusively cover canceled events, instead of those that have been postponed or rescheduled. 

It’s hardly a secret that the coronavirus (COVID-19) crisis has brought the live-event industry to a screeching halt. Responding both to government mandates and health concerns, promoters have canceled (or delayed) sporting events, concerts, and essentially all other audience-based entertainment functions.

And predictably, a substantial number of would-be attendees are looking to receive refunds for the tickets they bought prior to the pandemic. In responding to this unprecedented cluster of repayment requests, Ticketmaster has quietly changed its refund policy to cover only canceled events — not the many functions that promoters have indefinitely “postponed” or rescheduled to a date/time that some ticketholders cannot make.

Previously, Ticketmaster’s refund policy stated: “Refunds are available if your event is postponed, rescheduled, or canceled.”

Now, however, the Live Nation company’s refund policy simply says: “Refunds are available if your event is canceled.”

Plus, Ticketmaster’s “Coronavirus Impact” webpage quite carefully describes the difference between cancellations and postponements, in addition to the corresponding policies of each.

On social media, fans’ frustration with the refund reversal appears to be boiling over.

One agitated Twitter user wrote: “@Ticketmaster won’t help me out with my refund…Time to call a lawyer and @bbb_us [the Better Business Bureau].”

Another disgruntled individual asked: “Why is it that when I buy concert tickets you take the money out of my account in a matter of SECONDS, but when shows are being canceled it can take you months to return my money??”

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Lastly, a different fan yet tweeted: “All the concerts I bought tickets for have been ‘postponed’…How about you just refund us for our purchase? Nobody knows their future right now.”

Earlier this week, Digital Music News was the first to report that an angry customer had filed a class-action lawsuit against ticket-resale platform StubHub, over the brand’s opting to provide vouchers (instead of cash refunds) for tickets to events canceled because of the coronavirus (COVID-19) pandemic.

In a statement, StubHub noted, “It is currently impossible for us to offer immediate cash refunds to all buyers.” It’s likely that Ticketmaster is experiencing similar fiscal difficulties, albeit on a much larger scale. (StubHub moves approximately $5 billion in tickets annually, whereas Ticketmaster’s yearly sales volume has exceeded $30 billion in the past.)

Stay tuned for additional updates on Ticketmaster’s refund policy.

Jimmy Iovine Powers Funding Round for FaZe Clan Gaming Platform

Photo Credit: FaZe

FaZe Clan is announcing an exclusive partnership with an e-commerce and merch company, Ntwrk.

Ntwrk offers limited edition product drops from sports stars like LeBron James and singers like Billie Eilish. Ntwrk led the funding round for FaZe Clan, securing the global direct-to-consumer product rights. Jimmy Iovine is a crucial investor in the deal.

“FaZe Clan is a very powerful pipeline into gaming culture, and their cultural impact reminds me of the early days of ’90s hip-hop,” Iovine told Variety in a statement. “It’s a really smart way into e-commerce — through culture, and it feels like a great combination with Ntwrk.”

FaZe Clan got its start in 2010 and has since accumulated over 215 million fans across the globe. Its social platforms and original content create over 500 million views per month.

FaZe Clan CEO Lee Trink says Jimmy Iovine’s investment will help skyrocket the brand to new heights beyond just gaming.

“His belief in FaZe Clan as the next cultural wave, not just in gaming but in entertainment overall, is an incredible representation of the transformative shift happening right now,” he said.

Beyond exclusive product drops, Ntwrk is a video commerce platform that also serves up live videos and celebrity talent. The company was founded by Aaron Levant, Jimmy Iovine, and Gaston Dominguez-Letelier in 2018. Investors in the platform include Live Nation, Foot Locker, and LeBron James.

Ntwrk aims its products at Gen Z and millennials, who value exclusive content and experiences with their favorite stars and creators. Ntwrk will offer exclusive content and merch to help FaZe extend its branding and cultural influence.

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The best comparison to draw here is to the Supreme brand, which is well-known among skateboarders. FaZe hopes to become a brand recognizable to all gamers by providing “high-intensity drops that fans line up around the block for.”