Welcome, Welcome, Welcome back to the Bob left Stetts Podcast. My guest today is CEO and President of Blave Nation, one and only, Michael Rapino. Michael, good to have you on the podcast. You just announced this new effort, Vibe. What exactly is it?
Biby is a destination event company. As you know you've probably read over the years, there's more and more of these on location companies where they're kind of taking the current events doing a special package VIP. Maybe it's a destination to see Lionel Richie just in Cabbo for a thousand people. So anyway, you can kind of create above and beyond special experiences around an artist event. So it could be a current event, meaning we could do it at La La Lose and do a jet in a
backstage and a VIP package. But most of it is trying to create destination events for artists and fans to have kind of an exceptional VIP experience.
So what is already booked for Vibe?
Well, we got a few going on. We've got a hotel in can Kun, Mexico, Moon Palace. Luke Bryan the Grateful Dead have done it there where it's a kind of a three thousand limited package for three thousand people, take over the hotel special two days live performance just for those fans merchandise parties. We've got a couple ship ideas that we've been working on, Holy Ship, where you can go on to an Insomniac DC ship for three days.
So you've seen some of these before where the artists take over the ship and kind of have that destination idea.
So we've got three or four ship projects right now with DC Insomnia, got some Cabo Mexican, Luke Bryan, Grateful Dead Adventures, and now we've got Lallapalooza we launched today, and some of Vegas ideas that I think they'll launch this week around special Formula one concert VIP experiences, So just taking the experience VIP above and beyond what you currently can buy at a typical concert and delivering a higher end experience to the fan.
You know, just staying on this. It appears most people don't know, but the most expensive tickets go first on most of these conferences. Is there any limit to what people will pay for a VIP experience?
You know, I think it's all new territory. You were right, the house always sells front to back, so you've never heard me say, you know, I can't sell the front, but the back sold out. So it's always front back. And what you see a lot of artists doing today, even though they get a little bit of press from it, is charge a bit more for the front. So the real theory is you can actually charge a bit less on the back and make sure that last row does
sell out. But right now, Bob, we've seen coming out of COVID price resistance is not We haven't seen it anywhere yet. As crazy as some of the secondary stuff you see online where there are two three hundred times what a face value is. Those things are selling out instantly, So we have not seen yet. I don't think the top end of what does a concert VIP platinum experience look like if you want to go see that show.
I think this is new. You know, as I say to my team, we've kind of been operating like American airlines for a long time. One price not that much of a variance from top to bottom. Probably a warm beer and a cold hot dog and good luck. But the idea that a concert is a memorable experience and and fans will will pay for an upgraded experience all fans, not just this isn't just for the rich the one or two times a year you'll go to that show.
Our fans want a better experience, they want a higher end experience, and they'll pay for it if we can deliver it.
Okay. Needless to say, ticket Master is a hot topic in the news and Washington DC. You are literally at the epicenter, So let's kind of drill down explain for the average person how ticket fees are established.
Yeah, I'd say it's definitely been the year to start talking about this because it's been As you you point out on your newsletter, you kind of understand the inner work. So if you step back in the simplest context, a venue wherever you are decides who is going to be their ticketing company. Generally that venue and the irony of this idea that we have control generally that venue is a billionaire that is building a billion dollar plus arena
or stadium, SOFI stadium here in LA. You name the place, the San Francisco New Arena, So you're the you're you have a sports team generally, and you call us, you call seak Geek, you call Access and say I want an RFP to be who's going to be the exclusive ticketing company for my business?
Not not everybody knows what's an RFP is.
They're gonna they're gonna call all of us and say, we want you to bid on the rights to be the exclusive ticketing company for our venue. And generally ninety percent of time, here are the terms you're We don't get paid on season tickets. That's a big unknown to the industry. So we do all that one hundred and twenty five million tickets that are season tickets. Uh, we don't.
We don't get paid on as a ticketing company. And you get paid on the single ticket, the the one off ticket for the game or the concert, and the van You then dictates how much of the ticket fee they're going to keep and how much they'll pay you, and how how big the ticket fee will be. And that's kind of the let's let's go a little bit slower, right.
They stand out the RFP request request. We are basically bidding, Yes, what would typically be in that bid and what would the varying competitors put in the bid such that then you might choose one one or the other.
Well, there's a there's a fundamental technology, basic program to it. Can you do these things for my team, my venue. Maybe it's multiple teams and and every team. Uh geez, we're dealing with the Clippers right now. That's a very technical r f P because Balmer and Microsoft background is very different. Are working with Mark Cuban in in Dallas. So it usually a technical basic basis to the to the to the bid what they want to get done
with that. With the ticketing company, they's got to work with this CRM company, it's got to work with their food and beverage, it's got to work with their access, it's got to work with their charity. So they kind of a long technical spec on can your ticket company deliver all of these different needs we have amongst our businesses. That's the that's probably the fifty percent of it. Then the next part is going to be how are you going to how are you going to market and sell
incremental tickets for us? How are you going to help us deliver our business? And again that's going to vary, Bob, as you know, if you're the hot team that sells out in a minute, that's different. If you're the Phoenix hockey team, you're looking for the best marketing partner you can to help you sell tickets. So again it'll vary on how much the marketing and the and the marketplace you have matters to the team. And then let's call the final piece the financial. How much how low will
you deliver the business for? Will you give us an advance against that a bonus? And is it three five years? They'll they'll usually dictate those kind of terms. So it's technical, marketing, marketplace, and then financial.
Okay, most venues, if not all, do want an advance, isn't that correct?
Yeah, most of them are going to ask for some version of an advance or a bonus based on getting the contract.
Okay, And an advance would be recoupable and a bonus would not be. Yes, okay. So going back to where we were earlier, the venue is telling you how much the fee is going to be. Yes, yeah, the venue is going to define. You know, it's kind of evolved over the last five ten years. It used to be, you know, when Fred was on your call. You know, it was easy in Fred's days. They would just say, you know, add another dollar to the service fee and
we'll split it fifty to fifty. Today it's kind of working backwards, where the venue says, I'll pay you three four dollars a ticket, and then we're going to keep all the upside and we're going to charge forty six thirty seven whatever the service fee is. So it's still evolving, but generally the net number is determined by the venue because the venue has a net takeaway that they want to take home from the ticketing business, whether it's a
percentage or whether it's a fee. Okay, and they established it themselves and ticket Master has no negotiation with that to raise it or lower it.
No, and again I'm you know, we can. We can come to the part where I am the venue Live Nation, so I can I can walk in that shoe later. But no, it is a you know, although it doesn't seem like it on Twitter at times, it's a competitive process. I mean, you have you know, we're just we just lost the stadium in Washington. The seat geek. So what they ask for someone will pay, whether it's US AEG
access to stub Hub seat geek. So if they want to pay someone two dollars and fifty cents a ticket, I can go back and say no, I want four and I want the service fee to be lower, but they'll go someone else will be standing next door to me that says we'll do it for two fifty and charge thirty six bucks.
So okay, if I own an arena in a major market, generally speaking, what is the advance in dollars?
You know, on a it's the team part that's important that drives most of the economics. So could be a multi million dollar advance, anywhere from zero to ten million dollars, could be over for longer term contract.
Okay, so they're telling you what the fee is going to be. But if someone is buying, let's focus on concert tickets, where most of the controversy is the fee is not the same for every ticket. Usually more expensive tickets have a higher fee. Can explain that.
Yeah, I think historically it's been a percentage. If you look at Macro, the ticket percentage is somewhere in the twenty to twenty five percent on average, So you're right. If it's a ten dollars ticket, it's two fifty. If it's a two hundred dollars ticket, it's twenty percent of that. Sometimes it can scale from twenty to maybe thirty thirty percent on the top end. But it's a percentage scaling that's set out from the beginning, and it goes up as the ticket price goes up.
Okay, so let's just say that you have round numbers and this would be extremely low. The fee is out of that ten dollars they are going to pay ticket Master a certain number which is negotiated in advance. Yes, and okay, so I buy a ticket.
Which, by the way, because republic we say it loud, we would typically get two of that ten dollars. They would get eight, right, which is the real unknown. Right, that's where the you know you you would assume because we have to take the punch that says it's the ticket Master service fee, that we get more of it. And that's the biggest kind of unknown to date.
Okay, when I buy a ticket, there are multiple fees. There is you know, the convenience fee and other fees. So typically under this paradigm where you have given it advance to an arena, what would be all the fees in the ticket as a percentage?
No?
No, when you have negotiated with a building. We're using the example of ten dollars, which is low, you get two dollars. Let's say but when the customer goes to buy the ticket, there are more fees than ten dollars. There are additional fees.
What are those could depend You could have a facility fee which the venue would charge. That would be all of their fee. So venues have a facility fee. Credit card fee is separate. That's a small percentage that is
exactly what it is. It goes to the credit card company, and it might there might be or it might be dressed in a ordering fee which covers the ordering fee, which would be the credit card fee within that that might be three four percent as an ordering fee where covers a credit card fee, and the venue and ticket master would split that on that same kind of percentage. So facility fee, ordering fee, service fee would be your three typical fees.
And since the building is really at the heart of this, why would there be a facility fee in addition?
I think that's just another way the venues have looked to say, how can I get some revenue per ticket? And we could. We're going to come later to whether this is just or not, but I'm so now we'll just talk to the technical part. But I think it's a revenue stream that the venues put in place years ago to gather revenue per ticket.
And that is determined in advance. And is that a percentage number?
Now that's the venue add on.
That would be with the venue of charge, and that would be across all events sports, concerts, rodio.
Generally. Yes, you know, again there's always going to be someone going to tweet exceptions to the rules to all of this, but yes, in generality, generally you would have a facility fee on all your events. If you were charging facility fees.
Okay, using this ten dollars, ticket master gets two dollars. Doesn't the promoter also share in the fees?
No? Now you know this is like pulling one block of jingle right, where does one? Where? Does? Where? Does one get paid? Typically the venue is paying the promoter, so you can in theory say did he pay the venue? Did he pay the promoter out of his eight dollars, or did he pay it out of his facility fee, or did he pay it out of his parking fee?
But generally a venue has to incentivize the promoter to bring shows, so there would be a promoter fee at some sometimes that the venue would pay that would come out of some version of their of their fees or their revenue line, but we don't see it. And you know, when you're doing a settlement at the end of the night, the promoter doesn't have a cut of the fees. That's that goes to the venue direct, and then whatever rent and venue deal you have with the venue is separate.
Okay, but the rent in the there's rent, right, But you're also saying there's another line item where essentially the building is paying you to have your concert in that building.
They're called rebates. You've probably heard of them over time. You know. The way the venue would work is if you have a big arena and probably three arenas maybe in town, it's competitive. So you would come to me, you'd come to aeg, you would come to any promoter, and you would try to incentivize them and say, listen, if you could bring ten shows a year, we'll pay you five dollars a ticket. If you could bring twenty
shows and thirty shows. So they're going to try to provide an incentive or rebate to bring scale and more shows to their venue if you can as an added incentive.
Okay, So let's just use the concert example. Ticket Master revenue stream other than the percentage other than a couple of dollars on the then you feed, are there any other income streams for ticket Master?
No, that's the complete business model is a percentage of the fees.
Okay, needless to say what you have saying, these are costs that are going to be built in. The costs are never going to go away. Just for some people, understand, even though you and we have discussed this, the position of ticket Master Live Nation is you're all for an all in ticket price.
Yeah, I would say that if you were a you know, whether you're a small club owner or a Live Nation you have a venue or these arenas that are spending a billion dollars on their venues. The reality is the artist has done a great job over the last ten years or taking more of the door as you know, so there's not any dollars left on the gross ticket. The ticket goes to the artist. So as that kind of has expanded. In order to pay for the venue, to pay for the staff, to pay for your costs,
the service fees have become the revenue line. But you're right, if you you couldn't take the service fee away and then stay to the venue. Let's put the show on the venue would say, well, who's paying all the costs? I got to get paid, so they could crank up the rent and stay to the artist. Hey, now the rent's going to be a lot more money. And then then the artist is going to say, okay, they're not to charge higher ticket prices, so you wouldn't net it.
The same result is there is I think I think Garstad at best on stage, there's one pizza to get the show done. It isn't forty eight dollars, it's seventy six. So the quicker we decide that it's a seventy six dollars experience, the better will be as an industry than what we're doing today. And you know, I use example of Amazon. When I buy that hammer at Amazon, I think it's a great deal. Now if I if they said to me the hammer's five dollars, but the Amazon
service fee is four, I would think that's horrible. But you know Amazon, Apple charge thirty to fifty percent distribution fees, So call this fees the distribution fee the margin. The challenge in our industry is we have we have kept the margin the distribution cost, if you want to call it, outside of the price generally in industries, when you buy something at Walmart or Target, it's all built in the north.
Stroms gets paid that the Calvin client gets paid, the distribution costs are paid, and it's ninety nine dollars to buy the jenes our business for many reasons, it's stayed outside. So, yes, we are, we as an industry think the We don't think they're junk fees. We don't think there's service fees that are just beautiful add ons to make a ton of money. We're a very low margin company, so we we we certainly are. Our numbers are public and financial
show you that we're not. We're not making a ton of money on service fees other than the what you need to pay for staff costs, structure and then have a return on your capital.
Okay, just to get this nailed down, your position is you would go to an all in ticket price. You're pro that position.
Yes, we're we're happy pro Jam announced it today on their tour. We're we're talking to others. We would we would tomorrow go all in pricing. We need we would love the industry to do it. I mean New York went to all in pricing. We're the only person doing all in pricing right now, no one's monitoring it. You go go to New York right now and try to buy a ticket at subhub or seek geek, No one's No one's following the all in pricing mandate law that's
been put in place there. Because we know, if you one guy says it's seventy six dollars and one person said it's forty two, but really seventy six, check out, you're going to win on Google every day of the week on the forty two dollars ticket. So to be to be a level playing field for everybody, you would want everyone to have to show the right price upfront. So yes, we think that. We think showing the fan the real price to go to the show upfront is better for everybody.
Okay, what is impeding this process? Why can't it happen?
Well, I think, you know, I think his StubHub tried it a few years ago, five years ago, six years ago, you know, and they ended up pulling out of it and inciting that their business went down fifteen to twenty percent. I think that's scared most people. You looked at that and went, geez, if I'm going to be the only solo player moving. That's a big hit. So I think
the date we all have probably been scared of. Do I want to absorb any of the leakage in that mission because you're going to do it on your own. The artists aren't going to give you a break. Then no one's going to give you a break that the venue's not going to say that's too bad. Will help you out here? If you're going to go, you're going to go. I think we've been scared to date, and then obviously COVID came. We all just had to get
ourselves back together and back on the horse. So I think to date it's been the fear of the unknown. Will it hurt your sales? Will the agent artists ask for more money because they now say it's all one? Is it better to keep it separate? I think the sports teams have always done it separate for different reasons too, So I think to date there's been a fear of
the unknown if you went all in. I think at this point though, we have to start acting more like the leader and standing stronger and taking some of the short term pain for the longer term win.
Well forgetting the resale market, which is where stub Hubbs experience was and still is. You have all these acts using round numbers, once again saying I said the price was fifty dollars, but the checkout price was eighty dollars, and that's terrible. So to what degree do the artists not want all inke at pricing.
I think it's I think it's split. I mean, as you know, there's no one artist. There's you know, some want the money and and some want twenty dollars tickets. And there's a spectrum, right, there's no there's no I wish I always joke I wish I saw Adam Silver yesterday. I wish I had a I wish I was a commissioner and can mandate a few a few few things here and there. But we're dealing with fifteen hundred different managers and artists a year, and they all have different
agendas and different parts of their life cycle. And and so you're right, there are going to be some artists that say, no, screw you. I'm not going to say it's an eighty dollars ticket, it's fifty. Some artists like Pear Jam, we're gonna say, I get it, let's let's let's make it fair and do what's right. So you're right, it hasn't been something to date. You know, this is an industry we talk about is Live. It's very very unorganized. As you know. The recording side is a bit more organized.
They've got you know, they got lobbyists, they've got kind of organized, the Grammy's, the Riria. There's really no there's no organization and Live we always joke the only actual organization is the Ticket Broker Association. We're a really good lobbyists, but there is not even a lobbyist group for us as an industry, so we don't do well as an
industry making smart moves holistically. You're right. So I think we're going to have to just move forward Live with some short term pain of some artists or others, but I think it's right for the fan and the experience overall. Now, Bob, I would say, I don't want to you know, let's go to the second part. I don't want to say that there aren't times when the service fee is too high and that doesn't have to be addressed too. This
isn't just jam all the service fees in. Put it in one price so we can hide it there are as you saw with the Cure. I think we do have to look at some of our businesses on the lower end ticket prices, the clubs, theater. I do think as an industry we probably do have to absorb a bit better and think a little smarter at what is the add on fee because I think I think although it's justified, I don't think it's justified probably at every
ticket price point. So we probably as an industry need to be smarter there.
Okay, let's be very specific since you brought it up, what exactly happened with the cure because ten dollars were given back, which is a first, right, you.
Know, it was again when you you know, the system isn't really built for artists like Robert the cure, right, We're usually do a running fast put the ticket on sale, and we kind of are proud of the ticketmaster's side. We did a ton of work with Robert making sure it was a non transferable, that it would be then face valued exchange, and we kind of got verified and doing all we could to put all the roadblocks to
help him deliver his ticket price to the fan. But he's so active on Twitter, as you know, there was a screenshot of a venue which wasn't even a Live Nation venue. It was an amphitheater that we don't own that showed a the ticket service fee of the twenty on the twenty. Which it doesn't matter whether we justify that the service fee is a good idea or not. We have an industry where we got to build some credibility back. So Robert reached out to me. We talked
about it. I couldn't defend that in any version of life, we were going to add a twenty dollars service fee to a twenty dollars ticket. So I made the decision that we would go in, spend some money and help on this case, give back the ten dollars, and get it to a reasonable place for those fans.
Okay, let's be very specific where did the ten dollars come from? Because using the earlier paradigm on the fees, the venue takes most of the money.
Right, we went to the venues and said we're going to reduce it by ten and we will eat the car if you don't want to join us well as a one time hit, we'll take the cost to make this right. And I'd say half the venue said listen, will help you out. The other other half said good luck, eat it. So it was a fast, moved, fast decision, and we thought it was worth the million dollars or so to say, let's let's let's make the right message with an artist that does care to this level.
But if you leave all emotions out, is it reasonable to expect to see the Cure for twenty dollars in an arena which only holds fifteen to twenty thousand people.
No, I think you're I think the you know, I think the pricing of concerts in general, I don't think we should. I think there's this fine line between yes, we want it accessible, but I think it's a great art and I think there's a price to it, and I don't think we should fool ourselves. The fans will not pay, especially the cure age fans that will not pay for the great show. But as I said, my job isn't a debate whether the artist wants to take all the money or give or or or or or
Zach or Cure want to charge too little. I'm just trying. My job is just deliver that platform for them. In this case, I think I think we were we thought we'd be better off to respond and address it than leave it. Leave it as is.
Okay, now Live Nation owns, clubs and smaller venues. Based on what you just said, you believe in your owned venues that you should address the fees because in some cases you think they're inappropriate and too high.
Yeah, listen, I think as a I think we are. If you look at our fee structure, we're no different than AG or Independence anywhere else. Sports concerts, nine to thirty, club AG, We're all in the same ballparks. We're all charging facility fee, service fees. We all have the same economic challenge of running a venue, paying staff and as you read about inflation, staff costs up, insurance costs, So
we're all in the same predicament. But I do think as the leader, we probably have to make we have to start acting and moving a little bit more on
the younger developing artists club and low ticket price. So yes, I do look at my twenty dollars amphitheater tickets or a twenty dollars ticket in general, and I don't care if it's rational right now that we got to pay staff and we have costs and the service fees should be what it should be to a fan right now, We've got to build some trust back, So I think
we got to go all in pricing. But I do think at Live Nation we'll look at the lower end ticket prices in the theater and clubs and say, can we also scale them back and make sure or we're a defendable fee on a service on a ticket price. Okay, well, now we might have allay other ways Bob to get revenue to pubblement that. But I think it's been too easy to add a dollar to the service fee. And I think I think at a certain point of fans says listen, I get it. I even get a twenty percent.
We've done the research. I understand the service fee paid staff, and I understand it. One, don't surprise me at the end. Please tell me upfront. Two if it's more than twenty percent, I don't understand it. Where's it going doesn't seem fair. So I think we are looking at we got to do a better job of saying where it's going and
how it's broken out. That would be a start. But if we go all in pricing, I do think we still also have to look at the bottom end of the lower end and make it more accessible.
Okay, as I say, a lot of people listening to this are emotionally invested but don't know all of the process. So let's start with the process of how Live Nation gets a date or a tour and how the money is established, both the paybact and what the ticket prices will be.
So an artist has an agent, and whether they are selling a local date to an arena or a club show in Philadelphia, or maybe the agent is trying to sell twenty or thirty dates together as a tour. That agent's going to call the promoters. Whether it's Live Nation, it's going to be aeg, it's going to be the local promoter, seth another planet. There's always a local promoter. So the agent's going to call three promoters and say,
bandex wants to play October one in Chicago. Make us an offer, and they might you know, they might say here's the ticket price or not at the beginning, it'll depend on the artist. But we want to an arena or a theater on October one in San Francisco. Make us an offer. We'll come in, we'll come we'll run the math. Look at the arena. Thirteen thousand seats what did they do last time, sixty nine, thirty nine, one hundred and ten. Look at their scaling, they sold out,
didn't sell out. Put that math together and say, you know, we think we think there's this business that is going to sell eighty percent of the tickets. We think it's a four hundred thousand dollars guarantee. And we'll send back that guarantee and say four hundred thousand dollars against a thirty fifty and one hundred and ten dollars scaling agent will take all three of those. Generally come back to all three of us and say we want four fifty. Highest bid is four fifty, And now the ticket prices
gets rescaled based on the guarantee. So now your ticket price will go to one twenty and seventy nine and sixty nine. So you can look to scale and gross that number at the door.
So in your original bit, your original offer, you do put in ticket price points.
As I said, it's it's it's both ways. Sometimes the artist is clear on what. The agent will say, you know, here's what we here's the maximum he'll charge. Here's the ticket prices he'll charge it. Usually only the top end they worry about. So they'll probably say, listen, historically he's never gone above one twenty for a P one, so come back with the scaling. There's some version of a of a top end established by the artist, so we'll
come back with that scaling in it. Typically that scaleing will spit out a number less than they want, and we'll all probably sharpen our pencils, the eight promoters and come back and say, listen, if you go to one forty, we can pay you a four to fifty a night. And that tends to be how it gets defined. So the guarantee drives the ticket scaling. It's just math. Just back, you're just dividing thirteen thousand seats by the guarantee and then debating how many are each in each level.
Well, let's be very clear, at the end of the day, the act, through his agent, establishes the price of the ticket.
Yes, why the cure decided he would have a low price, right, he would have. We wouldn't have we wouldn't have put an offer in those low prices. That wouldn't have been historically what you do that would have came back and said, I want to charge twenty dollars and I'll live with a lower gross and a lower walk out, or other artists will say, agents will say I want I want a million dollar guarantee. Come back with the math.
Okay, so let's just assume, based on your example, you're paying the act four hundred thousand dollars. Now, just for the newbies, there is a potential back end, an additional payment. Explain that.
Again. I'm going to use generalities, but typically you're going to pay an artist a guarantee versus a ninety ten. Maybe it's a ninety five to five. So if you sell out whatever tickets you sell that night, you're going to get your total gross. And if you grossed five hundred and ten thousand dollars after at the top end, you're going to take expenses out rent local, local ushers, local security, local venue costs, and then you might end up at four hundred thousand dollars net after venue costs.
If you guarantee them four fifty, you write to check for four fifty, regardless if after costs it's five hundred, they're going to get ninety percent of that five hundred versus their guarantee of four fifty, So they're going to get four seventy five and you'll make your your ten percent. So at minimum they got a floor. Their job is then to push us to keep expenses down, sell as many tickets as we can, and try to get that artist to what they call percentages.
Okay, overall, what is Live Nations profit percentage? And where do you actually make the money since the acts get most of the ticket revenue.
Well, listen at the core. This is a scale business, right, you know, I had to build this over the last fifteen years because you don't get rich on any one show. It's the service global business. We're going to do forty thousand shows in one hundred cities and forty countries. So I remember an analyst wayback said it's the river and nickels, right, So you have to build a business that has a lot of ongoing nickels of revenue streams around that flywheel
called the show. So you know, if you kind of look at our model, we're going to do forty thousand shows, We'll spend about ten billion dollars on guarantees or those
walkouts at midnight. We'll make a bit. We'll make a small percentage on that so called door where we're going to make our money now is okay, we have one hundred million people walked into the door, so we're going to one We have one hundred and thirty one hundred and fifty of our own venues, amphitheaters, clubs, theaters, three hundred festivals, so in those places will be the venue we're going to make the food and beverage, the parking, the service fees, and the sponsorship. So you're kind of
vertical on the non live nation shows. We're going to make money on those rebates as we talk about bring our content to the arena, bring them forty to fifty shows and get paid a rebate. And then third is we're going to spoil our global sponsorship business just in general delivering global sponsorships to our shows, our festivals, our venues, our access, image programs, pre sale programs, all of those
ways that we can deliver sponsorships to big brands. And then Ticketmaster service fees those twenty percent that they're going to make on that side. So those are the main buckets that you're going to put together that deliver your profitability above your on your forty thousand shows.
And at the end of the day, what's the margin we're at.
You know, we're a combined basis. We're a ten eleven percent margin business. Concert business is a low margin two two percent margin, could be four. Sponsorship is a high margin business. And ticketings it's thirty five percent business. But you're netting out to a ten eleven percent margin business overall.
And compared to other companies. Apple strives for thirty percent margin.
Yeah, if you're a tech company, you're going to be in your thirty forty plus percent margins. You would You wouldn't find a monopoly in history that had a ten eleven percent margin, if you want to kind of use that analogy. Typically, monopoly means you've exerted, you have enough power and pricing power, et cetera. You probably have a very high margin return. So you're right, it is a
low margin business. At the core. You have to have global scale like we built ultimately deliver a consistent, global good business. But it's a it's a hand to hand combat.
How much of the income is from sponsorship.
You know what is ballpark? Were about forty percent sponsorship. It's a big business for us in our festivals.
Okay, let's talk superstar acts and I'm gonna speak English. Here there are a number of superstar acts, some of them who used to be with AEG eight. But Live Nation pays more, and sometimes the act goes with Live Most of the time the act goes with Live Nation. How can Live Nation pay more?
Yeah, I don't. I don't go the pay more route. I wouldn't say that's fair fair all the time as I went to that earlier bidding process. When there's a big global tour that AG and Live Nation are bidding on, I can't remember the last latest one. We're both we're both neck to neck. I mean, there's never a version that a G they're calling me saying, oh god, you so overpaid. It's yours. I mean, god, we're just we're just too good as a company as is a G.
Nor are they overpaid. I mean, you're literally going to win by a dollar either way. You're you you at that point though, you're you're selling your global business, you're selling your relationships, you're selling your marketing, you're you know, so you're you're you're selling a bundle. But I wouldn't tell you that we There would be no version that we are waking up and stealing a tour from them or winning a tour from them because we dramatically overpaid. It's an inside baseball negotiating.
Wait wait, wait, wait, there's a lot of dollars involved here, and I certainly know specific cases. At the end of the day, Live Nation paid more than AG was willing to pay, and the act went with Live Nation, let me let me, let let me go to a different spot.
And while addressed, well, just I joke with my team, right when we lose a tour, Age overpaid when we went a tour for geniuses, right, So I deal with this every day when when when we losed AG, my promoter will come to me go, oh my god, they so overpaid. They didn't you know. That's that's that's what competitively wise, that's typically what you do is the only way you must have lost is the other guy must have dramatically overpaid. Most of us are every negotiation with
that agent, it's inside baseball. That agent is calling you saying Age's at forty one million and you're at thirty nine eight These calling Age saying they're at thirty nine Like, it's not like we're at fifty and they're at forty two. There's there's no version of that we're all it's none of us and Nora's age. When they beat me, it's not because they dramatically overpaid. You know, they won the
Luke Combs tour. They's got a good relationship with Capian won that in the US, and and and and and you know, there's kind of a combination of relationship meets money meets you know, their package. But so I just say that because I definitely don't believe that when we win it's because we overpaid. We typically win because we have a global business different than theirs. We have been able to generally make artists more money overall, which really
matters not what you pay them. What the artist cares about is what's the walkout in the end. And we were the author of platinum and Dynamic Pricing and and and VIP. So I do believe we've been able to help deliver for the artists, but wouldn't say we overpay to win. I think we both win on price, but but there's always a package around it.
Okay, let's talk specifically about Ticketmaster. Ticket Master is also a secondary platform, okay, meaning the ticket's already been sold, it can be resold on ticket Master. Let's start first, the fact that the ticket cannot be resold at less than in the original price. Is that a Ticketmaster policy or is that an act policy?
That's Ticketmaster. So when I took over Ticketmaster, our biggest challenge of Ticketmaster and the reason it was to declining five years in a row, Well, stubbub was kicking its ass at ten o'clock. When you went to ticket Master to buy that Tour of the Day ten years ago, we said no tickets available, literally, and I followed it one day and for the next six months, like eighty six million people came to the page which we basically said,
go to stubhubb. So our sports clients then also our team, team owners, NBA, NHL adopted exchanges and secondary fully at that point. So number one reality was we need to be able to say we need to open our platform and let secondary dots live. We can't keep telling customers we have no tickets at ten am. Well Secondary is alive and well down the street.
But one of the.
Realities was what were we going to do that we believe for the team and the artist would still be something that is right for their business. Things we don't do which hurt us overall market share is we don't do spec selling and we don't underprice face. That probably means at any given time we have fifty percent less inventory than sea geek and stub Hub because, as you see, a lot of this game that go on now is spec selling where they don't have the seats, they don't
really have the ticket. They're masterful, they're very good marketers. They'll put three seats together at eight hundred dollars and two seats at two thousand, but they don't have any of those. But if you buy the eight hundred because it seems cheaper than the two, they'll email you and
they'll find seats a row difference and you'll buy them. Anyways, So we don't do spec selling, and we decided that we would always say we don't ever think content should be underpriced from whatever the artist or team said it at. So that's been our philosophy and we've stayed true to that so far.
Okay, what is the payment to ticket Master when a ticket is re sold on its platform.
It's the same. So the secondary has to be approved by the venue because the venue, again when they select a ticketing company, they mandate what the secondary is or isn't so it's the same split basically the secondary. I can't turn on the secondary and that venue without the venue approving it. And the third thing that we do that scalpers I guess don't do is we get approval
from the artist. So again, a lot of times if the artist says I don't want TM to turn on secondary, we don't, even though Seekeek and others will, well, you know, we'll fill up Taylor Swift for example, we didn't turn on DM plus and Seekeek and others made a fortune. But but the ultimate is the reality is the venue controls the ticket secondary and turning on and turning off for their teams.
Uh So on a concert, if the on a secondary is the split similar to the.
Primary, similar prime? Yeah, they're all the similar.
And then to what degree does the fee change based on the price of the ticket?
I would assume it has the same up scales up as the ticket goes up twenty, twenty five, thirty, whatever the actual.
St Okay, So Nicholas to say, on the secondary, the venue is making the majority of the money's supposed a ticket master, but.
Just the fees, not the yes, just for the unknown there for the people out there it's not. The face is the third party person making the real money. The fee is then just split between the venue and TM.
Okay, there are many events the ticket master is the ticketing company, but Live Nation is not the promoter. Yes, correct, Yes, So if I am a promoter and Ticketmaster is the platform I'm using for the gig, I would say, hey, if their secondary market, why can't I share in that income because Live Nation is sharing in the upscale upsell on Live Nation shows, but they're also making money on my show.
Yeah, but you, as the promoter can say I don't want to turn it on. So typically AG won't turn it on. They'll say it's my show and we don't want to turn on secondary in that venue. So the promoter has the right with his show in that venue to determine if if if TM does get turned on for the platform and well and the promoter. You know, remember the promoter is always going to go to the venue and say, in general, I want to get paid my rebate. So you know, his motive is always going
to be whether however much money the venue makes. Your job is the promoter is to figure out how to increase your rebates.
So theoretically, if you know it's an in demand show. The promoter would be aware of this and say I want to payment that in essence would be percentage of your fees that you're making on the resale.
Yeah, I just want to make clear we don't get that misstated. The promoter in general isn't specifically saying give me The artist or the promoter aren't specifically saying give me some of that eight dollars or two dollars. That conversation doesn't happen. The venue has already got a relationship with the venue or the promoter, and the promoter is getting his five, eight, nine dollars rebate as a business overall.
So if you are the venue and you want to turn it on, the promoter isn't going to worry about that one revenue stream that night. You're playing for the full year, and there are some days where the show loses money and the venues are great partners and help you out on the rent or help you out on you know, it's the bad shows. You want to save the good days for the venue, not the days they can make some money.
Okay, let's talk about ticket prices. You know there have been some amplified examples like Springsteen. Okay, you mentioned Pearl Jam. It's a non transferable ticket. They're establishing the price. That's what it costs. But there are other acts. Let's use Springsteen who went over one hundred dollars, and people say, I am a die hard fan, i am entitled to be in the building. I'm entitled to get a good seat at a low price. These are the same. No,
these are boomers mostly going to a Springstein show. If they go to dinner, it's one hundred dollars a person. Yeah, but for somehow to go to see Springsteen, one hundred dollars is too much. What's the reality of pricing and is it different for younger acts? And is it really we should just charge what the ticket is worth.
It's a it's a really interesting complex problem, right. You have this fandom, as you know, that fan is so emotionally connected to that artist. They've listened a thousand times and they really believe they have rights. It's very different than sports, which is a badge of honor to say this court side's cost sixteen thousand dollars. You know, I
was talking. I was talking little bron James the night he broke the record and ticket on points and I said, you know, lebron tonight to sit courtside Laker games ten to twenty thousand dollars, but they're mad. Beyonce's charge in eight hundred for one tour every five years. But it's a you know, the super Bowl. The sports business is kind of embraced. It's expensive and for some reason that Diehart fan doesn't get on Twitter and say that team owner is an asshole because I can't see the Lakers
for sixty six dollars. So you're right, the fan is very mostly connected. They've got great outlets now on Twitter and other ways. They really believe that they have the right to see that artist. But the reality, as you said, Bob, then in this scarcity world of birkin bags and lbmhs that you wrote about last week, the live experience is a absolutely special moment in time. That front row is a birkin bag and more. It's a an exceptional product.
And you're right, I do think the quicker the artists figure out that we got to charge closer to market for some of the seats. You know, Springsteen was a great example. It was only one percent of the seats were over one thousand dollars. All we did was transfer. Last tour, the tickets went right to the scalper and resold to the fan for two thousand dollars. So this time we just took those same tickets and said, Bruce, you should actually get the money, but let's make sure
we keep the rest of the house cheap. But the stories don't get that headline. You know, ninety eight percent of my shows don't sell out. Most shows are very affordable, but you're going to have some burking bags in the Beyonces and the Drakes and the bad Bunnies and these these artists and the front rows are scarce business commodities.
And I do think that, well the secondary exists free and free and clear in America, that you do have to start saying, then, if the fan is buying it from stub hub, they are fans, why wouldn't the artists participate in that art and have more of it? So I do think I think that they have to slowly start charging closer to market at the front end. Now you know, you know, we launched a fare ticket act,
and I'm sure you'll mention all that, you know. I do believe that the reality is the Digital ticket is a great tool that could help us out in this mess.
I mean, the mess we have right now is that creates the Twitter storms, is that fan comes at ten am and they're pissed off because at ten oh one it's sold out and there's ten pages of scalpers selling tickets for three hundred times face and I get the d ms and the hate mail and the and the death threats that say, you know you asked whole you must have given all those tickets to the scalper at
ten o'clock. It's not fair. That's the drama that we created, right and we do our best with verified fan and speed bumps and it's but it's a it's an arms race because it's five billion dollars in secondary of vail to make a very very very high margin business. So while we're letting that run wild, then you either have to control it or you have to price to it. But I think if we let it run wild like we are today and then it's silly of us then not to let the artists participate in some of that
and price it better. Or we got to control it, and we could with digital ticketing. We could tomorrow just say there's a cap on it, or there's some rules around it. A lot of countries in the world have figured out this is probably not a great idea to run wild and have fans have to pay these prices. So I do think that it should be some control put in place, so we could put some limits on it. I don't have a lot of faith that we can get much done in the government probably right now, or monitored,
or actually execute it properly. So I think you do then have to say, probably have to price closer to market for some of those front rows and some of those seats. So the artist who's already paying that anyways, they're paying it today. It's not that it gets not being paid, it's just not being monetized by the artist.
Would you say people complaining about excessive ticket prices is more of a boomer gen X phenomenon as opposed to younger acts.
Yeah, it's this. It's an interesting you know, to see that which ones do flare up? As you're right. I sat at the Bad Bunny Stadium show here in La credible show, credible performer with the third highest grossing stadium in history. He broke most records, and I said, I said to his manager, credible. The fans are, they're dancing, they're having their blast, they dressed up. This is a party tonight. And the tickets were you know, price well,
but there was no social about it. But but definitely the the Springsteen fans seem to get really upset, even though it was probably much older and richer. So it did seem a bit ironic that week.
The other thing that people don't realize is the very expensive tickets are not only going to the rich. The hardcore fan will pay that price, even if I hear from them all the time, even I'm stubum, and they're very happy about being that close.
I so agree with you, Bob. I said this to an artist last week who went on this low ticket price, and I just like you, just you know, you're missing it. I came from no money and I remember going to my Robert Plant tour in uh In, Toronto from Thunder Bay on a bus and yes, I saved my money and I worked hard and it was all my money for that month or whatever it was. But that was
a great experience. And you know, I get these emails now from someone that says, oh my god, I had to work two jobs to get to the Bad Bunny Show. And yeah, you know most most people look at concerts as a really special moment in their kodact life. It's it's magic moment maybe twice a year. Way cheaper than Disneyland or the super Bowl, or the NFL or the NBA playoffs or or an expensive night out. So it's really cheap overall considering. And you're right, this is not
that the that the this just the rich people. This is a great, great product that people will buy as they're going to buy the Gucci bag. They're going to buy moments in life where they will step up and spoil themselves at the big screen TV or whatever it may be. But you're right, this is a business where we can charge a bit more. I'm not saying excessively, but it's it's a great two hour performance of a lifetime that happens once every three four years in that market.
You don't have to underprice yourself. Low low to middle income we'll we'll, we'll, we'll make their way to that arena for that special night.
About twenty years ago, the concept of platinum started. You got a seat very close to the stage, you might get to eat meat, a member of the band, you might get to hear a sound check, whatever. We learned that the extras weren't what we're selling the tickets. People just wanted the good seats. But when it came to Springsteen, the term platinum was used for tickets that were not right up front, and in addition, those were dynamically priced. How did we get there?
Yeah, you're right, the platinum, the VIP tickets, no different ways where there were higher ticket prices outside of thep ones, And you're right, they all got bought, regardless of whether it was a cocktail, shrimp and a laminate. It was just the good seats and they bought them. So recently, over the last five years a those sound checks and meet and greets and VIPs, especially through COVID, before and after it started to wean out, they were the cost
to execute. They weren't that special anymore, and the business converted to more of a platinum ticket. Let's just charge for those good seats. Let's put some seats into an allocation where they're more than the pre ones and we can price them better. Started five eight years ago, band started to embrace this idea that there was an idea and again, artists are always just looking at the other
side of the equation. As everyday secondary got more sunlight and went from the streets to the internet, and you could start seeing what they were paying the obviously the artist, the manager of the agent, promoter. We all looked at that and went, geez, look what's happening over here. How are we going to get the artists to charge closer to market on some of the good seats. So that
that's when Platinum launched. It's done really well. Dynamics started same thing eight nine years ago when you started just we started with price Master, where you started to say, there's different you know, this scaling shouldn't be the same most dynamic products, hotels, airlines aren't sergeant the same on the last day, in the first day of the middle seat.
So we started price Master years ago to say to the artist, you know, a Friday night in New York should not be the same ticket price as a Tuesday in Cleveland. The aisle seat's worth more than the middle You can monetize the house smarter, you can sell it out, set charge less for the back seats more for the front. Said it as three scalings, which was always kind of the thirty years of doing three scalings and same markets all the time. So dynamic price Master had been used
for the last probably eight years. And I think coming out of COVID dynamic platinum adding more increasing the allocation, the dry got a little sexy, and more and more artists started putting and promoters we started putting more in the platinum allocation to increase the gross and I think we're, uh, you know, I think we're learning now. H We've we've got to watch. If the definition of platinum is going to be platinum, we better make sure it's a platinum seat.
And if we're gonna dynamic, we better put better rules in place on when we change ticket pricing, not not not in the price sale not or not in the on sale. So we're I think we're I think we're as an industry or learning how to price dynamic tickets to demand. And that's kind of what's been going on today. I think we're slowly putting better rules in place to figure out how to do it smartly.
Let's use Springsteen as an example. Demand was heavy and tickets in the platinum area spike to momultiple four figures. Anybody experienced in the business knows. No one's buying those tickets at those excessive prices. They're waiting for them to come down. What happened there was that purely a program, an algorithm. Was that something Spreedsteam was aware of in advance how expensive the ticket should be. Is this something that needs to be done by hand? Was it done by hand? Yeah?
Again, artists are you know, as you and I talked about there, there's nothing done in price in that a agent, artist manager aren't agreeing too. There's no no promoter gets to just run the clock. It's all part of your plan. Listen. I think we're as an industry, we're still learning what
it means to dynamic and platinum. And you're right, there are a few tours where you put a few tickets in this twenty five hundred up to five thousand dollars limit and said, let's put some platinums at that price. Reality is ten of those sell. It's not a smart strategy because the headline's so bad, but the volume is not there. I think that's a lesson quickly learned. I don't think you're seeing a lot of platinum now. That's probably more than a thousand seems to be the quick
learning curve. I know we did it in Vegas and others, So I think the imperfect science of how do we manage the secondary business that's going to boom instantly at ten o'clock, how do we get some of that captured on this side of the ledger. The pricing isn't perfect right now, and it is manually done, not complete algorithms. You're looking at algorithms to figure out the pricing of secondary and demand to come up with a range. But
I think we're quickly learning on platinum. Any major tour, whether you can really sell a thirty three hundred dollars ticket or a twenty seven isn't worth the small upside You probably should just put some good platinum somewhere in the five to one thousand dollars range seems to be the sweet spot right now where you can sell a decent scale of those in the good seats and the good sections and be happy with that uplift that didn't go to the secondary.
Okay, conventional wisdom is that ticket Master is a monopoly. You hear this from elected officials, you hear this from ticket buyers. What is your response to that.
You know, it's a it's a business that when we merged ten years ago, the DOJ in there. I think IRV and I spent eighteen months going through that process of the DJ digging in deep. So and when the DOJ digs in deep, I mean there's ten thousand emails later. So they did that when we merged and let the let the let the acquisition go through. They let the merger happen. So that that's step one that says they
didn't believe it was a monopoly. You know, it couldn't find facts that said Ticketmaster was a monopoly, or they wouldn't approved it. We agreed to a dissent degree for ten years that said we will absolutely then if there is concern, we won't leverage. We won't punish any venue that doesn't use Ticketmaster. And that went on for ten years.
I think it was the ninth year. DJ opened up the case again four or five years ago now said we have a couple of cases where we think you threaten threaten the venue and front of the venue means you know, a random promoter. And of my nine said you should renew a Ticketmaster. You're not going to get a show. I mean, this isn't like you know of thousands and thousands of shows, and nine years later, this isn't as we always said, this isn't an ongoing structural
reality doesn't happen. And by the way, those venues when you looked at him, they didn't actually get reduced. Show camp facts didn't support that, so there was no real actual venue that got punished. We just decided at that point that we would extend the decree for five years, as you always do, to make sure you just kind of simplify this case and move on. But they spent a year deposing me and going through it again. That
was the three or four years ago. So again I would say to you, if we were the monopoly a year after the DOJ probing, you trust me, if there was real structural legal data that said Live Live Nation, Ticketmaster together, single or momopoly, they would have sued us, done something, gave us a five year extension, and moved on.
So you know, it's not like we haven't been already investigated deep and haven't seen every email I've ever written and everyone else's and all of our promoters and ticket Master, they've been down the deep dive many times. So I say that in the sense of, you know, that's kind of a clean bill of health to date. Now I understand why it's easy to jump on the wagon. The ticket master and the service fees and what you and
I've been talking about. We haven't done a good job as an industry, especially on my front as Live Nation Ticketmaster, explaining out loud what happens to fees, how they're set, what happens. It hasn't been a It hasn't been a big motive historically for me to kind of go out loud and say, hey, the venue, my client has taken most of the money, or the artist is setting the
ticket price. I'm a B to B business. I serviced the artists and venue and Ticketmaster's job is to been to take that punch in the head for the industry. That's been part of what people do why they hire you.
There's no glory in being the ticketing company who no matter who you are, Sea Geek, Access, anyone, they all have the same challenges when there's ten million fans that want a million tickets and then secondary So I understand why the flurry of energy can be spent on it because it looks big and it looks like there's service ticket master fees and challenges, but we don't think there's any basis to a legal challenge that says in any
way we're monopoly. Our margins prove that our daily battles to win that venue or lose that venue or win that tour are live and well that's well documented. There's nothing wrong with being big, nothing wrong with being great, nothing wrong with offering a great product and being better than the other guy and winning. We don't set ticket prices. We're not harming fans. Artists have all the options in the world. Do you know that as well as I do.
There's only one aerosmith that has one hundred dates of a and a thousand venues that want those dates and every promoter and partner that wants it. So the business is, you know, widely misunderstood. As you know outside of the industry, big as big as an easy target. Ticketing is an easy target. But on the fundamentals on a monopoly, no, we're We're far from that.
So let's go a little deeper here. Administrations change, and presently under Biden, the woman who's head of the FTC lead at Khan is very active. Everything that she has tried to uh get through has not ultimately passed. But inside the business, it's well known that she is looking at ticket Master in Live Nation questions of monopoly antitrust? Are they asking you for information? Do you have a team at Live Nation who is dealing with this?
Yeah, just to be clear, though they there tends to be you tend to either deal with the FTC or the DOJ, and they kind of split it up. If they're going to probe, it's the DOJ that are doing the investigation on us right now, not the FTC. So that wouldn't be in not that she couldn't, but she wouldn't be doing it if they're doing it. So right now, we have been working with the DOJ since November, providing
them all of the data. They want to take a look at our business and see if there's any new data that would support any thesises around our ticket monopoly or descent decree. So we're working with them and that's that'll be an ongoing process and somewhere in the next somewhere this year. The sad part about the DJ is they get to kind of leak when they're looking at you, but you don't really get a final date when you're
going to be done with it. So we'll live that this year and be cooperative with them, But we don't we think legally. Dan Wall, who now works for US full time, has not a great great article on kind of the technical legal part the DOJ and the case. So we think we're complying and we'll we'll get through this.
What do you say to the people who say, since you have an excess of fifty percent market share, you're inherently a monopoly.
Yeah, don't. I don't you know the market share? You know? I could go down a whole bunch of you're a lawyer, so I could go down a whole bunch of paths on how big a market how big is the competition today versus when we merged. I don't have fifty percent market share with you, and I can debate how to define market share. There's thousands of venues, there's lots of promoters. The math will say on promoting side, I don't have
fifty percent in America. And when you look at the festivals, the ticketing, the arenas, the theaters, the clubs, there's more competition ticketing today than there was ten years ago. Seakeek today announcing going public. Stub Hub Access didn't exist. I mean when we merged this company, there was nobody. We had to white label our software to AEG for three years so we could start a competitor called Access. That
was the mandate from the DOJ. But that was at a time when they didn't think we're and they didn't think we're operly. Then there wasn't even close to the competitive nature there is today. So I would say to you we we have grown globally really well. In America. Our market share since we merged to today has gone down. Sea Geek, Access have taken more venues because they didn't exist when we merged. So today, if you're a venue bob,
you're going to have no there's no debate. You're going to be able to say, I got three great competitive options that I can get the best deal I want from Access, see Geek or ticket Master. I don't have to pick ticket Master. Take Master maybe better than the other ones that might have better technology. They may they may they may have a better product, and that's where we tend to win. But you don't have to pick us as the Washington Redskins or Commanders just picked Seakeeek
for their stadium. So, you know, we think it's still a really competitive business. Our margins are the best ultimate dictation of that. If you're if you have margins of where we are, you're you're not exerting or leveraging any power against your your your your, your user base. So we think the artists have great options. We think venues have great options. We think we've been able to demonstrate that, and we think the market's more competitive today than it
was before. Even as big and strong and great as our businesses globally, we still think there's competition.
Okay, in other territories ticketing is different and the you k there are multiple ticket sellers for venues. Can you explain a how that works and how you're involved in that, and b you have your competitors who I speak with who want that model in the US, so if you could address that.
Yeah, the UK, I think, you know, Germany is not really like that a little bit. But yeah, So historically outside of America, it was an allocation market. If you were the venue, you allocated to multiple ticketing companies. The exclusive venue model was a US red model. I would say to you though, that if you look at where
the trend is going internationally. Generally, as the new buildings are being built, they're looking to go to a more exit exclusive model because they're you know, think about the difference in internationalist. They didn't have NBA, NHL arenas they have soccer stadiums, so not a lot of things were built.
As the new buildings were being built, whether it's a soccer or or a hockey arena, they tend to now go, you know what, if I'm building a billion dollar arena or a football stadium, I should go monetize my ticketing rights, and I probably could get somebody to pay me more money to have exclusive ticketing rights than three people have the rights. So that's where the model grows out. So you look now at some of the businesses in the UK, the football businesses, they tend to go exclusive. Now SEEKIK
had a few, We have a few. So I would say, you know, I think the venues as they get built, and you build a building, your job is to figure out where am I going to get paid the most for all of my revenue streams. And I think you're starting to see some of those venues say I actually think I can monetize it differently. Now, I'll back up up. I'm not you know, the golden child that says that all has to be exclusive. That's the model I inherited.
It's been working in this industry for long before my time. It's the model we run to date. I'm not telling you that I think the future needs to be exclusive. I could Ticketmaster could operate on an allocation model as well as an exclusive model and do really well. The irony is the double side of the venue is if you go back to the venue and say, great, you're not going to be exclusive, we don't have to pay as much. I'll be happy to sell sixty percent of
your tickets without having to buy exclusivity. If that's the model we want to market. So it's a balance, right, I don't have to be exclusive. The cost of exclusive, so in the industry is expensive. Now the venues have done a good job charging a very real premium for that, and maybe at a certain point the business model is better for everybody, meaning the ticket master and companies if we don't have exclusive because the best, the best seller still wins in the end. Okay, just to be.
Very very clear for those not in the know in the UK, let's just use an example of three ticket resellers or ticket sellers actually A do they pay the venue? B do they pull inventory from the same database.
No, you're going to have a you know again, if you look what's happening. AE g owns the O two arena, So they're gonna in theory, they favor their ticketing company, just like CTS does in Germany. So they're going to run the They're going to run their database, the central database. They're going to give most allocation to their own ticket companmpany, and then they're going to give as limited amount of as tickets as they can to us and others to kind of finish off the market. But it's not a
free for all allocated. How to three companies equally access that venue. I could give you the opposite there where we're not getting paid or have the same allocation as the venue because they're allocating to their own company, but it's off one database, and they would the venue would pay a piece of the service feed to the ticketing companies, So the ticket companies would get a piece of the service fee for the tickets they sold.
But there's no advance from the other companies to the venue.
It's starting now. Yes, there are because your job because what really happens now is you want to be the You want to get a higher percentage of the allocation. So you're now going to start paying to be in pollpase position of the good seats and more of them. So that's where it's morphine. The venue is now figured out. Oh someone will pay me. You know, you can us to wake up and say here here ticket companies for free, take all my tickets. Good luck. You're going to start going.
Someone wants the good seats and so we'll pay me for it. So we are now competitively doing that as an industry, and festivals tend to be more one one company.
Let's talk about traditional new building arena meaning they have skyboxes, etc. Inside there's always an issue of all the tickets are not on the manifest. You reference this earlier, but can you explain from my audience.
Yeah, generally a venue in America, I'm you know, we're going to talk arenas and stadiums. You know their primary business is to sell that sports team season tickets, sweet spotship and as you're selling those eighty games whatever the sport is, the sponsorship, you know, your your box and your premium seats are only you know, exciting for how many of those eighty games. So the best way to deliver that box season ticket sponsor is to say, listen,
spend this much money. You're going to get the season tickets for the hockey team. You're also going to get it for the thirty five concerts that come to the venue a year. You're going to you're going to get first assets those tickets. So that's generally every arena is going to have some level of a club box system. One thousand and two, three thousand tickets that are within that venue system sold to their current client base, which is a lot of reasons why people say, word its
scalpers get tickets. That's another big leaky bucket. But that's so that's why when you sell, when you put this inventory on sale, it's not the fourteen thousand seats in that venue and then there's club seats and then there's boxes. It's not everything in that venue is going for sale. Some of it has already been pre sold or held back for customer basis.
Let's talk about the secondary market. You reference that. Yes, they do get it from the people who receives and ticket holders, To what degree are the bots a problem on the on sale and to what degree can it be addressed or possibly eradicated?
Yeah, the bots are you know, it's an arms race. It's it's an impossible mission right now because again as an industry, you really only have ticket Master even trying to stop them. There's no one else, you know, Access isn't spending much money on it, and Seekik and stub
bubber obviously that's with their businesses. So right now, when again, when you have that the famous tailor scrift moment, but when you have that level of you know, if you looked in the tailor script moment, there you go on the dark web right now, you can buy a whole bunch of software to try to hack the latest on sale. You know, it's a very organized and unorganized kind of underweb of five billion dollars that people are trying to access.
So there's bots, there's tons of software on the dark web to how to break the code, what's the password? That's what happened on Taylor. So you have a lot of a lot of global parties trying to break and allocate that on sale to try to get those tickets and put them on a secondary platform. The Bought Act has never been enforced, which is our big complaint. As much as all everyone loved tweeting Taylor Swift and their tweet to get a lot of likes, none of them
want to address the challenge, right. It's the challenge at the end of the day is you know, I use the example of when you see those videos of someone breaking in the protest store on Beverly Hills stealing the purses. You know, people go, oh, what's going on with the Beverly Hills police department. We got to staff up. They don't blame product. Well, what happened in Taylor Swift was the product story, right is they broke they tried to
break the doors down. Really does we stopped them. Now, we had to slow the system down, but we kept them out and they didn't steal one bag. And we still ended up by the end of the day delivering two million tickets to Taylor Swift fans. And then you have the congressmen putting their hands up, going, oh my god, what's going on, And we're going, well, you're doing nothing to enforce the Bought Act. We had a bought attack, we had a cyber attack, we did our best to
fight it off ourselves. We're the protest store, so we're now start to enforce the bought police, or you have to enforce the plice. So you know, we kind of get in that circle. Right. If you're gonna let if you're gonna let Second run wild like we are today, then you've got to just forget about even blaming anybody for what happens on on sales. It's a free for all. Or you have to then decide are we going to legislate anything, Are we going to try to limit bots?
Are we going to try to limit that on sale mess? And right now we have it, so right now the on sale is going to be a mess. On a high profitable show, the bots will end up getting seats and they screw up the system and they try to break the system for the hours. It's all part of that. All their job is is to figure out give a mess, scare you that they're all sold out fast, right. They
try to hold tickets forever. That's the big game they play is get on the map and hold all the dots so you only see a few dots for sale, and you'll buy them, or you'll go to stubbub and buy them. Then they release the dots later and that's why you end up seeing at the end of the day, why is there more tickets available? Because the they got in and held tickets, you got scared. You went to seat Geek bought tickets for two thousand dollars because you
thought it was sold. When you come back to ticket Master and go, oh, there's tickets available, what happened. So it is a big challenge, it's a big mission. Again, we haven't been that vocal historically. We've we've stayed on the sidelines and tried to battle it. But now we're we're being pretty vocal on the Fair Act and we do think that you got to start there. And I think there's a bill coming up from NIVA and others,
so I do think it's time we do. Let we do think about legislation around the secondary in some sense, as a start we went to all in ticketing and some legislation on secondary. The experience starts to get real, bit real different.
Okay, just going back to the Taylor Swift on sale, the perception was every buddy's got an uh got a computer at this point, and everyone knows if there's an incredible demand. Even with Apple products, the system slows down. Are you saying you intentionally slowed the system down? In two you said you made it so the bots didn't get tickets. Is that really what happened with Taylor's with the bots really didn't get tickets?
No, they didn't one hundred percent. Yeah, I mean you know, I'm you know again, some some percentage I'm sure slip in because bots can dress up as Taylor fans pretty good too, But generally on a verified fan percentage wise is we do a really good job of knowing the difference between a bot and a fan, and the result is you end up knowing instantly on what's on sale on the secondary is if it's successful, right, if there's less inventory on secondary, you absolutely cut out a lot
of the bots. So no, that was a that that was about not letting the bots in. The bots didn't get in for the bad guy didn't get the tickets. But unfortunately it was a bad consumer experience for the day as the system needed to get needed to operate at a slow level to ultimately get those two million tickets out. The single biggest ticket day in history was nine hundred thousand tickets. So the mission that day and Tigamaster, we actually sold one million pink tickets that day too.
So if you want to talk about the load that that was able to deliver by the end of the day was a huge, huge, deliverable although readily so the fans jumped on and we're not happy, but but no, we were proud at the end of the day that the tickets didn't get the purse, didn't get stolen. We were able to limit that and make sure that the tickets got to the hand of the verified fans' hands in the end.
Okay, go back to Miiley Cyrus. She went on tour this about twelve to fifteen years ago. All the mothers complained, Hey, we can't get tickets. The next tour was totally paperless and didn't sell out instantly. If we go back to Taylor Swift, the last time she went on tour pre COVID, she did not go clean in every market. So we have all these competing interests that changed the perception of the fan as to availability. Hey, can we say that
some acts want to put on a lot. I want to create this demand which will incentivize people to buy tickets and two. If another superstar came to you today and said, I have thirty stadium dates unless they Taylor Swift wanted them all on sale on one day. But as the ticketing company, if the act was opened to another take, would you say, let's not do it that way. Let's do it market by mar market or fifty one day, fifty the next week.
Yeah. I think the lesson, obviously is we should we should spread the load. That's the given. But Bob, I want to just state something so we don't get it wrong. I am not against secondary, just to be clear where I stand, because you are right. Secondary is an incredible distribution platform right now. Meaning you're right. They buy a lot of tickets and they help out a lot of on sales, and in the sports business, it's it's very valuable because that's how a lot of people sell their
eighty games. I'm not against I'm not saying that we should outlaw secondary, although that would be the simplest way to fix it, all right, as Gar said on stage, just outlaw but that's not going to happen in America. I'm fine on the idea that tickets should be exchanged. I'm first though, big believer that the artists should have the ability to decide. And I know that sounds not as simple as it is. But right now, as you said,
some artists don't care, some do. Right now, I can't you know, as you know that secondary lobbyists are doing any great job state by state, dressed up in fancy bills around service fees, to say, don't let transferability get changed, right that's the core challenge right now, And they've convinced a lot of people that we must be the bad guy because we want to limit transferability and we only want the ticket a ticket master and resold a ticket master.
That's not the agenda at all. I believe that the PDF that used to be on the airline and used to be you know, in the hotel went digital, and just like you used to be able to walk up on the airline, the digital ticket, when it went to PDF went to digital, means you can do things with it now, you can have some level of control. And I do believe when Pearl jam or an artist says, you know what, I don't want my secondary ticket resold at a premium, execute that or I don't care, you
know what, I want it sold. I want I only want a twenty five percent uplift on the secondary. I'm fine if people make money, but I don't want to make in three hundred percent. We could deliver that as an industry, not just Ticketmaster and or I don't care, exchange it wherever you want free for all, great, then then let the market deliver it. But right now, you if we don't stop some of this legislation, the legislation's moving towards, you know, this idea that you can never
have a non transferable ticket rule. And I've never said that I want this to happen because I only want the ticket resold. Ticket Master should I'm fine if it's resold everywhere. You know. The NFL, I think, is the great example on what we delivered on exchange. So the NFL used to have a system where we would pay the NFL to be the secondary preferred partner, but it meant nothing because ticket Master would have secondary tickets, but
so would everyone else. So I was paying the NFL a lot of money, but you could go get all your same tickets at subub seat geek. They just didn't have the NFL logo or they didn't have a few things. So NFL smartly sat with us five years ago and said how do we capture it all so it's more organized, and we put a system forward that said, listen, we
should deliver an exchange for you. We should make sure that c g Can, Stubbub and others have to abide by the exchange rules and then that way they're authorized and everyone should be able to sell the tickets. But they're all authorized, they're playing by the NFL rules, and the NFL can take a percentage of those fees. So the NFL exchange today is an exchange where if you seek Geek, StubHub have been authorized, they pay the NFL
an advance versus a percentage. And all of these platforms are authorized NFL resellers now like an authorized Rolex reseller, but it means they have to play by the rules. They can't spec some they can't put Super Bowl on sale before it's announced. Play let's all play by the same rules, so the NFL fan and knows what they're doing. Now there's a couple exchanges like Vivid that don't participate in the program and still do it on their own.
But it's a big move forward where you had multiple platforms playing by the same rule addressed by the NFL. That's the model I think we should get to, right where Access Seak, Geek, stub Hub, Live Nation, Ticketmaster. You know, if the artist says this is the rule, I want to play a twenty five percent premium on my ticket, then we should all all execute that on our digital
ticket an honor written be authorized to do it. Or if there's no exchange, like seat geek did with with the cure, great, then let's all none of us got to turn on the exchange. None of us made money on the secondary business. But that's what the artist wanted. We played that way other times artists won't be that obsessed with it. Let the market exchange, let the market run free. Great. So I'm not against secondary I don't.
I think we're an American market free enterprise. We're never going to get to a place where you're going to ban it. I don't want to pretend we have fake rules around bots and it doesn't work. I'd love spec selling. I would love all these deceptive websites and all of these things to go away and be cleaned up. You could get that done by FTC tomorrow. And I do I do believe that content should have the right on the ticket. Just like the sports teams get to do
whatever they want. They define the rules of the game for their sports league. I think the artists should be able to say this tour, I want it my way, this way. If I'm Zach Bryan, I want to do it this way, or I don't care, or I do care, but right now so I'm a big fan of that. I think content and the artists should control and put the rules. We have the technology as an industry in digital now to be able to do that. So I want to state that I'm not an anti secondary I may.
Want to. I want to weigh in here too, because the public does not have clean hands. They want to resell, and unfortunately they get caught up in what the secondary legislation is uh saying. The other thing is if you make it too tight, the public isn't happy.
You're right.
The public wants to know if I decide that I want to go to the show tomorrow and there's no limit to what I I will pay, there will be a ticket for me.
It's it's you're dead right. It's the challenge of you know, the voices on Twitter versus the reality of the marketplace. Right, and as you think you've written about me. I had a fan rate me last week about some Taylor Swift show and I'm like, I went onlines to this thoughts. Tickets available at a decent price. You can still go to see Taylor. So you're right, want it their way when they want it. They've been accustomed to that on
every other platform and marketplace today, So you're right. It is a It is a double edged sword right now on how do you how do you try to deliver some level of secondary legislation or rules that would simplify the system for the on sale really all you're trying to solve. But you're right, the free enterprise of the American market says, I want to do whatever I own that ticket, and I want to do whatever the hell
I want with it. The challenge we have, though, Bob, is it's not you know, I'm not worried about Billy that you know, the lobbyists are so great at doing. You know, Billy in Texas just he's going, he's paying for school by selling a couple of tickets. We're not worried about him. That's not the problem being created at ten am. It's the bots at ten am. That is the challenge right now. So if we can address that part at least, then the ca acsual secondary seller or
the seller, we're less worried about him. But we have to address the first part on the ten AM free for all right now is not being done by you know, Billy who wants to sell a couple of tickets. It is industrialized.
Your CEO of the company, how much of your time is dedicated to managing your stock price? And your stock price now is a little depressed from where it was. To what degree do you pay attention to that? Address that?
Yeah, he listen. I don't want to sound like that guy that says I don't ever look at it. Of course I do. I've lived long enough now from when we went public, I've been two dollars, I've been twenty eight, been one hundred. I do say that. You know what what I spend most of my time on is ultimately what matters in any company, whether it's my stock or AG's private company or your own, is the business growing.
How's the fundamentals of the business, Because the stock price will ultimately follow performance, and you're always going to have when you're as big as we are, and been doing it this long, there's going to be moments of you know, we'll have a little DJ overhang for a few months or this year. While they will the investors debate what that means or doesn't mean. All I really care though, I obsess around the performance. That part is what really matters.
You don't want to be having a depressed stock and having a business that isn't growing and healthy and has a great future ahead of it. So I'm I'm blown away at the resilience of this business, Bob. Coming out of COVID, I mean, I'm I get that, you know, we had a little bit of a kent up demand, but seeing the continuation of it on a global basis,
it's just just mind blowing. Whether that's truly that experience economy on steroids, your point of content being free everywhere and driving all these customers, globalization of it overnight where you know, we're doing ten sold out river stadiums for Coldplay right now. By middle of the road festivals are selling out bands more than ever want to have a have a great experience. So that's that's the part that
your stock is. You know, you're kind of in your mind debate the stock price is only relevant if you if you if you don't think your business is going to deliver, then that's a those those those kind of companies are in trouble. This is a business where this is an industry forget my own agenda, this is an indituative for the next five to ten years is going
to have an incredible boom. Yes, we're going to live with some pr realities at the ticket price, and the artists are going to start charging a bit more and right sizing their product and and and and and taking some of that secondary and there'll be some news around that. But this is an industry that is I think still massively underpriced, still doesn't do a great job experientially. So lots of great venues are going to be built, better venues,
better experiences, higher end premium experiences. I think there's a lot of upsiding upsize in this industry. When I look at the sports industry and almost how well they've done. Look at the Masters four hundred and ninety dollars per head spent that weekend sports has really done a much
better job at you know, the high end. It's not and I mean again it doesn't mean the rich people experience the just if I want to go to the Masters, or I want to go to the super Bowl, I want to go to the NBA All Star Game, or or just the new Arena for the end for the Chargers game. That's a beautiful arena with a lot of great clubs and VIP rooms. We've been you know, I think it's an industry. We've been playing backwards, behind on
the ball and all that. So I think as an industry, you're going to see better venues built, better new products being built around experiential stuff, more globalization more than ever, and more of these great artists that you know, bad money and international where it didn't it didn't matter before international. I've been in forty countries and for most years there was always a tragically hip in that market, but it
didn't matter. They weren't really going to break. What mattered was Springsteen coming to the market, and you just been able to see my local markets now where that's that tragically hip does matter now because they get a TikTok hit or they get some exposure and everyone knows who they are now they're not they're not limited by that kind of domestic media agenda. So I think you got a huge supply of artists that are going to surprise us from all over the world. So stock price will
will ultimately follow the performance of our company. And I think this is an industry worth betting on.
Okay, you we talk generally about the industry, but specifically where are the growth opportunities for Live Nation and Ticketmaster.
I've said it for a while, you know, it's a global is our biggest kind of you know, I've always been obsessed with outside of the American growth. We've got a great US business. There's great opportunities to still do things, but just grow. You know, this business is Latin America has just been a huge new growth area. Obviously, we bought Osessa in Covid. That was the big promoter we've We've obviously can have a bunch of businesses in Brazil. We just launched a new festival this week in Brazil
called the Town from our Rock and Real Company. So one hundred and thirty thousand tickets on its opening day, brand new festival Rock and Rio. So we like international. I think you're going to see a lot of a
lot of expansion in South America Asia. We continue to expand in so globalization there are tons of markets, Bob, where there's crappy arenas, there's maybe a festival, there's an under probably a crappy ticketing system, maybe no sponsors, you know, so kind of professionalize these businesses when you roll in. You launch Live Nation Brazil and we just launched our Ticketmaster Brazil. We upgraded the festival team there. We're going to build an arena there and a club there. We launched.
We brought a lot of palooza to those markets. So we look ran Lollapaluza to India, launching them some new businesses in Cape Town and Africa. So all about international tons of great growth opportunity. Uh. Number two is we've really, through COVID, really put a front foot forward on our venue development. And it's something we had not historically been as aggressive in on the higher end. We'd been more
a club theater amphitheater business. And then we stuck our toe out in Austin with OVG and and that building in Austin, that arena. It's been a home run success. So we've been looking at markets where outside of mostly outside of America, where you don't have that NBA, NHL beautiful arena, we have a. We have an arena now in Dublin, one in Copenhagen, Portugal. I've got a few others in the pipe with OBG and Latin America and Asia. So I think venue development is a is a big opportunity.
Going back to our math earlier, Bob, you know, it's a vertical business, right, So the more the more vertical you are with the content and the food and the beverage and the peanuts, the better your businesses. So you'll see us continually like a Netflix analogy, I guess is you want to rent a lot of shows and put them on other venues, but you got to have a lot of your home grown brood shows in your own
venues and festivals where they're higher margin. So we'll keep expanding our global venue platform, so in ant national global expansion. And you know, every time you put a new venue, you open up a bigger sponsorship opportunity and a ticketing opportunity in those markets. So I think you'll see for the next five years. We told the market, jeez, we did about fifty million fans four or five years ago.
We're over one hundred and twenty five million, meaning they went to a live nation show in twenty two, like we've now told them, we're we can see one fifty to one seventy five over the next five years of fans going to our show. So we think the pie gets bigger globally, our market share just growing. If the pie gets bigger, we get bigger and before we have to even take more market share in entering new markets
that we're not in. So we think this is a global business that will grow, and we'll obviously grow as the tide goes up.
Now North America is pretty myopic. They don't really know what's going on in these other countries. What is the market and who are the competitors of live Nation around the world.
Well, you have CTS in Germany, they're done a good job there, and then most of the markets that you're going to go to are going to have let's call it the Golden voices, right, they're going to have a local and grain promoter. I mean, Japan is a big market, big market, second largest market in the world, and we have no market share. They're really small and there's four historic promoters there that have owned the market. So you've
got to figure out how to be in business. Is one of those four we've launched a live nation in Japan. We're bringing artists there. But generally in a market place that matters, there's an established Merrick Liberberg, there's a promoter that probably owns the market market and has two other competitors, so still a local business where they'd probably be a festival and a promoter in those markets with their good
you know, good scale within their current market. Australia is the same as you know, three or four old time promoters own the market there. We bought one of them, Copple, But so you tend to have to go into those markets there's probably one or two historic promoters that own the market. We tend to try to partner with one of them and then help them supercharge their business by bringing tours and sponsorship and capital.
So what's a typical day in the life of Michael Rupino?
Jeez, stressful now thanks to the check my Twitter feed and they see who's see who's mad at me that day? But you know, I think it's it's I think listen, let's.
Slow down there. You're a CEO. How much time do you spend on Twitter? And what's your feeling about musk running it and where it's going.
Well, that's a loaded one in Twitter. You know, it's an addiction you hate, right because you know, you know, you know, they don't go on there and say thank so thankful, I got great tickets today. So it's it's only the pissed off that are going to go hit you up. But I do think it, you know, it is a you know, as Kara Swisher and Prophergy who we both like talk about, you know, it's still a damn good lightning rod to figure out what's going on
in the world, right. I mean, you still go to that I go to that trending Explore page and just quickly go what's going on? And I still think it is an incredible lightning rod and a quick way to figure out whatever the drama of the day is going on in the world. So I think I think he's you know, I think he's a you know, obviously a genius. But I can't imagine why he wanted this this mission. This is a this is not a fruitful mission to
come back to. But I think so, you know, I was my job, I would say, you're the reality is the one thing that has changed is in the world it's much more complex to run a comp business today. I mean there's a lot of voices right every day, So I think that's a new part of the business. You have to figure you have to spend time on it. You didn't before. You know, mostly it's going to spend your time on your strategy and your business and your divisions.
And we're we've got a credible global team and that's where I spend most of my day dealing with my team's internal and figuring out what talent we're buying and what models and venues and strategy we're pursuing. And I think that just right there.
To what degree do you delegate? To what degree do you get your hands dirty?
Oh? My team, would you know? They know I'm still nuts. This is this is my baby. I'm I'm night and day here, I'm three feet and thirty thousand feet. I you know, I really look at running a business and I love it still. You know, one of the realities of being a CEO is you know, I always say there's kind of three things you can spend time on, your family, your business, and a lot of the external stuff.
And the external stuff is gratifying for for for a lot of people, but you can't do all three something breaks. So I'm pretty obsessed with my three boys. It's making sure i'm a good dad and snowboarding and all the things you and I have talked about. And then two, as i'm internal focused, I really believe it's it's my team needs me. So I'm you know, every Tuesday at two and a half hours my concert team, and Wednesday is ticketmaster for two hours, sponsorship Thursday and venues and
so I go. I'm I'm a I'm an active parent making sure all these divisions have access to me, help them cut through bureaucracy, make good decisions, deal with drama. So I'm pretty. I'm pretty. I go deep and stay stay very engaged. And as you know one of your famous lines about the bunker, I'm an introvert, so I don't spend a lot of time on the external. I figured that that all comes with good results and all that. You know, the good strategy and good results take care
of the profile and the other things. But so that's kind of my day.
Are you reachable twenty four to seven? Are you working twenty four seven?
Oh yeah, yeah, no, that's the that's the curse for sure. Artists. Middle of the night, whoever it is, I'm always available, Yeah, absolutely, you know, it's listen to a gift where we run an incredible fun industry. I came from nothing and to be able to sit here and work with some of these great artists and have access and be part of their lives and help them deliver it's a pleasure.
And why are Canadians so prominent and play above their weight in the concert industry?
I don't, oh, you know, I do think this one, you know, is so when I was in Toronto, I thought Michael Cole and this idea of touring was an everywhere experience. I didn't really understand that that was such a uniqueness that you bought multiple So when when when Steve Herman I started a core audience, and you know, we bought tours across the country about the Rod Stewart tour for the country. You bought fourteen dates and it was you know, huge money for us at that time.
I remember we remember we bought Janet Jackson from Jack remember Jack Usick? What was his name, the guy they went to jail jack?
Oh yeah, Jack Utsick? Yeah yeah, oh man, he was a character.
What a character? Hit off and we bought Janet Jackson lost four hundred thousand dollars and we went to Mel's diner that night, thought how are we going to pay for this? So when you buy tours it was exception. Only when I moved to America and then Europe, I really realized that the promoter, as rich as he was in his great he never left town like Don Law made a fortune living in Boston or and whoever they Larry,
Larry Maggott and Philly Merrick Leberberg in Germany. So their market, they were just buying these you know, they were buying their market. So this idea that you know that I was that that Michael and Canada you were buying tours. It just was so foreign to these people because you just you never crossed the lines here as you know, it was that it was the mafia, right you had Philly, you didn't buy a New Jersey, and so I do think out of necessity in Canada because you didn't buy Toronto,
you bought the world. Michael broke that model for me and Cole and Jerry Baird and Omar and myself and Steve Herman. We just that's the model we thought was right. So I think that did excel us because I think it when I was sitting in the room, I was able to talk about a bit more complexity than just one market. And and and in Canada, uh, you know, you had Quebec, you had some different geographies. You know, you had the second largest landmass in the world, so
it wasn't like they were close markets. So you were mine a gena cross country business. And I think that was really really in the concert world that was so decentralized. Still that that and still is still there's still a fight for for for the local promoters, you know, versus the tour. Still that battle exists. So I think I think that kind of just unlocked why the concert business
moved fast with with Michael and that CPI model. When he broke that model in the Stones and kind of pushed that forward, we all looked at it and thought that was business as usual. I didn't realize till I moved here how much they hated us and in terms of Michael and that and that model and in the Stones and that history of breaking that local model. So I guess that that was a bit of it.
Needless to say, to be an artist, people have no idea what a backbreaking job it is. So to what degree are residencies like Harry styles And to what degree is Vegas where the act, where the audience comes to the act. Is that just going to be a stasis thing? Is that going to grow?
Well? As a side note, you just hit on one thing on going back to pricing, you're dead right these artists. First of all, to go on the road right now is expensive, and to run a venue is expensive. But as you know, everything is increased dramatically. I mean every costs went up. If you look at the ticket price increases from twenty nineteen to today, know they've gone up nineteen percent, but so did labor, rentals, lighting, transportation, and gas. Right,
so the costs are expensive for these artists. They're all in. They all want to have the greatest production arms race, so their production costs are intense. Now you can see Taylor's show or Beyonce's, but Dona is what they put
on that stage. It's crazy expensive. So you are right there are I think Vegas has unlocked this idea that I could I could have a bit of a life and still deliver an incredible gross So I think Adele really really took it to the next level of being a modern artist that could have just done a stadium tour and decided to sit in Vegas for a while. So I think you're going to see, you know, the Harry style fifteen fifteen venue, fifteen amphitheaters or a fifteen arenas.
But I would back up and say, every artist that you talk to knows that ultimately, when they get to the market, they make lifelong fans. You don't make a lifelong fan on Spotify. You make it when you show up at the city and they see you in stage and live. So every artist will still talk to me about they got to go play the world like they
get that model now. I think once you've done it a few times, yes, then you can start saying do I need to go back to South America or can I I'm going to do thirty dates and I'm going to pick five cities. So I think you're going to see a bit of those models where the artists will say, you know what, I'll play five markets. I'll play London and you know, New York and Miami and Brazil and try to do more residency that way. So I do think the cost of production, transportation and the wear and tear.
I think you'll start to see some of those models emerge where they won't do the one hundred dates, so they'll do sixty, but they'll be in five cities, not fifty cities. But I would say it all depends on your life cycle, right. Every artist knows Coldplay knows right now that they're making worldwide, global fans for life. They'll run around the world. Maybe there's a point where they say, Okay, we won't run as far now that we've done it,
but they all know they got to go. They all everyone in the touring business, and you know, it has the stories of the artists that didn't do it and why they're not today able to be that global star. And then there's the Metallica model and lars on why they're selling and then their brand is so big forever, or the U two model, the Stones model. So most people look at that model and go, Okay, if I'm gonna have longevity, if I'm going to make money forever and be a global brand, I got to go actually
do those one hundred date global tours. But I think you're right, there'll be artists now that once you've done it three or four times start to say, can I still make money doing that sitting down in a city, and that's definitely happening.
Okay, what's the health of the festival mark? You talked about that great on sale in Brazil. So we had a couple of huge festivals Coachella, Lallapalooza, bon Aru, and then there were a million imitators. What's the health of the market now?
You know, if you'd asked me a few years ago, I might have said I was worried that there was the headline, kind of the big ones that made it, and there were a lot in the middle trying to be big but didn't have soul. What I see today is, you know, if you are the if you've crossed the line like Coachella obviously has, or Lollapalooza, Blastonbury, E d C. They seem to be passage to rite. So they there there's and there's Rock and Rio and Brazil and Rector
in Belgium. There tends to be one of those in every market and they're reading leads. They're fine. I think where the market got smart and we're seeing successes. Oh quickly the market whoever you are, realized you can't just rent this field and put Drake, Billy, Joel and little weighing on like that kind of idea that there was that was happening everywhere the festivals had, you know, wherever they were, we had some, everyone had them. And I
think quickly those those got killed. Quickly you you realize you lost three million bucks who you didn't stand for anything. And and then what happened, though I'm seeing now is they quickly went to these one and two days, these nicher ideas that have more focus, and we're having a really really big success with these this year. You know when when we were young, last year in Vegas and again this year one day, two day festival, but really meant to be a one day tim Sweewood's got a few.
We got this year, C and C. We just did one on the weekend. Charlie Walker texted me, I didn't
even know we're doing in Texas a one day. So what I'm seeing is either you were already made it to the big big league and you're established and you just got to keep reinventing that brand and do what you do at the top end, or you're probably playing for a local or a niche idea that bottle Rock, for example, where or the market or the idea is niche enough to be a better experience, But it's probably a one day, maybe it's two on a on a
good day. But so I think you've seen a lot of those pop up now where the risk is less. You're not betting on a three day, fourteen million dollar all in idea that's that's this multi genre festival. I think those are dyed. You've got to now be a more single shot festival that stands for something. And that idea that festivals, you know, that old idea that you could you know, put in the middle of anywhere. It
doesn't work anymore. Like you've got to put that festival where you and I want to go on Saturday anyways. So why it works in Vegas, why it works in Palm Springs. But you can't put them in the middle of nowhere anymore. People want to want to want to go to either a destination or a town or a location where it's already got built in cool factor or destination. So so I think it's actually in a good space because I think a lot of we had a lot in the middle. We had some of those in the
middle where you're bent and big. You're trying to be the next Coachella. You're never going to get there. You're trying to be the next Law of Palooza. So you're almost stuck in the middle. You don't stand for any you know, I always joke with my team, you know, a bad logo, a Ferris Will, an artist village and free headliners and they think they have magic, right, and
it was formula, but it wasn't standing for anything. So we're seeing in the UK here Europe, if you're starting smaller and simpler, you're you're probably going to have success. And you're also in our view you can start five or six of those a year and if two don't make it, you're not You're not going down for ten millions. They're simpler to start more and if they got a flash like whence we were young. When we were young was on you. We put one day on an epssee
one hundred and forty thousand tickets. If you hit a little mark an idea that can run, then you can run with it. But you don't start in a multi genre big idea. So top Pen seems to be doing we Coachella did well We're having a record year in Lollapalooza, Bonna rue is roared back, so I'm thrilled. I mean, the lawas outside of America are doing really well. Rock and rear, so the big boys and kind of the established ones seem to be doing really well this year.
And I think if you're starting something smaller and niche, you're probably going to be Okay, what we miss?
What do you have to tell my audience that we didn't cover? Well?
I think we talked. I mean, listen, I think the idea that you know, it's as we're not a perfect business, but I think the industry of the venues and the cost that they're incurring, I don't think, you know, I think people just have not that everyone's going to understand or have a sympathy. But being a guy that owns a lot of venues, I looked at my venues this morning. You know, my amphitheaters. We you and I have talked about this before. My Amphitheater's lost one hundred and forty
three million dollars at the door. So you wonder why I have a twenty dollars service fee right That means I'm paying not just the one hundred percent of the door. I'm paying one hundred and something percent of the door, right, So you got to pay for that somehow, right, So you got to pay for the perky and the booze that you know, the food. So this is an industry where your capex is going up, your costs are going up, and your artists costs are going up. So guess what
that means. The fees are going to go up or revenue has to be generated to cover the costs. None of them are none of them are are evil in themselves. They're all part of the plot that says, to put a great show on in a great venue with the right staff and the and the insurance and the capex and all the things that come with putting a show on, it costs this much. And I think we're finally as
an industry ready. I think we will move towards that all in because my my point is the artists should take all the money they deserve it, they should charge more, and the venues deserve to figure out how to pay for those venues and put that show on. So I just think as an industry, we've got to be presented it in a way that we can no longer proceed with because it's not defendable the way it's broken out today. So I think that's you know, you've been always it's
a complex problem. I mean, I meet with you meet with a Senator, a congressman. They look at you and like, oh my god, the service fee, and you try to explain why the service fee at this, you know, and then you talk about the hockey game down the street and why the service fee and who the scalper is and why the scalper. I mean, it's a complex industry, hard to win any public opinion polls on explaining it.
So it's a challenge in that front. But I do think, you know, we talk about the crisis in the last year has been our opportunity to actually start talking about it because I think I think will be better for it in the end, whether it's all in pricing the fair, some legislation will happen around secondary. There's enough movement now around that I think there'll be something that'll come around
all in and or secondary. So I think that's a step forward because it's a sideshow to the actual great growth that the industry has.
And what do you look for in hiring somebody, you know, it's.
It's always a challenger. Your batting rate is fifty sixty percent, it's usually the the IQ is easily, it's usually I'm looking for EQ. Right. A lot of smart, smart people can get things done. But this is a rare industry where you can. You can come from Harvard, it don't matter. Can you actually get things done with people? You know? I joke that I, you know, I went to university and got an accounting a psychology degree, and I need them both every day here because this is not about.
This isn't whether I have great strategy. I tomorrow could write down the April fruls idea you had, which was fabulous. I could give you the thirteen things we should do tomorrow to make this a better industry. It's irrelevant because I got get a lot. I got to herd a lot of cats. We got to move a whole industry and a lot of agendas at odds, and we got to find like common ground that we can move it
somewhere forward and move the business forward. So we get lots you know, we'll hire them in sponsorship sometime and they'll come from somewhere and they have these great ideas and you know if we could just get Beyonce it on stage to do its like, Okay, that's not going to work. So you know, it's a it's an industry where you know, you got to understand and bring people
in that definitely have the IQ. But can they manage understand our industry well enough to make sure we can move the people, manage the egos involved, put your egos and hopefully try to get something done.
Okay, you're in your mid fifties. How long are you going to do this? This is a business where people tend to work in touring until they drop, unlike on the record side. And as we've discussed before, you know Liberty has a position in Live Nation. Greg mcfay is active as they have in Serious they have other interests. Could you ever be tempted to take a different job, another job?
Well, so you know Greg does read your emails because he forwarded me or April Foles. So I didn't He said, I didn't think I had any See I must have power. Now Liberty has been a Greg and John have been incredible shareholders. They've been fabulous shareholders today. No, I think this is listen. I think the you got to be self aware as the CEOs to trust me, I don't take anything for grant in it. I know I'm not on the golf course. I get. I I don't do this for money. I do it because I love it.
But I do think I think we have another chapter left. So I think there's I think there's another another move and another chapter left. We you know, when I launched this company, we're a few hundred million dollars market cap. We we started to build, we went global. Ticketmaster was a huge moment to differentiate our business. I think I got a few other moves in the in the playbook
still that can make us a different business. So I'd like I'd like to I'd like to, you know, this new five year deal I have, I think we got some some moves left in the tank in this five years. I'm certainly not going to go run another business at this level, you know. I you know, I guess never as long and I love Disney and other companies, But I don't think I'm I'm I think I got I think I got a trick or two left here that
we can unlock and make this an exciting place. And I think that's the way I finished the game.
Okay, Michael, thanks so much for taking the time to speak to my audience. You've been very open and honest and forthcoming, and I thank you for that.
Thank you, Bob, much appreciated.
Until next time. This is Bob left Sets