After a year of concern over the future within the music industry and the Justice Department, the controversial deal proposed last February is done – the department has approved the merger of Ticketmaster Entertainment and Live Nation, at the behest of Bruce Springsteen. That is, on certain conditions.
According to the Wall Street Journal, the department mandated that the companies make concessions to gain its approval. Ticketmaster will have to license a copy of its primary ticketing software to the number-two American concert promoter, AEG. It must also sell ticketing company Paciolan Inc. to Philadelphia-based sports and entertainment firm Comcast-Spectator or another appropriate buyer.
The Wall Street Journal also reports that the department has mandated provisions barring the new company, Live Nation Ticketmaster (LNT), from retaliating against concert or sports venues that choose not to use LNT.
Says Live Nation CEO Michael Rapino:
This is a good and exciting day for the music business, and we are close to finalizing the creation of a new company that will seek to transform the way artists distribute their content and fans can access that content….We believe that this merger will now create a more diversified company with a great selling platform for artists and a stronger financial profile that will drive improved shareholder value over the long term.
DailyFinance reports that as the Justice Department approved the merger, shares of both Live Nation and Ticketmaster rose about 10 percent.
In addition to sports and entertainment ticketing, LNT will be in the business of managing artists (via Front Line, owned by Ticketmaster CEO Irving Azoff) and promoting concerts. According to DailyFinance, LNT will be associated with 350 artists and 125 U.S. venues, while Ticketmaster already handles between 70-80 percent of U.S. live events. Service fees are bound to rise, so enjoy the already exorbitant fees while you can.
Azoff, like Rapino, had some choice words about the merger:
We appreciate the Department of Justice’s effort. Their resolution is a great win for fans. The entertainment industry needs innovation and we are ready to deliver. I’m truly excited that as this new company goes forward, we will be able to create more choices for family entertainment, sports, artists, teams and other rights holders.
We all hope Azoff and Billy Corgan are right about this.