The Clear Channel Philosophy Lives On, Live Nation And Ticketmaster To Merge?

One thing that tends to happen during times of financial crises is large companies will merge. This helps stabilize all parties involved by, in essence, eliminating the competition. But with new reports of a Live Nation and Ticketmaster merger, experts and industry insiders are wondering if a review by antitrust authorities is needed. Looks like you can take the Live Nation our of Clear Channel, but you can't take the Clear Channel out of Live Nation.

As the Wall Street Journal has reported, Ticketmaster and Live Nation are close to a merger that would bring the United States' two largest concert-promotion/ticket-sales companies under one roof. While neither company has a sterling reputation for conducting ethical business, the idea that the world's biggest concert promoter combined with the world's dominant ticketing and artist-management company has many crying monopoly. Sound familiar?

It was roughly three years ago when Clear Channel launched Live Nation amid complaints that having a company who controls the radio airwaves also controlling the countries largest music venues could -- and did -- lead to rather poor business practices. While the newly formed Live Nation might have been a change in name-only, it was successful in helping other promoters and radio corporations stabilize themselves (or at least stop blaming Clear Channel for their woes). In the wake of the change, we've seen fair competition and a new crop of companies arise -- here in New York City, Bowery Presents has grown to a much larger scale and often presents better artists than the Live Nation venues, and has even expanded to other markets. Meanwhile, indie promoter Todd P is throwing shows that dwarf many conventional venues, even if the locations are illegal (a Dan Deacon show just this past weekend drew as many as 2,000 people). And with the number of independent promoters and venues having increased in recent years, so have the options for purchasing tickets.

Therefore, it should come as no surprise that despite still having rather large pockets, both companies would look to find a solution in each other. The problem with the proposed solution is the same reason it was a problem for Clear Channel in the first place -- controlling both sides of the market will lead to trouble. This is like our country being run by a President who is an oil tycoon and then the cost of gas goes up 200% during his administration. This is like a Vice President who owns an oil field services and construction company that helps scheme a plan to invade a country so his company could then go back in and rebuild it. You see where this is going?

Under the planned merger, the newly created company would be called Live Nation Ticketmaster, and the combined firm would be able to take advantage of close relationships with hundreds of major artists to find new ways to do business in the ailing music industry. To put it layman's terms: Those damn independent companies are profiting while we're slow to catch up to the game.

But fear not conspiracy theorists, the boards of both companies have yet to approve any merger and apparently sticking points remain. Including the fear that the merger would concentrate so much power in the music industry under one company it would require review by antitrust authorities. Nonetheless, The Journal states the deal -- which would not entail an exchange of cash -- could be announced as early as next week.

The new company would have close ties with over 200 artists, thanks to Ticketmaster's acquisition last year of Front Line Management, a firm whose dozens of artist managers handle the affairs of around 200 major acts, including The Eagles, Miley Cyrus and Christina Aguilera. That transaction vaulted Front Line's veteran chief executive, Irving Azoff, to the helm of Ticketmaster.

Live Nation brings to the table close ties of its own to several major artists, including Madonna and Jay-Z, both of whom have signed far-reaching pacts that pay them hundreds of millions of dollars for a broad range of rights.

While we could go on and on about this proposed merger and the impact it could have on the industry as a whole -- especially since tour revenue and artist management are both thriving despite the current downward trend of record sales -- we're looking to Eddie Vedder to help us out with this one. After all, with Ten getting a makeover, we were thinking he could go back to the days when he led the anti-Ticketmaster parade. Eddie? You going to help us out on this one?

The Clear Channel Philosophy Lives On, Live Nation And Ticketmaster To Merge?