Behind The Scenes: Three Giants Fighting For European Music, Part 1

During the next few months we will be covering issues concerning major companies and their control of European concert promoting, music booking and ticket sales. Our upcoming newsletters we will be focusing on Clear Channel Entertainment (formerly SFX).

When a singer enters one of the European music stages, grabs the microphone and starts to sing, or a guitarist plugs a cable into an amplifier – they are probably both hired and paid through one of three gigantic companies which today control the majority of the European music scene. In the past three years great efforts have been made by the US company Clear Channel Entertainment (formerly SFX) and the two German grounded companies CTS Eventim AG and DEAG Entertainment to acquire most of the major entertainment agencies in Europe. Today these companies are fighting a battle about live entertainment, and along the way are gaining control of most European venues and obtaining the right to sell the bulk of tickets for major entertainment events.

The battle of European music takes places on two important fronts – to create the most effective media machine and to control the majority of agencies.

Ticket fight on the internet
In January last year SFX Entertainment, now Clear Channel Entertainment, agreed in principle with World Online International to create a joint venture to develop a comprehensive pan-European live entertainment portal covering a wide range of live events. Last summer CTS Eventim AG announced that it was planning to build an internet platform which should end up being the European number one portal for leisure and events with concert ticket sales and associated merchandise. The company’s aim was to have Europe-wide ticket distribution.

Today the three companies alone are selling millions of tickets for music, sport, film and other entertainment events.

The battle for European concertgoers started around 1996 when the two companies CTS and Deutsche Entertainment AG (DEAG) were formed.

In 1998 CTS acquired 80 per cent of the company Software Organization GmbH (GEO), a company developing software and hardware, also operating in Belgium, which among other things specialized in support for ticketing and merchandising. The year after CTS which had got the name CTS Euroticket, bought a 75 per cent holding in Austria’s Ticket Express GmbH based in Vienna, a deal that extended CTS’s reach further into Hungary and Slovakia.

American giant in Europe
1999 was also the year when the huge American entertainment giant, SFX Entertainment, started to direct it’s attention towards the European music market. In January the company began negotiations to acquire venues and assets in the Netherlands. Those negotiations were completed in March and SFX ended up acquiring certain interests in seven venues and other assets in Holland. That was the beginning of a long string of acquisitions, which have temporarily ended this summer with the take over of British ITB in London and Promoter Herman Shueremans in Belgium.

SFX started its European “buy ups” in the Netherlands and only six months later in 1999 concentrated it’s interest in Scandinavia. In September SFX could add the largest provider of live entertainment in Scandinavia, EMA Telstar Group, to its long list of acquired agencies. EMA Telstar today owns DKB in Denmark, Gunnar Eide Concerts in Norway, Welldone Agency & Promotion in Finland and Motor & Luger in Sweden.

When the acquisition of EMA Telstar was completed the Executive Chairman of SFX Entertainment, Robert F.X. Sillerman, said: “ We continue to establish a footprint in Europe similar to what we have created here in the US.”

Leading European companies in SFX
Only four days later SFX completed two acquisitions in the United Kingdom, both Apollo Leisure Group, one of the largest providers of entertainment and leisure management services in the United Kingdom, and The Barry Clayman Corporation, which promotes concert and entertainment events throughout the U.K and Europe. Four days later again and another SFX acquisition was a reality. This time it was the leading concert promotion company and motor sports venue operator in United Kingdom, Midland Concert Promotions Group Limited (AMCP) which was bought up.

The SFX buy up in Europe was then paused for one month from September 21st to October 25th when SFX announced that it had completed the acquisition of 80 per cent of the Mojo Works group of companies, the leading promoter and producer of live entertainment in the Netherlands.

In the year 2000 SFX Entertainment concentrated on building up an internet portal within the company with World Online International and it was therefore not until January 2001 that new European acquisitions were made. Firstly International Talent Booking (ITB) in United Kingdom was bought up, then in February SFX made a strategic alliance with one of Germany’s leading live event producers, promoters and event marketing agencies emp Media AG.

In March 2001 SFX acquired Belgium’s leading concert and family entertainment promoter, Make It Happen. Today SFX, now Clear Channel Entertainment, operates in the United Kingdom, the Netherlands, Belgium, Sweden, Finland, Norway and Denmark. In Germany, which today is the second largest live entertainment industry in the world, CTS Eventim AG and DEAG Entertainment are continuing to grow in order to get the greatest part of what SFX haven’t already acquired. CTS Eventim AG’s Chairman Klaus-Peter Schulenberg says that he expects CTS to continue expanding and during the next few years he expects to have Europe-wide concert promotion in place.

– CTS is expanding, but the concert market is not. So any additional gain that CTS makes will be explicitly at the expense of another player, Klaus-Peter Schulenberg said last year to the magazine Audience.

We would like your opinion
This article is the first of many about the European music market, which we have planned to publish in this news section. We would like to bring into focus issues concerning huge companies controlling the greater part of ticket selling and music booking.

If you have a viewpoint regarding this issue then write to the author of this article at thoc, and we will call you to discuss your opinion.

-thoc

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