LIVE NATION/HOB
HOB wanted out. At a much higher price, but out nonetheless.
We can talk about the fuck-ups in HOB's history, Isaac Tigrett's overspending a la Erich von Stroheim and the failed (or far ahead of its time) filming of acts for new media distribution, but that's all in the past. Now we're left with two big players and a bunch of renegades.
Never fuck with the likes of John Scher and Jon Stoll. How do you think they survived this long to begin with? Concert promotion is an historically scary business, where it was always cash, not checks, and enough drugs and guns to make 50 Cent feel at home. If you could make it there, you could make it ANYWHERE!
But, Live Nation has deep pockets. And AEG even DEEPER pockets. God, in a bidding/pricing war I'd bet on AEG, for concerts are not Anschutz's only business, by FAR!
But this is a sad day in the history of the music business. Concerts are not like records. The Internet revolution, despite the RIAA hype, is good for music. For it allows ANYBODY in. ANYBODY can get distribution. The Net is INFINITE!
But there are not an infinite number of concert venues available.
Live Nation now owns the shed business. AEG will tell you those buildings, that whole PARADIGM, is passe. We do know that the buildings are aging and require capital investment. And that not everything sells out outdoors anymore. It's not quite the special event it once was. As evidenced by the reduced schedules these venues now sport. But, it's all about distribution baby. And if you control ALL of the sheds, you're a king in the eye of the agents and managers. Not everybody wants to play indoors. Not during the summer. Not when there might not be a comparable indoor building with such variable sizing options (yes, never forget the lawn, which can be empty for some events and no money is lost and be FULL for others and revenue can climb ever higher).
A lot of the buildings are still open venues. But can anybody really get in? What are the barriers to entry?
God, Live Nation can afford to lose on some shows to win on others. Can an independent? At these prices? Can new twentysomethings get in? Not unless they've got a VERY rich daddy.
This merger is bad for everybody but Live Nation and HOB. The fewer customers you have for your acts, the lower the ultimate price you're going to get. As for concertgoers, let us count the ways in which ticket prices will go up. Acquisition costs of buildings. Stock performance. It goes on and on.
Blame Robert Sillerman.
And Wall Street. Not only the downtown denizens who invested in SFX, but the financial people running up Live Nation's stock today. WHY? Is there something I don't know? Are there a new Beatles and Stones on the horizon? Are there suddenly another hundred million people in America?
Radio consolidation, allowed by the government, killed the medium for music.
Concert promotion consolidation has yielded no benefit for the consumer, only losses. But unlike with radio, the fan has got no alternatives. A kid can't erect a concert venue on the skills he picked up surfing the Internet.
http://www.nytimes.com/2006/07/06/business/media/06music.html
BILLBOARD/R&R
Trying to build an irrelevant monopoly.
This kind of information belongs on the Web. And, with Net distribution, you no longer need SoundScan.
Two dinosaurs pairing up for the ride to hell. GOOD RIDDANCE!
UNIVERSAL VARIABLE PRICING
A non-story.
Don't blame Universal. They're just milking their cash cow, discs, before the business implodes.
Sure, charge more for first line product. The business ALWAYS had this wrong. Shit, the hottest CONCERT acts are not the cheapest.
And sell the old stuff as cheap as you can. Stores have been clamoring for lower price points.
And hell, leave a middle ground for shit you're not quite sure where to place. Stuff new, but not so in demand.
But don't make it about costs. The packaging costs are negligible relative to the price of the ultimate product.
But the disc is dead. Video extras. Higher sound quality. It's irrelevant. We're on an inexorable death march.
XM/SIRIUS
Panero is history. There were rumors of this when I was in the building, since the stock price tanked so much under his watch, but now with these new subscriber numbers, it's gonna be official. WHO'S STEERING THIS SHIP?
Sirius has terrible coverage. The signal drops out constantly. It has worse radio products. Yet it's got all the buzz. And it's going to ride this buzz to victory.
Mel talking about a merger? Hell, there are two different technologies! This isn't Warner and EMI. But why does HE get all the ink, why does HE look in control and XM saying nothing looks like the secondary player even though it's the leader?
XM blames their shitty numbers on lack of new products and soft retail. Obvious hogwash, since, as stated above, Sirius has much worse radios and the theoretically soft retail marketplace didn't hurt them.
Sirius has the one thing XM lacks. Marketing. The marketing is SO bad at XM you'd swear a teenager is running the operation.
What does XM stand for?
We know what Sirius stands for. Howard Stern and celebrities.
XM stands for…baseball.
XM has a REVOLUTIONARY music programming concept. Of truly changing the marketplace. By not insulting the listener. By making broad swaths of
music available for listening. Does anybody know this?
And despite the jive jocks and endless repetition on so many music channels Sirius is LIGHT YEARS better than terrestrial. And some of the stations are actually quite deep and good.
So why buy XM? Doesn't everybody want to be a winner?
Who buys a Creative Zen instead of an iPod? The same kind of person who buys XM instead of Sirius. An iconoclast.
Who do we give credit to? Scott Greenstein who wooed all the talent, even though he overpaid for it? Or Mel, who gave the operation a recognizable figurehead?
This isn't rocket science. Yet XM has failed completely. And then tried to compete by IMITATING Sirius. Bringing in Jon Zellner to tighten playlists. Hiring a non-appearing Oprah.
When it comes to entertainment, the fundamentals come last. You make your money at the end. First and foremost it's about creating something exciting, something that draws eyeballs, something that's HOT! Look at Paris Hilton. There's truly nothing there, it's not like she's even that great looking, yet she laughed all the way to the bank. Because she realized it's about buzz and perception.
Sirius has got the buzz. Sirius is perceived to be better than XM. XM will be in a death spiral unless they SPEND money instead of trying to get to profitability, telling their story.
But it may be too late.
Supposedly it was all about car installations. But ask a potential satellite radio consumer. Does he understand business or does he want to go see the lame "Superman" movie to appear hip?
Panero came from cable infrastructure. Mel understands sizzle, at least more than Panero. It's no contest. Someone with a profile has to come into XM and try to save it. But the D.C. company is already looking like an also-ran.
http://www.betanews.com/article/Sirius_Continues_Run_Outperforms_XM/1152210768
