Ticketmaster & Live Nation Merger Cleared By Justice Department

The U.S. Justice Department approved Ticketmaster Entertainment Inc.’s merger with Live Nation Inc., while imposing conditions on their plan to create a new music- industry power.

Under terms accepted by both companies, Ticketmaster must license its software to AEG Live, its largest customer. Ticketmaster also must sell its Paciolan unit to a Comcast Corp. joint venture or another suitable buyer. The new company also will be banned for 10 years from retaliating against any concert site that signs a ticket-sales contract with a competitor.

The $889 million merger “will change the landscape of the live entertainment business,” said Allen Grubman, a New York- based music industry attorney whose clients include Madonna, Elton John and U2. “Artists are focusing tremendously on live performance because that’s an area where there is still a lot of money to be made.”

The combined company creates a new business model with a presence in almost every segment of live entertainment, including the operation of concert venues and merchandise sales. Worldwide concert ticket sales more than doubled to $4.4 billion in 2009 from $1.7 billion in 2000, while compact disc sales fell 65 percent, according to industry magazine Billboard.

via www.businessweek.com

This merger has been incredibly controversial with music fans and musicians alike. We're now looking at an entertainment behemoth with serious ramifications for the entire live music experience.

The concessions by the new music mega-entity were required in order to pass serious antitrust concerns. To that point, the new company will also be prohibited from bundling ticket services with concert promotions. The new venture will be known collectively as Live Nation Entertainment. The relationship with competitor AEG, especially, should prove interesting to watch.

Stay tuned...

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