In a move everyone saw 3 months ago, Live Nation cancels Bonnaroo 2020. Will Austin City Limits get chopped next?
By David Icke Turner
Today, Live Nation announced that one of their flagship festivals, Bonnaroo, was to be canceled for the year. After ‘postponing’ the event earlier in the year, the LN owned festival announced what everyone in the industry knew was coming.
The writing was on the wall from the get go. It was clear from the onset of the pandemic that large festivals would not be permitted by any sensible state of municipal officials in the near future. To hold a festival in today’s pandemic environment would be both irresponsible and likely un-insurable. The fact that Live Nation would even consider holding festivals attended by hundreds of thousands in a nation where a pandemic is increasing in virulence/mortality everyday demonstrates one of the following:
- Live Nation does not read the news.
- Live Nation are willing to put their attendees, staff, and lives of their families at risk.
- Live Nation is in a very desperate situation.
In case you are wondering, the last option is the clear winner.
Live Nation knew they were cancelling Bonnaroo months ago. Everyone on the talent side of agencies knew this definitively. Live Nation knew there would likely be no festivals in 2020. For fuck’s sake, Live Nation CEO Michael Rapino announced 2 months ago that concerts would not be returning until mid to late 2021. So why the sudden sanctimonious statement and cancellation ?
Ultimately, it all seems to be a ruse for Live Nation to get a massive interest free loan from the fans. You see, Live Nation is in trouble. The nation’s largest concert promoter has limited cash to weather what appears to be an indefinite pause in the industry. Their revenues are frozen,their stock value is, and they have an expensive empire to maintain. To remedy this, they have created a charitable non-profit to pay their employees & contractors wages, sold off 800 million in debt financing, cut artist fees for future contracts across the board, and have even gotten into bed with the Saudi Government — notorious human rights abusers. Nonetheless, the most desperate act they seem to be engaging is selling tickets to multiple festivals they damn well know are not going to happen. Now, the festivals are ostensibly offering refunds. Yet much like the rebate on cars and electronics, a large portion can not ask for a refund. Many fans bought their tickets from secondary sources, bought them cash, or no longer have access to the card which they purchased their ticket with. Live Nation is banking on this. Do the math: If Live Nation pre-sells 30,000 tickets to Bonnaroo, well below their daily capacity, at their GA price of $319 ( we will get to ticket fees shortly ) — that is a total take of just under 8 million dollars ($7,975,000.00). If only 25% of ticket holders get a refund, then they get to hold roughly 6 million dollars of fans ticket money until 2021. Shiiiit, they get to stuff it in an account and make interest off of the kids hard earned money. Now, 6 milly is not going to fix Live Nation’s desperate cash crunch. They have also sold well more than our estimates and have done so for two solid weekends of Bonnaroo. Not to mention campsites and merchandise. However, a policy across the board that sells tickets to events that won’t happen helps. Multiply the 6 million from Bonnaroo times an innumerable amount of concerts and festivals and you get the picture.
Now to the gangster shit: Ticket fees.
Ticketmaster, a wholly owned subsidiary of Live Nation, argues that when they sell you a ticket, they are rendering a service. Hence, all of the fees they add to tickets are non-refundable. This includes service fees, facility fees, taxes, etc. Then, when you go to buy a ticket to the refunded, postponed and now rescheduled event, you pay those fees all over again. This is a comical dance and it’s absurdity is not lost on other commentators. Tim Chambers, an expert on the concert industry and ticketing, does a great job of articulating this problem:
“ From the perspective of the disappointed fan, patron or supporter, the response is immediate and clear, if an event is cancelled, they would expect a refund in full i.e. the price they paid. Assuming they bought via a primary source (how would the consumer know any differently?) and after excitedly waiting several months since the OnSale, during which they confirm their identity, contact details, payment and agreement to receiving follow-up marketing messages from the artist / promoter / venue / sponsor / ticket retailer, it’s disappointment enough that the event is not happening.But to add insult to injury ticket retailers then routinely expect that consumers will accept that a partial service has been provided, and therefore only part-refund will take place ‘*as specified in the original (small-print) 30-point Terms & Conditions’. The argument being that as the now invalid tickets (whether physical or digital) have been delivered in advance, and that a part-service has been provided, this must therefore be paid for, by the disappointed ticket-buyer.”
The retailer then typically informs the consumer that refunds for the original ticket face-value may be further delayed whilst they retrieve revenues advanced to the event organiser (as per their internal supply-side agreement) and that it may take up to 30 days to process their refund request – comparing somewhat less favourably from the micro-seconds it took to take payment all those months ago.”
Is the Golden Goose Cooked?
Some would argue that C3 Presents and the festivals they produce are the most critical acquisition made by Live Nation in recent years. According to Billboard, LN originally paid $125 million for a 51% stake in C3 Presents. It has since bought the remaining 49%. This is important not because C3 not only controlled tours and concert venues throughout the critical routing chess-piece Texas, but owned and operated a bevy of high-grossing festivals such as Austin City Limits Festival ( ACL ) and Lollapalooza. We are talking mega-fucking-dollars here. To give you an idea, ACL was attended by 450,000 people in 2015. The local economic impact exceeds one billion dollars. That is why the pressure is on for ACL Fest and 2020. As of today, ACL is still selling tickets. Also, as of today, Texas is seeing Coronavirus cases and hospitalizations skyrocket. So much so, the typically business/open friendly Governor Abbott is sounding the alarm and suddenly recognizing this health crisis for what it is. But with numbers like Austin City Limits, it must be irresistible to Live Nation to use it as a windfall for tens of millions of dollars in interest free loans. I wish I could be a fly on the wall at Live Nation headquarters. I wonder if there is any consideration about how bad people are suffering in this economy and the lengths some kids go to scrounge together the money to go see their favorite musician. Is this completely lost on them?
To be continued...