Live Nation and Ticketmaster Near Merger

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The Wall Street Journal reported this morning that entertainment megacorp Live Nation and Ticketmaster, the world's leading ticketing agency and an important player in artist management, are in talks to merge the two companies. "The resulting firm" - called, appropriately, Live Nation Ticketmaster - "would be able to manage everything from recorded music to ticket sales and tour sponsorship," reporter Ethan Smith wrote.

The deal is still subject to the approval of both the Live Nation and Ticketmaster boards - "it was unclear which company would be acquiring the other" - and because it would create such a dominant entity in the live-entertainment field, would also be subject to Congressional antitrust review.

Ticketmaster's holdings include the Front Line Management agency, who handle the Eagles, Miley Cyrus and about 200 other artists; Live Nation has signed "360" revenue-sharing deals with top-tier acts like Jay-Z, Madonna and U2. The New York Times' business blog DealBook said Ticketmaster is also exploring a possible merger with Live Nation's main competitor, Anshutz Entertainment Group (AEG, partnered with the Messina Group in Houston), though it's leaning toward Live Nation.

More ominously, French writes, "the new company would be able to muscle out competing concert promoters, and also have more power to dictate ticket prices to consumers."

Like all too many other corporations, both Live Nation and Ticketmaster's stock prices have taken a beating in recent months. Both are currently being traded at around $5 a share -Ticketmaster's is about a dollar higher - down from $25 (Ticketmaster) and $18 (Live Nation) last August.

"The fan is screwed," music-industry watchdog Bob Lefsetz wrote on his Lefsetz Letter blog today. "Consolidation has not helped the fan one bit. Label consolidation reduced the variety of music. Promoter consolidation drove the price of concert tickets sky high. Music itself may be free, but going to the show is a once a year event.

And after you've seen the dinosaurs, do you really need to go every year?"

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