Both sides are locked into a contract through 2008, but Ticketmaster issued an internal memo to employees this week signaling the eventual end of that agreement. The Ticketmaster memo obtained by Billboard, among other news outlets, states the company does not see a resolution to the growing disagreement between the two parties.
“While it has been our sincere desire to create a new long term partnership [with Live Nation], we now believe it is doubtful we will extend our agreement when it expires at the end of 2008. Live Nation has been a valued client for a very long time and we believe we’ve taken every reasonable step possible to facilitate a renewal, but they seem intent on a direction for their business that leaves us no viable way to work together,” wrote Ticketmaster CEO Sean Moriarty and Chairman Terry Barnes. . .
Analyst estimates place Live Nation’s contribution to Ticketmaster’s annual revenue at almost 20 percent. Live Nation is one of Ticketmaster’s more than 9,000 clients.
News of the potential dissolution of the deal affected shares of the two companies’ stock in early trading, sending down the stock price of IAC/InterActiveCorp, Ticketmaster’s parent company, almost 1.3 percent just after 1pm EST. Live Nation’s stock was up almost 1.8 percent at the same time. Shares of both were trading in the $20 range.
“We’re not commenting at this point,” said John Vlautin, spokesperson for Live Nation. Bonnie Poindexter, Ticketmaster spokesperson, reiterated Vlautin’s sentiments by stating Ticketmaster, also, had no comment.
Tom Patania, president of the National Association of Ticket Brokers, said he anticipated some service charges may drop as a result of the move because the two companies will no longer have to split them, but like other observers, he said only time will tell what effect it will ultimately have.
“This has been brewing for a little while, but we haven’t seen what type of primary ticketing operation Live Nation intends to roll out. If it’s good and comparable to that of Ticketmaster, then Live Nation could emerge the clear winner. If not, then Ticketmaster could end up better off,” Patania said.