It’s coming from the promoter.

In Aspen, Jim Lewi and Diarmuid Quinn lamented that there was nowhere to get cash anymore.  That the label couldn’t afford to fund everything.  Where was the money going to come from?

Two weeks later a promoter who was in attendance laughed.  He told me the promoter was the new bank!  It’s the promoter who’s guaranteeing the tour, but he’s not seen as a partner, the agents and acts just want to extract as much cash as they can, they don’t care about the health of the company that puts on the show.

This same person quoted Howard Kaufman.  Irving once told me in a phone call that he had no problems with Rapino, he just had to say "You don’t want me to have Howard call, do you?"

Michael Rapino wanted to change the structure.  Wanted acts to share in the upside.  But suddenly Howard’s acts weren’t going to play Live Nation sheds.  They were going to take a year off, or play indoors.  Howard controls the shed sellouts, everything from Jimmy Buffett to Def Leppard to Journey.  Rapino caved.

Not that you can blame Howard.  He can’t help it if promoters are clambering over each other to pay more.  That’s what we’ve got, a pay more world.  Where Live Nation and AEG outbid each other.  Live Nation needs the business and AEG has got more money than god.  But is this helping the industry?

Sure, momentarily it’s helping the acts.  But, as a result, ticket prices go up and promoters end up stealing from acts. Who wouldn’t?  It’s almost impossible to make any money.  And if you’ve got a loss, it’s significant.  Used to be the agents/managers/acts would help the promoter out if he lost money, the talent needed the promoter to stay in business.  But now that Live Nation is a publicly traded company and AEG is so rich, why?

So the promoter has to cough up a ton of bread.  The promoter is the bank.  But he’s getting very little in return.

Why can’t deals be restructured?   Where costs are covered and everybody shares in the upside?  Why can’t labels use some of that 360 money, that live revenue, to develop new acts?  Why does the promoter put up all the money and have such little power?  Where else do you take all the risk and end up with so little reward?

We’re fighting amongst ourselves and we’re the losers.  Live gigs are a once a year event, something planned way in advance as opposed to a weekly or monthly occurrence like they used to be.  Hell, tickets go on sale more than twelve months ahead in some cases!  And unlike in sports, the teams/acts are constantly changing, so you don’t have a legacy of good will bringing the customer inside the building.

But ultimately, you’ve got to blame the promoter himself.  The promoter has to learn how to say no.  But he hasn’t yet.