Irving Azoff, MSG's James Dolan on $300 Million Joint Venture

Joining Forces (from left):James L. Dolan, Executive Chairman of The Madison Square Garden Company and Azoff Music Management's Irving Azoff onstage during a press conference announcing The Madison Square Garden Company's revitalization of The Forum and expansion to the West Coast at The Forum on July 30, 2013 in Inglewood, California. (Photo by Lester Cohen/WireImage)

In what amounted to his exit interview from his chairman post at Live Nation, mega manager Irving Azoff said his “biggest regret” was selling Front Line Management, the management company rollup that created the world’s largest management firm, to Ticketmaster in 2008. “I really wish we would have kept it a pure management play,” he told Billboard at the time. 

Now, with Azoff MSG Entertainment (AMSGE) the new joint venture between Azoff Music Management and the Madison Square Garden Company, Azoff has his management play, along with a publishing play, a multimedia play, a digital play, and a live entertainment play.

Irving Azoff and Madison Square Garden Co. Announce $300 Million Joint Venture

And, according to MSG Executive Chairman James Dolan, a VC play. “From MSG’s point of view, we see this as a venture capital play,” Dolan tells Billboard, “not run by us, but taking advantage of our position, of all our venues and combining it with great artists managed by Azoff Music.”

MSG has purchased half of “all of my companies,” Azoff says, and formed a new company (AMM continues on with clients such as the Eagles and Christina Aguilera) that will, in effect, fulfill the vision and leverage promised when Azoff first began consolidating management companies more than a decade ago. “[Dolan] was an early investor in Front Line, he stayed with me all the way through, and this has been our dream, to do something like this together,” says Azoff. “These days, to make an impact you need clout and financing and brains, and we think we have all three of those.”

That could include acquiring other firms as well as signing new artists. Asked whether the AMSGE venture (Azoff says, “that’s what we’re calling it for now, unless you come up with a better name before we go to print”) would be acquisitive, Dolan says, “Yes we will, using the assets of both Azoff Music Management and MSG, and a bunch of cash.”

MSG's James Dolan on LA Forum Reopening: 'We Take Everybody's Business;' 
Live Nation, AEG, Nederlander Listening

Azoff says management will be “a core business” of the new venture, but the company could be hindered in the early going by the terms of Azoff’s exit agreement with Live Nation, which has since rebranded Front Line as Artist Nation. Those terms say Azoff can sign an “established artist” (more than $5 million in revenues the previous year) in limited circumstances, and can represent up to five new “less-established” (less than $5 million) artists in both 2013 and 2014, and an unlimited number of emerging artists. Asked about the Live Nation non-compete, Azoff says, “there’s a beginning and end to everything.”

More importantly is AMSGE’s status as a privately held company, at least for Azoff, who made clear his distaste for steering a public company after he left Live Nation. So, while MSG has been public since spinning off from parent Cablevision in 2010, its venture with Azoff is private, with Azoff as CEO.

“What I like about it is that it doesn’t go through the public company process,” Dolan says. “Irving is the first and last call with the decisions at this company. He will be able to move quickly, he doesn’t have boards to answer to on this. It’s just going to be him, and I have great faith, as does everybody here at MSG, that he’s going to produce a lot of winners for us in this partnership.”

As head of MSG and Cablevision, Dolan is well versed in all the various interests of AMM-MSG, save one: publishing. Asked what is intriguing to him about entering the performing rights space, Dolan says, “What intrigues me most about it is Irving thinks it’s a good idea, and when he thinks something is a good idea, that generally means it’s gonna make some money,” he says. “I will tell you that [with] this company, I feel we’re setting the tiger loose in Mr. Azoff. We’re going to be riding on his coattails, and that’s one of the big advantages of the way we’ve constructed this.”

Live entertainment, venues, and old and new media are familiar territory to Dolan and MSG, and, in marrying content and distribution, AMM-MSG seems a familiar concept, if one with powerful leaders behind it. Madison Square Garden is no ordinary venue brand, just as Azoff is no ordinary manager. Both are entrenched in the live business, and that will be the case in this partnership, as well. 

“We obviously run some of the most important music venues in the world and, along with that, have a company that has been involved in the entertainment and sports business for decades, and all the infrastructure that goes along with that,” says Dolan. “Irving will have all of that available to him to leverage. I think he will find there are opportunities in those venues in terms of developing content and having a place to play, developing new ways for artists to relate to audiences inside the venues. We bring the bricks and mortar of the business, and he [brings] the content and the artists, and together they are powerful.”

The industry should expect live entertainment components along the order of special events or touring properties, but not outright concert promotion or artist touring deals. “We’re not going to be promoters, we’re not going to be a ticketing company,” says Azoff, “but, yeah, we’re interested in live events.”

As strong as the management, live entertainment and venue components seem here, it is their melding with the publishing quotient that sets AMM-MSG apart from other major players in the music business.  “We’re in several spaces here, so nobody’s in this space,” is how Azoff weighs the venture’s place in the industry. “Everybody in the business whines about ‘there’s no place to go, there are only three record companies and Live Nation and AEG,’ well, hopefully, people will think of us as a place equal to one of those [companies] to come to with a great idea or a great project.”

 


Head HERE to subscribe to Billboard's free music industry newsletters:
Breaking News, Morning Fix, Touring, Top 40, Country Update and many more

Questions? Comments? Let us know: @billboardbiz

Print

Tagged