The Year's Many Touring Shakeups

The concert business posted huge numbers, and saw major changes at the top of its ranks.

The year 2013 was truly one for the books, as the industry not only enjoyed its most robust year of this millennium, but by some metrics its best ever. Several of the business’ biggest companies racked up record numbers and underwent significant personnel changes, and big names made big moves, whether in the court room or on the road. Here are the biggest news stories of 2013.

CONCERT BUSINESS BOOMS

The touring industry has quantitatively put the Great Slump of 2010 firmly in its rear view and is on a roll that, barring unforeseen circumstances or, less likely, an abandonment of the “back to basics” focus on value, pricing and marketing that led to the rebound in the first place, could last for at least the next decade. Worldwide, gross ticket revenue is up nearly 30% and concert attendance is up 26%, based on numbers reported to Billboard Boxscore. That gross figure is up more than 9% over Boxscore’s highest year ever—2009. Back then, dark clouds were looming, but today, all signs point toward continued growth, as the industry remains focused on providing value through savvy pricing and packaging, international markets continue to open up, new artists are selling tickets across several genres while veterans remain consistent, and new-media marketing tools are moving the needle in quantifiable ways.

2013: The Year in Music

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IRVING AZOFF STEPS DOWN AS LIVE NATION CHAIRMAN

Technically, this might qualify as one of last year’s biggest stories, since Azoff actually left Live Nation Entertainment on Dec. 31, 2012, but the shock reverberated well into this year, as the world’s largest promoter, ticketing company and management firm faced going ahead without its high-profile leader, who had helmed Live Nation Entertainment since Live Nation consummated its merger with Ticketmaster in 2010. Azoff, No. 1 on the Billboard Power 100 in 2012, took only a handful of artists with him, including his flagship client the Eagles, and has since launched Azoff Madison Square Garden Entertainment with his old pal James Dolan, MSG executive chairman. Azoff MSG Entertainment is a content/distribution/publishing endeavor that boasts huge potential but has yet to announce any major moves.

Meanwhile, Live Nation, under the leadership of CEO Michael Rapino, posted its best numbers to date in 2013, with concert ticket sales up 15% year-over-year and more than 20 million tickets sold in North America. The live business’ only public company, with a market cap of $3.6 billion, has seen its stock rise to $18.41 at press time, up from as low as $8.68 during the past year. The firm’s third quarter, boosted by a record summer with revenue of $2.3 billion, was up 15%, largely driven by a 27% growth in global concert attendance compared with year-over-year. And Live Nation’s Artist Nation management division, formerly Front Line Management headed by Azoff, received a big boost when news broke that Live Nation Entertainment would acquire Principle Management and Maverick Management, which represent U2 and Madonna, respectively, and Maverick’s Guy Oseary would take over management of U2 in a deal that Live Nation has yet to confirm. Both U2 and Madonna are in the midst of long-term multirights deals with Live Nation. With a $3 billion annual talent budget, the industry needs a healthy Live Nation.

AEG COMES OFF THE BLOCK; LEIWEKE, PHILLIPS EXIT

The industry was taken by surprise when global sports and entertainment giant Anschutz Entertainment Group announced it was for sale in September 2012, and even more surprised when it came off the block in March, specifically when that announcement included the resignation of CEO Tim Leiweke.

Leiweke, No. 8 on this year’s Power 100 list, was widely recognized as the visionary behind the AEG model of combining real estate in theaters, arenas and stadiums with revenue-producing content in sports teams and live events, with added fringe businesses like ticketing, media deals, merchandising and sponsorships. Few pictured AEG’s future without Leiweke, but now Dan Beckerman, a 15-year AEG vet who was CFO/COO, moves forward as president/CEO, and speaks of continued growth and investment.

And AEG’s hits kept coming, with the news that Randy Phillips, CEO of AEG Live, the world’s second-largest concert promoter and live entertainment arm of AEG, was fired as part of a restructuring at the end of a record year for the promoter. Also part of the AEG Live revamp: former AEG COO Jay Marciano took on the role of chairman of AEG Live; Coachella founder Paul Tollett was named president/CEO of AEG subsidiary Goldenvoice; John Meglen, co-CEO of subsidiary Concerts West, assumed the role of president of global touring for AEG Live; and Shawn Trell was promoted from senior VP/general counsel to COO.

AEG FOUND NOT GUILTY

In the most closely watched concert industry trial ever, a Los Angeles jury in October found AEG Live not guilty of negligence in the hiring of Dr. Conrad Murray, the doctor convicted of manslaughter in the death of Michael Jackson. The lawsuit was brought by Jackson’s mother, Katherine, and sought to financially punish AEG Live, the promoter of her son’s 50 This Is It concerts planned for 2009-10 at London’s O2 Arena. The trial was marked by courtroom theatrics and testimony from well-known concert industry figures like AEG Live’s Phillips and Concerts West co-president Paul Gongaware.

A guilty verdict would have set a precedent in the way touring deals are constructed going forward, and the trial will still likely have impact simply because it took place at all.

Dating back to the birth of single-promoter tour deals in the ’70s, the lines of whom is legally employed by whom on tours have been blurry. Until now, just how exposed these producers may be hasn’t come under much scrutiny, but the fact that the Jackson/AEG case even went before a jury changes the game considerably. The case will undoubtedly change the way producers in the future hire tour personnel, even if few touring artists would want or need 24-hour doctor care.

AEG NABS STONES TOUR IN 11TH-HOUR DEAL

A Rolling Stones tour is always big news, but the band became even bigger news in March when AEG Live nabbed the rights to be the North America promoter on the Stones’ 50 & Counting tour in a last-minute deal. It was always highly doubtful the group would reconvene for a mere five dates commemorating its 50th anniversary in December 2012. Those shows were promoted by Australian promoter Paul Dainty and Virgin Music, which won the rights in a fierce bidding war with AEG, Live Nation and former Stones producer Michael Cohl, the latter two pairing up as negotiations progressed. The Dainty/Virgin deal ended with those five shows, which grossed $38.7 million, according to Billboard Boxscore, and it seemed like Dainty and Virgin would promote an 18-date North American tour, as sources told Billboard in early March that a deal in principle had been reached. But as Dainty’s deal faltered, according to a source, the Stones’ camp reached out to AEG Live with financial terms, and AEG owner Phillip Anschutz quickly approved a deal worth nearly $80 million.

In an extremely rare turn of events for a band known for strategic planning under Cohl’s watch, the Stones had a new promoter less than two months before the tour would begin. When the tour did launch, speculation swirled that higher-end tickets were being deeply discounted due to slagging sales. AEG Live’s Meglen told Billboard that wasn’t the case, citing “flex pricing” that sought to combat scalping and determine market value. Whatever the case, the Stones sold out every show, grossing $87 million and turning a profit for AEG Live. A mega sponsorship with Citi for North America, brokered by MAC Presents and garnering the Concert Marketing & Promotion Award at the Billboard Touring Awards, sweetened the pot for the Stones.

FESTIVALS, LED BY COACHELLA, STAY STRONG

Festivals solidified their position as mainstays of the North American summer concert scene, led by Coachella, which rang up a record boxscore of $67 million in its second year as a two-weekend event. Lollapalooza, Bonnaroo, Governors Ball, Firefly, Outside Lands and the Austin City Limits Music Festival also posted robust numbers, but some chinks in the festival armor were exposed this year. While there is still room for growth, the market for major destination festivals could be headed toward a saturation point, as evidenced by notable cancellations like LouFest in Louisville, Ky., and Kanrocksas in Kansas City, Kan. While Americans have clearly bought into the festival experience in a broad way, the best opportunity for growth may well be in the niche market, specifically festivals with a clear identity and a targeted lifestyle market. In many cases, these are artist-curated events.