Reflecting on Viagogo’s long-running dispute with UK authorities, Harbottle & Lewis's Mike Jones urges live companies to monitor their compliance with local consumer laws
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From the importance of associations to the need for new attitudes towards risk, IQ identifies the business lessons the ongoing Covid-19 pandemic is teaching us
By Gordon Masson on 04 May 2020
The latest issue of IQ Magazine features a bumper coronavirus special report that delves into the lessons learnt from the crisis, various governments’ responses to the pandemic, and predictions for the shape of the industry’s post-Covid-19 recovery.
Here, we look at the key business takeaways from the global concert business shutdown, with a little help from Paradigm’s Alex Hardee, Echo Location’s Obi Asika, Yourope’s Christof Huber and more…
1. Entrepreneurialism and creativity remain at the heart of the industry
While much of the debate in the live music sector in recent years has centred around independent versus corporate approaches, when the shit hit the fan the spirit of entrepreneurialism has shone through.
Artists around the world have been streaming live shows and content to maintain their relationship with fans, while companies big and small are thinking outside the box and going above and beyond to help out employees, crew and others in the business, financially and though other support packages.
“We adapt fast and we can deal with the curveballs,” comments Live Nation Belgium’s Herman Schueremans. “We are resilient and artists and fans will always find a way to connect.”
2. Technology makes mass home-working a possibility
The use of Zoom, Houseparty, Skype, FaceTime and other video conferencing platforms has helped millions of employees around the world to effectively communicate with colleagues, peers and clients in a way that many would have thought impossible a few months ago.
“Anyone who said home-working doesn’t work was wrong,” says Live Nation chairman of international music, Thomas Johansson.
3. The appetite for risk needs revision
The very nature of the live music industry had historically relied on a cash-flow wing and a prayer, with everyone in the chain relying to some extent on future earnings to pay for their latest projects. The sudden cessation of the business has put this situation into sharp relief, as thousands of event postponements and cancellations have highlighted that the global business could collapse if refunds were mandated internationally.
“You have to have reserves,” states Obi Asika of London-based agency Echo Location. “A lot of this business focuses on the future, prospecting and possibilities. We make bookings really far in advance and now this has shown that anything can happen.”
“This crisis has shown that anything can happen”
4. Every day brings new challenges
It seems that as long as the coronavirus pandemic continues, uncertainty will be the new norm. Agents, promoters, artist managers, venue operators and everybody in the production supply chain are working incredibly hard to make sure things are ready for business to resume, but with no concrete dates to work toward, the planning process is never-ending.
“We make plans and strategise and then overnight something happens and the next day we have to start all over again,” says Paradigm’s Alex Hardee. “When I’m doing my P&Ls at the moment, they are all Ls.”
5. Government intervention is crucial
The live music business has a long and proud tradition of policing itself and trying hard to stay ahead of the curve when it comes to issues like health and safety and self-regulation. However, it has become apparent in the coronavirus environment that businesses involved in the live entertainment sector need the co-operation of government and local authorities to survive.
At the time of writing, summer festivals in some countries are still waiting to announce 2020 cancellations because they have not been told by government that they cannot hold this year’s events, meaning that promoters could be liable to pay artist fees if they take that sensible decision themselves.
“There’s a fear among promoters when it comes to announcing festival cancellations, because nobody wants to lose the momentum when difficult decisions need to be taken,” says Christof Huber of European festival association Yourope.
6. One rotten apple can spoil the barrel
The domino effect of a cancelled show has never been more apparent than during the economic shutdown. Artists often rely on the revenues from certain key festival or headline dates to pay for visits to less lucrative markets, and the cancellation of one or more of those key dates can put the whole tour – and, therefore, other festival shows – in jeopardy.
With the pandemic amplifying this situation more than ever before, festival organisers who perhaps previously viewed each other as rivals have been working closely on key announcements and strategies.
“We make plans and strategise and then overnight something happens, and the next day we have to start all over again”
7. Honesty is the best policy
With millions of people suddenly and unexpectedly facing redundancy, business owners and senior management around the world have never been under greater scrutiny. However, early and continued communication has proved invaluable during the halt to commerce and, by and large, people who have been included in the hard conversations have accepted that everyone is in the same boat because of this global crisis.
“If you are transparent, honest and upfront with people, then when you have to make difficult decisions the reaction of people can pleasantly surprise you,” reports Paradigm’s Hardee.
8. There goes my hero, he’s ordinary
People that society has taken for granted are stepping up and putting the health of themselves and their families at risk to make sure the rest of the world’s suffering is minimised. Health workers, carers, supermarket employees, teachers, sanitation staff, pharmacists, truck and delivery drivers and many more ‘ordinary’ people are the true heroes of the hour.
9. Insurers need to take a long hard look at themselves
There’s no need to mention any names, but for reference have a look at Hellfest’s website about the small-print cowardice that has been manipulated to shirk responsibility. To quote our French comrades: “Fuck you!”
10. Coronavirus is kryptonite to the super-touts
As much as the legitimate live music industry is reeling from cancellations, postponements and having to deal with refunds and other unexpected costs, the situation for the secondary ticketing business is even more dire, as many super-touts have to deal with inventory they can no longer shift.
Having agreed a highly controversial $4 billion deal that would see it merge with Viagogo, in late March, StubHub announced it was furloughing two thirds of its staff, and company policy on refunds would change, whereby purchasers of tickets to cancelled events in North America would now be offered vouchers, rather than refunds. Cue class-action lawsuits.
With StubHub now reportedly struggling hard and Viagogo saddled with debt, the future for the world’s biggest secondary ticketing platforms looks precarious to say the least. “In the context of the unprecedented crisis being played out in all our lives, this could well be one the most poorly timed acquisitions in recent corporate history,” says Adam Webb, campaign manager for FanFair Alliance.
2021 could prove to be live music’s most important year ever
11. Trade associations and industry collectives are proving their worth
In days gone by – and they are not that long ago – the live music industry was a cutthroat, highly competitive battlefield where often ludicrous deals would price others out of the game, all in the name of market share.
Coronavirus has levelled the playing field somewhat, and it’s heartening to witness just how quickly previously warring factions have come around the table to collaborate and agree sensible paths forward to try to minimise the impact on staff, suppliers and, of course, the artists. Hats off to the many trade associations and organisations who are lobbying parliaments, government ministers and local authorities on behalf of the business – you have never been so important to the livelihoods of so many people.
“[The corona crisis has] certainly made me realise the huge importance of associations and representative bodies,” says Kilimanjaro Live boss Stuart Galbraith. “Government don’t want to talk to individual commercial organisations, but they will talk to the Concert Promoters Association, AIF, UK Music, etc., and there’s been huge co-operation between [the associations] as well. Because it affects everybody.”
12. It’s only rock’n’roll… but I like it
As lucky as we are to have careers in such a great industry, at the end of the day it’s only rock’n’roll. Yes, it’s important for culture and for people’s happiness and wellbeing, but people we know are dying – relatives, friends and neighbours – and the battle to minimise that death toll far outweighs any gig, tour or event (or shareholder expectations, for that matter).
However, the hundreds of musicians and artists who are livestreaming to entertain millions of fans confined to their homes shows that the power of music is as strong as ever. Once we emerge from this dark period, people will be clamouring to get out, socialise and see their favourite acts.
Twenty-twenty is undoubtedly going to take its toll, but for those able to remain in the business, 2021 could prove to be live music’s most important year ever.
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