Vivendi ‘exploring See Tickets sale’
French-headquartered media giant Vivendi is reportedly exploring the sale of See Tickets along with its festival division.
According to Sky News, the conglomerate is working with advisers on potentially offloading parts of its Vivendi Village subsidiary, which also includes 11 festivals such as the UK’s Love Supreme and Kite, as well as Garorock in France.
Sources indicate that Vivendi, which announced the partial spin-off of its stake in Universal Music Group in 2021, has concluded its ticketing and festival businesses were not of sufficient scale to compete with the likes of Live Nation and AEG.
The remainder of Vivendi Village’s operations, including Paris’ L’Olympia venue and a cinema chain in Africa, are not believed to be part of the strategic review process, which is expected to begin imminently. However, insiders caution that the sales of the two businesses were not inevitable, with no final decision yet made.
A Vivendi spokesperson has declined to comment on the report.
“The business is mainly driven by ticketing, which represents 70% of overall revenues and is experiencing strong growth”
See Tickets, which was acquired by Vivendi in 2011, opened its first US base in Los Angeles in 2014 and operates more than 15 offices worldwide including in London, New York, Nashville, Paris, Amsterdam and Zurich. Its executive committee comprises five members: Rob Wilmshurst (Group CEO), Boris Patronoff (Group COO), Leanne Lipscombe (Group CFO), Marijke van den Bosch (CEO Benelux and Germany) and Laurent de Cerner (CEO France).
In 2022, the firm sold more than 39 million tickets for 8,000 clients including the UK’s Glastonbury festival, Tomorrowland in Belgium and AmericanaFest in Nashville, US.
Vivendi Village posted revenues of €238 million last year – up from €102m the previous year – and reported sales of €81m for the first six months of the 2023 financial year.
“The business is mainly driven by ticketing, which represents 70% of overall revenues and is experiencing strong growth, due in particular to the expansion of its customer base to new market segments beyond its traditional activities in the field of music,” said Vivendi in response to the financial results.
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Mika’s ‘I love Beirut’ concert raises over €1m for charity
Lebanon-born artist Mika has raised over €1 million from his livestreamed charity concert in aid of those affected by last month’s devastating explosion in his home city.
I Love Beirut was livestreamed across four time zones from Mika’s YouTube channel on 19 September and featured performances from himself, Kylie, Rufus Wainwright, Mashrou Leila and others.
More than 100 countries bought tickets to the benefit event – the most recorded on a Ticketmaster event – and 48 countries donated.
The benefit concert raised €1m euros from ticket sales, sponsors and members of the public donating via GoFundMe. The money will be split between the Lebanese Red Cross and Save the Children. Donations can still be made here.
“Thank you to everyone around the world who bought a ticket to the stream, donated to GoFundMe and our sponsors for helping us to raise such an amazing amount of money,” says Mika.
“I also wanted to say how amazing this statement of solidarity for the situation in Beirut has been, with tickets for the stream selling to over 120 different countries around the world.
“This has been a project that was born out of and made possible by love, and a huge amount of collaboration with friends and many new friends made in the process.”
More than 100 countries bought tickets to the benefit event – the most recorded on a Ticketmaster event
Georges Kettaneh, secretary general of the Lebanese Red Cross, said: “We are extremely grateful for this generous support and for the solidarity that has been expressed. These funds will help the Lebanese Red Cross to continue to support Beirut at this time of great need.
“The people of Beirut face a long road to recovery, with this generosity and the continued support we have received from around the globe, we can continue to stand alongside them for as long we are needed.”
Kevin Watkins, CEO of Save the Children UK said: “Save the Children is working around the clock to provide vital support to children and families in Lebanon whose lives have been devastated by the explosion in Beirut. A heartfelt thank you to everyone who has come together to raise this incredible total.
“All donations will be going towards our emergency response efforts in Lebanon, which include weatherproofing damaged homes, supporting vulnerable and displaced families with food and cash grants, and providing ongoing psychological support for children and families.”
Mika will also perform at United for Lebanon, a charity event organised by French media conglomerate, Vivendi.
The benefit will take place tomorrow (1 October) in L’Olympia in Paris, featuring artists from Vivendi subsidiary Universal Music Group, including Sting, Clara Luciani, Florent Pagny, Melody Gardot, Soolking and Grand Corps Sick.
The concert will be broadcast live on France 2 and France Inter and a small audience will be present, in compliance with Covid regulations.
Fundraisers For Beirut and The Sound of Beirut took place earlier this month.
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Public live cos add nearly $6bn since March crash
The main publicly listed live entertainment companies have added US$5.75 billion – or nearly $1bn a month – to their collective value since the worst of the Covid-19-induced stock-market crash in March, new analysis reveals.
Combining the market capitalisations of Live Nation, CTS Eventim, DEAG, Time for Fun and Eventbrite, as well as a relevant percentage of Vivendi’s business, shows the six companies were worth nearly $6bn more on 21 September than 20 March, in spite of the six-month-and-counting shutdown of nearly all live experiences.
As in previous IQ coverage of live music’s (pre-coronavirus) stock-market performance, Live Nation Entertainment – the world’s biggest live entertainment business – is the biggest mover, growing its market cap by nearly 60% in the period analysed.
Worth $7.29bn on 20 March, with a share price of $33.97, Live Nation (LYV)’s market cap stood at $11.55bn six months later, with most financial analysts confident the concert behemoth will bounce back strongly post-pandemic. As of 9 September, of the 12 firms covering Live Nation stock, seven have assigned it a ‘buy’ rating, one a ‘strong buy’ and one a ‘hold’, with none recommending a ‘sell’.
While the recovery of Live Nation – which has made an estimated $600m in savings this year, believed to include widespread redundancies globally – is impressive, five of the six businesses included have rebounded strongly over the last six months, with only DEAG shares having declined in price as of 21 September.
Berlin-based Deustche Entertainment AG (LOUD), which trades on Frankfurt’s Xetra exchange, had around $11 million (€9.4m) shaved off its market cap after the value of its stocks fell from €3.48 on 20 March to exactly €3 on 21 September. As of the latter date, DEAG’s market capitalisation was €58.9m ($68.9m), down around 14% on €68.3m ($79.9m) six months previous.
Live Nation is the biggest mover, growing its market cap by nearly 60% in the period analysed
Yet DEAG stock, too, is strongly rated by market watchers: analysts’ ratings similarly lean heavily towards a ‘buy’, with even the most pessimistic financial observers giving the company’s stock a price target of €3.50 in the short term (while noting that DEAG should “return to pre-corona levels” by 2022).
Of the other four businesses, another German company, public pan-European concert and ticketing giant CTS Eventim, was the stand-out performer, growing its market cap more than $1bn by adding nearly €10 to its share price.
Compared to 20 March, when its share price was €31.78 and market cap €3.05bn, CTS Eventim (EVD) shares traded at €41.14 six months later, giving the company a market capitalisation of €3.95bn at the time of writing.
Brazil’s Time for Fun/T4F Entertainment (SHOW3) – the largest promoter in South America – has seen its value increase 42%, from R$131m ($23.8m) to R$186.1m ($33.8m), while US-based self-service and club ticketing specialist Eventbrite (EB) is up 61%, growing its market cap from $649.2m to $1.06bn in the same period.
French media conglomerate Vivendi (VIV), meanwhile, has seen its market cap rise from an estimated €20.9bn in March to €26.38bn on 21 September. The company’s Vivendi Village unit – which incorporates its live (Olympia Production, U Live, festivals and venues in France and Africa) and ticketing (See Tickets, Starticket, Paylogic) businesses – accounts for some 0.34% of the business: €26m in revenue, of €7.58bn total, per its H1 2020 report.
Many outside observers agree live music’s recovery will be complete by 2022
While it should be noted the industry is far from back to its pre-Covid-19 value – Live Nation stocks were once worth nearly $75, while Eventim shares hit a high of €60 in January – the rally bodes well for a sector often described as the first to close and last to reopen, and which has been hit particularly hard by the impact of the virus.
Additionally, the live music industry welcomed two newly public businesses – MSG Entertainment, spun off from the Madison Square Garden Company, and Warner Music Live/Umbrella Artists owner Warner Music Group, which floated in April and June, respectively – in the same period, and which would likely have pushed the $5.75bn figure even higher were those companies trading in March.
With so-called second lockdowns looming in many territories, it remains unclear how global markets will perform in the months ahead, as well as the effects, positive or otherwise, any volatility will have on live music stocks.
One thing, however, many outside observers seem to agree on is that live music’s recovery will be complete by 2022.
As IQ revealed earlier this month, financial consulting firm PricewaterhouseCoopers (PwC) is predicting a complete recovery by 2022, with the value of the live music market (public and private) set to reach $29.3bn – over $300m more than 2019’s $28.97bn – that year, while investment bank Goldman Sachs is similarly bullish, with its head of European media research, Lisa Yang, also heralding a return to normal in 2022.
Read PwC’s live music growth predictions here:
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See Tickets acquires Switzerland’s Starticket
See Tickets has acquired Starticket, a major player in Switzerland, bolstering the UK-based ticket seller’s presence on the continent and expanding its footprint to a ninth European market.
Zurich-based Starticket – formerly owned by TX Group, Switzerland’s largest media company – sells more than five million tickets annually, and is the country’s second-biggest concert ticketing platform, behind CTS Eventim’s Ticketcorner, according to the International Ticketing Yearbook 2019. The acquisition by See comes nearly three years after a merger between Starticket and Ticketcorner was blocked by Swiss competition regulators.
As a result of the merger, Vivendi-owned See sells nearly 30m tickets a year for 10,000 clients, including Glastonbury Festival, the Château de Versailles, L’Olympia in Paris, Garorock and Tomorrowland (pictured). Its presence in the US means it is active in ten markets worldwide.
Samuel Hügli, head of technology and ventures at TX Group (formerly Tamedia) says: “With this acquisition by See Tickets, Starticket will become part of a leading international ticketing service provider that uses cutting-edge technology and has a huge network with numerous partnerships.
“We have long admired Starticket as a stand-out independent ticketing company in Switzerland”
“This will strengthen Starticket in international competition and allow See Tickets to benefit from Starticket’s many years of experience in the Swiss market.”
“I am delighted to welcome Starticket and its experienced management team into our group,” adds See Tickets’ global CEO, Rob Wilmshurst. “We have long admired Starticket as a stand-out independent ticketing company in Switzerland, and I know that together we will be able to further develop the quality and range of services to our clients and customers in the country.”
According to PwC, Switzerland is Europe’s eighth-biggest live music market, worth US$370 million in ticket sales in 2019, and the 13th-biggest globally. Read IQ’s latest Switzerland market report here:
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Tencent acquires U-Live stake with UMG buy-in
Vivendi and a consortium led by Tencent, the Chinese tech and entertainment giant, have finalised the consortium’s acquisition of a 10% stake in Universal Music Group (UMG), concluding talks than began last summer.
The acquisition values UMG at €30 billion, with members of the consortium including Tencent Holdings Ltd, Tencent Music (often referred to as ‘China’s Spotify’) and “certain global financial investors”, according to a joint statement.
The consortium has the option to purchase an additional up-to-10% stake in UMG at the same ‘enterprise value’ (the value of the whole company; ie €30bn) before 15 January 2021, while Tencent Music also has the option to acquire a minority stake in UMG’s business in so-called ‘Greater China’ (the PRC, including Hong Kong and Macau, plus Taiwan).
Pending regulators’ approvals, the transaction is expected to complete by the end of June 2020.
“Vivendi is very happy with the arrival of Tencent and its co-investors. They will enable UMG to further develop in the Asian market,” reads a statement from UMG’s French parent company, Vivendi.
“Together with Vivendi, Tencent and TME will work to broaden the opportunities for artists and to enrich experiences for music fans”
Tencent adds: “Tencent and the Consortium members are excited to support UMG’s growth through this investment.
“Together with Vivendi, Tencent and TME [Tencent Music Entertainment] will work to broaden the opportunities for artists and to enrich experiences for music fans, further promoting a thriving music and entertainment industry.”
The acquisition of a 10% share of UMG also gives Tencent a stake in U-Live, Universal Music’s live music arm, whose UK festival stable includes Love Supreme, the Long Road, Sundown and Nocturne.
UMG grew its revenues 17.5% in the nine months ending September 2019, the most recently available financial results, to over €5 billion (€1.8bn in Q3), bolstered by strong merchandise revenues and the success of artists including Ariana Grande, Taylor Swift and Billie Eilish.
Tencent – which, in addition to its music interests, leads the world in social media and videogaming – turned over CN¥312.7 billion (€40.2bn) in 2018, and employs nearly 60,000 people.
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The decade in live: 2013
The start of a new year and, perhaps more significantly, a new decade is fast approaching – and while many may be thinking ahead to New Year’s Eve plans and well-meaning 2020 resolutions, IQ is casting its mind back to the most pivotal industry moments of the last ten years.
Following on from a few tough years, 2013 was the year the live industry began to sparkle again, thanks to the improvement of several key economies and more favourable weather conditions.
The main issue for the 2013 business, in fact, appeared to be the abundance of tours, which somewhat outnumbered the amount of resources available to handle them.
2013 was also the year when a new generation began to shine, with the likes of Miley Cyrus, Justin Bieber and One Direction performing well on year-end charts, indicating that the future of live was certainly looking bright.
2013 in numbers
In 2013, the top 20 worldwide tours raked in a combined US$2.4 billion, up 24% on the $2bn generated the year before, according to Pollstar.
Bon Jovi once again made the top spot, surpassing their winning 2010 total by almost $60 million and achieving the highest year-end tour total of the year, grossing $259.5m from 2.7m tickets with the Because We Can tour.
Beyoncé’s The Mrs Carter Show came in second with a total gross of $188.6m, followed by Pink’s The Truth About Love with $170.6m. Justin Bieber came hot on the Pink’s heels at fourth, grossing $169m with his second concert tour Believe. Bruce Springsteen and the E Street Band earned $145.4m, adding to the $210.2m grossed in 2012.
Newcomers also made their mark in 2013, with One Direction scraping into the top ten global tours for the first time with the Take Me Home tour ($114) and Bruno Mars making his first top twenty appearance with Moonshine Jungle tour.
2013 in brief
January
Seatwave founder and chief exec Joe Cohen exits the UK-based company, claiming that the secondary ticketing business is in great shape.
Kylie Minogue and her manager of 25 years, Terry Blamey, split, as the artist announces her intention to concentrate on her acting career. Minogue is now represented by Jay-Z’s management company Roc Nation, who also look after Rihanna, MIA and The Ting Tings.
February
Universal sells EMI’s Parlophone label group to Warner Music for an estimated £480m ($764m). The deal effectively means that three record companies now dominate the global market – Universal, Sony and Warner.
March
SFX Entertainment receives an undisclosed financial boost from advertising giant WPP, which counts agencies such as JWT; Grey; and Young & Rubicam in its portfolio. The deal gives SFX a powerful ally as it looks to ramp up its EDM empire.
AEG’s deal to take over the management of Wembley Arena is referred to the Competition Commission in the UK after an investigation by the Office of Fair Trading, which is concerned that AEG has too big an influence over live entertainment in the capital.
Wembley Stadium in 2013 © Wikiolo/Wikimedia Commons (CC BY-SA 3.0)
April
Princess Diana’s brother, Earl Spencer, becomes arguably the most renowned ticket tout in the world, when he resells tickets for his debenture box at the Royal Albert Hall.
New York-based agency Paradigm launches a record label, Big Picnic Records, which boss Marty Diamond intends to use to “support the development of new artists.”
May
Ticketmaster files a lawsuit against a New York man who they allege uses bots to buy as many as 200,000 tickets a day, before the general public can.
Pink smashes her record of 17 shows at Melbourne’s Rod Laver Arena by booking an 18th date on her The Truth About Love tour. The Australian leg includes 46 shows and is expected to sell more than 500,000 tickets.
June
The promoter and stage supplier are charged in relation to a fatal stage collapse, which claimed the life of Radiohead drum tech Scott Johnson in Toronto’s Downsview Park last year.
Live Nation and Insomniac Events confirm rumours of a creative partnership, although the latter’s chief, Pasquale Rotella states Insomniac will remain independent.
Insomniac promotes EDM festival franchise Electric Daisy Carnival © Global Stomping/Flickr (CC BY-SA 2.0)
July
Vince Power sells a major shareholding in Benicàssim Festival to SJM Concerts and Denis Desmond in a deal designed to assure the future of the popular Spanish event. Power will remain MD of the event which this year featured Arctic Monkeys, Queens of the Stone Age, Beady Eye, and The Killers.
Vivendi rejects an $8.5bn offer for Universal Music Group from Japanese telecoms giant SoftBank. It’s thought the increasing importance of music services in the mobile market prompted the unsolicited offer.
August
Lady Gaga and Madonna face prosecution in Russia for allegedly performing without proper visas. Both artists are accused of breaking Russia’s new gay propaganda laws, which make it illegal to promote homosexuality to minors.
Agency IMG Worldwide is put up for sale by private equity firm, Forstmann Little & Co, with analysts expecting a price tag of about $2bn.
September
Michael Gudinski’s Frontier Touring agrees a strategic partnership with dance promoter Future Music Festival to present the touring event, which visits five Australian cities and Malaysia next March.
Irving Azoff partners with The Madison Square Garden Company to create Azoff MSG Entertainment. In return for a $125m investment, MSG will own a 50% stake in a company, which will include artist management, TV production, live event branding and digital marketing divisions.
Benicàssim Festival © Jiquesan/Wikimedia Commons (CC BY-SA 4.0)
October
The jury in the $1.5bn case brought by Michael Jackson’s family against AEG finds that although AEG did employ Dr Conrad Murray, the company was not liable for his negligence.
Austin City Limits organisers are forced to cancel the final day of the US music festival when heavy rain and thunderstorms cause flooding.
November
Scooter Braun, manager of Justin Bieber, is pulling together a management conglomerate thanks to backing from Waddell & Reed Financial. The New York Times says Braun is in talks with several potential partners including Drake and his management team, Shania Twain and Troy Carter (ex Lady Gaga manager).
Live Nation confirms it is negotiating terms to acquire the management companies of U2 and Madonna. The deal to buy Paul McGuinness’s Principle Management and Guy Oseary’s Maverick could cost about $30m with Oseary taking over management of both operations.
December
Talent agency William Morris Endeavour acquires IMG Worldwide in a $2.3bn deal backed by private equity group Silver Lake.
SFX Entertainment pays $16.2m for a 75% stake in Dutch- based ticketing operation Paylogic, which counts 2,000 clients across its offices in Groningen, Amsterdam, Berlin and Antwerp.
Claude Nobs, Montreux Jazz founder (1936-2013) © Yvan Hausmann @ MJF/Yvanhausman (CC BY-SA 3.0)
Who we lost
Notable industry deaths in 2013 include Claude Nobs, Montreux Jazz Festival founder and GM, 76; Modern World founder Henning Tögel, 58; Cecil Womack, The Valentinos and Womack & Womack singer, aged 65; Live Nation Denmark CEO Flemming Schmidt, 63; German promoter Fritz Rau, 83; Edwin Shirley, founder of Edwin Shirley Trucking and Edwin Shirley Staging, 65; Danish live music impresario Arne Worsøe, 72; Velvet Underground singer and guitarist and solo artist Lou Reed, 71.
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The decade in live: 2011
The start of a new year and, perhaps more significantly, a new decade is fast approaching – and while many may be thinking ahead to New Year’s Eve plans and well-meaning 2020 resolutions, IQ is casting its mind back to the most pivotal industry moments of the last ten years.
Following on from the 2010 synopsis, IQ looks to 2011, a year in which rising unemployment and astronomical national debts continued to take its toll on spending habits. The live industry experienced a slower period, indicating signs of maturity after years of fast growth.
Extreme weather led to festival cancellations and, tragically, the loss of lives at Pukkelpop and Indiana State Fair. Festival attendance, however, stayed strong, with festival bosses commenting that the demand for festivals was definitely still there.
2011 also saw U2 take the crown for the most successful concert tour in history, dethroning the Rolling Stones with their mammoth 360° tour. The Irish rockers were on course to retain the record into the new decade, too, before Ed Sheeran came along.
2011 in numbers
Worldwide, the top 50 tours grossed US$3.07 billion in 2011, up from $2.9bn the previous year.
According to Pollstar, U2 were the most successful band of 2011. A back injury sustained by Bono in 2010 saw many dates on the 360° tour postponed to the following year, with the band selling 2.4 million tickets over the year – at an average price of $97 each.
The stadium tour, which typically drew crowds of almost 92,000 per show, grossed $231.9m in 2011, adding to the $133.6m earned on the 2010 leg.
Other major tours of 2011 included Take That’s reunion tour with Robbie Williams ($224m), the Bon Jovi Live tour ($148.8), Taylor Swift’s Speak Now tour ($104.2m) and Roger Waters’ The Wall Live tour ($103.6m).
2011 in brief
January
AEG opens the 52,000-cap. Türk Telekom Arena in Istanbul, later winning the contract to manage the 12,500-cap. Ülker Arena in the same city.
Serbia’s Exit Festival ends its business relationship with Charmenko agency and begins booking international artists directly.
February
Ticketmaster buys Spanish ticketing company ServiCaixa, allowing it to sell tickets through over 8,000 ATMs owned by financial services company and bank La Caixa.
Live Nation takes full control of Front Line Management, with its founder Irving Azoff becoming chairman of the Live Nation board, taking over from Liberty Media’s John Malone.
March
Nelly Furtado announces she is giving the $1m fess she was paid for performing in front of Libyan leader Colonel Gaddafi in 2007 to charity. Beyoncé follows suit.
President of Madison Square Garden Jay Marciano moves to London to take up a new role as CEO of AEG Europe.
Irving Azoff took over as Live Nation chairman in 2011 (© Full Stop Management)
April
International Federation of the Phonographic Industry (IFPI) figures show that global music sales fell $1.4bn in 2010, with the UK market dropping 11%, the US dropping 10% and Japan dropping 8.3%.
U2’s 360° tour becomes the highest-grossing tour of all time, beating the Rolling Stones’ Bigger Bang tour record of $554m. 360° is set to gross over $700m by the time it ends.
May
US ticketing company Eventbrite, which integrates social media and mobile, announces a $50m influx of venture-capital finance.
Gil Scott-Heron dies in New York at the age of 62.
June
German festival promoter Folkert Koopmans announces his second Swedish festival in Norrköping, the 50,000-cap. Bråvalla Festival, following the January acquisition of Hultsfred Festival.
Bloomberg reports that AEG plans to refinance the O2 Arena in London with a £150m ($240m) loan and equity injection.
U2’s record-breaking 360° tour (resized) © Kristian Strøbech/Flickr (CC BY 2.0)
July
Promoter Vince Power raises £6.5m ($10.4m) by floating his company, Music Festivals, on London’s Alternative Investment Market exchange.
SMG secures a management contract for Movistar Arena in Santiago, Chile, its first in South America.
August
AEG launches its new ticketing system, AXS, in several Denver and San Francisco theatres. The system includes a mobile app and social media integration.
Belgium’s Pukkelpop creates a private foundation to support the victims of the storm that claimed five lives at the festival on 19 August.
September
Global entertainment giant Vivendi buys UK number two ticketer See Tickets for a sum thought to be around £80m ($128m).
eBay announces it will launch secondary resale platform StubHub in the UK, the first market it will have operated in outside of the US.
Santiago’s Movistar Arena (© Movistar Arena)
October
German powerhouse FKP Scorpio continues its buying spree by taking a majority stake in Sweden’s Getaway Festival.
2011’s biggest-selling artist, Adele, undergoes throat surgery to repair damaged vocal chords, forcing her to cancel all remaining tour dates and promotional appearance for the year.
November
Bankers Citigroup agree to sell EMI Music to Universal Music Group for $1.9bn, while EMI Music Publishing will become part of Sony ATV in a $2.2bn deal.
Michael Jackson’s physician, Dr Conrad Murray, is found guilty of manslaughter.
December
Live Nation emerges victorious in the saga for the rights to run the new €134m 15,000-capacity arena in Copenhagen, Denmark.
Seatwave chief Joe Cohen denies speculation the ticket resale company is in financial trouble, despite reports it has amassed losses of €40m since 2007.
Amy Winehouse (1983-2011) © Republic Records (cropped)
Who we lost
In 2011, the music industry lost a number of important figures, including Scottish singer-songwriter Gerry Rafferty, 63; agent Ron Baird, who opened CAA’s Nashville office in 1991, 60; legendary soul and jazz musician Gil Scott Heron, 62; Willie Robertson, co-founder of insurance specialist Robertson Taylor, 67; award-winning singer Amy Winehouse, 27; Academy Music Group founder John Northcote, 62.
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“The next gen is virtual”: Five Vectors on the rise of esports
Five Vectors, a start-up founded by former Universal Music Group and ESL executives, is on a mission to create “the first real baby” of the music and gaming space.
The company, which recently received US$1 million in seed funding from esports investor BitKraft, is aiming to “bridge the gap between the two worlds and create an end-to-end system”, creating and integrating music into games, streams and live esports events.
Esports has burst onto the entertainment scene in force in recent years, with revenues from the competitive gaming sector set to exceed US$1 billion in 2020. Esports events are now filling large-scale venues such as the O2 in London and New York’s Madison Square Garden with a host of new, purpose-built stadia also popping up to house the events.
Major music industry players including DEAG, AEG, CAA, MSG, TEG and Vivendi have pricked up their ears at esports’ potential, investing in or partnering with those operating in the gaming space.
However, for Five Vectors co-founder Andres Lauer, the role of music in the gaming space “is not being pushed to its limits”.
“All we’ve seen is the promotional angle, but no one is truly looking to understand what best fits the situation”
“All we’ve seen is the promotional angle – of pushing artists out there through gaming events – but no one is truly looking to understand what best fits the situation,” says Lauer, “so neither side is really benefiting.”
Lauer met fellow Five Vectors co-founder Wasae Imran while working on a multi-year partnership deal between Universal and esports giant ESL. Lauer, then head of digital strategy at the music company, dropped out shortly after the deal was signed, teaming up with ESL’s global head of video network, Imran, to work on a different kind of music/esports hybrid.
The Five Vectors team is looking at how music can be integrated into competitive gaming to “truly enhance the experience”. Lauer believes that the emotive and social qualities of music have the power to make physical and digital events much more immersive for players and for fans.
Working with gaming partners, the start-up creates data-driven profiles of the kinds of music that gamers, and those watching them, best respond to, and their research is revealing that the music best suited to esports events is not necessarily what would be expected.
“A lot of times dance music or mainstream pop tracks are used at esports events, but we found that often more instrumental music is preferred”
“A lot of times dance music or mainstream pop tracks are used [at esports events], but we found that often more niche music is preferred, and the arrangement always varies due to the curve of the game,” says Lauer.
Livestreaming also forms a big part of esports viewership, with those watching at home demanding a different kind of experience. EDM, for example, works in an arena but could be difficult in the livestream, states Lauer, so Five Vectors is looking to help create or find the right composition with pieces to fit a range of specific situations.
Once the company has identified the right kinds of music for the gaming space, the plan is to help artists, producers and independent labels find access and new ways of monetisation in the esports space, allowing them to flourish and grow their audience
“We are moving into a virtual age. The new generation identifies with their ‘online selves’ and is leading a more and more virtual lifestyle – this is why esports is so important to us,” says Lauer. “With Five Vectors, we are going to integrate music into this sector in completely new and engaging ways.”
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Universal reports merchandise boom in 2019
Universal Music Group (UMG) has revealed that its revenues from merchandise sales nearly doubled in the first nine months of 2019, boosted by strong demand and a healthy global touring market.
According to UMG parent Vivendi’s third-quarter (Q3) 2019 financial results, merchandising and other related revenues increased by a whopping 82.4% year on a constant-currency basis compared to the first nine months of 2018, “thanks to increased touring activity and growth in retail and D2C (direct-to-consumer) revenues.”
In total, UMG grew turnover 17.5% in the nine months ending September 2019, to over €5 billion (€1.8bn in Q3). France-based Vivendi is currently in the process of selling a 10% stake in UMG to China’s Tencent for €30bn – as well as, potentially, “other partners”, according to its latest financials, “some of whom have already expressed an interest in investing at a similar price level”.
The growth of the music merchandising sector has accelerated in recent years, with merch sales totalling nearly US$3.5 billion in 2018 (though the impact of Brexit is cause for concern in Europe).
Universal’s merchandising division is Bravado, which earlier this year expanded its footprint by acquiring rival operation Epic Rights. Its major-label rivals are also increasingly making inroads into the merchandise space, with Warner Music last year acquiring EMP Merchandising and Sony Music investing in the Araca Group and Kontraband.
Merch grew “thanks to increased touring activity and growth in retail and D2C revenues”
Elsewhere in the Vivendi group, Vivendi Village – the business unit that includes its live entertainment and ticketing activities – grew revenues more than 50%, to €108 million, in the January–September period, bolstered by a strong festival summer and growth for See Tickets in North America.
“Live activities, which include Olympia Production (France), U Live (Great Britain) and venues in France and Africa, recorded very strong revenue growth at €56 million, a strong increase (x2.4),” reads the Q3 financial report. “Vivendi Village now produces 12 festivals that experienced a significant increase in attendance this past summer, especially Garorock in France and Sundown in the United Kingdom.”
Vivendi’s other festivals include Les Déferlantes Brive Festival in France, the UK’s Love Supreme, Poptopia in the US and Universal Music Festival in Spain.
“Ticketing activities are now all grouped under the same See Tickets brand,” continues the report. “Ticketing revenues amounted to €48 million, an increase of 19.5% compared to the first nine months of 2018 (+8.5% at constant currency and perimeter), due in particular to the robust growth of the activities in the Unites States, where revenues doubled in one year.”
In total, Vivendi turned over €4bn (+7.2%) in Q3 2019 and €11.3bn (+6.9%) across the year to date.
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Major moves: consolidation sweeps the ticketing sector
The past 12 months have seen big-money deals by global firms who have been expanding their reach through buying up existing companies.
Eventim’s major expansion into the €800 million French live music market will see it establish a joint venture with the retailer by the end of 2019. Under the proposed new structure, Eventim would acquire 48% of France Billet, with an option to increase its holding to a majority stake over the next four years. It is folding its Eventim French business into the partnership, and the established brands – which in addition to Francebillet.com include Fnacspectacles.com and Billetreduc.com – will remain in operation.
This move will be a blow for Paris-headquartered multimedia conglomeration Vivendi, which owns the local company Digitick and was the third-largest competitor behind France Billet and Ticketmaster.
Leapfrogging its rivals, Eventim has secured the top position in the ticketing space. However, it currently does not have a promoter presence in France, unlike Live Nation or Vivendi, the latter of which owns the venues L’Olympia (1,996-cap.) and Theâtre de L’Œuvre (326-cap.) in Paris, as well as Olympia Production, the operator of a number of French festivals including Les Déferlantes (12,000-cap.) and Garorock (45,000-cap.).
In 2017-18, Eventim bought three significant promoters in Italy – Vertigo, Friends and Partners, and D’Alessandro e Galli (Di and Gi) – solidifying its brand TicketOne as the dominant ticketer in the country after Ticketmaster opened operations there in 2017.
On the other side of the world, Live Nation Entertainment’s (LNE) $480m decision to buy a 51% stake in Ocesa Entertainment, the largest promoter in Latin America, and owner of Ticketmaster Mexico, is noteworthy.
Promoting about 3,100 shows a year, Ocesa reportedly sold 3.8m tickets in 2018. Ticketmaster Mexico is comfortably the country’s biggest ticket seller, with around 37m tickets sold each year.
While LNE and Ocesa have had a long partnership, this move significantly enhances the global entertainment company’s footprint
While LNE and Ocesa have had a long partnership through touring, festivals and the Ticketmaster brand, this move significantly enhances the global entertainment company’s footprint.
It demonstrates LNE’s growing confidence in the Latin American market and will likely lead to an increasing number of tours by international talent to the continent, and potentially further acquisitions of promoters, ticketing companies or venues.
What impact it will have on Ticketmaster in the US, where the second language is Spanish, remains to be seen. The Spanish- language market in the US is arguably currently underserved, and this could be seen as an internal growth opportunity for the global behemoth.
But more importantly, this could be part of a wider move by LNE into Latin America, where the firm historically has no major presence. Last year it acquired one of Argentina’s top promoters, DF Entertainment, while earlier in 2018, it took a stake in one of the largest music festivals in the world, Rock in Rio (100,000-cap), recently increasing its holding to 60%, which could be a sign that Ticketmaster is preparing to make a move into Brazil. Does this indicate a strategy of expansion across the region? We’ll have to wait and see.
LNE-owned Ticketmaster also bought Australia and New Zealand’s most significant independent ticketing company, Moshtix, in February, further expanding its presence in a market where it competes fiercely with TEG’s Ticketek.
Although it’s not likely to shift the balance of power, Ticketmaster’s move will add another indie brand to its suite of ticketing platforms.
Meanwhile, TEG grew its Asian reach by buying the Philippines-based ticketing company TicketWorld. This adds to its existing interests in Malaysia, Hong Kong and Macau. As well as major international tours by the likes of Guns N’ Roses and Katy Perry, TicketWorld has a strong presence in the local theatre market, and provides ticket services to Philippines’ venues including Solaire Resort and Casino, Resorts World Manila, BGC Arts Center and the Cultural Center of the Philippines.
What we can say is that the last 12 months have seen no sign of the trend for consolidation slowing down – and it may just be hotting up even further
“We see great opportunities in many Asian markets and our strategy puts us on course to becoming a truly pan-Asian promoter,” said TEG CEO Geoff Jones at the time.
While not strictly new acquisitions, DEAG continued its policy of wholly owning companies by completing the purchase of the MyTicket platform, which going forward will be powered by the Secutix SaaS solution, while Eventim completed its takeover of German online movie ticketing platform Kinoheld and Scandinavian ticketing solution Venuepoint.
So what’s next? In the fast-moving world of ticketing, it’s hard to say.
India’s BookMyShow sells some 20m tickets a month, mainly in the cinema sector, but is looking to grow further into live entertainment. In 2018, COO of non-films at BookMyShow Albert Almeida told the Economic Times the firm wants to increase its revenues from non-cinema events from 30% to 50% by 2020.
It is one of the ticketing partners at the newly opened Coca-Cola Arena in Dubai and is addressing a lack of infrastructure in its home country by building its touring venues and producing its own shows. At a recent fundraising round, the company was valued at $1 billion, and there is still huge potential in the country of 1.3bn people. But maybe it will look to acquire in new markets, or further consolidate its position in the Middle East.
Another interesting area is the growing trend of Chinese companies taking an interest in Western music companies (for example, Tencent acquired a 10% stake in Universal Music, with an option to take another 10% in a year). Could we see a Chinese firm take an interest in a ticketing company outside of its homeland?
What we can say is that the last 12 months have seen no sign of the trend for consolidation slowing down – and it may just be hotting up even further.
For more insight into the state of the global ticketing industry, read IQ’s International Ticketing Yearbook 2019.
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