BUILDING “THE KORN BRAND”:
AND LIVE NATION MAKES THREE

Korn really likes to share. That became apparent early Wednesday when the band and manager Jeff Kwatinetz announced an unconventional-setting revenue-sharing deal with Live Nation, the newly named Clear Channel concert company headed by Michael Rapino. Last September, Korn formed a similar partnership with EMI, the brainchild of Kwatinetz. The latest move, which brings a powerful concert promoter into the mix, appears to represent the logical next step in realizing the Firm leader’s vision.

"We've taken the biggest promoter and one of the biggest record labels and incentivized them to think long term and to think career about our band," Kwatinetz told N.Y. Times reporter Jeff Leeds, who broke the story in the paper’s Wednesday edition. "We believe long-term career planning is what's been lacking in the business. We believe that's part of the solution to the woes the music business is experiencing."

According to Leeds, citing executives involved in the agreement, Live Nation is paying roughly $3 million for an estimated 6% stake in the band's box office, licensing, publishing, merchandise and CD revenue for the recently released Virgin album, See You on the Other Side, and its follow-up,

Both partners are incentivized financially and creatively to take a long-term approach in building “the Korn brand,” as it has come to be referred to by the principals. Live Nation’s interest in the joint venture does not dilute EMI’s investment, according to The Firm.

"This is about shifting power back to artists by finding strategic partners who are the best in their respective businesses and incentivizing them to work in unison to attain common goals consistent with the band's goals," said Kwatinetz in making the announcement. "We are thrilled to be in business with Live Nation and especially with its forward-thinking new CEO Michael Rapino. Not only is Live Nation a superb concert promoter, it is a stellar marketing, promotion and production company. This deal allows them to focus not just on selling concert tickets, but on fully investing in the Korn brand. We believe this venture will pave a new way of doing business for musical artists in the future."

Added Rapino: “Creating a fan-focused industry will require new approaches and unconventional deals. In this new era, we’re bringing our branding, concert industry expertise and resources and collaborating with the best partners for one clear objective—to foster long-term artist development. Korn’s years of success in touring make them a natural partner for this kind of initiative."

Commented EMI N.A. head David Munns, who okayed the original partnership: "EMI was first to recognize the logic and potential of going beyond the traditional record label/artist relationship and creating partnerships that allowed us to be part of an artists' overall career. We are delighted that Live Nation is also breaking the mold and joining with us. Live Nation's interests will be completely aligned with ours, and because Korn is one of the most electrifying live acts performing today, having Live Nation's concert expertise in the mix makes complete sense."

Even Korn frontman Jonathan Davis had something to say about the deal: "Our partnership with EMI really opened our eyes that there are other ways to succeed in the music business that don't involve always fighting with our record company. They want what we want and we couldn't be happier with Virgin, EMI and David Munns. We expect that adding Live Nation to our team will also have a real impact on our careers."