LIVE NATION READY TO TEST NEW CONCERT IDEAS IN SUMMER

Live Nation is preparing to test fan-less concerts, drive-in shows and reduced-capacity arenas and stadiums this summer, with an eye toward a fuller fall schedule.

“A lot of artists are chomping to get back out, and we’re dabbling with reduced capacities to make the math work,” President/CEO Michael Rapino told stock analysts after releasing LN’s Q1 results. “They could be outdoors, a theater, on a stadium floor. All of these plans are in place, depending on the market. We want to be smart and don’t want to rush.

“It may be in Finland, Hong Kong—certain markets are further ahead. [There’s talk] of Europe opening 5,000-plus [venues] in the summer. The fall will be more experimental in theater settings and arenas.”

Whether the concerts are streamed to fans or held where everyone is grouped with space between them, the shows are important to keep sponsors happy, he said.

Rapino said the company is working with federal, state and local governments in addition to sports leagues to determine best practices and protocol, everything from bathroom lines to cashless concessions.

It plays into a recent LN poll of 8k concertgoers, 85% of whom said they wanted increased cleaning and sanitizing of the venues and ready access to hand-sanitizing stations. No other conditions appealed to even 40% of the respondents.

But the stat that Rapino finds “most compelling” is that 90% of fans are holding onto their tickets for rescheduled shows where refunds are available. “It’s not out of line with when we reschedule a tour.”

Live Nation had been on track to keep par with 2019 before the bottom fell out in March. Ticketmaster refunded 5.2m tickets in March and had 65k shows affected by the COVID-19 pandemic; Live Nation had 9k shows affected by the outbreak, 20% of which were canceled.

The company staged just over 7,000 concerts in Q1 and brought in $993.4m. Ticketing revenue was $284.3m and sponsorship—the one category that saw an increase over 2019—hit $90.3m, a 20% spike.

The touring giant has targeted $600m in cost reductions for the year, and even if no shows are staged this year, LN has the finances to sustain itself: More than $800m in cash and $900m in untapped credit to cover a monthly cash burn of about $150m.

Rapino is predicting a robust 2021 comparable to 2019, beginning with new tours going on sale in the final quarter of this year and extending into Q1 and Q2 of 2021. Currently, tours that were set for 2020 are getting first dibs on 2021 avails; new tours are more likely being pushed to the back half of the year.

Once the concert business is back to normal, Rapino says he expects it will go through a six- to 12-month readjustment period where business is not as usual. “Promoters can’t take all the risk and there’s absolutely latitude for artists and agents to share the risk in 2020 and 2021,” he said. “This is a unique time and artists, agents, managers and promoters are all on the same side. They’ve been incredibly supportive.”