Live Nation want artists to share risk when the live industry swings back into action, Getintothis’ Siân Ellis on the ongoing live music crisis.
Live Nation is to ask artists and bands to share the risk when the live industry swings back into action
Among changes proposed by the live firm are a drop in artist fees and guarantees of around 20% across the board, as well as some of the risks associated with staging events set to be put on the artists themselves.
The creative and live industries have been some of the most affected by the COVID-19 crisis, with the Music Venue Trust recently calling on the government for £50m in order to save grassroots venues across the UK.
These industries are falling into more financial struggle as the length of the shutdown continues, even the few companies that have received grants are now running out of money.
Many are worried that they will run out of finances completely before live events are allowed to go ahead, potentially putting thousands of jobs/ companies at risk.
Many promoters have been considering ethical decisions they can take to reduce the risk of attending live events as lockdown rules begin to ease.
Promotors are the primary risk-takers in the live industry, given the potential of a second wave of COVID-19, along with operating after up to a year of no income.
The attempt to get live events back underway could result in another round of cancellations and closures, putting further pressures on promotors and artists.
Many promotors also feel that, at their most successful, artists have had many advantages over the last decade. For this reason, promotors are suggesting that there is enough flexibility in the system for those artists to share the pain.
Bigger promotors have been in contact with the big booking agencies in recent weeks, discussing what losses may be involved in artist contracts in 2021.
This includes what happens regarding rescheduled shows and festivals for which 2020 deals had previously been agreed.
The Live Nation memo that has been circulating summarises some of the changes that are set to be made, especially for festivals.
As well as artist guarantees in 2021 likely to be around 20% lower than the agreement for 2020 shows, there could also be a difference in payment terms.
In relation to shows cancelled due to poor ticket sales (possibly due to COVID-19 spreading concerns), the memo states that artists will only receive 25% of their fee.
Additionally, if shows are cancelled due to major unforeseen circumstances (such as a second wave of COVID-19), artist will receive no fee at all.
This also applies to any change in physical distancing rules devised by the government, which could make a show unviable.
The memo also makes the bold statement: “if an artist cancels its performance in breach of the agreement, the artist will pay the promoter two times the artist’s fee”.
it's going to be a different world where everyone takes on more risk. It's not going to be sustainable or maybe even possible to some artists, oftentimes one festival guarantee and advance will bank roll an entire tour… it's not looking pretty
— jenna rogers (@jmjrogers) June 19, 2020
Artists are also being advised to organise their own cancellation insurance, should any of these potential losses take place.
The Live Nation memo concludes: “Merchandise: Purchaser will retain 30 % of Artist merchandise sales and send 70% to the artist within two weeks following the Festival.
“Airfare and Accommodations: These expenses will be the responsibility of the artist.
We are fully aware of the significance of these changes, and we did not make these changes without serious consideration.
“We appreciate you – and all artists – understanding the need for us to make these changes in order to allow the festival business to continue not only for the artists and the producers, but also for the fans”.
Such measures are not entirely unexpected, and the challenges with getting the live industry up and running are understood.
However, there is major concern regarding upcoming/ new artists, whose income may be severely impacted by both the COVID-19 shutdown and now the financial changes derived by Live Nation.
Despite this, it seems that headliners will have to take a cut and incur more risk in 2021 at least.
Many promoters are hoping that the changes are temporary and the live industry with soon return to some form of normality, while others remain uncertain on the future of live events.