Live Nation Seeks to Reassure

With Shakira 360 Deal

Latin Pop Star Signs 10-Year Contract Estimated at $70-100 Million

Posted by Mike Tunnicliffe in Ad Age 'Songs For Soap' on 07.03.08 @ 12:50 PM

According to The New York Post and the LA Times, Live Nation has signed a $70 million to $100 million "360" deal with Latin superstar Shakira. Once the deal begins, Live Nation will receive revenue from her concerts, recordings, merchandising, digital and other aspects of her career for 10 years.

The concert promoter has been pursuing an aggressive strategy of signing major artists to these types of deals, whereby the company receives a stake in all of an artist's revenue streams. Last year, LN signed a reported $120 million deal with Madonna, a reported $150 million deal with Jay-Z, and, this year, it completed a major deal with U2.

This latest signing comes on the heels of Live Nation Chairman Michael Cohl's resignation last week after an apparent dispute with CEO Michael Rapino over the speed and aggressiveness of pursuing these 360 deals. Cohl was a proponent of upping the intensity of the signings, with the Rolling Stones rumored to be his latest goal.

According to the New York Post, Live Nation and Shakira have been in talks for about 10 months, but sources said that after last week's negative press from the resignation, Rapino wanted to quickly finalize the deal in order to reassure employees the he was committed to the 360 strategy of the Artist Nation division.

Shakira still owes SonyBMG's Epic Records another English-language studio album, expected next spring, as well as a greatest-hits compilation. This means Shakira likely won't deliver her first album to Live Nation until late 2009 or early 2010, at the earliest. Prior contract commitments mean Madonna and Jay-Z are not expected to release Live Nation albums until then, either.

Jumpin' Jack Cash?

Could the Rolling Stones Be the Newest Horse in Live Nation's Stable?

By Mike Tunnicliffe originally published in Ad Age 'Songs For Soap' : June 18, 2008

Photo: AP

Another exile on Main Street?

In the world of alternative music-business models, Live Nation has blazed a trail in recent months, landing "360 deals" with major acts, including Madonna, Jay-Z and an almost-360 deal (excluding recordings) with U2.

The latest rumor hitting the street is that the Rolling Stones are considering leaving EMI after 31 years and throwing their lot in with Live Nation with a "360 deal" that would incorporate the back catalog (which reportedly earns EMI about $6 million annually), touring income, merchandise and brand partnerships. A report in the British Sunday paper The Observer stated that the band was "just weeks away" from announcing a deal that could also see Universal records getting in on the act by licensing new versions of the catalog from Live Nation.

The Stones camp has denied the story, but, given the band's long-standing and extremely close relationship with Live Nation chairman Michael Cohl (who has produced all of the band's recent tours), it seems highly likely that this will be a done deal shortly.

The only potential spanner in the works is a reported unease amongst Live Nation's senior executives about its 360 strategy and whether the company has been signing up mega-acts too quickly. As we've said before, Live Nation is really going to have to learn to speak the language of brands and manage brand-related businesses if they are really going to get their money's worth out of these deals.